Business Desk

This article is from the archive of The New York Sun before the launch of its new website in 2022. The Sun has neither altered nor updated such articles but will seek to correct any errors, mis-categorizations or other problems introduced during transfer.

The New York Sun
NY Sun
NEW YORK SUN CONTRIBUTOR

ENERGY


LIPA AND CONNECTICUT AGREE TO REPLACE CABLES UNDER LI SOUND


Long Island and Connecticut officials have agreed to replace a group of power cables under Long Island Sound, a plan designed to nearly double the flow of electricity between the two regions.


The Long Island Power Authority and Connecticut Light & Power Co. said yesterday they have reached an agreement to rebuild the group of seven power cables, collectively known as the 1385 Cable, connecting southwest Connecticut and Northport, on Long Island.


“This project will have far-reaching long-term benefits to customers, the environment, and economies of both Connecticut and New York,” said David Boguslawski, a vice president at CL &P’s parent company, Northeast Utilities.


The 1385 Cable, installed in 1970, became damaged by boat anchors over time and leaked an oil-based cooling fluid. It has been off-line for about a year.


The group of cables would be replaced with a solid cable buried beneath the Sound bed.


– Associated Press


TECHNOLOGY


CISCO SELLS BANK OF AMERICA 180,000 INTERNET PHONES


Cisco Systems Inc., the world’s largest maker of computer-networking equipment, will sell 180,000 phones that transmit phone calls over the Internet to Bank of America Corp., the third-biggest American bank by assets.


Bank of America, based in Charlotte, N.C., will replace desk phones in 5,800 offices and branches in 29 states and Washington, as well as 362 switches that direct call traffic, Bank of America and San Jose, Calif.-based Cisco said in a statement. Financial terms weren’t disclosed.


Cisco’s chief executive, John Chambers, 55, has said products for sending calls the same way e-mail travels over the Internet may be his next $1 billion-a-year business. Cisco trailed Avaya Inc. last quarter in the $726 million market for Internet-phone equipment, Synergy Research Group said.


The sale to Bank of America “suggests some customers are going to be inclined to do a wholesale replacement” of existing phone equipment, said Erik Suppiger, who follows Cisco for Pacific Growth Equities in San Francisco and rates Cisco stock “equal weight.” Typically, companies convert to Internet-phone products more gradually, he said.


Boeing Co. said in July it plans to buy Cisco Internet-based phones for operations employing 150,000 people.


– Bloomberg News


MOTOROLA TO CUT 1,000 JOBS, PAY $50 MILLION IN SEVERANCE


Motorola Inc., the world’s second-largest maker of mobile phones, will cut 1,000 jobs as the company prepares to spin off its computer-chip business, costing $50 million in severance payments.


The cuts are the deepest since the chief executive, Ed Zander, joined in January. Mr. Zander took the semiconductor unit public in July and plans to spin it off by the end of the year, rendering some jobs at the company’s Schaumburg, Ill. headquarters redundant. Reductions will also be made at other offices, spokeswoman Jennifer Weyrauch said.


The firings, which account for about 1.1% of Motorola’s workforce, make up part of an effort to reduce costs as Motorola tries to win customers from competitor Nokia Oyj of Finland. Mr. Zander, 57, has brought in new managers and reversed market share losses since he took the helm in January.


Motorola’s share of the global handset market grew to 15.8% in the second quarter from 14.5% a year earlier, according to researcher Gartner Inc. Nokia’s share dropped to 29.7% from 35.6%, according to the report released earlier this month.


– Bloomberg News


IN THE COURTS


MEDTRONIC MUST PAY INVENTOR $109 MILLION, JURY SAYS


A jury told Medtronic Inc., the world’s biggest maker of spinal implants, to pay $109 million to an inventor for violating contracts and infringing his patents.


The federal court jury in Memphis, Tenn., said Medtronic failed to adequately credit Los Angeles spinal surgeon Dr. Gary K. Michelson for his inventions, violated some provisions of its contract with him, and shortchanged him on royalties. Still, the jury rejected Mr. Michelson’s arguments that Medtronic purposely failed to develop some of his inventions.


A Medtronic spokesman, Bob Hanvik, said the company was preparing a statement on the verdict. The company may have to pay additional money because the jury found that Mr. Michelson is entitled to punitive damages, which will be set in a separate proceeding.


“It’s going to be appealed,” John Farrall, an analyst at National City Private Client Group in Cleveland, which owns Medtronic shares, said before the verdict was announced. “It could be another couple of years before we come to the bottom of this.”


Medtronic sued Mr. Michelson in 2001, seeking a court ruling that it had clear ownership of the inventions. Mr. Michelson countered with accusations that Medtronic failed to market some of his inventions and shortchanged him on royalties.


Mr. Michelson’s inventions form a key part of Medtronic’s spinal implant business. The company unit that sells implants accounts for about 20% of Medtronic’s $9.09 billion in annual sales. Medtronic sought a ruling that Mr. Michelson violated the contract, and the company sought a nominal $1 in damages.


Mr. Michelson was seeking as much as $1.7 billion in damages and asked the jury to award punitive damages and make a determination that would let him sell his inventions elsewhere. Medtronic claimed he was entitled to no more than $111.7 million, if anything.


– Bloomberg News


AMAZON, MICROSOFT FILE SUITS CLAIMING E-MAIL SCAMS


Amazon.com Inc. and Microsoft Corp. filed lawsuits against U.S. and Canadian companies they claim used their names to commit fraud on the Internet.


One suit accuses Gold Disk Canada Inc. of online forgery known as “spoofing” by sending e-mails that appear to come from Amazon.com and Microsoft’s Hotmail.com, the companies said in a statement. Others are accused of using phony Amazon.com e-mail and Web sites to trick consumers into providing personal financial information, known as “phishing.”


Microsoft has filed 70 similar suits since June to put financial pressure on companies that send unwanted e-mail, known as spam, and to warn others that spoofing and phishing are illegal, said Tim Cranton, a Microsoft senior attorney. Spam costs U.S. businesses as much as $87 billion a year, according to the Pew Internet and American Life Project.


– Bloomberg News

NY Sun
NEW YORK SUN CONTRIBUTOR

This article is from the archive of The New York Sun before the launch of its new website in 2022. The Sun has neither altered nor updated such articles but will seek to correct any errors, mis-categorizations or other problems introduced during transfer.


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