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The F.A.A. and Boeing face grillings today
Aviation regulators will testify before Senate subcommittees today on the crashes of two Boeing 737 Max 8 Jets, while Boeing meets with airline executives to update them on a fix for the software thought to be responsible for the accidents.
The F.A.A.’s acting chief will defend the agency’s practice of delegating some plane safety checks to Boeing as “critical” to the success of the certification process. The official, Daniel Elwell, will argue that the process for the Max 8 was “detailed and thorough.”
Senators are expected to ask about long-running doubts about the process. The NYT reports that F.A.A. employees and a Transportation Department watchdog worried over the years that the agency had “too close a relationship” with Boeing officials. Lawmakers will also ask why an update to the jet’s anti-stall software is still not ready.
Boeing’s response to the crisis is also being questioned, particularly since its C.E.O., Dennis Muilenburg, has largely remained silent. “Their comments have been very engineering-esque,” Richard Levick, a communications expert, told the NYT. (The company’s public response has become more assertive since hiring the crisis communications firm Sard Verbinnen.)
The company will meet today with 200 pilots and airline representatives at the factory where the Max 8 is made. It’s expected to offer some updates on the anti-stall software.
More Boeing news: A Max 8 made an emergency landing in Orlando yesterday, though the incident is not thought to be connected to malfunctions that may have led to the two recent crashes.
Europe adopts tough new copyright rules
The European Parliament voted yesterday to pass a new copyright law requiring technology platforms to sign licensing agreements with musicians, authors and news publishers in order to post their work online, Adam Satariano of the NYT reports.
“The new law is meant to force tech firms to aggressively remove unlicensed copyrighted material from their websites proactively, rather than waiting for complaints to come in before acting,” Mr. Satariano writes.
The policy is deeply divisive. Digital rights activists and the tech industry say it could result in censorship. Media organizations say it should protect Europe’s creative industries and ensure companies pay for content they share online.
Some digital business models could be affected, because website owners will take on more responsibility for what ends up on their platforms. Sites may find the law too expensive or cumbersome to police: Even Google shuttered its News service, which would require licenses from publishers under the new rules, when a similar initiative was introduced in Spain.
Smaller organizations may be hit hardest. These websites contend that giant tech platforms already have the resources to comply with the law, Mr. Satariano writes.
Purdue Pharma pays $270 million to settle an opioid lawsuit
Purdue Pharma, the drug maker behind OxyContin, said yesterday that it will settle a lawsuit by Oklahoma’s attorney general over its role in the opioid crisis, Jan Hoffman of the NYT reports.
Purdue and its owners will pay $270 million, far more than they have paid in previous settlements. The payout helps Purdue avoid a televised trial that was scheduled to begin on May 28.
But many more legal battles await. A federal judge in Cleveland alone is overseeing a consolidated collection of 1,600 lawsuits, and 35 other states have sued Purdue as well.
The settlement raises questions about a Purdue bankruptcy. The company has contemplated filing for Chapter 11 protection to help contain the cost of defending or settling its legal fights. In bankruptcy, lawsuit claimants would most likely get only a fraction of any court-determined payout.
Chapter 11 weighed heavily in the Oklahoma case. The state made a bird-in-the-hand decision, and other plaintiffs may need to make a similar choice. “The concern is that counties and states may settle on the cheap early to avoid getting little to nothing later on,” Elizabeth Chamblee Burch, a law professor at the University of Georgia, told the NYT.
Wall Street bonuses widen gender and race pay gaps
New data about Wall Street compensation shows that the financial sector’s huge pay has widened the national disparity between white men and women and people of color, according to a new report from the Institute for Policy Studies, a liberal think tank.
New York City’s financial sector bonus pool fell last year by 14 percent from the previous year, to $27.5 billion. But that is still three times bigger than the combined annual earnings of all U.S. full-time minimum-wage workers.
A majority of financial workers are white men, especially at the top ranks, according to the institute. No less than 68 percent of senior managers at the five largest U.S. investment banks are white men.
But they make up just 37 percent of America’s minimum-wage workers, who have full- or part-time jobs that pay $7.25 an hour. “Due to Washington inaction, the federal minimum wage continues to be a poverty wage, while the reckless bonus culture is alive and well on Wall Street,” the report concludes.
In Apple vs. Qualcomm, both sides notch wins
As at least 80 patent fights between Apple and Qualcomm trickle through courts around the world, both companies scored victories yesterday, the WSJ reports.
Some iPhones now face a U.S. import ban after an International Trade Commission judge issued an initial ruling yesterday finding that Apple had infringed a Qualcomm patent.
But Apple scored a bigger victory when another I.T.C. judge ruled that the phone maker had not infringed a Qualcomm patent relating to power efficiency in mobile phones. That overturned a previous court finding.
“Qualcomm is hoping a victory, particularly an import ban, could give it greater leverage in technology licensing negotiations,” Bloomberg explains. “Qualcomm says it’s due billions of dollars in unpaid royalties on the iPhone.”
“Apple denied infringing any of the patents in the two cases and claimed Qualcomm is trying to shut its only U.S.-based competitor out of the market, something Apple argues will hinder the development of the fifth generation of mobile communications,” Bloomberg adds.
Stock buybacks are bigger than ever
Corporate America set a record for stock repurchases last year, even as lawmakers proposed curtailing the practice.
