Appeals court hears BP challenge on spill claims

NEW ORLEANS — BP PLC is suffering financial harm because of the way a court-appointed administrator is making payments from a settlement of claims from the 2010 oil spill in the Gulf of Mexico, an attorney for the oil giant said Monday.

Ted Olson made the arguments in a packed courtroom before a three-judge panel of the 5th U.S. Circuit Court of Appeals. A lower court already refused to block payments to businesses that claim the spill cost them money.

At stake are billions of dollars in settlement payments stemming from the blowout of BP's Macondo well in the Gulf of Mexico.

Samuel Issacharoff, an attorney for Gulf Coast businesses and residents, argued the oil company was aware of the settlement terms and the administrator's methods. He questioned whether the appeals court has authority to change that agreement.

But Olson, who served as solicitor general under President George W. Bush, attacked the payout process.

"Irreparable injustices are taking place and money is being dispensed to parties from whom it may not be recoverable," he told the judges.

The panel opened Monday's hearing by asking Olson whether the court has jurisdiction in a case involving a settlement already approved by the parties in the case and a U.S. District Court judge.

Judge James Dennis seemed skeptical at times, asking at one point, "How can we go beyond the four corners of the agreement?"

BP has asserted that the judge who approved the deal and a court-appointed claims administrator have misinterpreted the settlement, allowing thousands of businesses to secure hundreds of millions of dollars in payments for inflated and fictitious losses.

Plaintiffs' attorneys who brokered the deal last year counter that BP undervalued the settlement and underestimated how many claimants would qualify for payments under the terms they negotiated.

BP's appeal doesn't apply to payouts to individuals.

The April 2010 blowout of BP's well off the Louisiana coast triggered an explosion that killed 11 workers on the Deepwater Horizon drilling rig and led to millions of gallons of oil spilling into the Gulf. Shortly after the disaster, BP agreed to create a $20 billion compensation fund that was administered at first by the Gulf Coast Claims Facility, led by attorney Kenneth Feinberg.

After the settlement was announced last year, Barbier appointed attorney Patrick Juneau to take over the process of evaluating and paying claims.

The settlement doesn't have a cap, but BP initially estimated that it would pay $7.8 billion to resolve claims by tens of thousands of Gulf Coast residents and businesses. Now the company says it no longer can give a reliable estimate for how much the deal will cost.

Awards to businesses are based on a comparison of their revenues and expenses before and after the spill. BP says a "policy decision" that Juneau announced in January 2013 allows businesses to manipulate those figures in a way that leads to errors in calculating their actual lost profits.

Plaintiffs' attorneys say BP has never offered an alternative methodology for evaluating these claims — and had agreed from the outset of the settlement agreement that the claims administrator should interpret the compensation frameworks to provide the greatest payouts to claimants, the plaintiffs' lawyers said.

Juneau's office has offered more than $2.2 billion in settlement payments to more than 8,600 businesses as of June 23.

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Al-Jazeera kicked out of Egypt news conference

CAIRO — Journalists for the pan-Arab broadcaster Al-Jazeera have been kicked out of a news conference being held by Egypt's military on the killing of at least 54 people, most of them supporters of Egypt's ousted president, outside an army facility.

Qatar-based Al-Jazeera was founded by the Gulf nation's ruling family. The tiny but wealthy country was a strong supporter of Egyptian President Mohammed Morsi, who was toppled by the military on Wednesday.

The station broadcast graphic images of those killed and wounded in the violence Monday outside a military facility.

During the news conference, one journalist stood up and demanded Al-Jazeera reporters be excluded from the proceedings.

The Al-Jazeera reporters eventually walked out accompanied by chants of "Out! Out!" from others in the crowd.

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Thomson Reuters suspends early data access

Thomson Reuters will suspend its practice of distributing results from consumer surveys a couple seconds early to clients who pay the news and business information provider for advance access.

A company spokeswoman said Monday that Thomson Reuters will simultaneously distribute survey data at 9:55 a.m. starting Friday from the University of Michigan Surveys of Consumers after the New York State attorney general requested the suspension.

The attorney general's office is investigating the early data access, and Thomson Reuters said it is cooperating with that review.

That twice-monthly survey is separate from the consumer confidence index produced by the private research group the Conference Board.

Thomson Reuters pays for exclusive access to the University of Michigan results, and some of its clients have been paying extra to receive the data two seconds before other clients receive it at 9:55 a.m. This allows high-speed computers to make trades before others gain access to the data.

Thomson Reuters then sends out a news release about the survey at 10 a.m.

