Thursday morning headlines

Stocks turn sluggish: There's little carryover from yesterday's big gain, perhaps reflecting investor caution about Wall Street's direction. Dow is up just a few points.

Decent month for retailers: August turned out better than expected for several big chains, adding more confusion over the willingness of consumers to spend. Remember, though, the comparisons are with August 2009, which was very weak. From AP:

Costco Wholesale Corp. posted a robust gain Thursday, boosted by higher gas prices and improved international revenue. Limited Brands Inc. and Macy's Inc. also had solid revenue increases. But shoppers are still keeping to their lists, hurting a number of clothing stores such as Aeropostale Inc. and Gap Inc. Target Corp.'s results came in below expectations.

Dodgers debt: Looks like owner Frank McCourt is leveraged out, with several lenders, including Citibank, turning down his request for additional loans. The LAT brought on an accounting firm to analyze the financials submitted as part of the McCourt divorce case. On the surface, the team's debt load - $153 million as of September 2009 - is no worse than several MLB clubs. But....

The $153 million is but a fraction of the $619 million in total liabilities held by the team's parent company, LA HoldCo LLC. That figure includes $433 million of long-term debt, with both figures obtained from a September 2009 balance sheet. HoldCo is where revenue and expenses from the Dodgers' assets are consolidated. Court records -- including statements by Jamie McCourt, the team's former president and chief executive -- show that the company has no significant source of income to service the debt besides the Dodgers and no significant HoldCo operations aside from the Dodgers.

Maker of Botox settles: Irvine-based Allergan agreed to pay $600 million to resolve charges that the company illegally promoted and sold the drug through 2005 for unapproved uses like treating headaches. From the NYT:

The company developed and put in place a wide-ranging marketing program, according to the complaint, that included paying kickbacks to doctors to induce them to prescribe Botox for conditions -- like pain and severe spasms in the limbs of children with cerebral palsy -- not included in the drug's label. Federal prosecutors also accused the company of teaching doctors how to get reimbursement from Medicare and Medicaid for off-label uses by putting in the codes for an approved treatment.

Sexual harassment case settled for $5.8 million: The government had connected ABM Industries, one of the nation's largest janitorial companies, with incidents involving rape, indecent exposure, groping, asking for sex and trading sex for promotions. The incidents allegedly happened in Bakersfield, Fresno and Visalia. (LAT)

Fraud charges involving failed credit union: Two former executives of Western Corporate Federal Credit Union are accused of pocketing millions of dollars for themselves and other top officials of the company. From the LAT:

WesCorp, as it was known, was seized by the government in March 2009 after incurring nearly $7 billion in losses, largely because of bad investments in mortgage-backed bonds. The suit, filed this week in federal court in Los Angeles by the National Credit Union Administration, a government agency, seeks at least $1 billion from the defendants or their insurers. Among the defendants is the current head of the national trade group of credit unions.

Disney channels stay on: Still no new fee deal with Time Warner Cable, but ABC, ESPN and the rest of the Mouse House lineup remains on the cable system. Update expected later today. (Bloomberg)

KB is cleared: After completing its inquiry into possible accounting violations, the SEC will not recommend any enforcement action against the L.A.-based homebuilder. (AP)

Miramax deal not done?: Two would-be investors have dropped out of the $660-million purchase of the movie production company. No word on whether the move will jeopardize the entire deal, which is being led by Ron Tutor. (LAT)