Business Digest

BUSINESS DIGEST

January 11, 2003

In the Region

U.S. judge allows suits to proceed against Microsoft

A federal judge in Baltimore refused yesterday to dismiss antitrust suits alleging that Microsoft Corp. used its might to squeeze out an alternative to its Windows operating system as well as technology for streaming video online.

Chief U.S. District Judge J. Frederick Motz found "sufficient allegations" to warrant allowing lawsuits by Burst.com and defunct software maker Be Inc. to proceed.

Microsoft had sought to dismiss five claims filed by Burst.com, a Santa Rosa, Calif., company that makes technology for streaming movies and sounds. Be Inc. alleges that Microsoft pressured computer manufacturers such as Compaq Computer Corp. and Dell Computer Corp. not to install Be's rival BeOS operating system.

Sun Microsystems Inc., also was trying to persuade Motz yesterday to let its case go forward. Motz already has approved Sun's request to require that Windows include Sun's latest Java programming language pending resolution of the lawsuit.

USAir flight attendants agree to $26 million in cuts

US Airways Group Inc. flight attendants agreed yesterday to work-rule changes and benefit cuts that will save the seventh-largest U.S. airline about $26 million annually as it tries to emerge from bankruptcy. The flight attendants voted 55 percent in favor of the agreement, the union said.

Two other unions, the International Association of Machinists and Aerospace Workers and the Communications Workers of America, also were voting yesterday on the concessions, part of US Airways' effort to save $1.6 billion annually.

The Machinists agreed to a tentative deal late last month. US Airways' pilots already have accepted concessions of about $100 million.

New T. Rowe Price fund to protect against inflation

T. Rowe Price Inc. has introduced a bond fund designed to protect investors' income from inflation. The fund, the Inflation Protected Bond Fund, invests at least 80 percent of its assets in bonds of the same name, primarily issued by the U.S. Treasury.

An inflation-protected bond includes an inflation adjustment typically applied to the bond's principal, so when inflation is on the rise, both the bond's principal value and interest payments, calculated as a percentage of the bond's face value, increase, too.

Elsewhere

FleetBoston Financial to increase reserves, write off $500 million

FleetBoston Financial Corp., the parent company of Fleet Bank, said yesterday that it will write off about $500 million in loans and increase reserves by $300 million in the fourth quarter, reflecting losses in the merchant energy and airlines sectors.

Excluding the credit-related provisions, the company projected fourth-quarter earnings at about $600 million, or 57 cents per share, in line with analysts' expectations. The $800 million in fourth-quarter provisions are $450 million above the third-quarter level, FleetBoston said.

The company said three credits account for about $150 million of the write-offs - the bankruptcy of a major airline, trouble at a European energy company and FleetBoston's share of costs in an insurance dispute involving the bankrupt Enron Corp. that was settled recently by J.P. Morgan Chase & Co.

Kmart to seek court OK to close more stores

Kmart Corp., the largest U.S. retailer to file for bankruptcy protection, will seek court permission this month to close more stores to cut costs in an attempt to emerge from Chapter 11 this year.

The discount chain said it will finish evaluating its roughly 1,800 stores by mid-January and will request approval at a hearing Jan. 28.

This column was compiled from reports by Sun staff writers, the Associated Press and Bloomberg News.

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