Modern stock trading is dominated by automated computer systems that make trades in fractions of a second, and traders can profit from receiving data even milliseconds before its public release. Consumer sentiment regarding the economy is watched closely because consumers' spending accounts for about 70 percent of U.S. economic activity.

The attorney general's office said in a statement the two-second edge that Thomson Reuters gives to some high-frequency traders amounts to an unfair advantage as those traders "execute enormous volumes of trades in the blink of an eye."

"The securities markets should be a level playing field for all investors and the early release of market-moving survey data undermines fair play in the markets," Attorney General Eric T. Schneiderman said in the statement.

Thomson Reuters said separately it "strongly believes that news and information companies can legally distribute non-governmental data and exclusive news through services provided to fee-paying subscribers."

"It is widely understood that news and information companies compete for exclusive news and differentiated content to help their customers make better informed trading and investment decisions," the Thomson Reuters statement said.

Company spokeswoman Yvonne Diaz added that Thomson Reuters has always been transparent about how it releases proprietary data so its customers can choose the level of service they want.

Last month, the Conference Board announced that it will no longer provide its economic reports in advance to news organizations because it suspects the data is being diverted early to computer-driven trading systems, which can unfairly profit from it.

It had long provided its monthly data to reporters 30 minutes before the information is publicly released. That early access allowed journalists to prepare news reports ahead of the information's public release.

Last year, the Labor Department revoked early access to its employment data for several companies that deliver data to high-speed traders but produce little or no original news content.

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Fiat exercises option to buy more Chrysler stock

DETROIT — Italian automaker Fiat has exercised a third option to buy a small amount of Chrysler stock, but the sale won't go through until a U.S. court settles a dispute over the price.

Fiat said Monday that it offered $254.7 million for another 3.3 percent of Chrysler's outstanding equity.

Fiat already owns 58.5 percent of Chrysler, with the remaining 41.5 percent held by a trust that pays medical bills for retired United Auto Workers union members. The Italian company wants to buy all of the trust's stock and fully merge Chrysler and Fiat.

The price on the options will be settled by a judge in Delaware Chancery Court, and the ruling is likely to set the price for the trust's remaining Chrysler stake. For several months, Fiat has been trying to arrange financing to buy the trust's stock. Fiat expects a court ruling sometime this month.

"I hope to close (the deal) as soon as possible if they let me do it," the Italian news agency LaPresse quoted Fiat and Chrysler CEO Sergio Marchionne as saying at an appearance Monday in Turin, Italy, Fiat's headquarters city.

Fiat now has exercised options to buy 9.9 percent more Chrysler stock. The Italian automaker has options to buy 3.3 percent of Chrysler stock every six months until it gets another 16.6 percent. Fiat offered $139.7 million for the first 3.3 percent option on July 3, 2012, but the trust fund says the price should be $343 million. Fiat raised its offer to $198 million for the second 3.3 percent on Jan. 3 of this year.

Morgan Stanley, in a July 5 note to investors, estimated that it would cost Fiat $2 billion to $5 billion to buy the trust's entire stake.

The options are part of the deal in which Fiat and Marchionne were appointed to manage Chrysler in 2009 by the U.S. government. The government bailed out the struggling Chrysler and funded its trip through bankruptcy restructuring.

Since then, Fiat has raised its stake in the resurgent Chrysler, and Marchionne is merging the companies to generate more cost savings from joint research, management and purchasing.

Once it gains control of the whole company, Fiat is considering a plan to hold an initial public stock offering, which would raise much-needed money for research on new vehicles at both companies, and could help Fiat weather the economic downturn in Europe.

Fiat SpA shares are now traded publicly on the Milan stock exchange, while Chrysler is technically a private company with no publicly traded shares. Presumably, Fiat shareholders would be offered a stake in the new company if they approve the merger.

Merging the companies would give Fiat access to Chrysler's cash. Currently, Fiat shares in Chrysler's profits but can't use the Detroit automaker's funds for its own operations. Fiat lost $108 million in the first quarter, while Chrysler made $166 million. Without Chrysler, Fiat would have lost $1.41 billion last year. Chrysler had $11.9 billion in cash as of March 31.

Like Fiat, the trust got its stake in Chrysler from the government as part of the 2009 bankruptcy. At the time Chrysler owed the trust around $4 billion as part of a deal with the UAW to take over retiree health care costs.

The trust fund needs cash to pay medical bills for thousands of Chrysler blue-collar retirees. In order to monetize its stake in Chrysler, it either has to sell the shares to another party, such as Fiat, or sell to the public — which could happen if Fiat and the trust can't agree on a share price.

