AUTOMOTIVE

Carmakers oppose fuel-economy law

Detroit —- A lobbying group for major automakers said Tuesday that the government is underestimating the cost of increasing fuel economy standards and wants those standards to go into effect too quickly. In a 77-page response to a request for comments on the government's proposed new rules, the Alliance of Automobile Manufacturers said the National Highway Traffic Safety Administration's goal of increasing fuel economy by 4.5 percent per year between 2011 and 2015 "goes beyond what is technologically feasible and economically practicable." The group wants to implement a law passed last year by Congress that requires new cars and trucks to meet a collective fuel economy average of 35 miles per gallon by 2020. That law was supported by the automakers.

DEALS

Wolfgang Puck soup brand sold

Camden, N.J. —- Campbell Soup Co. has bought the Wolfgang Puck soup business, a move that quickly expands the company's organic soup options. Financial terms were not disclosed, but Campbell said the cash deal with Country Gourmet Foods is not expected to have a material effect on fiscal 2009 financial results. Campbell entered a licensing agreement with Wolfgang Puck Worldwide Inc. to use the Wolfgang Puck brand on soup, stock and broth products in North America. The deal includes an option to extend the brand into related categories and channels.

Manitowoc wins battle for firm

London —- A $2.1 billion bid by Manitowoc Company Inc. for Enodis PLC was endorsed by the British cooking equipment supplier Tuesday, ending a takeover fight. Enodis said it will recommend a $6.55-per-share cash offer from Manitowoc, a U.S. maker of ice machines, following an auction arranged by Britain's takeover regulator. The Takeover Panel said Illinois Tool Works had withdrawn its $5.59-per-share offer announced in May.

InBev lobbies A-B shareholders

Brussels, Belgium —- Brewer InBev SA on Tuesday urged Anheuser-Busch Cos. Inc. shareholders to challenge the biggest U.S. beer company's rejection of its $46 billion buyout bid. InBev Chief Executive Carlos Brito insisted in a statement that the company's offer of $65 a share was "full and fair" and would give A-B shareholders certainty as stock markets plunge. The Belgian-based maker of Stella Artois and Beck's has already set the scene for a hostile takeover battle by saying it would "pursue all available avenues that would allow Anheuser-Busch shareholders a direct vote."

B of A completes Countrywide deal

Charlotte —- Bank of America Corp. completed its purchase of Countrywide Financial Corp. on Tuesday, making the bank the nation's leading mortgage originator and servicer. The Federal Reserve and Countrywide's shareholders cleared the way for the acquisition last month. Bank of America now controls between 20 percent and 25 percent of the country's home loan market. Bank of America agreed in January to purchase the California-based mortgage lender in an all-stock deal valued at roughly $4 billion, exchanging 0.1822 of a share of Bank of America for each share of Countrywide outstanding. The deal is now worth around $2.5 billion, reflecting a decline in Bank of America's stock price.

Blockbuster drops bid for retailer

Dallas —- Blockbuster Inc. said Tuesday that it is withdrawing its proposal to buy Circuit City Stores Inc., the big-box retailer whose sales have tumbled this year. Blockbuster Chief Executive James Keyes said in a statement that the proposed deal, at a price of $1 billion or more, didn't make sense because of market conditions. Blockbuster, the nation's largest movie rental chain, will still try to merge content such as movies and games with the sale of electronic devices under one roof —- but it will be at Blockbuster's own stores, Keyes said.

ECONOMY

Atlanta Fed chief wary of inflation

Federal Reserve Bank of Atlanta President Dennis Lockhart said Tuesday consumer prices are rising faster than he wants and that the Fed should act "decisively" against any sign of entrenched expectations for higher inflation. "Such signs are not apparent, and I don't expect them to materialize," Lockhart said in a speech in Washington. He said he anticipates little pickup in growth in the next six months from an estimated 1 percent to 2 percent pace in the first half, and noted that some credit markets remain "fragile." Lockhart is the first regional Fed president to speak publicly since the central bank's decision to leave its benchmark interest rate at 2 percent.

FINANCIAL

Visa changes policy on debit cards

Washington —- Consumers can now use Visa debit cards for smaller purchases without entering a personal identification number. Visa said Tuesday it is no longer requiring merchants to treat its debit cards differently when customers use them as PIN-debit cards, as opposed to signature cards. The move prompted the Justice Department to drop an antitrust investigation of the practice.

LEGAL

Last claims against Grasso dismissed

Albany, N.Y. —- A midlevel New York appeals court has ordered the remaining claims dismissed against former New York Stock Exchange Chairman Richard Grasso's $187.5 million compensation package. The Appellate Division of State Supreme Court said Tuesday that the state attorney general's authority to pursue the claims lapsed when the NYSE changed from a nonprofit to a for-profit corporation. Last week, the Court of Appeals —- New York's top court —- dismissed the four other claims against Grasso's 2003 compensation.

Judge blocks Cuba travel law

Miami —- A federal judge on Tuesday temporarily blocked a new Florida law that would have imposed a stiff bond and other restrictions on travel agencies and charter companies booking trips to Cuba. Lawyers for the companies argued that the measure seeks to pre-empt federal law and could put the agencies out of business. The law, which was set to take effect Tuesday, would force agencies to put up a $250,000 state bond if they book tours to Cuba. Other travel agencies would only pay $25,000. "This law does nothing to help the consumer or the state," the companies' attorney, Steven Weinger, said. "These are business people whose livelihoods are threatened because of the onerous bond conditions."

