NTL's stock last traded at $4.95 a share on the National Association of Security Dealers' Over the Counter Bulletin Board at the end of 2002. After the shares of the financially restructured company were listed on Nasdaq when the company emerged from bankruptcy in mid-January 2003, NTL ended up being the Nasdaq market's best performer for the year, said Alison Kirkwood, NTL spokeswoman. The stock traded at $18.10 a share on Jan. 15, 2003, and rose to $69.75 a share on Dec. 31 for a 285% increase.
Jerry Brown, the chairman of the board of trustees for the $2.2 billion Dallas Police and Fire pension fund, said his board "has decided to take no action" on the fee question.
"Personally, I think it's a gray issue," and the firm could have done more to let clients know what was going on. But over a 14-year relationship, Dallas has known Mr. Huff to be "a very good manager, who has always gone to do the best he can for clients," said Mr. Brown. Bill Huff is "very tough, and that's why Dallas hired him," he said.
Over the past month, consultants have begun weighing in on the issue. Some, such as Wilshire Associates Inc., San Francisco, have written off the matter as a "communications issue" and have not urged any action, according to clients. Kim Shephard, a Wilshire spokeswoman, declined to comment.
According to industry sources, a few consultants — including Callan Associates Inc., San Francisco, and Ennis Knupp & Associates Inc., Chicago — have advised their clients to ask Huff to use the $11.5 million in advisory fees it took to offset their money management fees. Representatives at Callan and Ennis Knupp declined to comment.
An executive with another big consulting company, who declined to be named, said many of Huff's competitors have guidelines stipulating that they funnel any extra fees they receive back to clients. "If everybody else does it one way and Huff does it another way, that sort of makes them the odd man out," he said. Those $11.5 million in fees "belong to the clients as much as they belong to Huff," said the executive.