“That’s how quickly the fortune of the Waltons, the clan behind Walmart Inc, has been growing since last year’s Bloomberg ranking of the world’s richest families.
“At that rate, their wealth would’ve expanded about $23,000 ($A33,868) since you began reading this. A new Walmart associate in the US would’ve made about 6 cents in that time, on the way to an $11 ($A16) hourly minimum.”
It also revealed the family’s “jarring” and “near-unprecedented” wealth had soared by $39 billion since June 2018.
But who are the mysterious Walton family, and how did they amass such a “jarring” stack of cash?
(Reuters) – A Missouri jury on Thursday ordered Johnson & Johnson (JNJ.N) to pay a record $4.69 billion to 22 women who alleged the company’s talc-based products, including its baby powder, contain asbestos and caused them to develop ovarian cancer.
FILE PHOTO: A bottle of Johnson and Johnson Baby Powder is seen in a photo illustration taken in New York, February 24, 2016. REUTERS/Mike Segar/Illustration
The verdict is the largest J&J has faced to date over allegations that its talc-based products cause cancer.
The company is battling some 9,000 talc cases. J&J denies both that its talc products cause cancer and that they ever contained asbestos. It says decades of studies show its talc to be safe and has successfully overturned previous talc verdicts on technical legal grounds.
Thursday’s massive verdict, handed down in the Circuit Court of the City of St. Louis, was comprised of $550 million in compensatory damages and $4.14 billion in punitive damages, according to an online broadcast of the trial by Courtroom View Network.
J&J in a statement called the trial “fundamentally unfair” and said it would appeal the flawed decision.
J&J shares fell $1.31, or 1 percent, to $126.45 in after-hours trading following the punitive damages award. They had risen $1.52 during regular trading.
The jury’s decision followed more than five weeks of testimony by nearly a dozen experts from both sides.
The women and their families said decades-long use of Baby Powder and other cosmetic talc products caused their diseases. They allege the company knew its talc was contaminated with asbestos since at least the 1970s but failed to advise consumers about the risks.
“Johnson & Johnson is deeply disappointed in the verdict, which was the product of a fundamentally unfair process,” the company said in a statement. The company said it remained confident that its products do not contain asbestos or cause cancer.
“Every verdict against Johnson & Johnson in this court that has gone through the appeals process has been reversed and the multiple errors present in this trial were far worse than those in the previous trials which have been reversed,” J&J added, saying that it would pursue all available appellate remedies.
J&J has successfully overturned talc verdicts in the past, with appeals courts pointing to a 2017 decision by the U.S. Supreme Court that limits where personal injury lawsuits can be filed.
Of the 22 women in the St. Louis trial, 17 were from outside Missouri, a state usually regarded as friendly towards plaintiffs. The practice of combining plaintiffs in such jurisdictions, commonly criticized as “forum shopping” by defendants, will be challenged on appeal.
Mark Lanier, the lawyer for the women, in a statement following the verdict called on J&J to pull its talc products from the market “before causing further anguish, harm, and death from a terrible disease.”
“If J&J insists on continuing to sell talc, they should mark it with a serious warning,” Lanier said.
The majority of the lawsuits that J&J faces iare about claims that talc itself caused ovarian cancer, but a smaller number of cases allege that contaminated talc caused mesothelioma, a tissue cancer closely linked to asbestos exposure.
The cases that went to trial in St. Louis effectively combine those claims by alleging asbestos-contaminated talc had caused ovarian cancer.
Previous talc trials have produced verdicts as large as $417 million. But that 2017 verdict by a California jury, as well as other verdicts in Missouri, was overturned on appeal, and challenges to at least another five verdicts are yet to be determined through the courts.
The U.S. Food and Drug Administration commissioned a study of various talc samples from 2009 to 2010, including of J&J’s Baby Powder. No asbestos elements were found in any of the talc powder samples, the agency said.
But Lanier during the trial told jurors that the agency and other laboratories and J&J have used flawed testing methods that did not allow for the adequate detection of asbestos fibers.
Talc, the world’s softest rock, is a mineral closely connected to asbestos and the two substances can appear in close proximity in the earth.
Plaintiffs claim the two can become intermingled in the extraction process, making it almost impossible to remove the carcinogenic substance. J&J denies those allegations, saying rigorous testing and purification processes ensure its talc is clean.