R.I. court overturns lead paint verdict

Providence, R.I. —- The Rhode Island Supreme Court overturned a landmark verdict against three former lead paint producers Tuesday, a major setback for communities that want the companies to decontaminate hundreds of thousands of homes and other buildings. The unanimous decision reversed the lone victory to date against the lead paint industry. A jury found Sherwin-Williams Co., NL Industries Inc. and Millennium Holdings LLC liable in 2006 for creating a public nuisance by manufacturing and selling a toxic product.

Ala. wins damages from drug makers

Montgomery —- A state court jury on Tuesday found two major pharmaceutical companies defrauded Alabama in a long-running Medicaid drug pricing scheme and ordered the firms to pay more than $114 million in damages. The jury found that GlaxoSmithKline should pay the state $80.8 million in compensatory damages and that Novartis should pay about $33.7 million. It declined to order any punitive damages. The state asked for as much as $800 million in total damages in what its attorneys claimed was a scheme to overcharge for Medicaid prescription drugs from 1991 to 2005. The companies denied any fraud, contending they followed proper procedures in setting drug prices. GlaxoSmithKline is a London-based health care company with U.S. headquarters in Philadelphia and Research Triangle Park, N.C. Novartis is the U.S. affiliate of a Swiss company with U.S. headquarters in East Hanover, N.J.

REAL ESTATE

Beazer CEO's pay $7.5 million in '07

Beazer Homes USA Inc., the Atlanta-based home builder under investigation by federal prosecutors and securities regulators, paid Chief Executive Ian McCarthy $7.5 million in the company's last fiscal year. McCarthy received a base salary of $1.2 million and stock and option awards totaling $6.1 million in the year ended Sept. 30, 2007. He received other compensation totaling $219,522.

REGULATORY

Feds to probe Yahoo-Google tie-in

Washington —- The Justice Department has opened a formal antitrust investigation into a deal struck last month that would allow Internet titan Google to provide some search advertising for Yahoo, The Washington Post reported Tuesday night. Investigators are planning to demand documents not only from Google and Yahoo, but also from other large companies in the Internet and media industries, the newspaper said, citing people close to the situation. Google and Yahoo officials have said since the deal's announcement that they would delay its implementation for a voluntary Justice Department review. Officials of the companies declined to comment Tuesday.

TECHNOLOGY

Contract-free iPhone to be sold

New York —- AT&T Inc. will sell the new version of the iPhone without a service contract for $400 more than the price with a two-year plan, a break from the rules set when Apple Inc.'s popular touch-screen gadget made its debut last year. Two new models of iPhones go on sale July 11 for $199 and $299, depending on the amount of memory, with two-year AT&T contracts. The contract-free versions will cost $599 and $699 and will be sold sometime "in the future," AT&T said. The phones sold under contract are subsidized by AT&T, which expects to make the money back through monthly service fees over the life of the contract.

AT&T to end tie-in with Dish

Dish Network Corp., owner of the second-largest U.S. satellite television service, said Tuesday that AT&T Inc. is terminating an agreement to market its products, leaving the telephone company free to choose a new TV partner. AT&T, the biggest U.S. phone company, plans to end the marketing accord on Dec. 31, Englewood, Colo.-based Dish said in a regulatory filing. The action follows AT&T's decision last month to sell $500 million in Dish debt back to the satellite service.

UTILITIES / ENERGY

IEA chief speaks of 'oil shock'

Madrid, Spain —- Oil supplies will remain tight despite record prices that have reduced demand, according to the International Energy Agency. The agency's executive director said Tuesday that the world is in the grip of its third "oil shock." Downsizing its estimate of how much oil will reach the market, the IEA predicted supply will exceed projected demand only by 2 million barrels a day —- a thin cushion. The IEA is the energy watchdog for the Organization for Economic Cooperation and Development, a grouping of the world's most industrialized countries. In its annual Medium Term Report, the IEA said the world's estimated daily oil needs will rise from 86.87 million barrels this year to 94.14 million barrels in 2013 —- less than it anticipated last year, because of skyrocketing prices. The agency said there will be 1.4 percent less demand this year and 3.43 percent less in 2012, the last year for which the report gave figures. As Western nations cut back, China and other emerging economies will consume more crude, the IEA said.

WORKPLACE

Wal-Mart loses labor suit in Minn.

Minneapolis —- A judge has ruled against Wal-Mart in a class-action lawsuit, saying the discount retailer violated state labor laws 2 million times by cutting worker break time and forcing employees to work off the clock. Dakota County Judge Robert King Jr. has ordered Wal-Mart Stores Inc. to pay $6.5 million in compensatory damages, but Wal-Mart could end up paying much more than that after a jury in October considers civil penalties and punitive damages. "We believe that this award not only helps the individual clients, but it also sends a message to Wal-Mart that it has to pay for its mistakes," said Justin Perl, an attorney representing the former Wal-Mart employees named as plaintiffs. Wal-Mart spokeswoman Daphne Moore said the company disagrees with portions of the decision and is considering an appeal.