Tag: Corporate management

Flying home for the holidays will cost you more this year

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People still looking to book trips home to visit family or take a vacation during the holidays need to act fast and prepare for sticker shock.

Airline executives say that based on bookings, they expect huge demand for flights over Thanksgiving, Christmas and New Year’s. Travel experts say the best deals for airfares and hotels are already gone.

On social media, plenty of travelers think they are being gouged. It’s an understandable sentiment when government data shows that airfares in October were up 43% from a year earlier, and U.S. airlines reported a combined profit of more than $2.4 billion in the third quarter.

Part of the reason for high fares is that airlines are still operating fewer flights than in 2019 even though passenger numbers are nearly back to pre-pandemic levels.

“Fewer flights and more people looking to head home or take vacation for the holidays means two things: Prices will be higher, and we will see flights sell out for both holidays,” says Holly Berg, chief economist for travel-data provider Hopper.

Yulia Parr knows exactly what Berg is talking about. The Annandale, Virginia, woman struggled to find a reasonably priced flight home for her young son, who is spending Thanksgiving with his grandmother in Texas while Parr visits her husband, who is on active military duty in California. She finally found a $250 one-way ticket on Southwest, but it’s not until the Tuesday after the holiday.

Parr figures she waited too long to book a flight.

“My husband’s kids are flying home for Christmas,” she said. “Those tickets were bought long ago, so they’re not too bad.”

Prices for air travel and lodging usually rise heading into the holidays, and it happened earlier this year. That is leading some travelers in Europe to book shorter trips, according to Axel Hefer, CEO of Germany-based hotel-search company Trivago.

“Hotel prices are up absolutely everywhere,” he said. “If you have the same budget or even a lower budget through inflation, and you still want to travel, you just cut out a day.”

Hotels are struggling with labor shortages, another cause of higher prices. Glenn Fogel, CEO of Booking Holdings, which owns travel-search sites including Priceline and Kayak, says one hotelier told him he can’t fill all his rooms because he doesn’t have enough staff.

Rates for car rentals aren’t as crazy as they were during much of 2021, when some popular locations ran out of vehicles. Still, the availability of vehicles is tight because the cost of new cars has prevented rental companies from fully rebuilding fleets that they culled early in the pandemic.

U.S. consumers are facing the highest inflation in 40 years, and there is growing concern about a potential recession. That isn’t showing up in travel numbers, however.

The number of travelers going through airport checkpoints has recovered to nearly 95% of 2019 traffic, according to Transportation Security Administration figures for October. Travel industry officials say holiday travel might top pre-pandemic levels.

Airlines haven’t always done a good job handling the big crowds, even though they have been hiring workers to replace those who left after COVID-19 hit. The rates of canceled and delayed flights rose above pre-pandemic levels this summer, causing airlines to slow down plans to add more flights.

U.S. airlines operated only 84% as many U.S. flights as they did in October 2019, and plan about the same percentage in December, according to travel-data firm Cirium. On average, airlines are using bigger planes with more seats this year, which partly offsets the reduction in flights.

“We are definitely seeing a lot of strength for the holidays,” Andrew Nocella, United Airlines’ chief commercial officer, said on the company’s earnings call in October. “We’re approaching the Thanksgiving timeframe, and our bookings are incredibly strong.”

Airline executives and Transportation Secretary Pete Buttigieg blamed each other for widespread flight problems over the summer. Airline CEOs say that after hiring more pilots and other workers, they are prepared for the holiday mob.

Travel experts offer tips for saving money and avoiding getting stranded by a canceled flight, although the advice hasn’t changed much from previous years.

Be flexible about dates and even destinations, although that’s not possible when visiting grandma’s house. In a recent search, the cheapest flights from Los Angeles to New York around Christmas were on Christmas Eve and returning New Year’s Eve.

Look into discount airlines and alternate airports, but know that smaller airlines have fewer options for rebooking passengers after a flight is canceled.

Fly early in the day to lower your risk of a delay or cancellation. “If something goes wrong, it tends to progress throughout the day — it gets to be a domino effect,” says Chuck Thackston, general manager of Airlines Reporting Corp., an intermediary between airlines and travel agents.

There are plenty of theories on the best day of the week to book travel. Thackston says it’s Sunday because airlines know that’s when many price-conscious consumers are shopping, and carriers tailor offerings for them.

For the most part, airlines have dodged the accusations of price-gouging that have swirled around oil companies — which drew another rebuke this week from President Joe Biden — and other industries.

Accountable US, an advocacy group critical of corporations, linked airline delays and cancellations this summer to job cuts during the pandemic and poor treatment of workers. “But generally, we would say the airline industry is not currently at the same level as big food, oil or retail in terms of gross profiteering,” says Jeremy Funk, a spokesman for the group.

