Sunday, August 25, 2013

Microsoft, Motorola set for second round of trial over patents

By Bill Rigby and Dan Levine
SEATTLE (Reuters) - Microsoft Corp takes on Google's Motorola Mobility unit this week in the second of two landmark trials between the companies that delve into hot disputes over the patents behind smartphone and Internet technology.
The jury trial, starting Monday in federal court in Seattle, is set to resolve whether Motorola breached its contract with Microsoft to license on reasonable terms its so-called standard essential patents, covering wireless and video technology used in the Xbox game console.
The proceeding comes days after Microsoft Chief Executive Steve Ballmer unexpectedly announced his retirement. It also follows a complex trial last November that decided what the appropriate fee for Microsoft's use of Motorola-patented technology should be.
After five months of deliberation, U.S. District Judge James Robart came down heavily in Microsoft's favor, saying it owed only a fraction of the royalties Motorola had claimed, suggesting the appropriate rate was about $1.8 million, above Microsoft's estimate of $1 million, but well below Motorola's demand for as much as $4 billion a year.
Motorola cannot appeal Robart's April ruling until after the jury decides the second phase of the case.
In a court filing, Microsoft said it had offered to pay Motorola $6.8 million in past royalties, based on its application of Robart's order. However, Motorola rejected the money, the filing said.
In the forthcoming trial, starting with jury selection on Monday, Microsoft will argue that Motorola's initial demand was exorbitant and a clear breach of its agreement to charge reasonable and non-discriminatory terms - commonly referred to as 'RAND' - for technology that is an industry standard.
Microsoft and Google declined comment on the trial.
After the result of the first trial, Motorola may have an uphill task in persuading a jury that it did not breach its contract. But Microsoft might not be able to recover huge damages, either.
"I think the interesting question is, assuming the court finds that Motorola breached its obligation to offer a RAND license, what is the remedy?" said Mark Lemley, a Stanford Law School professor who has been following the litigation. "No court has addressed that issue before."
In its quest for damages, Microsoft will introduce evidence about how much it had to spend to relocate a facility in Germany as a result of an injunction that Motorola won in Europe, according to court filings. Robart later ordered Motorola not to enforce that injunction, and Microsoft claims it should be reimbursed.
Microsoft will also seek legal fees resulting from the injunction fight.
The argument between Microsoft and Motorola - and by extension Google, which now owns it - is just one facet of a wide-ranging global patent war surrounding smartphone and Internet technology that has drawn in Apple Inc, Samsung Electronics Co, Nokia and others.
At heart, the companies are arguing over who owns the technology and design features behind smartphones, which are now essentially small computers.
More particularly, Microsoft has been locked in a battle with Google to ensure that handset makers using Google's free Android phone operating system pay Microsoft a license fee. Most large handset makers, such as Samsung, LG and HTC, have agreed to pay Microsoft a royalty on Android handsets that Microsoft believes may infringe on its patents. Motorola, which was bought by Google last year for $12.5 billion, is the last big holdout.
Robart gave each side 16 hours of trial time to present their case to a jury.
The case in U.S. District Court, Western District of Washington is Microsoft Corp. vs. Motorola Inc., 10-cv-1823.
(Reporting by Bill Rigby in Seattle and Dan Levine in San Francisco; Editing by Ken Wills)