Reporting by Tina Bellon in New York; editing by Leslie Adler and Rosalba O’Brien
It might happen tomorrow. It could take until the end of the week. Heck, it might even take until the end of the month. But any day now the Amazon founder Jeff Bezos will become the world’s richest person. After yet another powerful set of results, and yet another surge in the company’s share price, Bezos is a mere $US5 billion away from the Microsoft founder Bill Gates and likely to overtake him very soon.
True, on one level, the “world’s richest man” is just a statistical footnote, of no great significance. On another, however, the title sets a role model that entrepreneurs and business leaders around the world aspire to.
FILE – In this Sept. 6, 2012, file photo, Jeff Bezos, CEO and founder of Amazon, speaks at the introduction of the new Amazon Kindle Fire HD and Kindle Paperwhite personal devices, in Santa Monica, Calif. The Washington Post Co. agreed Monday, Aug. 6, 2013, to sell its flagship Washington Post newspaper to Bezos, the founder of Amazon.com for $250 million. (AP Photo/Reed Saxon, File)
After all, if making more money than anyone else doesn’t tell you they are doing something right, it is hard to know what might. So what lessons can we learn from Bezos’s rise to the top of the pile? That you should think big, innovate furiously, ignore failures, forget about obsessing over profits, and avoid major acquisitions. Those are pretty good guidelines for any business heading into the 2020s.
The rising value of Bezos’s net worth has been almost as relentless as the hard sell of Amazon Prime memberships over the past few years. His stake in the web giant he founded slightly over two decades ago is now worth US$81 billion. In the past five years, Amazon’s share price has more than quadrupled, rising from US$220 to more than $900 as the company powers into new industries and markets. He has already overtaken Warren Buffett and Amancio Ortega, the Spanish founder of Zara owner Inditex, to become the world’s second richest. It will only take a few more dollars on the share price for him to race past Gates – and given the relatively stagnant performance of his Seattle neighbour, that seems just about inevitable.
SANTA MONICA, CA – SEPTEMBER 6: Amazon CEO Jeff Bezos unveils new Kindle reading devices at a press conference on September 6, 2012 in Santa Monica, California. Amazon unveiled the Kindle Paperwhite and the Kindle Fire HD in 7 and 8.9-inch sizes. (Photo by David McNew/Getty Images)
Although there were times when he was briefly overtaken by Buffett, and also for a few weeks by Ortega, Gates has hung onto that title for a long time. He became the world’s richest man all the way back in 1995, when it took a mere US$12.9 billion to take that slot. In the past, the title has been held by tycoons such as John D Rockefeller and Andrew Carnegie, or indeed, if you want to go back far enough, by Musa I of Mali, the 14th-century African king, who many historians now reckon was the richest person of all time, with a net worth of $400 billion in today’s money. After 22 years, however, the baton appears about to pass onto a new man. So what are the lessons that every business – and investor for that matter – can learn from Bezos? Here are five of the most important.
One, think big. Amazon was started in 1994 as an online books retailer. But books were only chosen because Bezos could see they were a relatively easy way into online retailing. They come in standard sizes, you don’t need to try them on, they fit easily into parcels, and there was plenty of space to compete on choice and price. But its ambitions always went way beyond that. As it moved into CDs, DVDs, and then just about everything, it became clear that Bezos wanted Amazon to be the biggest retailer in the world. He was thinking big right from the beginning – and working out the best starting place to get to his ultimate destination.
Secondly, keep innovating. Amazon is now far more than just an online retailer. It has built a massive cloud computing business that serves some of the biggest web companies in the world. It is making films and TV series for its Prime streaming service. It has developed publishing, physical shops, grocery sales, own-label products, and drone delivery systems. It is rare that more than a few weeks go by without Amazon trialling something or other – right now it is making a huge push with its Alexa voice-activated assistant. Whatever it does, it invariably brings something new to it – for example, shops with no check-out staff. Most companies come up with one or two good ideas Google’s parent Alphabet has created both the search engine and the Android operating system – but Amazon comes up with dozens of them. That is hard to emulate – but it is an incredibly powerful model if you can get it right.
Thirdly, don’t fret about failure. As you might expect for a company that is always trying out new stuff, Amazon also has plenty of flops. Its smart phone was a complete turkey – it cost US$170 million in investment, but has made no progress so far. Its web payment service went nowhere, and so did Amazon Destinations, its travel unit. Askville, its questions and answers service, was shut down after several years of investment, and Amazon Local was no match for competitors such as Groupon. But so what? Bezos accepts that if you don’t try out lots of stuff, you won’t ever have more than one or two businesses. He just moves on to the next one.