Brett Snyder, who runs a travel agency and writes the “Cranky Flier” blog about air travel, says prices are high simply because flights are down from 2019 while demand is booming.

“How is it gouging?” Snyder asks. “They don’t want to go (take off) with empty seats, but they also don’t want to sell everything for a dollar. It’s basic economics.”

Travelers are sacrificing to hold down the cost of their trips.

Sheena Hale and her daughter, Krysta Pyle, woke up at 3 a.m. and left their northwestern Indiana home an hour later to make a 6:25 a.m. flight in Chicago last week.

“We are exhausted,” Hale said after the plane landed in Dallas, where Krysta was taking part in a cheer competition. “We started early because the early flights were much cheaper. Flights are way too expensive.”

They’re not going anywhere for Christmas.

“We don’t have to travel. We’re staying home with family,” Hale said.

———

David Koenig can be reached at www.twitter.com/airlinewriter

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November 13, 2022
Trump Org. trial off until Thursday after witness gets COVID

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NEW YORK — A criminal trial involving tax fraud charges against Donald Trump’s company won’t resume until late next week at the earliest as a key witness continues to recover from COVID-19.

Court spokesperson Lucian Chalfen said the trial, in state court in Manhattan, is slated to resume on Thursday — not Monday, as the judge had previously hoped.

The Trump Organization trial was abruptly halted Tuesday when longtime company senior vice president and controller Jeffrey McConney tested positive for the virus.

McConney was on the witness stand for the first two days of testimony, Monday and Tuesday. He coughed off and on as he walked prosecutors through the company’s bookkeeping and payroll practices.

By Tuesday’s lunch break, McConney’s symptoms had worsened, prompting him to take a COVID test. Chalfen said he was not aware of anyone else involved in the case testing positive.

If the trial resumes Thursday, it will be the only day the case is in court next week.

Court is closed Tuesday for Election Day and Friday for Veterans Day. The judge, Juan Manuel Merchan, previously said he would not hold the trial on Wednesdays.

Merchan has said he expected the trial to take at least four weeks. The prolonged delay could push it into mid-December or beyond.

The Trump Organization is accused of helping some of its top executives avoid income taxes on lavish company-paid perks, including a Manhattan apartment and luxury cars.

McConney was granted immunity to testify last year before a grand jury and again to testify at the criminal trial.

Before Tuesday’s adjournment, McConney told jurors he altered company pay records to reduce one executive’s income tax bill and recounted how the company changed its pay practices and financial arrangements once Trump was elected president in 2016.

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November 4, 2022
Widespread Twitter layoffs begin a week after Musk takeover

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NEW YORK — Twitter began widespread layoffs Friday as new owner Elon Musk overhauls the company, raising grave concerns about chaos enveloping the platform and its ability to fight disinformation just days ahead of the U.S. midterm elections.

The speed and size of the cuts also opened Musk and Twitter to lawsuits. At least one was filed Thursday in San Francisco alleging Twitter has violated federal law by not providing fired employees the required notice.

The company had told workers by email that they would find out Friday if they had been laid off. It did not say how many of the roughly 7,500 employees would lose their jobs.

Musk didn’t confirm or correct investor Ron Baron at a Friday conference in New York when he asked the billionaire Tesla CEO how much money he would save after he “fired half of Twitter.”

Musk responded by talking about Twitter’s cost and revenue challenges and blamed activists who urged big companies to halt advertising on the platform. Musk hasn’t commented on the layoffs themselves.

“The activist groups have been successful in causing a massive drop in Twitter advertising revenue, and we’ve done our absolute best to appease them and nothing is working,” he said.

Some employees of the San Francisco-based company got clues about their pending dismissal when they lost access to their work accounts hours earlier. They and others tweeted messages of support using the hashtag #OneTeam. The email to staff said job reductions were “necessary to ensure the company’s success moving forward.”

No other social media platform comes close to Twitter as a place where public agencies and other vital service providers — election boards, police departments, utilities, schools and news outlets — keep people reliably informed. Many fear Musk’s layoffs will gut it and render it lawless.

Several employees who tweeted about losing their jobs said Twitter also eliminated their entire teams, including one focused on human rights and global conflicts, another checking Twitter’s algorithms for bias in how tweets get amplified, and an engineering team devoted to making the social platform more accessible for people with disabilities.

Eddie Perez, a Twitter civic integrity team manager who quit in September, said he fears the layoffs so close to the midterms could allow disinformation to “spread like wildfire” during the post-election vote-counting period in particular.

“I have a hard time believing that it doesn’t have a material impact on their ability to manage the amount of disinformation out there,” he said, adding that there simply may not be enough employees to beat it back.

Perez, a board member at the nonpartisan election integrity nonprofit OSET Institute, said the post-election period is particularly perilous because “some candidates may not concede and some may allege election irregularities and that is likely to generate a new cycle of falsehoods.”