The trust has asked Fiat to begin working on an IPO of Chrysler, but cannot formally compel it to follow through; a public offering takes about 18 months to prepare. Marchionne has said he favors buying the trust's stake to a public sale.

Marchionne has already taken steps to combine Fiat and Chrysler. The companies are sharing engines and parts and have jointly designed cars like the Dodge Dart compact. The balance sheets are already combined, although there is a strict separation of assets.

___

Correspondent Frances D'Emilio contributed to this report from Rome.

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Medicare won't pay for Eli Lilly Alzheimer's agent

WASHINGTON — Eli Lilly & Co. says it will push ahead with a first-of-a-kind imaging chemical designed to help screen for Alzheimer's disease, despite a negative ruling by Medicare officials.

The Centers for Medicare and Medicaid Services said last week it will not cover the chemical, called Amyvid, which highlights brain plaque in medical imaging scans. The government program provides health coverage to more than 47 million seniors, and is the largest payer for prescription drugs in the U.S.

In its decision, posted online, Medicare said more trials are needed to prove the tool works. The government will pay for patients enrolled in future studies, but not for general use.

The radioactive imaging agent works by binding to beta-amyloid plaques and causing them to show up on positron emission tomography, or PET, scans of the patient's brain. The presence of these plaques may help indicate that a patient with cognitive problems has Alzheimer's disease, although such a scan does not definitively show that.

Eli Lilly, which is based in Indianapolis, has said Amyvid is one tool intended to help find the cause of a patient's cognitive decline.

The ruling is an unexpected setback for the product after European Union regulators endorsed the chemical in January. The U.S. Food and Drug Administration approved the drug for sale in 2011.

"Lilly remains steadfast in our request for Medicare coverage of beta-amyloid imaging agents for the appropriate patient population," said Wei-Li Shao, director of the company's Alzheimer's business, in a statement.

Eli Lilly and Co. paid $300 million in 2010 to acquire the drug and its developer, Avid Radiopharmaceuticals Inc.

Avid Radiopharmaceuticals CEO Daniel Skovronsky said in a statement the Medicare ruling "may stifle future innovation aimed at improving diagnosis."

Doctors currently diagnose Alzheimer's disease by observing patients and administering physical and mental tests. The disease is the sixth-leading cause of death in the U.S. and the most common form of dementia, a term for brain disorders that affect memory, judgment and other mental functions.

Alzheimer's attacks neurons in the brain, leading to problems with memory, thinking and behavior. There is no cure for the disease, and scientists are not even sure what causes it.

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Shaw’s fined for item-pricing violations

Shaw's Supermarkets has been fined $8,000 for item-pricing violations at a few of its stores, according to the state Division of Standards.

Officials report finding three of four Shaw's supermarkets visited last month failed to individually price a majority of their grocery items in violation of state law.

The stores were visited June 12-28 to determine compliance with the state's new item-pricing law enacted in January. That law requires grocery stores to individually price each item or apply for a waiver that would allow them to remove the individual item prices provided they installed in-aisle or handheld scanners for consumers to check prices. Shaw's supermarkets have not applied for a waiver and do not have the scanners, and therefore must continue to individually price certain items in their stores, the state agency said.

"What we found during the course of our investigation was concerning enough that the Division of Standards will be sending staff out to all Shaw's Supermarkets in the Commonwealth to ensure that the item pricing law is being followed," state Undersecretary of Consumer Affairs and Business Regulation Barbara Anthony said in a statement. "Fortunately all of the items we tested scanned at the register for the correct prices, but the issue is price transparency as well as accuracy."

The state can fine a food retailer up to $200 for each missing item pricing label.

Shaw's spokesman Steve Sylven said ensuring that all Shaw's and Star Markets comply with item pricing laws is a high priority.

"We strive for 100 percent compliance," Sylven said. "Shaw's and Star Market recently initiated thousands of price cuts across all of our locations, which may have contributed to the results."

Shaw's management teams will be auditing stores to ensure locations are in compliance, according to Sylven.

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Senate immigration bill would remake economy

WASHINGTON — Landmark immigration legislation passed by the Senate would remake America's workforce from the highest rungs to the lowest, bringing more immigrants into numerous sectors of the economy, from elite technology companies to restaurant kitchens and rural fields.

In place of the unauthorized workers now commonly found laboring in lower-skilled jobs in the agriculture or service industries, many of these workers would be legal, some of them permanent resident green card holders or even citizens.

Illegal immigration across the border with Mexico would slow, while legal immigration would increase markedly.

That's the portrait that emerges from recent analyses of the far-reaching immigration bill passed last month by the Senate with the backing of the White House. Although the bill aims to secure the borders, track people overstaying their visas, and deny employers the ability to hire workers here illegally, it by no means seeks to choke off immigration. Indeed, it would increase the U.S. population over the next two decades by 15 million more people than current law, according to the Congressional Budget Office.

