Business digest

NAPSTER CAN INVESTIGATE SONG RIGHTS: Napster Inc. can investigate whether the five major labels own the rights to songs they say the music-swapping service infringes, a judge ruled after settlement talks broke down. The labels -- AOL Time Warner, Sony, Bertelsmann, EMI Group and Vivendi Universal -- sued in 1999 claiming millions of Napster users were illegally trading copyrighted songs. Napster has barred music trading on its Web site since July and is testing a paid subscription service.

DIAGEO TO SPIN OFF BURGER KING: British drinks group Diageo PLC said it's ready to sell or spin off Burger King Corp. and that it expects to approach potential buyers next month for the Miami fast-food chain. Options being considered are a management buyout, a sale and an initial public stock offering. Diageo wants to concentrate on its lucrative alcoholic beverages business including Smirnoff and Johnnie Walker.

CIRCUIT CITY TO SPIN OFF CARMAX: Circuit City Stores warned fourth-quarter earnings for its Circuit City Group will be below expectations and said it plans to spin off its profitable CarMax division. Circuit City shares plunged about 30 percent, or $7.04 a share, to $16.55 on the news. CarMax trades as a tracking stock designed to reflect the used car seller's performance. It fell $2.51 to $26.

MICROSOFT DISCLOSES FLAWS: Microsoft Corp. has disclosed "critical" flaws affecting at least six products, including its Windows XP operating system and Internet Explorer browser. Three security flaws make users of XP, IE, and in some cases the Outlook and Outlook Express e-mail programs, vulnerable to online snoops, Microsoft said. Network administrators using the SQL Server 2000 database and Commerce Server 2000 for online sales also are at risk. Microsoft has made patches available on its Web site.

NEW INFLATION INDEX PLANNED: The government will offer an additional measure of consumer prices in August to address long-standing criticism that the current index overstates inflation. The new measure, called a superlative or chain consumer price index, will become part of the monthly consumer inflation reports in the form of a table. The CPI, the most closely watched inflation gauge, still will be the focal point of the Labor Department's monthly inflation reports and the basis for Social Security cost-of-living adjustments.

DOW ENDS WEEK WITH GAIN: Lured by lower prices, buyers returned to Wall Street at the end of a roller-coaster week, shrugging off concerns about an earnings warning from Circuit City and a federal investigation of Computer Associates' books. The Dow Jones Industrial Average was up 133.47, or 1.4 percent, to close at 9,968.15. The Dow had big swings all week, reversing a triple-digit loss Tuesday with a triple-digit gain Wednesday. Analysts don't expect the gains to hold, given the market's fluctuations so far this year and investors' ongoing worries about corporate earnings and bookkeeping.

FLORIDA TOURISM SLUMPED IN 2001: After a miserable fourth quarter, Florida tourism declined by 4 percent to 69.8-million visitors in 2001, according to Visit Florida Inc., state government's tourist marketing organization. Mostly because of the Sept. 11 terrorist attacks, fourth-quarter domestic traffic dropped 19 percent, the flow of Canadians declined 21 percent and the number of overseas visitors sunk 18 percent.

DEBARTOLO TO BUY TAMPA MALL: DeBartolo Property Group LLC, which is controlled by former San Francisco 49ers owner Eddie DeBartolo Jr., confirmed it is making a bid to buy Tampa Bay Center, an 895,000-square-foot regional mall in Tampa. The mall, owned by the Rouse Co. of Baltimore, closes this week, but its Sears Roebuck & Co. store will remain open until fall. DeBartolo executives declined to say how they would redevelop the property.

FINAL IMPLANT SETTLEMENT REACHED: Sulzer Medica and patients suing the company over defective hip and knee implants have reached a final agreement, and a judge extended an order barring individual lawsuits from proceeding. The parties had agreed to general terms of a $1-billion class settlement but had to work out details. Friday was the deadline for an accord. A judge extended a stay on individual suits to March 8 while lawyers finish drafting the deal that provides about $200,000 to each patient. Company lawyers have said Sulzer could face bankruptcy if forced to litigate more than 1,000 individual lawsuits.

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