AUTOMOTIVE

BMW finishes No. 1 in quality survey

Detroit —- Luxury brands again dominated an annual U.S. automobile quality survey by a California research company, but total quality dropped for the first time in four years. BMW led all brands in the results released today by San Diego-based Strategic Vision Inc., followed closely by Hummer, Mercedes-Benz, Audi, Infiniti, Lexus, Land Rover, Cadillac, Lincoln and Volkswagen. Volkswagen AG, which includes Audi, led all corporations with a total quality index score of 892 out of 1,000 possible points. General Motors finished second as a corporation at 867, followed by Ford and Honda, which tied for third at 862.

DEALS

Developer of gene drugs makes deal

A developer of an emerging class of drugs designed to shut off genes that trigger disease has reached its second potential $1 billion deal with a large pharmaceutical company in less than a year. Massachusetts-based Alnylam Pharmaceuticals Inc. on Tuesday announced a drug-licensing partnership with Japan's Takeda Pharmaceutical Co. Ltd., an agreement similar to a nonexclusive deal it reached last summer with Switzerland-based Roche. There is growing interest in development of so-called RNA interference technology from traditional pharmaceutical companies eager to supplement their slow-growing pipelines of drugs.

Chemtura starts buyout talks

Two private equity firms —- Blackstone Group and Apollo Management —- are in talks to acquire specialty chemicals company Chemtura Corp., The Associated Press reported Tuesday. Middlebury, Conn.-based Chemtura makes plastic additives and flame-retardant materials.

B of A to raise Chinese bank stake

Charlotte —- Bank of America Corp. said Tuesday that it plans to raise its stake in China Construction Bank Corp. to nearly 11 percent.

GE finds bidders for appliance unit

LG Electronics Inc. and Haier Group Corp. are among companies that may acquire General Electric Co.'s century-old appliances division, according to GE chief Jeffrey Immelt. "The players become very obvious," Immelt said at a meeting with business leaders in Seoul, South Korea, on Tuesday. "It's Haier in China, LG in Korea and so on. Of course, LG is one of the leading candidates."

FINANCIAL

Thrifts increase loan-loss reserves

Washington —- Federally regulated savings and loans set aside a record $7.6 billion to cover losses on problem loans in the first quarter. The Office of Thrift Supervision said Tuesday that the nation's 831 thrifts lost $617 million in the quarter, down from a profit of $3.61 billion in the same quarter a year ago. It was an improvement from the fourth quarter of 2007, when thrifts lost $8.75 billion. The agency's director, John Reich, said thrifts have aggressively been setting aside reserves to cover loan losses. "This forceful response to the housing market crisis continues to depress industry earnings, but it also strengthens institutions to withstand future challenges," Reich said in a statement.

Interest rates rise in Treasury auction

Washington —- Interest rates on short-term Treasury bills rose in Tuesday's auction to the highest levels in three months. The Treasury Department auctioned $25 billion in three-month bills at a discount rate of 1.870 percent, up from 1.855 percent last week. Another $23 billion in six-month bills was auctioned at a discount rate of 1.920 percent, up from 1.885 percent last week. Separately, the Federal Reserve said that the average yield for one-year Treasury bills, a popular index for making changes in adjustable-rate mortgages, rose to 2.09 percent last week from 2.07 percent the previous week.

SunTrust affiliate forms venture

Alpha Equity Management, an investment fund with ties to SunTrust Banks, said Tuesday that it has formed a joint venture with the Praedium Group, a real estate firm that focuses on buying properties in financial distress. SunTrust's asset management subsidiary, RidgeWorth Capital Management, bought a minority stake in Alpha Equity Management last year. New York-based Alpha Equity uses a "long-short" strategy in which it sells short, or bets against, stocks that it expects to decline in value, using the proceeds to boost its investments in companies it expects to rise in value. The joint venture will focus on investments in publicly traded real estate securities.

FOOD / BEVERAGE

Merger talk boosts SABMiller shares

Shares of SABMiller PLC, the world's third-largest brewer, rose the most in almost three years after The Financial Times reported that InBev NV is weighing a merger. InBev, the world's biggest brewer by sales, is considering an SABMiller deal as a Plan B should its potential $46 billion approach to Anheuser-Busch Cos. fail, the newspaper reported. Belgium-based InBev generates less than 1 percent of its total volume in the United States.

Investment firm buys stake in Cott

New York investment firm Crescendo Partners LP has bought 6.2 million shares, or 8.7 percent, of Canadian beverage firm Cott Corp., according to a recent Securities and Exchange Commission filing. In the filing, Crescendo said it believed Cott's stock was undervalued. It also said it was engaged with Cott in discussions to change the composition of the company's management team and board of directors. Cott's stock dropped by more than a third in February after Beverage Digest reported the company could have its shelf space reduced at Wal-Mart. Cott makes the store-brand carbonated soft drinks.