Twitter’s employees have been expecting layoffs since Musk took the helm. He fired top executives, including CEO Parag Agrawal, and removed the company’s board of directors on his first day as owner.

As the emailed notices went out, many Twitter employees took to the platform to express support for each other — often simply tweeting blue heart emojis to signify its blue bird logo — and salute emojis in replies to each other.

The sweeping layoffs will jeopardize content moderation standards, according to a coalition of civil rights groups, that escalated their calls Friday for brands to pause advertising buys on the platform. The layoffs are particularly dangerous ahead of the elections, the groups warned, and for transgender users and other groups facing violence inspired by hate speech that proliferates online.

Leaders with the organizations Free Press and Color of Change said they spoke with Musk on Tuesday, and he promised to retain and enforce election integrity measures already in place. But the mass layoffs suggest otherwise, according to Jessica González, co-CEO of Free Press.

González pushed back on Musk’s assertion that content moderation rules — an operation she said was already “dangerously under-resourced” — had not changed since his takeover.

“When you lay off reportedly 50% of your staff — including teams who are in charge of actually tracking, monitoring and enforcing content moderation and rules — that necessarily means that content moderation has changed,” González said.

As of Friday, Musk and Twitter had given no public notice of the coming layoffs, according to a spokesperson for California’s Employment Development Department. That’s even though the Worker Adjustment and Retraining Notification statute requires employers with at least 100 workers to disclose layoffs involving 500 or more employees, regardless of whether a company is publicly traded or privately held.

A lawsuit was filed Thursday in federal court in San Francisco on behalf of one employee who was laid off and three others who were locked out of their work accounts. It alleges Twitter violated the law by not providing the required notice.

The layoffs affected Twitter’s offices around the world. In the United Kingdom, Twitter would be required by law to give employees notice, said Emma Bartlett, a partner specializing in employment and partnership law at CM Murray LLP.

In the case of mass firings, failure to notify the government could “have criminal penalties associated with it,’’ Bartlett said, adding that whether criminal sanctions are ever applied is another question.

The speed of the layoffs could also open Musk and Twitter up to discrimination claims if it turns out, for instance, that they disproportionally affected women, people of color or older workers.

Employment lawyer Peter Rahbar said most employers “take great care in doing layoffs of this magnitude” to make they are justified and don’t unfairly discriminate or bring unwanted attention to the company.

“For some reason, he seemingly wants to lay off half the company without doing any due diligence on what these people do or who they are and without any regards to the law,” Rahbar said.

The layoffs come at a tough time for social media companies, as advertisers are scaling back and newcomers — mainly TikTok — are threatening older platforms like Twitter and Facebook.

In a tweet Friday, Musk blamed activists for what he described as a “massive drop in revenue” since he took over Twitter late last week. He did not say how much revenue had dropped.

Big companies including General Motors, REI, General Mills and Audi have all paused ads on Twitter due to questions about how it will operate under Musk. Volkswagen Group said it is recommending its brands, which include Audi, Lamborghini and Porsche, pause paid activities until Twitter issues revised brand safety guidelines.

Musk last week sought to convince advertisers that Twitter wouldn’t become a “free-for-all hellscape” but many remain concerned about whether content moderation will remain as stringent and whether staying on Twitter might tarnish their brands.

In his tweet, Musk said “nothing has changed with content moderation.”

But Twitter advertisers have steadily declined since Musk agreed to buy Twitter in April, according to MediaRadar, which tracks ad buys. Between January and April, the average number of advertisers on Twitter was 3,350. From May through September, the number dropped to 3,100. Prior to July, more than 1,000 new advertisers were spending on Twitter every month. In July and August, that number dropped to roughly 200.

Insider Intelligence analyst Jasmine Enberg said there is “little Musk can say to appease advertisers when he’s keeping the company in a constant state of uncertainty and turmoil, and appears indifferent to Twitter employees and the law.”

“Musk needs advertisers more than they need him,” she said. “Pulling ads from Twitter is a quick and painless decision for most brands.”

———

AP Business Writers Mae Anderson, Alexandra Olson and Ken Sweet in New York, James Pollard in Columbia, S.C., Frank Bajak in Boston and Danica Kirka in London contributed to this story.

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November 4, 2022
Ford quality chief retires as CEO tries to boost reliability

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DETROIT — Ford Motor Co.’s top quality executive is retiring as the company continues to struggle with high warranty claims and reliability issues.

Stuart Rowley, chief transformation and quality officer, is leaving after 32 years with the company. He’ll be replaced by Jim Baumbick, who is now vice president of product development operations and internal combustion engine programs, the company said Wednesday.

