DELTA TESTS AMENITIES: Delta Air Lines is testing all-coach flights with increased leg room, leather seats, laptop computer plugs and other "small but important and convenient amenities" for business travelers, the airline said Monday. Delta will test the service on flights between Atlanta and Houston and between Atlanta and Kansas City from today through Jan. 31. Customers also will receive a complementary newspaper in the morning and one free cocktail, beer or wine between 3 p.m. and 7 p.m.
AIRTRAN OFFERS AKRON DAILY: AirTran Airways will begin the only daily nonstop flights between Tampa International Airport and Akron, Ohio, on Feb. 11. The low fare airline said Monday it was responding to "overwhelming demand" for Saturday-only flights it started Nov. 8. AirTran is the seventh-largest carrier at Tampa International, carrying 5.6 percent of passengers.
ALLIANCE CAPITAL EXECS TOPPLED: Two top executives at Alliance Capital Management were ousted Monday, and the investment management company warned of a "high likelihood" that it will face sanctions and penalties for improper trading of mutual funds. The company requested the resignations of John D. Carifa, president, chief operating officer and director of Alliance Capital and chairman of the board of its mutual funds, and of Michael J. Laughlin, chairman of Alliance Capital's mutual fund distribution unit. "They had both senior and direct responsibility over the firm's mutual fund unit," said Lewis A. Sanders, Alliance Capital's chief executive.
RX NETWORK REQUEST DENIED: U.S. District Judge William Zloch in Miami refused to reinstate a license yanked by the Drug Enforcement Administration from a pharmacy that filled online orders for prescription diet pills without a doctor's visit. The civil actions taken against Rx Network are part of a DEA crackdown in an area of law the pharmacies claim is fuzzy. Rx Network attorney Sean Ellsworth said the company knew getting a preliminary injunction would be an uphill battle. "We are now focused on preparing for the upcoming administrative hearing where we will have an opportunity to present our full case," he said.
RESTAURANTS CEO RESIGNS: Avado Brands Inc., the financially troubled parent company of Don Pablo's Mexican Kitchen and Hops Grillhouse & Brewery, said Monday that company founder, chairman and chief executive Thomas Dupree Jr. had resigned. Replacing Dupree as interim CEO will be turnaround artist Kevin Leary of AlixPartners LLC; Robert Sroka will serve as acting board chairman. Both Avado chains have closed Tampa Bay area locations recently. Hops moved its headquarters earlier this year from Tampa to Madison, Ga., Avado's hometown. Avado's stock closed Monday at 15.5 cents per share, down 5.5 cents.
CSX CUTS UP TO 1,000 JOBS: CSX Corp. of Jacksonville will release 800 to 1,000 nonunion employees over the next six months as part of a plan to streamline its management structure and create a smaller organization. The railroad said Monday that the layoffs will cost $60-million to $80-million, which will be recognized over the next two quarters. After assessing its organization, the company said, it decided to streamline its management structure to no more than eight layers from as many as 11. "We will put managers and decisions closer to our customers, increase accountability at every level and establish a far more competitive cost structure," Michael J. Ward, the company's chairman, president and chief executive, said in the release.
BOND TRADING SHUTTERED: Because government offices close on Veterans Day, there will be no trading today in government bonds, treasury futures or treasury options. Foreign exchange futures also will not be available. All other commodities and equities will trade as usual.
FAO SAYS IT'S NEGOTIATING: FAO Inc. said Monday it was trying to resolve issues that caused its lenders to deliver a notice of default but couldn't guarantee that it would be able to negotiate better loan terms. The default notice said lenders no longer considered themselves obligated to give FAO - the owner of FAO Schwarz toy stores, as well as the Right Start and Zany Brainy stores - further loans or letters of credit, the company said. Shares in FAO fell 56 cents, or 32 percent, to close at $1.17 on the Nasdaq Stock Market. The company, which emerged from bankruptcy just over six months ago, said Friday it was exploring a sale of the company.
