Among other items: The Benaroya Research Institute at Virginia Mason said it has hired Jack Nagan as executive director; and the massive fraud at HealthSouth began unraveling days after a new law was enacted with stiff penalties for false corporate reporting, according to testimony yesterday.

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In a preliminary agreement with Boeing announced yesterday, Ethiopian Airlines said it will order five of Boeing’s new 787 jets, with options for five more. The airline will be the first African operator of the new jet.

The firm orders are valued at $600 million at list prices. The first plane is scheduled for delivery to Addis Ababa in 2008.

Boeing now has 191 announced orders or commitments for the 787 from 15 airlines.

Ethiopian Airlines operates an all-Boeing jet fleet of 737 and 767 airplanes.

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Executive director hired at Virginia Mason institute

The Benaroya Research Institute at Virginia Mason said it has hired Jack Nagan as executive director.

Nagan, formerly the chief executive of the Northern California Institute for Research and Education, will be responsible for all business activities at the nonprofit research center.

He will also assume a new position, vice president for research at Virginia Mason Medical Center.

Gerald Nepom, an immunologist, will continue as director of the research institute.

Executive who resigned boosts stake in Hollywood Entertainment chain

Hollywood Entertainment’s former chief executive officer boosted his stake in the movie-rental chain Thursday and said he may begin talks with bidders for the company.

Mark Wattles said he raised his stake to 10.3 percent, or 6.14 million shares, by exercising stock options, according to a Securities and Exchange Commission filing yesterday. He bought the shares a day after Blockbuster offered $883 million to thwart a lower bid by Movie Gallery.

Wattles, who resigned Thursday, plans to have discussions with both companies about a transaction and may open talks with others, he said in the filing.

He’s trying to wield influence on the sale after failing to purchase the company with buyout firm Leonard Green & Partners, independent analyst Dennis McAlpine said.

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New law exposed fraud, former HealthSouth CFO says

The massive fraud at HealthSouth began unraveling days after a new law was enacted with stiff penalties for false corporate reporting, according to testimony yesterday by a former finance chief at the trial of fired CEO Richard Scrushy.

Bill Owens, who served in several top positions at the rehabilitation giant, said then-Chief Financial Officer Weston Smith told him he was quitting on Aug. 5, 2002, rather than sign bogus financial statements under the Sarbanes-Oxley law, enacted less than a week earlier amid a wave of corporate scandals.

Owens said he and Scrushy — the first chief executive tried under the law — tried to come up with a way to keep Smith “on the reservation” and get him to sign the financial reports, which Smith knew were fraudulent.

Compiled from Seattle Times business staff and Bloomberg News