Amgen close to buying Onyx for $125 per share: sources

By Soyoung Kim
(Reuters) - Amgen Inc (AMGN) is close to buying Onyx Pharmaceuticals Inc (ONXX) for $125 per share, or more than $10 billion, in a deal that is expected to be announced as soon as Monday, two people familiar with the matter said on Saturday.
A deal, which is still being finalized and would require board approval from both companies, would represent the fifth-largest biotechnology deal in history.
The proposed takeover would value Onyx at 13 times the company's expected revenues for next year, one of the richest valuations in biotech takeovers, one of the people said.
The people asked not to be identified because the matter is not public. Representatives for Amgen and Onyx could not be immediately reached for comment.
The acquisition of Onyx would give Amgen full rights to Kyprolis, the new multiple myeloma drug that analysts expect to reach annual peak sales in excess of $2 billion.
Amgen would also gain a revenue stream from the liver and kidney cancer drug Nexavar that Onyx shares with Bayer AG, as well as royalty payments on Bayer's much newer colon cancer drug Stivarga and potential future royalties on an experimental breast cancer drug being developed by Pfizer.
A deal in the $10 billion range would be Amgen's biggest since its $16 billion acquisition of Immunex in 2001 that gave it the rheumatoid arthritis drug, Enbrel, which is one of Amgen's most important, biggest-selling products.
It would be by far the biggest deal under CEO Bob Bradway, who took over the top spot in May 2012. He has done a handful of much smaller deals, the biggest to date being a $1.16 billion acquisition of Micromet.
Onyx shares closed at $116.96 on Friday. Amgen offered to pay $120 per share for the company in June but Onyx said that bid significantly undervalued the company and put itself up for sale.
An Onyx deal would also give Amgen a much higher profile in oncology. Several of its current drugs offer supportive care for cancer patients, such as to treat anemia or decreases in white blood cells caused by chemotherapy.
Another of its newer medicines, Xgeva, helps prevent fractures in patients whose cancers have spread to the bone. Its one product that treats cancer, the colon cancer drug Vectibix, has largely been a disappointment.
Analysts are expecting Onyx revenue to reach $878 million in 2014, according to Thomson Reuters I/B/E/S.
Geoffrey Porges, long-time biotech analyst for Sanford Bernstein, projected that an Onyx acquisition would boost Amgen revenue by 5 percent to 6 percent near term, rising to 20 percent by 2021.
He sees Amgen EPS declining by 3 percent to 4 percent in 2014 with the purchase of Onyx, but increasing by 8 percent in 2016 and growing to an increase of 22 percent in 2019.
Two of Amgen's biggest products - the anemia drugs Aranesp and Epogen - have been in decline for years, while others are fairly mature at this point.
The New York Times first reported on Saturday that the two companies were near a deal.
(Reporting by Soyoung Kim in New York; Editing by Gunna Dickson and Xavier Briand)

Central bankers debate risks of withdrawing global liquidity

By Pedro da Costa and Alister Bull
JACKSON HOLE, Wyoming (Reuters) - Global financial stability is at risk as central banks draw back from ultra-easy policies that have flooded the world with cash, because emerging markets lack defenses to prevent potentially huge capital outflows, top officials were warned on Saturday.
Central bankers from around the world, devoting the second day at their annual Jackson Hole policy retreat to the threats posed by global liquidity, heard two academic papers on the challenges, sparking a debate on actions and on coordination.
Bank of Japan Governor Haruhiko Kuroda told the audience, which included top officials from advanced as well as emerging economies, that the bold measures he had championed to spur his nation's moribund economy were bearing fruit.
"The bank's (policy) has already started to exert its intended effects," Kuroda said. The Bank of Japan has embarked on an aggressive bond-buying campaign to lift inflation in his country to 2 percent.
Easy money policies used to depress interest rates in Japan, Europe and the United States had sparked a flood of capital into emerging markets as investors sought higher returns.
Now, however, the U.S. Federal Reserve has said it plans to reduce its bond-buying stimulus by year end, with an eye toward drawing it to a close by mid-2014.
Federal Reserve Bank of Atlanta President Dennis Lockhart made clear that tapering could begin next month, provided the economic news between now and then was not dramatically bad.
"I can get comfortable with September, providing we don't get any really worrisome signals out of the economy between now and the 18th of September," he told Reuters in an interview, referring to the Fed's next meeting, which is on September 17-18.
Concerns over Fed tapering has sparked an exodus of cash from emerging markets, including India and Brazil, whose currencies and stock markets suffered steep losses this week.
"Amplifications, feedback loops and sensitivity to risk perceptions will complicate the task of exit and necessitate very close and constant dialogue and cooperation between central banks," Jean-Pierre Landau, a former deputy governor of the Bank of France, warned in his presentation.
Turkish Central Bank Governor Erdem Basci attended the conference, but his Brazilian counterpart, Alexandre Tombini, canceled in order to stay home and deal with the crisis.
Tombini was replaced in Jackson Hole by his deputy, Luiz Pereira, who argued that a tapering of the Fed's bond purchases might actually be a net benefit for emerging economies if it signaled that the U.S. economy was picking up steam. A stronger United States should spell stronger demand for exports from emerging economies, including Brazil.
Landau argued that central banks in advanced economies had cooperated successfully during the 2007-2009 financial crisis, when they coordinated on interest rates cuts and set up currency swap lines. As a result, they could do so again in the future with an eye toward moderating the spillovers from their actions.
But, he acknowledged it would be difficult to get agreement to subordinate national priorities in advance, a point echoed by others.
"How much should domestic monetary policy restrain itself for the stability of global (conditions)?" asked Allan Meltzer, a Fed historian and professor at Carnegie Mellon University. "That's a fundamental problem for monetary policy."
Lockhart said the Fed had a legal obligation to focus on domestic U.S. goals, but allowed that there could be circumstances when the international impact of its actions could be taken into account.
"If a policy maker in the United States believed that the global consequences of taking a domestic action would spill back over into the U.S. economy in a very negative way, that clearly is within the scope of consideration," he said in the interview.
There was also discussion about the need for emerging market nations to develop tools to control credit flows. Without such tools, these countries could lose the ability to control domestic financial conditions with monetary policy.
But Terrence Checki of the New York Fed cautioned that monetary policy may not be the best way to deal with financial excesses, and others said domestic priorities should not be subordinated to international obligations.
Don Kohn, a former Fed Vice Chairman and a candidate for the top job when Fed Chair Ben Bernanke's term ends in January, countered the claim that monetary policy might be too loose globally, citing elevated jobless rates in rich countries.
"One of the ways that monetary policy of the United States was transmitted was by resistance to exchange rate appreciation in other countries," he said, voicing a familiar Fed argument that emerging economies could better absorb easy U.S. policy if they allowed their own exchange rates to fluctuate.
(Writing by Alister Bull; editing by Gunna Dickson)