“Quality is our No. 1 priority as a company, and Jim Baumbick is the right leader to deliver world-class quality and reliability at Ford,” CEO Jim Farley said in a statement.

Farley has complained about quality, warranty claims, recalls and problems with launching new vehicles since his appointment as chief executive two years ago.

At the company’s annual shareholders meeting in May, Farley said the problems are affecting Ford’s financial performance, but also causing pain for customers.

“We’ve made more progress on our launch quality and initial quality, you could see it in the surveys and our ramp-up of production,” Farley said at the meeting. “However, we are not satisfied at all with our quality performance, including our recalls and customer satisfaction efforts, which we need to quickly accelerate. ”

He said fixing the problems will require new talent, which the company has, as well as a culture shift and better processes for engineering, manufacturing and supply chain management. “It’s very frustrating for our customers, and so we’re doing everything we can to accommodate them with the right policies to support them when they do have a problem, and rest assured this management team is completely committed to fixing our gap to competition and return the company to being benchmark,” he said.

Ford’s statement said Josh Halliburton, who was hired in January from survey and data analysis company J.D. Power to be executive director of quality, will report to Baumbick.

The move, Ford said, will integrate quality improvement work in design, engineering, manufacturing and the supply chain.

Rowley will retire Dec. 1 after more than three decades with the automaker, where he held multiple positions including chief operating officer for North America, president of Ford Europe.

The change is among several management moves the company announced Wednesday.

Joy Falotico, president of the Lincoln luxury brand, will retire after 33 years with the company. She’ll be replaced by Dianne Craig, now president of the International Markets Group.

Steven Armstrong, vice president for the India and South America transformation, also will retire, after 35 years with Ford.

The moves come at a time of profound change that Farley is leading at Ford, including separating the company into electric vehicle and internal combustion units.

In August the company let go of 3,000 white collar workers to cut costs and help make the long transition from combustion vehicles to those powered by batteries.

Governments across the globe are pushing to eliminate combustion automobiles to mitigate the impact of climate change. Companies like Ford are orchestrating the wind-down of their combustion businesses over multiple years, even though they are still generating the cash to fund electric vehicle development.

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November 2, 2022
Musk floats paid Twitter verification, fires board

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Billionaire Elon Musk is already floating major changes for Twitter — and faces major hurdles as he begins his first week as owner of the social-media platform.

Twitter’s new owner fired the company’s board of directors and made himself the board’s sole member, according to a company filing Monday with the Securities and Exchange Commission.

He’s also testing the waters on asking users to pay for verification. A venture capitalist working with Musk tweeted a poll asking how much users would be willing to pay for the blue check mark that Twitter has historically used to verify higher-profile accounts so other users know it’s really them.

Musk, whose account is verified, replied, “Interesting.”

Critics have derided the mark, often granted to celebrities, politicians, business leaders and journalists, as an elite status symbol.

But Twitter also uses the blue check mark to verify activists and people who suddenly find themselves in the news, as well as little-known journalists at small publications around the globe, as an extra tool to curb misinformation coming from accounts that are impersonating people.

“The whole verification process is being revamped right now,” Musk tweeted Sunday in response to a user who asked for help getting verified.

On Friday, meanwhile, billionaire Saudi Prince Alwaleed bin Talal said he and his Kingdom Holding Company rolled over a combined $1.89 billion in existing Twitter shares, making them the company’s largest shareholder after Musk. The news raised concerns among some lawmakers, including Sen. Chris Murphy, a Democrat from Connecticut.

Murphy tweeted that he is requesting the Committee on Foreign Investment — which reviews acquisitions of U.S. businesses by foreign buyers — to investigate the national security implications of the kingdom’s investment in Twitter

“We should be concerned that the Saudis, who have a clear interest in repressing political speech and impacting U.S. politics, are now the second-largest owner of a major social media platform,” Murphy tweeted. “There is a clear national security issue at stake and CFIUS should do a review.”

Having taken ownership of the social media service, Musk has invited a group of tech-world friends and investors to help guide the San Francisco-based company’s transformation, which is likely to include a shakeup of its staff. Musk last week fired CEO Parag Agrawal and other top executives. There’s been uncertainty about if and when he could begin larger-scale layoffs.

Those who have revealed they are helping Musk include Sriram Krishnan, a partner at venture capital firm Andreessen Horowitz, which pledged back in the spring to chip in to Musk’s plan to buy the company and take it private.

Krishnan, who is also a former Twitter product executive, said in a tweet that it is “a hugely important company and can have great impact on the world and Elon is the person to make it happen.”

Jason Calacanis, the venture capitalist who tweeted the poll about whether users would pay for verification, said over the weekend he is “hanging out at Twitter a bit and simply trying to be as helpful as possible during the transition.”

