AUTOMOTIVE

Chrysler to offer cheaper Challenger

Chrysler LLC said Monday that it will offer a less expensive and more fuel-efficient version of its 425-horsepower Dodge Challenger, a remake of the 1970s "muscle car." The 2009 Challenger SE will start at about $22,000 and get 25 miles per gallon on the highway, compared with $40,000 and 18 mpg for the most powerful model, the company said.

DEALS

Honeywell to sell unit to B/E

Honeywell International Inc. said Monday that it will sell an aerospace distribution unit to B/E Aerospace for $1.05 billion in cash and stock. Honeywell said the deal is expected to close in the third quarter and will include at least $800 million in cash and the rest in B/E common stock.

ECONOMY

Bernanke upbeat about long term

Despite a recent spike in the unemployment rate, the danger that the economy has fallen into a "substantial downturn" appears to have waned, Federal Reserve Chairman Ben Bernanke said Monday night. Addressing a Fed conference in Chatham, Mass., Bernanke said a government report last week showing the unemployment rate rising from 5 percent in April to 5.5 percent in May was "unwelcome." Although economic activity is "likely to be weak" during the April-to-June quarter, Bernanke said "the risk that the economy has entered a substantial downturn appears to have diminished over the past month or so."

FINANCIAL

Interest rates rise in Treasury auction

Washington —- Interest rates on short-term Treasury bills rose in Monday's auction, with rates on six-month bills climbing to the highest level since late February. The Treasury Department auctioned $24 billion in three-month bills at a discount rate of 1.850 percent, up from 1.820 percent last week. Another $24 billion in six-month bills was auctioned at a discount rate of 2.050 percent, up from 1.950 percent last week. Separately, the Federal Reserve said Monday that the average yield for one-year Treasury bills, a popular index for making changes in adjustable-rate mortgages, fell to 2.14 percent last week from a revised 2.19 percent the previous week.

Lehman to raise $6 billion in capital

New York —- Lehman Brothers Holdings Inc. said Monday that wrong-way trading moves and mortgage-backed securities caused it a nearly $3 billion second-quarter loss. Lehman's top executives will fund the firm's survival by raising $6 billion of fresh capital.

FOOD / BEVERAGE

Same-store sales rise at McDonald's

Oak Brook, Ill. —- McDonald's global same-store sales rose 7.7 percent in May, the world's biggest hamburger chain said Monday. The company said U.S. same-store sales, or sales at locations open at least a year, grew 4.3 percent. McDonald's said U.S. sales were helped by its breakfast offerings, new menu items, including a Southern Style Chicken biscuit and sandwich, and the chain's "emphasis on everyday affordability."

HOSPITALITY

CEO's son moves up at Marriott

Washington —- Marriott International has tapped the youngest son of Chief Executive Bill Marriott for a key position, raising more speculation about his future role in the company. David Marriott, 34, is viewed as the family member most likely to one day head up the company. Although Bill Marriott, who recently turned 76, says he has no plans to retire soon, that hasn't stopped rampant speculation about his successor. David Marriott will be the company's point man on full-service hotels in New York, Philadelphia, Baltimore and in a couple of smaller New Jersey cities.

Omni Hotel gets new boss

The Omni Hotel at CNN Center, one of the most heavily damaged buildings in the March 14 tornado that hit downtown Atlanta, has a new general manager. Jon Hunter, most recently director of operations at Omni Hotel in Jacksonville, has taken over the top position of the 1,070-room luxury property. "Jon will bring quality experience to our team, building on the hotel's presence in Atlanta's hospitality industry," Gary Froeba, regional vice president for the Omni Hotel at CNN Center, said in a statement. Hunter has been with Irving, Texas-based Omni for more than four years. In addition to his role in Jacksonville, he also has been director of operations at the Omni Hotel in Charlotte. The March twister blew out windows at the hotel and forced the Omni to pull several rooms out of inventory. Repairs are continuing.

