New York Comptroller Sues Qualcomm for Data on Political Giving

The suit by the comptroller, Thomas P. DiNapoli, was a novel and potentially significant tactic in the running battle over corporate political spending in the post-Citizens United era, after a 2010 Supreme Court ruling that opened the door to unlimited political spending by corporations and unions.

Qualcomm’s founder, the billionaire Irwin Jacobs, and some of the company’s top executives are major donors to the Democratic Party: Mr. Jacobs contributed at least $2.3 million to three Democratic “super PACs,” including one dedicated to re-electing President Obama, last year.

Mr. DiNapoli, a Democrat, is also seeking to determine whether Qualcomm made corporate contributions to tax-exempt groups and trade associations that are not required to disclose their donors. Such groups poured hundreds of millions of dollars into the 2012 election, including money from large corporations seeking to avoid negative publicity or customer outcries.

A Qualcomm spokeswoman would not comment on whether the company had contributed to tax-exempt groups.

In a statement, Donald J. Rosenberg, Qualcomm’s general counsel, said the company was surprised by the lawsuit. “Qualcomm is well regarded for its open and transparent culture and fully complies with all local, state and federal laws governing political activity and the disclosure of that activity — and the lawsuit does not suggest otherwise,” Mr. Rosenberg said.

He said that Mr. DiNapoli “knows from conversations we have had in the past Qualcomm was already in the process of enhancing our shareholders’ ability to access Qualcomm’s political contributions on our Web site.”

Mr. DiNapoli is asserting the right to access Qualcomm’s spending records as the sole trustee of the New York State pension fund, which is a major shareholder in Qualcomm and one of the largest public institutional investors in the country. He maintains that the contributions could pose financial risks for shareholders.

Qualcomm is based in California but registered in Delaware, whose law gives shareholders the right under some circumstances to inspect a company’s books.

Mr. DiNapoli filed the lawsuit on Wednesday in a state court in Delaware after Qualcomm rebuffed requests by the New York pension fund and other institutional investors to disclose its political spending. If successful, he could establish a precedent giving shareholders the right to inspect contribution records.

“We’ve done the petitions and the letter-writing,” Mr. DiNapoli said in an interview. “We’ve done shareholder resolutions. Rather than continue to be rebuffed, we’re taking this new approach.”

Mr. DiNapoli’s suit is one of a wave of actions by pension funds and other institutional investors attempting to limit or force disclosure of corporate political spending in the wake of the Citizens United ruling. More than 100 shareholder resolutions concerning corporate political contributions were filed last year, according to Institutional Shareholder Services, which tracks proxy actions.

“We believe that shareholders have a right to know how money is being spent in the political arena,” said Amy Borrus, deputy director of the Council of Institutional Investors, an association of pension funds, endowments and foundations. “Boards need to step up to the plate and ensure that political checks that a company writes enhance, not erode, shareholder value.”

Many of the new efforts to force disclosure of contributions are emerging in New York, where some of the nation’s biggest corporations and charities do business, giving state and local elected officials the leverage to pursue political spending that has national implications.

The New York State attorney general, Eric T. Schneiderman, has spent several months investigating political spending by politically active tax-exempt groups that raise money in New York; last month, he issued a regulation that will force many of them to disclose their donors. Bill de Blasio, the New York City public advocate, who is a trustee of the city’s pension fund, has secured pledges from a number of large businesses that they will not spend money on campaigns.

Mr. DiNapoli’s suit, filed in Delaware Chancery Court, is known as a books-and-records demand. While such demands are typically used to try to prove mismanagement, waste or wrongdoing by corporate executives or board members, the comptroller’s complaint asserts that political spending creates financial risk for companies and that shareholders should be entitled to be able to evaluate those risks.

“It really gets to the heart of the question of transparency,” Mr. DiNapoli said. “How is a corporation spending money in the political process and how does that impact shareholder value? The first step in evaluating that from a shareholder perspective is to find out where the money is being spent.”

Harvey Pitt, who was chairman of the Securities and Exchange Commission under President George W. Bush, said he believed that Mr. DiNapoli’s suit was consistent with the purpose of the Delaware law that permits such records demands.

“I don’t want to predict where the Delaware court will come out, but where you have a very large shareholder and something related directly to corporate governance, it seems to me a pretty compelling circumstance” under the state law, Mr. Pitt said.