Even after decades of growth in the U.S. foreign-born population, the added increase could be felt in ways large and small around the country, from big cities that would absorb even more diversity to small towns that may still be adjusting to current immigrant arrivals.

"That is baked into the basic premise of the bill," said Doris Meissner, a senior fellow at the Migration Policy Institute, "which is that you need to provide legal avenues for people to come to the country both in longer-term temporary and in permanent visa categories in order to meet the needs of the future and avert the incentives for illegal immigration."

The level of immigration under the legislation has been a political issue in the debate and will likely to continue to be disputed in the weeks ahead as the House's GOP majority wrestles with how to respond to the Senate bill. It's a complex question because the bill expands various temporary and permanent visa categories, shuts down others and creates new ones. Some visa programs are capped and some aren't, and some would expand or contract in response to demand.

Opponents led by Sen. Jeff Sessions, R-Ala., have forecast dramatic increases in immigration under the bill, with Sessions warning that 57 million new permanent and temporary residents and newly legalized immigrants would flood the U.S. within the decade and rob Americans of jobs. On the other side, supporters including Sen. Marco Rubio, R-Fla., have downplayed the impact of the bill. In response to Sessions, Rubio's office argues that the Senate bill "does not significantly increase long-term, annual migration to the United States."

Under current law, around 1 million people get green cards granting permanent U.S. residence each year. That would rise to between 1.5 million to 1.7 million annually under the Senate bill within about five years of enactment, the Migration Policy Institute estimates.

But those figures don't count people coming to the U.S. under temporary worker visas, which could rise by hundreds of thousands a year under the Senate bill, according to the Migration Policy Institute. This includes more than twice as many visas for high-skilled workers, a new visa for lower-skilled workers that could go up to 220,000 a year, and more visas for agricultural workers. There are also tens of thousands of new work visas set aside for people from Ireland, South Korea, African and Caribbean countries, and elsewhere that got special deals in the bill. Some of these workers would be able to transition to permanent status and eventually citizenship.

On the other side, the flow of illegal immigration into the country would decrease by one-third or one-half compared with current law, the Congressional Budget Office says. Illegal immigration has already decreased since 2000 due to a combination of factors, including the economic downturn and greater security measures in the wake of the Sept. 11, 2001 terror attacks. Although up-to-date annual figures on illegal immigration are hard to come by, one recent study published in the International Migration Review said that close to 400,000 immigrants entered illegally in 2009, either by crossing the border unlawfully or overstaying temporary visas. An author of the study, Robert Warren, said that the figure has not likely changed dramatically in the years since.

The bill offers a 13-year path to citizenship for the 11 million immigrants already here illegally, the most contentious element of the legislation since many House conservatives oppose granting citizenship to people who broke U.S. laws to be here. But that aspect of the legislation has little impact on the overall population size since the people involved are already in the country even if they end up transitioning to legal status. The Congressional Budget Office estimates that some 8 million of them would do just that.

Beyond the changes in numbers, the immigration bill shifts the emphasis of U.S. immigration policy away from family ties and put more weight on employment prospects, education and relative youth. It also raises ceilings on how many immigrants could come from any one country. And there would be impacts as yet unforeseen as the policies unspool into an uncertain future and economic conditions in other countries impact how many of their citizens dream of calling the U.S. home.

"There's not going to be a dramatic change that we will see overnight, but longer-term changes," said Audrey Singer, a senior fellow at the Brookings Institution. "We've got this idea of the policy and then when we put it into practice inevitably there are unintended consequences or unintended trends that develop."

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Markets outside of Asia recover their poise

LONDON — Aside from a big sell-off in Asia, markets generally recovered their poise Monday, as investors shrugged off fears of an imminent scaling-back of the U.S. Federal Reserve's monetary stimulus.

Investors in Europe, in particular, regained their footing after last week's stronger-than-expected U.S. jobs report prompted an end-of-week sell-off. After European markets closed on Friday, U.S. stocks posted solid gains and that's carried through into Monday's session.

Given the prevailing focus on the U.S., the key day this week will likely be Wednesday, when the minutes to the last policy meeting of the Fed are published. The Fed's chairman, Ben Bernanke, is also due to deliver a speech.

"It is possible that the combination of these events will encourage speculation that tapering is almost upon us," said Jane Foley, an analyst at Rabobank International. "Alternatively there is the possibility that Bernanke will push back against speculation that the Fed is ready to take a less accommodative position."