Calacanis said the team already “has a very comprehensive plan to reduce the number of (and visibility of) bots, spammers, & bad actors on the platform.” And in the Twitter poll, he asked if users would pay between $5 and $15 monthly to “be verified & get a blue check mark” on Twitter. Twitter is currently free for most users because it depends on advertising for its revenue.

Musk agreed to buy Twitter for $44 billion in April but it wasn’t until Thursday evening that he finally closed the deal, after his attempts to back out of it led to a protracted legal fight with the company. Musk’s lawyers are now asking the Delaware Chancery Court to throw out the case, according to a court filing made public Monday. The two sides were supposed to go to trial in November if they didn’t close the deal by the end of last week.

Musk has made a number of pronouncements since early this year about how to fix Twitter, and it remains unclear which proposals he will prioritize.

He has promised to cut back some of Twitter’s content restrictions to promote free speech, but said Friday that no major decisions on content or reinstating of banned accounts will be made until a “content moderation council” with diverse viewpoints is put in place. He later qualified that remark, tweeting “anyone suspended for minor & dubious reasons will be freed from Twitter jail.”

The head of a cryptocurrency exchange that invested $500 million in Musk’s Twitter takeover said he had a number of reasons for supporting the deal, including the possibility Musk would transition Twitter into a company supporting cryptocurrency and the concept known as Web3, which many cryptocurrency enthusiasts envision as the next generation of the internet.

“We want to make sure that crypto has a seat at the table when it comes to free speech,” Binance CEO Changpeng Zhao told CNBC on Monday. “And there are more tactical things, like we want to help bring Twitter into Web3 when they’re ready.”

He said cryptocurrency could be useful for solving some of Musk’s immediate challenges, such as the plan to charge a premium membership fee for more users.

“That can be done very easily, globally, by using cryptocurrency as a means of payment,” he said.

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October 31, 2022
Musk floats paid Twitter verification, fires board

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Billionaire Elon Musk is already floating major changes for Twitter — and faces major hurdles as he begins his first week as owner of the social-media platform.

Twitter’s new owner fired the company’s board of directors and made himself the board’s sole member, according to a company filing Monday with the Securities and Exchange Commission.

He’s also testing the waters on asking users to pay for verification. A venture capitalist working with Musk tweeted a poll asking how much users would be willing to pay for the blue check mark that Twitter has historically used to verify higher-profile accounts so other users know it’s really them.

Musk, whose account is verified, replied, “Interesting.”

Critics have derided the mark, often granted to celebrities, politicians, business leaders and journalists, as an elite status symbol.

But Twitter also uses the blue check mark to verify activists and people who suddenly find themselves in the news, as well as little-known journalists at small publications around the globe, as an extra tool to curb misinformation coming from accounts that are impersonating people.

“The whole verification process is being revamped right now,” Musk tweeted Sunday in response to a user who asked for help getting verified.

On Friday, meanwhile, billionaire Saudi Prince Alwaleed bin Talal said he and his Kingdom Holding Company rolled over a combined $1.89 billion in existing Twitter shares, making them the company’s largest shareholder after Musk. The news raised concerns among some lawmakers, including Sen. Chris Murphy, a Democrat from Connecticut.

Murphy tweeted that he is requesting the Committee on Foreign Investment — which reviews acquisitions of U.S. businesses by foreign buyers — to investigate the national security implications of the kingdom’s investment in Twitter

“We should be concerned that the Saudis, who have a clear interest in repressing political speech and impacting U.S. politics, are now the second-largest owner of a major social media platform,” Murphy tweeted. “There is a clear national security issue at stake and CFIUS should do a review.”

Having taken ownership of the social media service, Musk has invited a group of tech-world friends and investors to help guide the San Francisco-based company’s transformation, which is likely to include a shakeup of its staff. Musk last week fired CEO Parag Agrawal and other top executives. There’s been uncertainty about if and when he could begin larger-scale layoffs.

Those who have revealed they are helping Musk include Sriram Krishnan, a partner at venture capital firm Andreessen Horowitz, which pledged back in the spring to chip in to Musk’s plan to buy the company and take it private.

Krishnan, who is also a former Twitter product executive, said in a tweet that it is “a hugely important company and can have great impact on the world and Elon is the person to make it happen.”

Jason Calacanis, the venture capitalist who tweeted the poll about whether users would pay for verification, said over the weekend he is “hanging out at Twitter a bit and simply trying to be as helpful as possible during the transition.”

Calacanis said the team already “has a very comprehensive plan to reduce the number of (and visibility of) bots, spammers, & bad actors on the platform.” And in the Twitter poll, he asked if users would pay between $5 and $15 monthly to “be verified & get a blue check mark” on Twitter. Twitter is currently free for most users because it depends on advertising for its revenue.