Prominent names behind Genting bus company

The company's silence on the tragedy is understandable, seeing who's behind the firm.

KUALA LUMPUR (Aug 23):  Two days after one of the country's deadliest bus accidents, the company that owns the Genting yellow bus that plunged down a ravine in Genting Highlands and killed 37 people has maintained a stoic silence.

Meanwhile, a visit to the Genting Highlands Transport Sdn Bhd office in Jalan Segambut this morning drew a blank.

A company representative closed the door on our reporter saying "we have not made any statements and will not be making any comments to the media".

Looking at who's behind the firm, may shed some light on her anxiety due to a possible public relations disaster if the information trickling out is not managed prudently.

While the company that was registered in 1970 has various stakeholders, one name raises eyebrows – the Noah Foundation (see SSM documents below).

At 86,433 shares, Noah Foundation – established in the name of Tan Sri Mohamed Noah Omar – the grandfather of Prime Minister Datuk Seri Najib Razak – is the second biggest stakeholder in the company.

Another prominent name that cropped up in SSM-listed documents was Datuk Mohamad Ashfar Ali – the president of the Pan Malaysia Bus Operators Association (PMBOA) – who is listed as one of the company’s four directors.

The other three named were Lee Hoi Chong, 72, from Kajang, Selangor;  Yee Kee, 64, and Chen Mei Kuan, 47, both from Bukit Damansara, Kuala Lumpur (at different addresses).

Mohamad Ashfar, 61, of Taman Tasik Titiwangsa, Kuala Lumpur, has been very vocal in calling for an end to government-designed monopolies which are muscling out traditional stage and express bus operators.

The other shareholders of Genting Highlands Transport are Syarikat Central Pahang Omnibus Bhd which owns the lion’s share of 189,000 shares; Omnifi Holdings Sdn Bhd which holds 262 shares and Lee Kam Yong, Lee Kee Chong and company director Chen with 100 shares each.

A Yap San Chik holds 2,000 shares, while Chong Soo Chye, Lee Ah Kong, Gui Shew Chan, Lee Hoi Chong and Phang Kit own one share each as listed in the company profile.

Mohamad Ashfar and Yee Kee are also directors of Syarikat Central Pahang Omnibus, along with three others. Yee Kee is one of three directors of Omnifi.

The Noah Foundation was established on March 1, 1973 when Mohamed Noah, the father of Najib’s mother Toh Puan Rahah was 76-years-old.