Next, profits matter much less than market share. Amazon appears to hardly care whether it makes any money. It is interested in moving into new markets, and dominating the ones where it has already established itself. Profits will take care of themselves. It is not quite as relentlessly unprofitable as it used to be – it has actually made money for eight quarters in a row now – but its overall margins are wafer-thin given its vast size. Investment in expansion is far more useful than racking up cash in the bank, like Apple, or returning it to shareholders through dividends or stock buy-backs, like just about every other major company. Investors love it – and are rewarded via the share price.
Finally, forget acquisitions. It would be wrong to say that Amazon doesn’t buy companies. It paid US$1.2 billion for the online shoe shop Zappos in 2009 and $900 million for the video gaming streaming site Twitch in 2014.
There have been a steady stream of agreed takeovers. But they are all small scale stuff given the size of the company. It is clearly determined to take on Netflix in content, but it is spending massive sums on its own programmes rather than bidding for its rival.
Likewise, it’s trying to compete with Spotify in music, and Sainsbury’s and Tesco in groceries, rather than taking them out in a bid. Most acquisitions destroy value. It is far better to build your own rival from the ground up.
Amazon is far from perfect. It can ride roughshod over the competition, and it can be difficult place to work. But with its relentless drive to innovate and create new products, there could be many worse role models for entrepreneurs and business leaders.
In his annual letter to shareholders last month, Bezos urged people to “experiment patiently, accept failures, plant seeds, protect saplings, and double down when you see customer delight.”
That formula won’t work for everyone. But it is about to make Bezos the richest man in the world – and any business could do a lot worse than follow that formula.
Warren Buffett’s Berkshire Hathaway Inc on Monday revealed a new stake in Apple Inc, in a bet that the stock’s price could rebound after iPhone sales fell for the first time.
Berkshire held 9.81 million Apple shares worth $US1.07 billion ($1.47 billion) as of March 31, according to a regulatory filing detailing most stock holdings of Buffett’s Omaha, Nebraska-based conglomerate.
It is unclear whether the Apple investment was made by Buffett or by one of his portfolio managers, Todd Combs and Ted Weschler, who each invest about $US9 billion.
Apple shares look ‘stunningly cheap’: Wallman Investment Counsel founder Steve Wallman.
Buffett typically makes Berkshire’s multibillion-dollar investments, while Combs and Weschler make smaller wagers.
The investment deepens Berkshire’s commitment to the technology sector, which Buffett has largely shunned apart from a big stake in International Business Machines Corp, which grew slightly in the first quarter.
Apple last month reported its first quarterly decline in revenue in 13 years as an increasingly saturated market hurt iPhone sales.
Apple shares have taken a beating over the past month.
Chief Executive Tim Cook is looking to develop other technologies, and last week unveiled a $1 billion investment in Chinese ride-hailing service Didi Chuxing.
Shares of Apple have fallen by nearly one-third since April 2015. They were up $US2.13, or 2.4 percent, at $US92.65 in Monday morning trading, likely because of Berkshire’s imprimatur.
“The stock is stunningly cheap, and it has a massive pile of cash,” said Steve Wallman, founder of Wallman Investment Counsel in Middleton, Wisconsin, who has owned Berkshire since 1982 and Apple since 2003. “Apple is not getting credit for research and development it is doing behind the scenes, which will eventually show up in new products.”
An Apple spokeswoman did not immediately respond to requests for comment.
Despite his aversion to technology sector, Buffett told CNBC on Monday, he offered to help Dan Gilbert, the chairman of Quicken Loans and owner of the Cleveland Cavaliers basketball team, finance a bid for Internet company Yahoo Inc.
Reuters first reported Buffett’s support on Friday.
The Apple investment may have been made with proceeds from the sale of AT&T Inc stock, as Berkshire exited what had been a $US1.6 billion stake in the quarter.
Berkshire’s investment also puts it at odds with investors that have retrenched from Apple.
Last month, billionaire activist investor Carl Icahn said he sold his entire Apple stake, on concern that China could make it harder for the company to do business there.
David Tepper’s Appaloosa LP also shed his Apple stake in the first quarter, while Ray Dalio’s Bridgewater Associates cut its investment by two-thirds.
In Monday’s filing, Berkshire also reported higher stakes in Bank of New York Mellon Corp, Deere & Co and Visa Inc, and lower stakes in MasterCard Inc and Wal-Mart Stores Inc.