Without a clearer gauge, markets around the world have been volatile for weeks. For the past few years, the Fed's stimulus, echoed by other central banks, has been one of the props shoring up a number of financial assets, in particular stocks.

European markets started the week positively with the FTSE 100 index of leading British shares closing up 1.17 percent at 6,450. Meanwhile, Germany's DAX rose 2.08 percent to 7,968 and the CAC-40 in France was 1.86 percent higher at 3,823.

The mood in Europe was also helped by the news that Greece's international creditors appear to have reached a deal with the cash-strapped country over further economic reforms required for the release of the bailout funds. A meeting later in the day of the finance ministers of the 17 European Union countries that use the euro is expected to confirm the release.

In the U.S., the Dow Jones industrial average was up 0.43 percent at 15,200, while the broader S&P 500 index rose 0.37 percent to 1,637.

While the Fed looks set to be the main market driver, investors will be closely monitoring the start of the U.S. second-quarter corporate reporting season, which starts in an after-hours statement from aluminum company Alcoa Inc.'s.

"One update does not determine the tone of the entire earnings season, but at least it will provide a view on how the aluminum market is faring, an important element given ongoing worries about the Chinese economy," said Chris Beauchamp, market analyst at IG.

Those worries over China weighed on investor sentiment earlier during Asia's session. Investors appear to be getting increasingly worried about a cash squeeze in the world's number 2 economy.

In mainland China, the Shanghai Composite Index closed down 2.4 percent to 1958.27 while the smaller Shenzhen Composite Index lost 3.6 percent to 889.53. Elsewhere, Hong Kong's Hang Seng closed down 1.3 percent at 20,582.19 and Japan's Nikkei 225 fell 1.4 percent to 14,109.34.

In other financial markets, the mood was fairly benign. Among major currencies, the euro was up 0.3 percent at $1.2867 while the dollar fell 0.4 percent to 100.81 yen.

In commodity markets, the price of oil was down 8 cents at $103.14 a barrel.

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ISS recommends vote for Dell founder's offer

NEW YORK — A top proxy advisory firm is recommending that Dell shareholders vote in favor of a deal that would allow the company's founder and an investment firm to buy the computer maker and take it private.

Michael Dell and Silver Lake Partners have offered to buy Round Rock, Texas-based Dell Inc. for $13.65 per share, or a total of $24.4 billion. Michael Dell believes he can turn the company around by taking it private and diversifying into niches, such as business software, data storage and consulting.

But Carl Icahn, a billionaire investor and Dell's second-largest shareholder, says he wants Dell to remain publicly traded and boost value for shareholders by buying back $16 billion in stock.

The company has backed Michael Dell's proposal and said that Icahn doesn't have adequate financing for his plan. Shareholders will vote on the buyout offer at the company's annual meeting on July 18.

In its report, Institutional Shareholder Services pointed to the offer's hefty premium, about 26 percent over the company's share price before the offer became public, and the certainty that comes with an all-cash bid.

ISS said that if shareholders don't take the offer, they have to be willing to continue to hold shares in Dell as it continues to transform itself amid the risks of a still deteriorating personal computer industry.

The special committee of Dell's board evaluating the company's options said in a statement that it was pleased with the recommendation, noting that it believes not going forward with the sale would expose the company and its shareholders to "serious risks" that would further reduce the company's value.

Icahn said Sunday that he believes Michael Dell is trying to buy the company he founded at a "bargain price." He reiterated the benefits of his alternate proposal, which would involve the repurchase of up to 1.1 billion Dell shares at $14 apiece.

Icahn's plan would be funded with $5.2 billion in debt, $7.5 billion in Dell cash and $2.9 billion from the sale of Dell receivables. Icahn has said he and his affiliates have $5 billion in existing equity and proposed debt financing to help fund their proposal.

Dell shares rose 38 cents, or 2.9 percent, to $13.40 in midday trading — a quarter below the offer price of $13.65.

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UK to charge 3 more journalists in bribery probe

LONDON — British officials are charging three more journalists and a prison officer in an ongoing investigation into bribery of public officials.

The Crown Prosecution Service said Monday that two journalists — Lucy Panton, former crime editor at the News of the World, and Thomas Savage, deputy news editor at the Daily Star on Sunday — will be charged with conspiring with prison officer Scott Chapman to commit misconduct in a public office.

Chapman allegedly sold information about a high-profile prisoner to a number of British tabloids between March 2010 and June 2011.

Prosecutors also are levying the same charge at The Sun newspaper's Chris Pharo, for allegedly authorizing payments to public officials between January 2006 and December 2010. He was news editor of the tabloid at the time.

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