It gives out scholarships as well as disaster relief. Its chairperson is Datin Faridah Abdullah – Mohamed Noah’s eldest granddaughter and Najib’s first cousin.

The Foundation’s diversified investments include shares in Resorts World Bhd. The sole mosque in Genting Highlands, the Yayasan Mohammad Noah Mosque was built by the foundation in 1981.

Mohamad Ashfar, when contacted by, did not wish to comment.

Instead, he asked: "Am I? (the director of the company),” before stressing that he had nothing to say at this point in time.

The Prime Minister’s Office (PMO) meanwhile, has yet to respond to calls.

Walmart’s Latest Scheme to Replace the Middle Class With an Underclass Forced to Buy its Shoddy Goods

This article was published in partnership with the Institute for Local Self-Reliance .
Almost 30 years ago, as the U.S. was bleeding jobs, Walmart launched a “Buy America” program and started hanging “Made in America” signs in its 750 stores.  It was a marketing success, cementing the retailer’s popularity in the country’s struggling, blue-collar heartland.  A few years later, NBC’s Dateline revealed the program to be a sham .  Sure, Walmart was willing to buy U.S.-made goods — so long as they were as cheap as imports, which, of course, they weren’t.  Dateline found that Walmart’s sourcing was in fact rapidly shifting to Asia. 
This year, Walmart is back with a new “Buy America” program.  In January, the company announced that it would purchase an additional $50 billion worth of domestic goods over the next decade.  This week, Walmart is convening several hundred suppliers, along with a handful of governors, for a summit on U.S. manufacturing
This sounds pretty substantial, but in fact it’s just a more sophisticated and media savvy version of Walmart’s hollow 1980s Buy America campaign.  For starters, $50 billion over a decade may sound huge at first, but measured against Walmart’s galactic size, it’s not.  An additional $5 billion a year amounts to only 1.5 percent of what Walmart currently spends on inventory.
Worse, very little of this small increase in spending on American-made goods will actually result in new U.S. production and jobs.  Most of the projected increase will simply be a byproduct of Walmart’s continued takeover of the grocery industry.  Most grocery products sold in the U.S. are produced here.  As Walmart expands its share of U.S. grocery sales — it now captures 25 percent, up from 6 percent in 1998 — it will buy more U.S. foods.  But this doesn’t mean new jobs, because other grocers are losing market share and buying less.  What it does mean is lower wages.  As I reported earlier this year, Walmart’s growing control of the grocery sector is pushing down wages throughout food production
Groceries now account for 55 percent of Walmart’s U.S. revenue, up from 24 percent in 2003.  The company is planning to grow that ratio even further, with about 100 Neighborhood Market stores (Walmart’s new-ish supermarket format) in the pipeline this year alone, along with 125 new supercenters.  So we can expect that at least half of Walmart’s new spending on U.S. goods will be for groceries, with no net gain in jobs and, very likely, a further decline in wages. 
As for the rest, to a large extent, Walmart is simply taking credit for a shift that has already happened.  Over the last few years, U.S. manufacturing has undergone a modest revival, owing mainly to rising labor costs in China.  Unfortunately, it’s not at all clear that this revival will do much to resurrect the American middle class, because a lot of the new production is highly automated and located in the anti-union South. 
This is especially true for the companies supplying Walmart.  Take 1888 Mills, a Georgia towel maker that has a new (and much-publicized) contract to produce American-made towels for Walmart.  The company, which plans to maintain its overseas workforce of 14,000 for the bulk of its production, will be adding only 35 jobs at its U.S. factory to meet Walmart’s multi-year purchase agreement.  The jobs pay $12-14 an hour.  
In a way, Walmart’s Buy America program represents the home stretch of the economic transformation the company set in motion decades ago, when it set out to replace the American middle class, rooted in small business ownership and unionized jobs, with a vast underclass that has little choice but to rely on the shoddy, short-lived products sold at big-box stores to get by.

