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BUSINESS IN BRIEF

Firm Raises Data Theft Count

Tuesday, April 19, 2005; Page E02

Thieves who accessed a DSW Shoe Warehouse database obtained 1.4 million credit card numbers and the names on those accounts -- 10 times more than the company estimated last month. DSW Shoe Warehouse said it has contact information for about half of those people and started sending letters notifying them of the thefts, which happened at 108 stores in 25 states between November and February. The stolen information did not include home addresses or personal identification numbers, the Columbus, Ohio-based company said. Besides credit card numbers, the thieves obtained driver's license numbers and checking account numbers from 96,000 transactions involving checks, the company said.

GameStop to Buy Rival Retailer

GameStop agreed to buy rival video-game retailer Electronics Boutique for about $1.4 billion in cash and stock, a move that would create a chain of about 3,800 stores worldwide. The sale price reflects a 34 percent premium over Electronics Boutique's stock price. The companies compete against big general retailers such as Wal-Mart.


Former WorldCom chief executive Bernard J. Ebbers exits Manhattan federal court last month after he was convicted of orchestrating the $11 billion accounting fraud that sank the company. Ebbers has sent a request for a new trial to U.S. District Judge Barbara S. Jones, who presided over his trial. Lawyers for Ebbers, whose sentencing is set for June, said that Jones should have granted immunity to three former WorldCom executives who were reluctant to testify and that she unfairly told jurors they could find him guilty based on "conscious avoidance." And they said Ebbers should have been allowed to present a defense that the way WorldCom counted its revenue complied with generally accepted accounting principles. (Louis Lanzano -- AP)

MORE NEWS

Blockbuster escalated a feud with leading stockholder Carl C. Icahn, saying it would maintain its strategy of investing in an online movie-rental service and attacking Icahn's proposal to raise dividend payments by $330 million this year, calling that irresponsible and "tantamount to a liquidation strategy" given the company's capital structure and the declining market for video rentals.

Viacom paid chief executive Sumner M. Redstone $56 million last year, a 58 percent increase from 2003, even though the company's stock price fell 16 percent in 2004. Thomas E. Freston and Leslie Moonves, who were named co-presidents and chief operating officers after former chief operating officer Mel Karmazin resigned in July, each received $52 million in total compensation.

Warner Music Group expects to raise $581 million from its planned initial public offering, setting a price of $22 to $24 a share, which would value the company at as much as $3.43 billion, according to a filing. The company is offering 27.2 million shares, and existing owners are selling 5.43 million shares. Warner Music also said it was "in discussions" with Time Warner to repurchase Time Warner's option to buy back as much as 15 percent of the music company, on or before the closing of the stock offering.

A U.S. district judge has delayed a second trial of two former Westar Energy executives, pending outcome of an appeal to the federal appeals court in Denver to disqualify her. U.S. District Judge Julie Robinson ordered a delay of the scheduled May 9 trial of David C. Wittig, Westar's former chief executive, and Douglas T. Lake, the Kansas electric utility's former chief strategy officer. They claim that Robinson is biased against them because of comments she made during their first trial and conditions she has placed on their second.

Walt Disney Co. may consider buying additional broadcast-television stations, adding to the 10 it already owns. Disney would buy additional stations only at the "right price," Walter Liss, president of Disney's ABC Owned Television Stations unit, said at an AG Edwards conference.

T-bill rates were mixed. The discount rate on three-month Treasury bills auctioned yesterday rose to 2.805 percent from 2.71 percent last week. Rates on six-month bills fell to 3.04 percent from 3.065 percent. The actual return to investors was 2.864 percent for three-month bills, with a $10,000 bill selling for $9,929.10, and 3.13 percent for a six-month bill selling for $9,846.31. Separately, the Federal Reserve said the average yield for one-year Treasury bills, a popular index for making changes in adjustable-rate mortgages, decreased to 3.32 percent last week from 3.33 percent the previous week.

A jury was seated in a trial of five former executives from Enron's failed broadband unit. Three are accused of making false claims about capabilities of Enron's broadband network so they could sell hype-inflated company shares. The other two are accused of faking earnings stemming from a failed video-on-demand deal with Blockbuster to minimize the unit's losses. Opening statements begin today.

Alliance Capital Management did nothing wrong when it invested Florida state pension money in Enron stock, costing the retirement plan more than $280 million, a jury ruled. The state had charged in a lawsuit that Alliance breached its contract and trust; Alliance said its portfolio manager could not have known about Enron's accounting fraud.

A federal judge dismissed a lawsuit filed by Los Angeles, San Francisco and other California cities accusing Microsoft of overcharging them for Windows software, granting Microsoft's request to toss the case. The judge said the cities could file an amended complaint. The lawsuit filed by six California municipalities seeks to represent all government agencies in the state.

Verizon Communications said some customers in the Northeast who already subscribe to its phone and high-speed Internet service can drop their local calling plans but still keep their speedy Web connection. Thomas J. Tauke, executive vice president for public affairs, policy and communications, said stand-alone DSL would eventually be expanded to all of Verizon's territory.

Verizon announced it had struck a deal to carry NBC Universal's broadcast and cable networks -- including Bravo, CNBC and USA Network -- on its planned digital television service, Fios TV. In a speech at the National Association of Broadcasters trade show, Verizon chief executive Ivan G. Seidenberg said the company's efforts to launch that television service this year are being hampered by the need to win franchise agreements from individual cities. He urged broadcasters to join Verizon in asking the U.S. government to do away with what he called "the biggest barrier" to Verizon's plan to sell video.

Maurice R. "Hank" Greenberg, the ousted chief executive of American International Group, asked the insurer's attorneys for a chance to respond to an internal accounting investigation's findings. Greenberg, who was forced to step down in March, wants to respond before the report goes to AIG's audit committee later this month, his attorneys said.

Qwest Communications International has filed the first of an expected series of protests against the SBC Communications-AT&T merger, telling California regulators the combined company would hurt consumers and businesses. In a document made public Monday, Denver-based Qwest also asked the California Public Utilities Commission to examine the proposed union of MCI and Verizon Communications. Qwest has been spurned in its multiple efforts to buy MCI.

EARNINGS

Bank of America said first-quarter profit rose 75 percent, to $4.7 billion from $2.68 billion in the comparable quarter a year earlier, as corporate lending, trading and the purchase of FleetBoston Financial bolstered results. Revenue climbed 47 percent, to $14.02 billion.

Eli Lilly and Co. reported an 84 percent jump in first-quarter profit, to $736.6 million from $400.4 million, as expenses fell and sales of new products such as the antidepressant Cymbalta rose. Sales rose 4 percent, to $3.5 billion.

3M said first-quarter profit rose 12 percent, to $809 million from $722 million, but its shares fell on sales volume growth of 1.8 percent, well below its own prediction. Revenue rose 4.6 percent, to $5.17 billion from $4.94 billion.

SunTrust Banks said first-quarter profit rose 36 percent, to $492.3 million from $361.8 million, lifted by its acquisition of National Commerce Financial, "robust" net interest income growth and improved credit quality. Revenue rose 29 percent, to $1.88 billion from $1.46 billion.

LOCAL EARNINGS

Virginia Financial Group said it earned $4 million (56 cents a share) in the first quarter, up 16 percent from the $3.5 million (48 cents) it earned during the comparable period last year. Total loans at the Culpeper banking company increased 12.5 percent, to $1.06 billion, while net interest income rose to $13.6 million, up 4.9 percent.

Compiled from reports by the Associated Press, Bloomberg News, Dow Jones News Service and Washington Post staff writers.


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