Companies bought back $806.4 billion worth of their own shares, according to S&P Dow Jones Indices, with $223 billion of that coming in the fourth quarter alone. The previous high was $589.1 billion, set in 2007.
The biggest buyer was Apple, which repurchased $101 billion of its stock.
The buyback boom was fueled by the Trump tax cuts, with companies preferring to use their savings to repurchase shares and bolster their stock prices, rather than issue dividends or make new investments.
And it came despite opposition from Congress, with lawmakers from Senator Bernie Sanders to Senator Marco Rubio arguing in favor of limits on the practice.
But a repeat is unlikely this year, as the sugar rush from the tax cuts wears off.
Google’s robot reboot is all about software
In 2013, Google started an ambitious and flashy effort to create robots under the control of Andy Rubin, who later left the company amid accusations of sexual harassment. Now, the company has overhauled the effort with more modest goals — but subtly advanced technology, Cade Metz of the NYT reports.
Google’s first robot push was all about advanced machines, and was built on a series of acquisitions. Some of the companies that Google bought relied on humanoid robots, but the tech giant failed to capitalize on them, and sold off or shut down the companies over time.
Now the focus is on making robots smarter by injecting them with machine-learning software. “The company is developing ways for these robots to learn skills on their own, like sorting through a bin of unfamiliar objects or navigating a warehouse filled with unexpected obstacles,” Mr. Metz writes.
“Google is tight-lipped about how it hopes to deploy the technologies it is working on,” Mr. Metz adds. That’s probably because most researchers see robots being used in warehouses and distribution centers around the world, raising questions about how automation will erode jobs.
Revolving door
DealBook exclusive: The Brunswick Group plans to announce this morning that it has hired Michael O’Looney, most recently head of communications at Elliott Management, as a partner in New York and Courtney Chiang Dorman, who previously was the C.O.O. of the law firm Wilson Sonsini, as a partner in San Francisco.
JC Penney hired Bill Wafford, most recently the chief financial officer of The Vitamin Shoppe, as its C.F.O.
Simon Sutton is reportedly stepping down as HBO’s chief revenue officer.
The speed read
Deals
• Lyft reportedly plans to raise the price range of its I.P.O. amid strong investor demand. (WSJ)
• Renault reportedly plans to restart merger talks with Nissan and pursue a takeover of Fiat Chrysler. (FT)
• Centene has agreed to buy WellCare, a managed-care rival, for $17.3 billion, including the assumption of debt. (PR Newswire)
• The Chinese gaming company that owns Grindr reportedly plans to sell the dating app after the U.S. national security panel Cfius raised concerns about its ownership. (Reuters)
• Spotify agreed to buy Parcast, a producer of crime and mystery podcasts. (NYT)
Politics and policy
• Stephen Moore, the economic commentator whom President Trump plans to nominate as a Fed governor, said he’s no “sycophant” for the president. (NYT)
• Democrats see political opportunity as Mr. Trump moves to abolish the Affordable Care Act. Here’s what would happen if the Obama health care law is struck down. (NYT)
• The House failed to override Mr. Trump’s declaration of a national emergency over a border wall. (NYT)
• The Green New Deal failed in a Republican-led vote in the Senate yesterday, as Democrats voted “present.” (Axios)
• The Justice Department said that it plans to release a version of the Mueller report to Congress and the public within weeks. (WSJ)
Brexit
• Prime Minister Theresa May’s Brexit deal is slowly gaining support among critics in her Conservative Party — but some want her resignation in exchange for their votes. (Bloomberg)
• The E.U. has reportedly suggested that if Britain asks for a long delay to Brexit, its departure could be pushed back until March 31, 2020. (Guardian)
• More than half of British business leaders want a deal where Britain is closely aligned to the E.U.’s single market for goods and services. (FT)
Trade
• The U.S. is pressing Canada and Mexico to agree to permanent limits on the amount of steel and aluminum they export to America each year. (NYT)
• China’s humiliation in the 1800s feeds into its reluctance to let the U.S. impose tariffs if Beijing fails to keep its promises on trade. (NYT)
Tech
• Sundar Pichai, Google’s C.E.O., will reportedly meet with the chairman of the Joint Chiefs of Staff today to discuss the tech giant’s A.I. work in China. (Bloomberg)
• A judge will hear arguments on April 4 on whether Elon Musk should be found in contempt of court. (Business Insider)
• Three A.I. pioneers have won the Turing award, considered the Nobel of computing, for their work in developing artificial neural networks. (NYT)
• Google is reportedly funding “dozens” of new local news websites around the U.S. (Axios)
• Palantir reportedly won a Pentagon contract to build a battlefield intelligence system. (WaPo)
Best of the rest
• Wall Street firms, including JPMorgan Chase and Blackstone, have added #MeToo keywords like “harassment” to risk factors in their annual reports. (Business Insider)
• Nissan reportedly paid at least $601,000 in Stanford tuition fees for Carlos Ghosn’s children. (Bloomberg)
• Citigroup is being sued for age discrimination by a 56-year-old banker, who claims he was told “you are old and set in your ways” before being dismissed. (Bloomberg)
• Lloyd’s of London announced measures to combat sexual harassment at the insurance brokerage, including lifetime bans for offenders. (Bloomberg)
• Vice President Mike Pence said that the Trump administration wants NASA to put astronauts back on the moon by 2024 “by any means necessary.” (Verge)
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