Some U.S. Farmers Planning To Hike Food Prices To Pay For Cost Of Health Care Law -Rpt

WARNING: Silicon Valley Is Fighting A No-Win Battle Against Six Fatal Headwinds — Cultural, Political And Ideological Trends Now Hard-Wired Deep Within America’s Collective Brain, Psyche, Soul

Warning: Silicon Valley is fighting a no-win battle against six fatal headwinds — cultural, political and ideological trends that have become hard wired within America’s collective brain, psyche, soul.
These headwinds are making it virtually impossible for our best ’n’ brightest innovation and technology geniuses to save America from becoming a second-rate superpower trapped in a no-growth economy.
OK, so you don’t believe it? You’re a Silicon Valley superoptimist? Got lots of tech stocks? Believe technology is already building a new world? Saving the future? You’re convinced our best ’n’ brightest innovators, entrepreneurs and capitalists will save us, the whole world, civilization, the planet?
Wrong. High-tech solutions cannot and will not prevent America’s economic growth’s collapsing from an average of greater than 2% GDP growth beginning in 1750, with the Industrial Revolution, but ending a generation ago. America’s GDP is already collapsing. Now, growth is a weak 1.8% on average. Worse, America’s GDP is predicted to sink much further — down near the no-growth 0.2% GDP common on the planet for the years and centuries prior to 1750.
New Silicon Valley innovations can’t stop a collapsing economy
The clear message in economist Robert Gordon’s must-read National Bureau of Economic Research paper, “Is U.S. Economic Growth over?” is that Silicon Valley can’t maintain the economy on its own. His paper is guaranteed to make investors lapse into denial if not cardiac arrest, especially hard-core high-tech fans convinced that technology is indeed the miracle worker that can solve all problems and will save the world.
Until we all wake up, the Gordon deniers are good company: Federal Reserve Chairman Ben Bernanke, in fact, recently dismissed Gordon, saying, according to Bloomberg News: “Pessimists may be paying too little attention to the strength of the underlying economic and social forces that generate innovation in the modern world.
“Trade and globalization increase the size of the potential market for new products, the possible economic rewards for being first with an innovative product or process are growing rapidly.”
Yes, Bernanke believes in the eternal-growth myth.
Old-school economists sinking America’s future
Bernanke is trapped in old-school classical economics; it works in theory, fails in practice. Gordon opens with a direct challenge to that core classical principle of perpetual growth: His paper “questions the assumption, nearly universal since Solow’s seminal contributions of the 1950s, that economic growth is a continuous process that will persist forever.” For that Robert Merton Solow won the 1987 Nobel Prize in economics. Gordon deserves one, too.
Gordon’s challenge: “There was virtually no growth before 1750, and thus there is no guarantee that growth will continue indefinitely.”
Rather, he says, “the rapid progress made over the past 250 years could well turn out to be a unique episode in human history,” a collection of “one-time-only inventions” that Silicon Valley cannot and will not repeat.
Warning: Collapsing economic growth ahead
Early this year, in a Bloomberg Markets report, Gordon delivered his downbeat message to the upbeat Davos World Economic Forum. Jeremy Kahn wrote: Gordon “doesn’t mean ‘over’ in some happy-days-aren’t-quite-here-again-yet-just-wait-another-quarter kind of way. He means ‘over’ as in finished, finito, happy days ain’t never coming back.”
“Never”? Why so brutal? Gordon said: “Future growth in real GDP per capita will be slower than in any extended period since the late 19th century. … The inevitable decline in future growth required by the need to reduce government and consumer debt will guarantee a contentious political landscape not just over the next year but over the next several decades.”
Bloomberg Markets asked for bond king Bill Gross’s reaction to Gordon’s challenge: “A 1% differential means a lot in terms of unemployment. … Corporate profits grow more after overall economic growth hits 2%. Below that, they stall out.” Translation: America is heading into a “new, new normal” of low corporate profits and a downhill slide of gross domestic product into a growth cycle so anemic that investors will lose interest and stocks will just keep sinking.
Economist Tyler Cowen also “shares Gordon’s belief in a technological plateau,” adds Kahn. In his book “The Great Stagnation,” Cowen refers to the work of Pentagon physicist Jonathan Huebner, who looked at innovations per capita throughout history: “Huebner found that the rate peaked around 1873, in the early years of the Second Industrial Revolution. Declining innovation slows per capita productivity gains and, in turn, economic expansion.”
