Daimler to pay $1.5B for emissions cheating
WASHINGTON — Automaker Daimler AG and subsidiary Mercedes-Benz USA have agreed to pay $1.5 billion to the U.S. government and California state regulators to resolve emissions cheating allegations, officials said Monday.
The U.S. Department of Justice, Environmental Protection Agency and the California attorney general's office say Daimler violated environmental laws by using so-called "defeat device software" to circumvent emissions testing and sold about 250,000 cars and vans in the U.S. with diesel engines that didn't comply with state and federal laws.
The settlement, which includes civil penalties, will also require Daimler to fix the vehicles, officials said.
The German automaker said on Aug. 13 that it had agreements with the Justice Department, Environmental Protection Agency, Customs and Border Protection, the California Air Resources Board and others over civil and environmental claims involving about 250,000 diesel cars and vans.
Daimler said the settlement would bring costs of about $1.5 billion, while the civil settlement will bring a one-off charge of about $700 million. It estimated that "further expenses" would be required to fulfill conditions of the settlements.
Details of Oracle deal with TikTok unclear
SAN FRANCISCO — The short-video app TikTok on Sunday chosen Oracle as its corporate savior to avoid a U.S. ban ordered by President Donald Trump. The U.S. government said Monday it will review the prospective deal.
That much is known. Everything else is confusion, at least to outsiders. For example, what does it mean that, as Oracle declared, it will become a "trusted technology provider" for TikTok? Is this a joint venture, a vendor agreement or something else? Oracle is pointedly not referring to its deal as a sale or acquisition.
"This whole process has been a mess," said Martin Chorzempa, a research fellow at the Peterson Institute for International Economics.
U.S. Treasury Secretary Steven Mnuchin appeared to support the Oracle bid on CNBC Monday morning. Oracle's proposal made "many representations for national security issues," Mnuchin said. He also noted a new commitment — by whom, he didn't say — to make TikTok's global operations a U.S.-headquartered company with 20,000 new jobs. Neither TikTok nor Oracle mentioned that pledge Monday, although TikTok said in July that it would add 10,000 U.S. jobs
TikTok said in a statement Monday that its proposal to the Treasury Department should "resolve the Administration's security concerns" and emphasized the importance of its app to the 100 million users it claims in the U.S.
Oracle and TikTok did not answer questions about the structure of the proposal on Monday. The Treasury Department didn't return an emailed request for more information about the proposal.
Buyout sparks fears of chip dominance
LONDON — U.S. graphics chip maker Nvidia said it plans to buy U.K.-based Arm Holdings in a deal worth up to $40 billion, in a move that would create a global powerhouse in the industry.
The deal, announced late Sunday by Nvidia and Arm's parent, Japanese technology giant SoftBank, raises concerns about the independence of Arm, one of Europe's most important technology companies.
Most of the world's smartphones run on Arm's chip designs and it's a vital supplier for companies like Apple and Samsung. It's also an innovator in chip technology that can power artificial intelligence for connected devices like medical sensors, known as the "Internet of Things." The company's business centers on designing chips and licensing the intellectual property to customers, rather than chip manufacturing, for which it relies on partners.
Being owned by a U.S. company could mean Arm is exposed to U.S. government export bans at a time when Washington is in a battle for tech supremacy with China.
Nvidia CEO Jensen Huang said the U.S. company still plans to keep Arm based at its headquarters in Cambridge, England. "Together we're going to create the world's premier computing company for the age of AI," Huang said.
Verizon to buy mobile reseller Tracfone
NEW YORK — Verizon, the country's largest phone company, is buying prepaid phone seller Tracfone for up to $6.9 billion, expanding its low-income customer business.
Tracfone, a subsidiary of Mexico telecom giant America Movil, is a mobile reseller, the largest in the U.S. It doesn't build its own network, instead paying companies like Verizon, AT&T and T-Mobile a fee to use theirs. Nearly two-thirds of Tracfone's 21 million U.S. customers get their service from Verizon via Tracfone renting Verizon's network.