MICROSOFT SEEKS SETTLEMENT: Two days before key hearings, Microsoft Corp. said Monday it was still seeking a settlement of its antitrust case with the European Union. But the software giant struck a defiant tone in defending itself. Microsoft faces charges that it was trying to extend the dominance of its Windows operating systems into markets for servers and multimedia players. The company said it has submitted "a robust response" to the allegations along with "extensive evidence to illustrate that significant consumer choice exists in the server operating systems and digital media markets today."
U.S. SAYS BODY FLEX FAILS: The government charges that Body Flex, a weight loss program featured in television infomercials, does not help users quickly lose fat and inches off their waists, contrary to its claims. The Federal Trade Commission filed a lawsuit Monday against Body Flex in U.S. District Court in Los Angeles, saying the company made claims that aren't true. Body Flex spent $22-million this year to air its infomercial more than 2,000 times, claiming its program, which involves a breathing regimen and exercises with a plastic bar and elastic band, will help users drop four to 14 inches across six body areas in a week.
INSTRUMENT MAKER SUES J&J: Conmed, a Utica, N.Y., maker of powered surgical instruments, sued Johnson & Johnson in Manhattan federal court Monday, alleging that Johnson & Johnson's illegal tactics block Conmed from selling endoscopy devices to hospitals. Johnson & Johnson uses exclusive contracts with medical centers that bar purchases from competitors, Conmed said. Johnson & Johnson spokesman Marc Monseau said, "We believe our practices are consistent with all laws, guidelines, and regulations."
T-BILL AUCTIONS MIXED: The Treasury Department sold $16-billion in three-month securities at a discount rate of 0.935 percent, down from 0.940 percent last week. An additional $16-billion was sold in six-month bills at a rate of 1.040 percent, up from 1.025 percent. In another auction, yields on three-year Treasury notes rose to 2.625 percent, the highest rate since May 12, 1998, when they sold for 5.633 percent. Some $24-billion in notes were sold. The Federal Reserve said Monday that the average yield for one-year constant-maturity Treasury bills rose to 1.35 percent last week from 1.30 percent the week before.
INTEL, AMD DISPUTE IN TOP COURT: The Supreme Court will hear a dispute between Intel Corp., the world's largest computer chip maker, and rival Advanced Micro Devices Inc. over rules forcing U.S. companies to turn over confidential records to foreign regulators. A federal law allows U.S. judges to help people or governments obtain information for use in foreign or international tribunals. AMD argues that it is entitled to Intel documents to give to the European Commission, which is investigating whether Intel improperly kept other companies from winning market share in Europe. The case dates back to 2001.
HOME SALES OUTLOOKS CLIMB: Freddie Mac boosted its 2004 and 2005 forecasts for home sales, price gains and loan volume, saying mortgage rates will stay close to historic lows through next year. Freddie Mac said 7-million new and existing single-family homes likely will sell in 2004, 2.9 percent higher than last month's forecast of 6.8-million. The mortgage buyer expects 7.13-million home sales in 2003. In 2005, the company expects 6.7-million single-family home sales.
BARNES & NOBLE CHALLENGED: Barnes & Noble Inc.'s bid to buy its unprofitable Internet unit for $115-million is being challenged in court by a Barnes & Noble.com shareholder who contends the $2.50 per-share offer is inadequate. Eugenia Gladstone Vogel says in a suit filed in Wilmington, Del., that the Internet bookseller's directors have been unduly influenced by Barnes & Noble. Barnes & Noble "has tried to take advantage of the fact that the market price of Barnes & Noble.com stock does not fully reflect the progress and future value of the company," Vogel says in her suit, which asks a judge to block the purchase.
Earnings
Tyson Foods Inc.: The world's largest meat company said fourth quarter earnings rose 75 percent despite lower sales as the company reaped the benefits of changes to operations and products. Analysts surveyed by Thomson First Call had forecast earnings of 37 cents per share. For the fiscal year, earnings totaled $337-million, or 96 cents per share, compared to $383-million, or $1.08 per share, a year earlier. Sales for fiscal 2003 were $24.55-billion, up from $23.37-billion.
