Delta May End Pilots' Pensions
A federal bankruptcy judge approved Delta Air Lines' request to terminate its pilots' pension plan. The airline told the judge it must eliminate the plan to remain afloat. The federal Pension Benefit Guaranty Corp. must still officially end the plan by taking it over and paying pilots reduced benefits. The change would be retroactive to Sept. 2.
Delta said pilots who have already retired would still receive an average of about $75,200 a year. It did not provide an updated estimate of how much pilots who retire in the future will get.
In a settlement reached on Labor Day, a group representing about 100 retired pilots agreed to end its objections to the plan's termination on condition that Delta pay $500,000 to the group to cover fees and expenses.
6 Indicted in Counterfeit Case
Authorities said they broke up an attempt to smuggle counterfeit athletic shoes from China into the United States, indicting six people and seizing more than $16 million worth of goods. The alleged plot involved about 135,000 pairs of counterfeit Nike Air Jordan shoes, federal authorities said.
Roberto Medina, special agent in charge of Immigration and Customs Enforcement's office of investigations in Arizona, called it one of the most significant recent U.S. counterfeit-goods cases.
Tobacco Class Action Rejected
A California Court of Appeals upheld a lower court's decision to throw out a group lawsuit against U.S. cigarette makers, saying there are too many differences among California smokers to include them in a class-action suit.
The case, filed in 1997 under California law, sought restitution of money smokers spent on cigarettes because of misleading company statements about the health risks and addictiveness of smoking.
Dana's Bonus Motion Denied
Auto parts maker Dana Corp. was denied a motion to put in place a compensation plan for six top executives. Bankruptcy Judge Burton Lifland said portions of the plan would violate a new bankruptcy law on retention bonuses. The motion was seen as a test for a law enacted in 2005 to prevent executives from taking sizable payments while lower-ranking workers had their pay or jobs cut.
MERGERS & ACQUISITIONS
Merrill Lynch to Buy Lender
Merrill Lynch plans to buy First Franklin Financial, the mortgage unit of National City, for $1.3 billion. Merrill also will get National City's affiliated business units, National City Home Loan Services and NationPoint. Merrill Lynch said First Franklin is one of the nation's leading originators of nonprime residential mortgage loans, made to home buyers will less-than-perfect credit, through a wholesale network.
Sara Lee Finishes Spinoff
Sara Lee Corp. completed the spinoff of its Hanesbrands underwear unit to concentrate on meats, breads and household products. Shares of the producer of Hanes, Playtex and Champion apparel will start trading today under the ticker "HBI," Chicago-based Sara Lee said. The transaction ends 18 months of asset sales that raised more than $3.7 billion.
T-bill rates fell. The discount rate on three-month Treasury bills auctioned yesterday fell to 4.855 percent from 4.96 percent last week. Rates on six-month bills fell to 4.92 percent from 4.97 percent. The annualized return to investors is 4.984 percent for three-month bills, with a $10,000 bill selling for $9,877.28, and 5.116 percent for a six-month bill selling for $9,751.27. Separately, the Federal Reserve said the average yield for one-year Treasury bills, a popular index for making changes in adjustable-rate mortgages, fell to 5.03 percent last week from 5.07 percent the previous week.
Compiled from reports by Washington Post staff writers, the Associated Press and Bloomberg News.