LEGAL

Ruling curbs power of patent-holders

Washington —- The Supreme Court on Monday limited the ability of companies to collect multiple royalties on their patents, the latest step by the justices to scale back the power of patent-holders. The unanimous decision, which was helpful to customers of Intel Corp., involved a longtime Supreme Court doctrine that in recent years had been eroded by the U.S. Court of Appeals for the Federal Circuit in Washington, which handles patent cases nationally. Justice Clarence Thomas reined in the appeals court, saying that "for over 150 years the Supreme Court has applied the doctrine of patent exhaustion." The doctrine says the sale of an invention ends the patent-holder's right to control how the purchaser uses it.

Tobacco ruling to be reviewed

Washington —- The Supreme Court said Monday that it will review a $79.5 million punitive damages judgment against Philip Morris for the third time. The justices have twice struck down the award to the family of a longtime smoker of Marlboros, made by Altria Group Inc.'s Philip Morris USA. Oregon courts have repeatedly upheld the judgment

Court broadens whistle-blower law

Washington —- The Supreme Court ruled unanimously Monday that a whistle-blower law intended to expose fraud can be applied to subcontractors and other indirect recipients of federal funds. The case involved alleged contract fraud by a former unit of General Motors Corp. At issue was whether the False Claims Act covers any fraudulent claim paid for by government funds, or only fraudulent claims directly submitted to a government official. Justice Samuel Alito charted a middle path, saying the law can be used if fraudulent statements are ultimately intended to get the government to pay claims. The whistle-blower law does not apply in situations in which a subcontractor does not intend the government to rely on a fraudulent claim as a condition of payment.

MEDIA

Gannett to take major write-down

The nation's largest newspaper chain, Gannett Co., will write down its assets by about $2.5 billion to $3 billion this quarter to reflect the declining value of its operations in the United Kingdom and the United States. At a Deutsche Bank investor conference in New York, Gannett Chief Financial Officer Gracia Martore said much of the write-down reflects a declining value in Gannett's U.K. newspaper operation, Newsquest. It also generally reflects "where the market perceives traditional print businesses to be," she said. Shares of Gannett have lost roughly half their value in the last year.

Time Warner to cut movie output

Time Warner Inc. plans to reduce film production to increase profit at its movie studios, Chief Executive Jeffrey Bewkes said Monday. The company will reduce production to about half what it was two years ago, Bewkes said Monday at a Deutsche Bank conference in New York.

REAL ESTATE

Pending home sales increase

Pending home sales unexpectedly rose in April to the highest reading since October, but experts say the large proportion of distressed property sales will continue to weigh down prices. The National Association of Realtors' seasonally adjusted index of pending sales for existing homes rose to 88.2 from a March reading of 83.0. However, that's 13 percent below the April 2007 reading of 101.5.

FHA expects to lose $4.6 billion

Washington —- The Federal Housing Administration expects to lose $4.6 billion because of unexpectedly high default rates on home loans, an official said Monday. Brian Montgomery, the FHA commissioner, attributed the unanticipated losses primarily to the agency's seller-financed down payment mortgage program, which has suffered from high delinquency and foreclosure rates in recent years.

TECHNOLOGY

Icahn fires back at Yahoo execs

Carl Icahn, the billionaire investor seeking to oust Yahoo Inc.'s board, said the Internet company is making inaccurate statements to investors. "Yahoo keeps repeating misstatements in the hope it will convince its shareholders that these misstatements are valid," Icahn said Monday in a letter to Roy Bostock, chairman of Sunnyvale, Calif.-based Yahoo. The current employee severance plan isn't in the company's best interests as Yahoo claims, and the board refuses to explain its stance, Icahn said. Icahn is trying to build shareholder support for his board nominees, saying he will replace Chief Executive Jerry Yang and seek a new takeover by Microsoft Corp.

UTILITIES / ENERGY

Saudis to call for oil summit

Riyadh, Saudi Arabia —- Saudi Arabia will call for a summit between oil producing countries and consumer states to discuss soaring energy prices, Information and Culture Minister Iyad Madani said Monday. The kingdom will also work with OPEC to "guarantee the availability of oil supplies now and in the future," the minister said following the weekly Cabinet meeting, held in the seaport city of Jiddah. Madani said that the kingdom has informed "all oil companies it deals with as well as countries that consume oil that [the kingdom] is ready to provide them with any additional oil they need."