In the Region US Air Machinists split over wage...

BUSINESS DIGEST

August 29, 2002

In the Region

US Air Machinists split over wage, benefit concessions

US Airways' largest union split on wage and benefit concessions today, with mechanics rejecting the cuts and fleet workers accepting them.

The carrier, which has filed for Chapter 11 bankruptcy protection, had sought $219 million in annual savings as part of a $1.2 billion cost-cutting plan.

The International Association of Machinists, which represents about 12,000 workers, voted separately on the concessions. Fleet workers, who load luggage and freight, approved the concessions by a 62 percent margin; mechanics and related workers rejected the proposal by a 57 percent margin.

The vote was intended to allow US Airways to gain access to $175 million in financing that is part of a larger $500 million package, according to court records.

Former hotel guests get coupons in energy-fee flap

Marriott International Inc., Starwood Hotels & Resorts Worldwide and two other chains agreed to provide more than $61 million in discount coupons to settle lawsuits by lodgers who paid energy surcharges during stays last year in California and 11 other states.

Marriott, the largest U.S. hotel company; Starwood; Hilton Hotels Corp.; and Hyatt Hotels Corp. didn't tell guests in advance about the fees of up to $3.50 a night, said the suits, which were combined as a class action in state court in Los Angeles. The hotels imposed the charges to offset soaring electricity bills during the energy crisis in the western U.S. in 2001 and late 2000.

The hotel chains agreed to mail more than 6.15 million $10 discount certificates to people who stayed at the hotels last year.

Elsewhere

Americans eating more shrimp than tuna, for first time

For the first time in recorded history, Americans are eating more shrimp than canned tuna, the National Oceanic and Atmospheric Administration proclaimed yesterday. Records go back to the mid-1950s.

The National Marine Fisheries Service's annual assessment of the population's piscatorial preferences showed that Americans ate a record average of 3.4 pounds of shrimp last year, up from 3.2 pounds the year before.

During the same period canned tuna - long the reigning seafood - plunged from 3.5 pounds per capita to 2.9 pounds. Randi Thomas of the U.S. Tuna Foundation said that growing sales of fresh tuna account for some of the decline in sales of the canned product.

Philip Morris' dividend boosted to yield 5.19%

Philip Morris Cos. raised its dividend yesterday, giving it the second-highest yield in the Dow Jones industrial average. The world's largest cigarette maker also named Chief Executive Officer Louis Camilleri as chairman.

The payment was boosted by 10 percent, increasing the yield to 5.19 percent, Philip Morris said. The company, which has increased the payment for five consecutive years, will pay investors about $5.1 billion in dividends this year.

Investors are buying shares of companies paying higher dividends while seeking relief from the declines in stock indexes such as the Dow in the past year. Philip Morris, whose products range from Marlboro cigarettes to Velveeta cheese, has tripled its dividend payout since 1992 and its profit has risen in eight of the past nine years.

Ex-stockbroker pleads guilty to fraud charges

A former stockbroker accused of bilking his clients out of millions of dollars pleaded guilty yesterday in Cleveland to federal charges that he misused more than $50 million of his clients' money.

Frank Gruttadauria, 44, pleaded guilty to charges of securities fraud, mail fraud, identity theft and making false statements to a bank.

Between 1987 and 2001, Gruttadauria sent out false statements to at least 28 customers, mostly wealthy investors, about the status of their investment accounts and shifted money among accounts to cover up losses. His false statements overestimated the value of customer accounts by more than $270 million, investigators said.

He will serve from 6 1/2 to eight years in prison under a plea agreement, his attorney said.

Napster seeks approval of its proposed sale

Bankrupt Napster Inc. plans to seek a Delaware court's approval today of its proposed sale to Bertelsmann AG, which hopes to revive the silenced Internet music-sharing service.

No other bidders emerged for Redwood City, Calif.-based Napster after German-based Bertelsmann forced the company into bankruptcy in June. Bertelsmann values its bid for Napster at about $100 million, including debts that are to be waived as part of the deal.

CEO, 10 others buy shares in besieged Crown Castle

Crown Castle International Corp.'s chief executive officer and 10 other insiders bought $1.35 million in stock earlier this month, expressing support for the owner of communications towers as shares hit record lows.

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