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Cell phone companies sued for "locking" handsets

| Tuesday, June 8, 2004

A consumer watchdog group sued three cell phone companies on Monday for "locking" their phones to make it harder for customers to switch carriers.

The Foundation for Taxpayer and Consumer Rights filed suit accusing AT&T Wireless Services Inc., T-Mobile USA Inc. and Cingular Wireless, of using software in their handsets that prevents them from being used on a competitors' network. The practice effectively thwarts recent federal regulations allowing people to retain their phone numbers when switching mobile carriers, according to the lawsuit, filed in Superior Court in Los Angeles. "If you can use the same phone number with other carriers, you should be able to use the same phone," said Jordan Lurie, an attorney representing the plaintiffs.

Stewart sentence delayed

A federal judge has delayed the sentencing of Martha Stewart until next month, giving lawyers for the celebrity homemaker time to prepare new legal papers aimed at winning her a new trial. Sentencing for Stewart and former stockbroker Peter Bacanovic, originally set for June 17, was rescheduled for July 8. The decision, made by the judge Friday, was confirmed Monday by prosecutors and defense lawyers. Lawyers for Stewart requested the three-week delay so they could draw up a motion arguing for a new trial after a prosecution ink expert was charged last month with lying on the witness stand.

Markets to close Friday

Most U.S. financial markets will close Friday in observance of the national day of mourning for former President Reagan. The New York Stock Exchange, Nasdaq Stock Market and American Stock Exchange will all be closed Friday. Trading for the week will end on Thursday, and resume on Monday, June 14. The markets have customarily closed in the past for presidents' funerals.

GM invests in China

Signaling its confidence in the booming Chinese economy, General Motors Corp. said Monday it plans to spend $3 billion in China over the next three years in a challenge to rival Volkswagen for dominance of the world's fastest-growing auto market. GM, the world's biggest automaker, said it will build new facilities to more than double its manufacturing capacity, introduce new vehicles and set up an auto-financing venture with its Chinese partner, Shanghai Automotive Industry Corp.

Microsoft talked merger

Microsoft Corp. began merger discussions with German software company SAP AG late last year, but the talks ended because Microsoft decided the deal would be too complex, Microsoft said Monday. In a news release, Microsoft said it had no intention of resuming the merger talks. The company said it was disclosing the discussions because it expects Oracle Corp. to bring them up in an antitrust trial over Oracle's proposed acquisition of rival PeopleSoft Inc. Microsoft said it discontinued the talks a few months ago.

Lionel to pay $40 million

A U.S. District Court jury in Detroit decided Monday that model train-maker Lionel LLC and others should pay $40.8 million to rival Mike's Train House Inc. for misappropriating its designs. Mike's Train House of Columbia, Md., sued Michigan-based Lionel in 2000, saying that Lionel sold trains made from designs stolen from a South Korean manufacturer hired by Mike's Train House. The jury found that Lionel, along with its supplier Korea Brass Co. Ltd. and an individual, Yoo Chan Yang, earned millions of dollars by misusing designs that belonged to Mike's Train House.

Casino merger proposed

Shares of Mandalay Resort Group surged 17 percent Monday as Wall Street speculated whether MGM Mirage Inc. would be able to pull off a multibillion buyout that would give it control of about half the hotel rooms on the Las Vegas Strip. MGM Mirage surprised the casino industry by offering $4.85 billion dollars in cash and the assumption of $2.8 billion in Mandalay debt late Friday after the markets closed. Few had expected the blockbuster offer even though MGM Mirage has been aggressively seeking acquisitions, especially in the United Kingdom.

Other business news:

  • Americans cooled off their credit cards in April, a factor in a slower rate of increase in borrowing for the month, the Federal Reserve reported Monday. Consumer credit rose at a seasonally adjusted annual rate of 2.3 percent in April, or by $3.91 billion, from the previous month.

  • The average U.S. retail price for regular-grade gasoline fell 1.7 cents the past week to $2.034 a gallon, as lower crude-oil costs led to the second decline since a record $2.064 two weeks ago, the U.S. Energy Department said.

  • iGate Corp. said it has sold two international subsidiaries -- iGate Australia Pty Ltd., and Direct Resources Scotland Ltd. for $10 million. The companies, which provided information technology staffing services, had combined revenue of about $47 million.

  • USA 3000 Airlines will add a flight to Ft. Myers, Fla., from Pittsburgh International Airport each Monday starting July 12, with fares as low as $69 each way, the discount carrier said Monday.

  • Pittsburgh-area stocks rose on Monday. The Bloomberg Pittsburgh Index of 67 stocks gained 3.84 to 219.09.

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