General Motors said it will spend $3 billion in China over the next three years in a challenge to Volkswagen for dominance of the world's fastest-growing automotive market. The U.S. automaker said it will build facilities to more than double its manufacturing capacity, introduce new vehicles and set up an auto financing venture with its Chinese partner, Shanghai Automotive Industry Corp.
Microsoft Tried to Buy SAP
Microsoft disclosed that it began merger discussions with German software company SAP late last year but that the talks ended because Microsoft decided the deal would be too complex. The company said it was disclosing the discussions because it expects Oracle to bring them up in an antitrust trial over Oracle's proposed acquisition of rival PeopleSoft. SAP confirmed that the discussions had ended but did not say why. Microsoft's talks with SAP could be important to the antitrust case because one sticking point in the trial is whether Microsoft is plotting a further expansion into business applications software.
Pension cutbacks for some early retirees were ruled illegal by the Supreme Court. Two Illinois construction workers were told when they retired in 1996 that they could draw retirement benefits as long as they did not take certain jobs in the same industry. Both took jobs as construction supervisors, and in 1998 the Central Laborers' Pension Fund told them that they could not draw a pension while working in any construction industry job. The court said an employer cannot change benefits after a worker has retired.
Scott D. Sullivan, WorldCom's former chief financial officer, pleaded guilty to one count of conspiracy to commit securities fraud, Mississippi Attorney General Jim Hood said. Sullivan faces up to five years in prison and a fine of $5,000, the attorney general's office said. In March, Sullivan pleaded guilty to federal charges of securities fraud, conspiracy and false statements to regulators, as part of a plea agreement in which he will testify against his former boss, former chief executive Bernard J. Ebbers.
A consumer watchdog group sued three cell phone companies for "locking" their phones to make it harder for customers to switch carriers. The Foundation for Taxpayer and Consumer Rights filed suit accusing AT&T Wireless, T-Mobile and Cingular Wireless of using software in their handsets that prevents them from being used on competitors' networks. The practice effectively thwarts recent federal regulations allowing people to retain their phone numbers when switching mobile carriers, according to the lawsuit, filed in Superior Court in Los Angeles. The phone companies defend their policy, saying they routinely subsidize handset cost and would lose money if they allowed customers to use those phones with another carrier.
T-bill rates rose. The discount rate on three-month Treasury bills auctioned yesterday rose to 1.230 percent from 1.130 percent the previous week. Rates on six-month bills rose to 1.505 percent from 1.400 percent. The actual return to investors is 1.251 percent for three-month bills, with a $10,000 bill selling for $9,968.90, and 1.538 percent for a six-month bill selling for $9,923.90. Separately, the Federal Reserve said the average yield for one-year Treasury bills, a popular index for changing adjustable-rate mortgages, rose to 1.92 percent from 1.82 percent last week.
The notion of energy independence is a myth and the United States must maintain "constructive relationships" with oil-producing countries for its own prosperity, the head of Exxon Mobil said. "We do not have the resource base to be energy independent," Lee R. Raymond said in a speech in Washington in which he outlined some of what he called the "hard truths" about global energy markets. He added, "We periodically hear calls for U.S. energy independence as if this were a real option."
The 2004 Mazda RX-8 four-door sports car was the only vehicle to get a top rating during rollover tests by the National Highway Traffic Safety Administration. The RX-8 scored five stars, meaning an occupant has a 10 percent or less chance of serious injury from a rollover crash. Seven SUVs or pickups tipped up on two wheels during the tests, though none got less than three stars (21 to 35 percent chance of serious injury).
A federal judge postponed the first criminal trial of former Enron executives until mid-August, saying it would take longer than planned. Lawyers involved in the case blamed the delay on a scheduling conflict with the judge's vacation.
Tribune Co., publisher of the Chicago Tribune and the Los Angeles Times, said it will eliminate jobs and reduce spending because advertising sales at some papers are falling short of forecasts, though they are expected to rise about 4 percent this year. It didn't say how many jobs will be eliminated.
Tyco International's former top lawyer got a bonus for guiding the company unscathed through a federal investigation before the inquiry had been completed, a former board member said. Testifying at Mark A. Belnick's larceny and fraud trial, Frank E. Walsh Jr. said the bonus was approved in May 2000, three months before the Securities and Exchange Commission ended its inquiry. Prosecutors contend that the timing of the bonus, possibly as much as $17 million, indicates it was actually a payoff for helping to hide former chief executive L. Dennis Kozlowski's alleged thefts.
Non-mortgage borrowing by consumers slowed in April as spending cooled. The $3.9 billion rise in outstanding credit followed a $9.3 billion gain in March.
Northrop Grumman averted a strike at the only shipyard that builds nuclear-powered aircraft carriers with a tentative agreement with the local union. The world's largest military shipbuilder would raise wages at the Newport News shipyard by more than 15 percent over the four-year life of the contract.
Sen. Maria Cantwell (D-Wash.) called on the Justice Department to release all its tapes of conversations by Enron energy traders. A Snohomish Public Utility District lawyer said portions of the tapes that revealed Enron traders laughing about manipulating the electricity market during the West Coast power crunch represented only about six to eight weeks of trading.
Kraft Foods and General Mills are among suppliers that were ordered to provide documents for a shareholders' lawsuit against the Columbia-based U.S. Foodservice unit of Royal Ahold over its accounting practices. A federal judge ruled that ConAgra Foods, H.J. Heinz, Sara Lee and Tyson Foods also must submit documents by the end of June.
Home Depot said it would expand into China with the hope of becoming the largest home improvement store chain in Asia. The Atlanta-based retailer would not say how many stores it plans for China or when the first one will open, but it named Bill E. Patterson Home Depot president of Asia.
Host Marriott of Bethesda agreed to buy the Fairmont Kea Lani Maui in Hawaii from Fairmont Hotels & Resorts for $355 million in cash.
Research In Motion, the maker of BlackBerry pagers, asked a U.S. appeals court to overturn a jury finding that its products infringe on patents owned by NTP of Arlington. Research In Motion, a Canadian company, said closely held NTP "did not invent the BlackBerry system."
Compiled from reports by the Associated Press, Bloomberg News, Dow Jones News Service and Washington Post staff writers.