In recent years challenges paralleling Gordon’s were raised in many journals, including Foreign Policy and Foreign Affairs, and in an American Interest feature, “The Ends of Growth.” A new consensus emerges: Solow’s economic principle of “perpetual growth” is absurd. But until the next global catastrophe exposes its absurdity, it will be revered by old-school economists, bankers, CEOs, Big Oil, climate-change deniers and capitalist ideologues everywhere because it supports their short-term-profits strategies and lobbying efforts in Washington.
Death of Silicon Valley’s high-tech magic
“Whatever the future of innovation,” says Gordon, “the U.S. economy still faces six daunting headwinds that will limit future potential growth and hold it below the pace which innovation would otherwise make possible.”
Despite the limits of his data, spanning eight centuries and multiple continents, Gordon’s work is rock-solid, an aggressive challenge to the misleading economic principle of “perpetual growth,” whose origins began in with the Industrial Revolution. Problem: “The fact that so many fundamental one-time-only inventions have already occurred limits the potential for a continuing stream of equally basic inventions,” including those past achievements “conversion from rural to urban life, the speed of travel, the temperature of rooms, and the near-elimination of brute-force manual labor.”
What about some new “one-time-only inventions?” Unlikely.
Last week in James Glanz’s New York Times column, headlined “Is Big Data an Economic Big Dud?” Gordon compared Big Data to Big Oil: Gasoline “made possible a transportation revolution as cars replaced horses and as commercial air transportation replaced railroads. … If anybody thinks that personal data are comparable to real oil and real vehicles, they don’t appreciate the realities of the last century.”
Seriously, if you could only one chooses one, which would you pick: Facebook and Twitter or General Motors and Boeing?
Six fatal ‘headwinds’
In his NBER forecast of America’s future GDP growth, Gordon admits starting with a couple of biases favoring an optimistic outcome: First, he admits “pretending that the financial crisis did not happen” and, secondly, he allows that he is making a “heroic assumption that another invention with the same productivity impact of the Internet revolution is about to appear on the near-term horizon. Thus our starting point is quite optimistic.”
Gordon’s forecast begins with America’s average GDP growth rate of 1.8% from 1987-2007. From there, Gordon’s forecast is an “exercise in subtraction” with each of the following six headwinds reducing America’s future GDP growth by a percentage point, ultimately driving America’s future GDP down to 0.2%. Yes, that’s right back to where America’s economic growth rate was before 1750 and the Industrial Revolution.
Gordon’s NBER paper is a must-read, but here’s a summary of the six headwinds, as distilled by Bloomberg Markets:
1. Demographics: “As more and more U.S. baby boomers retire, the number of hours worked per person declines, and so does the growth in GDP per capita.” (Down goes GDP to 1.6%.)
2. Stagnant educational attainment: “The U.S lags behind other advanced industrial economies in reading, math and science.” (GDP growth drops to 1.4%.)
3. Rising income inequality: “From 1993 to 2008, the wealthiest 1% captured 52% of inflation-adjusted income gains.” (GDP falls to 0.9%.)
4. Globalization and information technology: “More and more skilled jobs in the U.S. are being automated or are shifting to low-wage countries. (Down further to 0.7% GDP.)
5. Energy and environment: “Possible U.S. efforts to combat global warming, such as a carbon tax, act as a drag on economic growth.” (GDP reduced to 0.5%.)
6. Massive household and government debt: “Spending money on debt repayments in the U.S. reduces funds available for productive economic activity. (GDP crashes at 0.2%.)
Gordon closes his NBER challenge on a lighter note: “There are more than enough provocative ideas in this article, but I conclude with another. My guess is that a Canadian or Swedish economist looking at the past and future of his or her country would not be nearly so alarmed. Why not? What are the differences in environment, resources, legacy history, policies, and culture that create their relative optimism? Experts [in other countries] are welcome to contribute their own reactions to this diagnosis of the successful ‘American century’ and the possibility that future economic growth may gradually sputter out.”

Second American Revolution Against Police State After Economic Collapse (Video Compilation)

The video compilation includes news reports and economic experts speaking of a pending economic collapse, clips and images of the militarization of police turning the U.S. into a SWAT-team nation, the unexplained massive government purchases of supplies, ammo and medicines the attempts to disarm Americans to which one officer says could lead to Americans rising up for the “second American revolution” after economic collapse.

Claire Rivero's Music - Lord Help Us Make This World A Better Place