Musk agreed to buy Twitter for $44 billion in April but it wasn’t until Thursday evening that he finally closed the deal, after his attempts to back out of it led to a protracted legal fight with the company. Musk’s lawyers are now asking the Delaware Chancery Court to throw out the case, according to a court filing made public Monday. The two sides were supposed to go to trial in November if they didn’t close the deal by the end of last week.

Musk has made a number of pronouncements since early this year about how to fix Twitter, and it remains unclear which proposals he will prioritize.

He has promised to cut back some of Twitter’s content restrictions to promote free speech, but said Friday that no major decisions on content or reinstating of banned accounts will be made until a “content moderation council” with diverse viewpoints is put in place. He later qualified that remark, tweeting “anyone suspended for minor & dubious reasons will be freed from Twitter jail.”

The head of a cryptocurrency exchange that invested $500 million in Musk’s Twitter takeover said he had a number of reasons for supporting the deal, including the possibility Musk would transition Twitter into a company supporting cryptocurrency and the concept known as Web3, which many cryptocurrency enthusiasts envision as the next generation of the internet.

“We want to make sure that crypto has a seat at the table when it comes to free speech,” Binance CEO Changpeng Zhao told CNBC on Monday. “And there are more tactical things, like we want to help bring Twitter into Web3 when they’re ready.”

He said cryptocurrency could be useful for solving some of Musk’s immediate challenges, such as the plan to charge a premium membership fee for more users.

“That can be done very easily, globally, by using cryptocurrency as a means of payment,” he said.

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October 31, 2022
Trump Organization faces criminal tax fraud trial over perks

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NEW YORK — For years, as Donald Trump was soaring from reality TV star to the White House, his real estate empire was bankrolling big perks for some of his most trusted senior executives, including apartments and luxury cars.

Now Trump’s company, the Trump Organization, is on trial this week for criminal tax fraud — on the hook for what prosecutors say was a 15-year scheme by top officials to hide the plums and avoid paying taxes.

Opening statements and the first witnesses are expected Monday in New York. Last week, 12 jurors and six alternates were picked for the case, the only criminal trial to arise from the Manhattan district attorney’s three-year investigation of the former president.

Among the key prosecution witnesses: Trump’s longtime finance chief Allen Weisselberg, who pleaded guilty and has agreed to testify against the company in exchange for a five-month jail sentence.

If convicted, the Trump Organization could be fined more than $1 million and could face difficulty in securing new loans and deals. Some partners and government entities could seek to cut ties with the company. It could also hamper its ability to do business with the U.S. Secret Service, which sometimes pays the company for lodging and services while protecting Trump as a former president.

Neither Trump nor any of his children who have worked as Trump Organization executives are charged or accused of wrongdoing. Trump is not expected to testify or even attend the trial.

Prosecutors have said they do not need to prove Trump knew about the scheme to get a conviction and that the case is “not about Donald Trump.” But a defense lawyer, William J. Brennan, said even if he’s not physically there, Trump is “ever present, like the mist in the room.”

That’s because Trump is synonymous with the Trump Organization, the entity through which he manages his many ventures, including his investments in golf courses, luxury towers and other real estate, his many marketing deals and his TV pursuits.

Trump signed some of the checks at the center of the case. His name is on memos and other company documents. Witnesses could testify about conversations they had with Trump. They are even expected to enter Trump’s personal general ledgers as evidence.

Prosecutors say The Trump Organization — through its subsidiaries Trump Corp. and Trump Payroll Corp. — is liable in part because former Weisselberg was a “high managerial agent” entrusted to act on behalf of the company and its various entities.

The Trump Organization has said it did nothing wrong. The company’s lawyers argue that Weisselberg and other executives acted on their own and that, if anything, their actions harmed the company financially.

Weisselberg, who has pleaded guilty to taking $1.7 million in off-the-books compensation, pinned blame on himself and other top Trump Organization executives, including senior vice president and controller Jeffrey McConney.

But he disagreed with the notion that the company was harmed, saying the perks actually saved the company money because it avoiding having to give raises.

Prosecutors have said they expect to call 15 witnesses, including Weisselberg and McConney, who was granted limited immunity to testify last year before a grand jury.

Judge Juan Manuel Merchan expects the trial to take at least four weeks, though a defense lawyer estimated last week that the prosecution case alone could go on for two months. Court will meet for a full day on Mondays, Tuesdays and Thursday and for a half-day on Friday. The trial is off on Wednesday so the judge can attend to other matters.

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October 30, 2022
Drizly agrees to tighten data security after alleged breach

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WASHINGTON — Alcohol delivery app Drizly has agreed to tighten its data security and limit data collection to resolve federal regulators’ allegations that its security failures exposed the personal information of some 2.5 million customers.