Qualcomm scores relatively low on the CPA-Zicklin Index, a ranking of corporations’ policies on political transparency, which was created by the Center for Political Accountability, a nonprofit watchdog organization.

Corner Office: Karen May of Google, on Conquering Fears of Giving Feedback

Q. You consulted for many companies before you joined Google full time. What are some common mistakes you’ve noticed in training programs for employees?

A. One thing that doesn’t make sense is to require a lot of training. People learn best when they’re motivated to learn. If people opt in, versus being required to go, you’re more likely to have better outcomes.

You can also influence people to come to training. If a group of people go through some kind of program and they like it, then you ask them to nominate someone who might find the program beneficial. If the invitation comes from a colleague or a manager, you have that kind of peer-to-peer influence that says: “I got something out of this. You might, too.” Then the people who come are motivated. They assume they’re going to get something out of it. You just create a much different vibe than, “I was told I have to show up to this thing.”

Another “don’t” would be thinking that because some training content is interesting, everyone should therefore go through it. If something is interesting under particular conditions, it can lose its magic when applied to everyone.

Q. Other pitfalls?

A. Don’t use training to fix performance problems. If you’ve got a performance problem, there is a process to go through to figure out what’s causing it. Maybe the person doesn’t have the knowledge or skill or capability. Or is it motivation, or something about relationships within the work environment? Or lack of clarity about expectations? Training is the right solution only if the person doesn’t have the capability. But what I have seen in other places is sort of a knee-jerk reaction by managers to put someone in a training class if somebody isn’t performing well.

Q. Many C.E.O.’s I’ve interviewed talk about how hard it is for people to give direct feedback. Have you seen that, too?

A. Absolutely. I would say it happens for a couple of reasons. It’s simply harder to give difficult feedback than positive feedback or no feedback. It’s harder because it can be an uncomfortable conversation. It creates tension. You might be disappointing somebody or potentially leading them to feel worse about themselves.

If you’ve identified something that isn’t going well, then you’re likely to be asked, “How do I fix it?” If you don’t know the answer, you might not want to start the conversation. I think that’s the primary reason managers don’t give feedback. They’re willing to give the feedback, but then they won’t know how to help fix it, so why start the conversation?

As a coach, I was often in the position of giving people feedback they hadn’t heard before, after I interviewed a bunch of people they work with. It was always difficult for me, too. Just at a human level, it’s difficult to tell somebody that something that isn’t working about them. But I came to find that people are incredibly grateful. If I’m not doing well and I don’t know it or I don’t know why or I can’t put my finger on what’s not working and no one will tell me, I won’t be able to fix it.

And if you give me the information, the moment that the information is being transferred is painful, but then I have the opportunity to change it. I’ve come to realize that one of the most valuable things I could do for somebody is tell them exactly what nobody else had told them before.

Q. How often does that have a positive outcome?

A. People can do something with the feedback probably 70 percent of the time. And for the other 30 percent, they are either not willing to take it in, it doesn’t fit their self-image, they’re too resistant, in denial, or they don’t have the wherewithal to change it. And the reality is that most change happens in small increments. So if you’re watching to see if someone’s changing, you have to watch for the incremental change. It’s not a straight line.

Q. Other insights about giving feedback?

A. We do something in some learning programs with our leaders where we’ll put them in a fast-paced exercise and ask them to give feedback to each other, spur of the moment, based on the experience they’ve had together during the day that they’ve been together. I actually named it “speed-back” instead of “feedback.”

Bankrupt Toni Braxton — Accused of Fraudulently Giving $53,000 to Husband

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Toni Braxton fraudulently transferred $53,490 to her estranged husband in order to avoid paying back creditors in her bankruptcy case — so says the trustee of Toni's bankruptcy estate.

According to new docs filed in Toni's ongoing bankruptcy case, Toni's estranged husband Keri Lewis received the 5-figure sum after Toni's money was already earmarked to repay creditors.

Now, the bankruptcy trustee is suing Lewis to get the money back — much like John Mayer was sued for $465,000 following a giant Ponzi scheme collapse in Seattle.

TMZ broke the story … Toni filed for bankruptcy in 2010, claiming she owed between $10 million and $50 million in debts.

A rep for Braxton tells TMZ, "All of the payments made to Lewis prior to Toni’s bankruptcy filing were appropriate transfers for reasonable and necessary personal and business expenses in the ordinary course of her business."

The rep adds Toni will continue to provide the trustee whatever info is needed to address the allegation.