LEGAL

T-Mobile loses ruling on contracts

Washington —- The Supreme Court handed a defeat to T-Mobile USA Inc. on Tuesday, rejecting the company's appeal in three cases involving the legal remedies available in millions of cellphone contracts. The issue in the three cases was the same: whether state laws that limit the ability of companies to prohibit consumers from banding together to pursue class-action lawsuits are preempted by federal law. T-Mobile included a prohibition on class actions in a part of its contracts that also required consumers to resolve any complaints through arbitration.

Yahoo sues over Net lottery scam

Sunnyvale, Calif. —- Yahoo Inc. has filed a lawsuit against an unknown group of defendants it alleges tricked consumers into thinking they won a lottery or prize offered by the Internet company. In its federal court filing, Yahoo contends that the defendants masqueraded as the Internet company, sending out e-mails claiming recipients had won prizes ranging from a few thousand to a million dollars and instructing them to click on a link or forward personal information to a "Yahoo lottery coordinator" to get their prize. At times, recipients were instructed to contact another party to arrange for the prize payment, Yahoo said in the filing, and this other party would charge them "hundreds of dollars in various processing and mailing charges in order to complete the payment process."

Insider-trading case settled

A former Connetics Corp. executive agreed to pay $723,000 to settle regulatory claims he illegally traded on inside information about the maker of skin drugs and tipped off a friend. Alexander Yaroshinsky, the company's former vice president of biostatistics and clinical operations, settled the Securities and Exchange Commission's 2006 lawsuit without admitting or denying wrongdoing, the Washington-based agency said in a statement. The SEC had accused him of making trades and alerting his former neighbor after learning in 2005 that the Food and Drug Administration had concerns about Connetics' proposed acne drug, Velac Gel.

Express Scripts settles with states

Express Scripts Inc., the third-largest U.S. manager of drug benefits, will pay $9.5 million to settle a 28-state investigation into its business practices, including the switching of cholesterol drugs. The investigation began in 2004, the St. Louis-based company said Tuesday in a statement. Express said it has already changed its conduct and will need to make "only minor adjustments in certain procedures" to meet the terms of the agreement. About $200,000 of the money will go to patients to cover their expenses for switching between cholesterol drugs known as statins.

Boston Scientific loses patent case

Boston Scientific Corp., the second-largest maker of heart devices, was ordered by a federal jury to pay $250 million to Medtronic Inc. for infringing patents on catheters used to install stents and break up blockages. The jury in Marshall, Texas, delivered its verdict Tuesday after a weeklong trial and concluded the infringement was intentional, giving U.S. District Judge T. John Ward the option to increase the award by as much as three times to $750 million.

REAL ESTATE

Regulator protests pact on appraisers

Washington —- The regulator who oversees national banks is protesting an agreement by Fannie Mae and Freddie Mac to stop buying mortgages that use lenders' in-house appraisers, a pact intended to protect buyers from fraudulently inflated home prices. John Dugan, the U.S. comptroller of the currency, is asking for withdrawal of the agreement that the two mortgage finance companies negotiated with New York Attorney General Andrew Cuomo and their federal regulator, on grounds it violates federal law and could have an unintended negative impact on the mortgage industry. It would raise lenders' costs of making mortgages, Dugan contended in a letter Tuesday.

TECHNOLOGY

Problems delay Intel laptop chip

Intel Corp. said a new version of its Centrino laptop chip will debut later than it originally promised customers because of a minor problem. Some of the new chips will ship on July 14 and others will come out during the first week of August, missing an earlier target of the first half of 2008, said Tom Beermann, a spokesman for the Santa Clara, Calif.-based company. The delay was caused by a problem with the graphics elements of so-called chipsets, which support the processor and control other functions of the computer. A failure to validate a wireless Internet antenna on time also caused a holdup, Beermann said. "It doesn't change our outlook for the second quarter," Beermann said in a telephone interview. "We are taking some extra time to rescreen some parts to make sure they work properly."

Deal paves way for interactive TV

Washington —- Sony Electronics Inc. and top cable TV providers said Tuesday that they had resolved a technology dispute. Analysts and industry representatives hailed the deal as a breakthrough in the quest to offer TV viewers more Web-type interactivity, in many cases without the need for set-top boxes and remote controls. The agreement could lead to new interactive services, such as personalized programming guides, customized news and sports tickers, live on-screen chats during TV shows and far more video-on-demand options. Sony plans to incorporate the cable industry's interactive technology, called tru2way, into TVs that will allow people to plug the cable directly into the back of the set.

TRANSPORT

American rejects pilots' proposal

American Airlines rejected a proposed contract from its pilots union, saying the plan would boost recurring costs by at least $3 billion and threaten the carrier's economic stability. In addition to the recurring costs, proposals from the Allied Pilots Association would require the airline to immediately contribute $1 billion to its pension plan, American said Tuesday in a statement.

JetBlue puts off buying planes

New York —- JetBlue Airways Corp. said Tuesday that it will put off buying 21 Airbus jetliners it planned to receive starting next year for four to five years because of rising fuel costs. The A320 planes, originally scheduled for delivery between 2009 through 2011, will now be delivered in 2014 and 2015.