The Federal Trade Commission announced the action Monday against Drizly, a Boston-based subsidiary of Uber that delivers beer, wine and spirits in states where it’s legal, and partners with retailers in hundreds of cities around the US. The proposed consent agreement with the FTC also names Drizly CEO James Cory Rellas. The regulators allege that the company and Rellas were alerted to security problems two years before the 2020 breach yet failed to act to protect consumers’ data.

Drizly agreed to put in a comprehensive data security program and establish security safeguards, and to limit future data collection or storage to that which is necessary for specific purposes. It will also destroy unnecessary data.

“Our proposed order against Drizly not only restricts what the company can retain and collect going forward but also ensures the CEO faces consequences for the company’s carelessness,” Samuel Levine, director of the FTC’s bureau of consumer protection, said in a statement. “CEOs who take shortcuts on security should take note.”

Drizly collects and stores on Amazon Web Services cloud-computing service a wide range of personal data from customers such as email and postal addresses, phone numbers, geolocation information and data purchased from third parties, according to the FTC.

“We take consumer privacy and security very seriously at Drizly, and are happy to put this 2020 event behind us,” the company said in a statement.

The proposed consent agreement will be opened to public comment for 30 days, after which the FTC will decide whether to make it final.

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October 24, 2022
Co-CEO of SKorean chat app steps down over service outage

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SEOUL, South Korea — A top executive of South Korea’s largest mobile chat app, Kakao, stepped down on Wednesday over a widespread service outage that triggered an outpouring of complaints in a country that is heavily reliant on such technology.

Namkoong Whon, who became Kakao’s co-CEO in March, said he will resign to focus on his role as the leader of the company’s emergency task force for solving the technical problems exposed by the outage, which was caused by a fire at a data center near Seoul on Saturday.

The fire initially paralyzed most of Kakao’s services, causing huge disruption in a country where millions of people rely on the apps to chat with friends, wire money, and hail taxis. Critics say the severity of the outage and Kakao’s slow recovery efforts highlighted the company’s poor backup systems and its overreliance on outsourced servers.

Kakao said most of its services were operating normally as of Wednesday morning. SK C&C, which hosts Kakao’s servers at its data center in Pangyo, reportedly resumed providing full levels of electricity to those servers earlier on Wednesday after restoring the damaged systems.

“Because of the data center fire, I feel more miserable than ever and take to heart my grave responsibility. I will step down to demonstrate Kakao’s willingness for renovation and change,” Namkoong said in a news conference.

Kakao’s sole CEO is now Hong Eun-taek. He said the company is investing 460 billion won ($322 million) to build its own data center in the city of Ansan, which it plans to complete within a year. The company also plans to establish another data center in nearby Siheung by 2024.

“We have learned our lesson from the fire, and our own data centers will be built as facilities that will be safe from fires and natural disasters like earthquakes, tidal waves and typhoons,” Hong said during the news conference.

According to market analysis firm WiseApp, Kakao’s free chat app had around 45 million active users as of April, a huge presence in a country with a population of around 51 million. The company has used the popularity of the app to branch out to banking, online shopping and Uber-like taxi services in recent years. Its app also has been part of the country’s COVID-19 response, including reservations for vaccines and use of QR codes for infection tracing.

Kakao’s chat users had dropped to around 39 million during the outage in the weekend as people began using other alternatives such as Facebook’s Messenger, Telegram and Naver’s Line, WiseApp said.

South Korean President Yoon Suk Yeol said Kakao’s service outage also exposed the problems of its dominant market presence and added that the country’s antitrust watchdog was examining competition issues.

“If a market becomes distorted by a monopoly or a severe oligopoly, especially to the extent where the (services) begin to function like a national infrastructure, the government should of course respond with necessary measures to protect the interests of people,” Yoon said Monday.

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October 18, 2022
Century-old nonprofit Goodwill on taking thrifting online

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NEW YORK — Goodwill is expanding its online presence, promising high tech features from digitized receipts to personalized alerts.

The 120-year-old Maryland-based nonprofit organization this month launched GoodwillFinds, a shopping venture that is making roughly 100,000 donated items available for purchase online and expanding Goodwill’s internet presence that until now had been limited to auction sites like ShopGoodwill.com or individual stores selling donations online via eBay and Amazon. GoodwillFinds aims to offer 1 million items online in the next year or two.

Spearheading the venture is Matthew Kaness, newly appointed CEO of the online shopping arm who has 20 years of retail experience. GoodwillFinds is a separate entity from Goodwill Industries International Inc., but will support the larger organization by helping fund its community-based programs across the U.S., provide professional training, job placement and youth mentorship. It should also increase donations, while also helping to expand its base of customers.

The Associated Press spoke to Kaness about the online experience and why the venture’s timing is right. The interview has been edited for clarity and length.

Q: What makes this venture different from the existing Goodwill online experience?

