Ex-Société Général trader told to pay $6.7 billion in damages
Ex-trader Jerome Kerviel was convicted on all counts Tuesday in history's biggest rogue trading scandal, sentenced to at least three years in prison and ordered to pay his former employer damages of 4.9 billion euros ($6.7 billion), a sum so staggering it drew gasps in the courtroom.
The court rejected defense arguments that the 33-year-old trader was a scapegoat for a financial system gone haywire with greed and the pursuit of profit at any cost -- a decision sure to take some pressure off the beleaguered banking system.
The ruling marked a startling departure from the general atmosphere of hostility and suspicion about big banks in an era of financial turmoil. It was a huge victory for Kerviel's former employer, Société Générale SA, France's second-biggest bank, which long had a reputation for cutting-edge financial engineering and has put in place tougher risk controls since the scandal broke.
Kerviel maintained that the bank and his bosses tolerated his massive risk-taking as long as it made money -- a claim the bank strongly denied.
U.S. service sector expands for ninth straight month
The U.S. service sector, the nation's predominant employer, expanded in September for a ninth straight month, although the growth has not been consistent enough to dent the high unemployment rate.
The Institute for Supply Management said Tuesday that its service-sector index rose last month to 53.2 from 51.5 in August. The rate hit a high of 55.4 in March, stayed there in April and May, and has fluctuated since. Readings above 50 signal growth.
Weak consumer spending has kept the service industry, which employs about 83 percent of workers in the private sector, from gaining momentum after the recession ended. Economists say Tuesday's reading was better than expected, but not enough to change their outlook of high unemployment and slow job growth for the rest of the year.
OK given to build solar plants on public lands in California
For the first time, federal land managers gave final approval Tuesday for the construction of two large solar installations on public lands that could power hundreds of thousands of homes with renewable energy.
U.S. Interior Secretary Ken Salazar said the projects in Southern California involve a square mile of glimmering solar panels near Victorville and a large array of satellite dish-like sun catchers covering about 10 square miles in the remote Imperial Valley.
Both could start transmitting electricity to the state grid by the end of 2011 or early 2012.
The approval came soon after California regulators passed new rules requiring utilities to derive a third of their electricity from renewable sources by 2020, the most aggressive standards in the U.S.
At full capacity, the two facilities would generate power for up to 566,000 homes and create almost 1,000 jobs, officials said.
Surging overseas sales boost Yum Brands' quarterly profits
Yum Brands Inc., owner of the Pizza Hut, Taco Bell and KFC fast-food brands, said Tuesday that its third-quarter profit grew 7 percent on surging overseas sales that offset a slight downturn in U.S. operations.
Yum said Tuesday that its net income was $357 million, or 74 cents per share, for the three months ending Sept. 4. That compares with $334 million, or 69 cents per share, a year earlier.
Revenue rose 3 percent to $2.86 billion.
The results were slightly better than analysts polled by Thomson Reuters expected. On average, they expected Yum to earn 72 cents per share in the most recent quarter on revenue of $2.87 billion. Analysts typically exclude one-time items from their earnings estimates. On that basis, Yum earned 73 cents per share.
Apple challenges settlement over technology patents
Apple Inc. is challenging a federal jury's order that it pay $625.5 million in damages for violating a small technology company's patents.
If upheld, the verdict would be one of the largest in a patent lawsuit.
Last Friday, the jury in Tyler, Texas, found that Apple infringed on three patents held by Mirror Worlds LLC, a company founded by Yale University computer science professor David Gelernter to commercialize his ideas.
The patents cover characteristic features on Apple's Macintosh computers, iPods and iPhones. The technologies include Cover Flow, which lets users flip through album covers and other content as if through a stack of cards; Time Machine, which performs automatic backups; and Spotlight, which is software for searching computer hard drives.
Over the weekend, Apple asked the U.S. District Court to hold off on imposing the jury award, saying there were still issues that needed to be addressed. Among other things, Apple objects to the way the damages were calculated.
Apple has not commented further on the case. Lawyers for Mirror Worlds did not return requests for comment.
Package that crunches louder than chips changed by Frito-Lay
Frito-Lay hopes to quiet complaints about its noisy SunChips bags by switching out the biodegradable bags for the old packaging on most flavors.
The company is switching back to original packaging, which is made of a type of plastic, for five of the six varieties of the chips. It will keep the biodegradable bags for its sixth variety, its original plain flavor. That's its second best-selling, after Harvest Cheddar.
The snack maker said the switch started in the middle of September and should be completed by middle to late October.
The bags were launched in April 2009 with a big marketing effort to play up their compostability because they're made from plants and not plastic.
But the technology Frito-Lay used to make the packaging results in a bag that's stiffer than the plastic packaging -- and louder. Customers complained. Groups on Facebook abound with names such as "I wanted SunChips but my roommate was sleeping..." and "Nothing is louder than a SunChips bag."