A: Access to shopping and thrifting on Goodwill will be unparalleled for the first time online compared to going to your one store location or trying to go through a sea of items on Amazon and eBay. The second thing is that because of technology, we’re going to be able to personalize the discovery, the recommendations, the notification, the email alerts, everything that you’re accustomed to when shopping at other brands.

Q: How will a greater presence online amplify Goodwill’s mission?

A: We are going to be elevating the global story around the impact that Goodwill has. Last year, Goodwill provided social services to 2 million individuals across the country. And then last year, all the Goodwills diverted 3 billion pounds of goods away from landfill based on the donations received and sold.

Q: Why is the timing right?

A: There’s a reason why secondhand is growing eight times faster than the overall industry. Consumers, in particular, younger consumers, Gen Z, generally love thrifting from a fashion perspective and from a retail store shopping perspective. They really care about the impact that their dollars have on the environment. That, coupled with the incredible value that all families of households for 100 years have found, especially at this time of economic hardship.

Q: Will this increased shift to online hurt the Goodwill physical stores?

A: When you are a store-based company and you’re only selling a little bit online through marketplaces, you don’t know who your customer is. You have to reacquire that customer over and over again. There are so many online competitors that are keeping your customers from getting to your store because they’re making it so convenient for shopping secondhand online. This is is going to massively expand the audience and the customer base for each one of our Goodwill members.

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October 10, 2022
Ex-PG&E execs to pay $117M to settle lawsuit over wildfires

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OAKLAND, Calif. — Former executives and directors of Pacific Gas & Electric have agreed to pay $117 million to settle a lawsuit over devastating 2017 and 2018 California wildfires sparked by the utility’s equipment, it was announced Thursday.

The settlement was announced by the PG&E Fire Victim Trust, which was established to handle claims filed by more than 80,000 victims of deadly wildfires ignited by PG&E’s rickety electrical grid. The trust’s lawsuit, filed last year, alleged that former officers and board members neglected their duty to ensure the utility’s equipment wouldn’t kill people.

The complaint was an offshoot of a $13.5 billion settlement that PG&E reached with the wildfire victims while the utility was mired in bankruptcy from January 2019 through June 2020.

As part of that deal, PG&E granted the victims the right to go after the utility’s hierarchy leading up to and during a series of wind-driven wildfires that killed more than 100 people and destroyed more than 25,000 homes and businesses, including the 2018 Camp Fire, which killed 85 people and destroyed much of the town of Paradise in Butte County.

PG&E pleaded guilty to 84 felony counts of involuntary manslaughter for causing the fire and was fined $4 million, the maximum penalty allowed.

All told, PG&E has been blamed for more than 30 wildfires since 2017 that wiped out more than 23,000 homes and businesses and killed more than 100 people.

Those sued by the fire trust included two of PG&E’s former chief executives, Anthony Earley and Geisha Williams, who were paid millions of dollars during their terms, and former board members. They were covered by liability insurance secured by the utility, the trust has said.

PG&E is the nation’s largest utility, with an estimated 16 million customers in central and Northern California.

In a statement, PG&E said the settlement is “another step forward in PG&E’s ongoing effort to resolve issues outstanding from before its bankruptcy and to move forward focused on our commitments to deliver safe, clean and reliable energy to our customers, and to continue the important work of reducing risk across our energy system.”

The settlement money won’t go to fire victims. Instead, under a bankruptcy court order, the money will be used to satisfy “the vast majority” of claims made by federal agencies, such as the U.S. Forest Service, that helped fight the blazes and assist the victims, said a statement from Frank M. Pitre, lead attorney for the trust.

That means the money won’t have to come out of funds earmarked for the trust, which has paid out $4.9 billion to victims.

The trust has said it faces a huge shortfall because half of the promised settlement consisted of PG&E stock that has consistently traded at less than what was hoped for when the deal was struck toward the end of 2019.

The stock closed Thursday at $12.38 a share on the New York Stock Exchange, down more than 30 cents.

Would-be investors might be spooked by PG&E’s continuing wildfire woes. In June, the company pleaded not guilty to involuntary manslaughter and other charges it faces after its equipment sparked the Zogg Fire, which killed four people and destroyed hundreds of homes in Northern California two years ago.

Also earlier this year, PG&E agreed to pay more than $55 million to avoid criminal prosecution for two other major wildfires sparked by its aging Northern California power lines. But the company didn’t acknowledge wrongdoing in those cases.

And last week, federal investigators seized a utility transmission pole and attached equipment in a criminal probe into what started the Mosquito Fire in the Sierra Nevada foothills.

The fire that broke out on Sept. 6 destroyed nearly 80 homes and other buildings. The fire, which has burned nearly 120 square miles (311 square kilometers), was 85% contained Thursday.

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September 30, 2022