Most U.S. cellphone customers are "postpaid" rather than prepaid — they pay a monthly phone bill. Prepaid customers are more likely to be low-income or have bad credit. Tracfone is a major provider of the U.S. Lifeline service, which discounts phone and internet service for low-income customers. Verizon said Monday that it would continue to offer Lifeline through Tracfone.
Verizon said it expects the deal to close in the second half of 2021. Regulators must approve it.
Gilead buying maker of cancer drugs
NEW YORK — Shares of the cancer drug specialist Immunomedics more than doubled before the market opened Monday, a day after its sale to Gilead Sciences for $21 billion was announced.
Gilead said on Sunday that it will pay $88 per share in cash as it seeks to broaden its cancer treatments portfolio. Immunomedics' drug Trodelvy was granted accelerated approval by the U.S. Food and Drug Administration in April for the treatment of adult patients with metastatic triple-negative breast cancer who have received at least two prior therapies for metastatic disease. The drug is also being studied for bladder cancer, lung cancer and other solid tumor types.
The deal is expected to close in the fourth quarter.
Delta to monetize its loyalty program
NEW YORK — Delta Air Lines will use its frequent flyer program to back up $6.5 billion in funding as the pandemic continues to buffet air travel.
A sharp drop in travel has left the airlines with tens of thousands more employees than they need to operate the vastly reduced number of flights. This spring, the airlines began receiving $25 billion in federal grants and loans to keep workers on their payrolls for six months. With that money ending Sept. 30, the three biggest U.S. carriers are expected to furlough or lay off about 40,000 workers.
Delta is only the latest to leverage its frequent flyer program to raise capital. United Airlines and American Airlines did the same in June.
Airline executives do not expect airline traffic to return to normal for some time, and that is raising pressure on lawmakers to step in and prevent mass job losses.
On Monday, Delta said the bonds and term loans linked to the funds will be secured by its SkyMiles program. SkyMiles IP plans to lend the net proceeds from the bonds and term loan to Delta after depositing a portion of the proceeds in a reserve account.
US halts some imports over forced labor
WASHINGTON — The U.S. has blocked imports from four companies and a manufacturing facility in northwestern China suspected of using forced labor from people detained as part of a sweeping crackdown on ethnic minorities in the region.
Companies that ship clothing and other cotton goods, computer parts and hair products from the Xinjiang region were named in the order issued by U.S. Customs and Border Protection.
VW completes monitoring in 2015 emissions scandal
FRANKFURT, Germany — Volkswagen said Monday that it has completed supervision by an independent monitor imposed as part of the company's plea agreement with the U.S. Justice Department in its diesel emissions scandal.
The company said it worked with monitor Larry Thompson since 2017 to implement compliance programs aimed at preventing behavior like that evidenced by the scandal. The company made cars rigged to cheat on U.S. diesel emissions tests, and paid more than $33 billion in fines and settlements.
The carmaker said that steps taken during the monitoring period included a code of conduct across all its businesses, an expanded whistleblower system and establishing a top-level compliance committee.
Former CEO Martin Winterkorn faces a trial on criminal fraud charges in Germany in connection with the 2015 scandal and also has been charged in the U.S. along with other former VW executives.
Walmart, Zipline to test drone delivery
NEW YORK — Walmart is teaming up with a company called Zipline to launch drone delivery program early next year that will deliver health and wellness products close to the retailer's headquarters in northwest Arkansas.
Walmart said Monday that it plans to eventually expand to general merchandise.
It's the second delivery drone deal for Walmart within a week. It's using drones from startup Flytrex to deliver groceries and household essentials from its Walmart stores in North Carolina.
Zipline, founded in 2014, has the world's largest drone delivery network and began operating in late 2016 in Rwanda primarily focusing on-demand delivery of medical supplies. The company has now delivered more than 200,0000 medical items to thousands of health facilities in numerous countries.
NJ sets US sports betting record
ATLANTIC CITY, N.J. — New Jersey gamblers set a nationwide record for the most money bet on sports in a single month, plunking down almost $668 million in August on events including resurgent baseball, basketball and hockey seasons that had been interrupted by the coronavirus outbreak, figures released Monday showed.
That smashed the previous record of $614 million set in Nevada in Nov. 2019.
The extra money helped cushion the blow of months of losses incurred by New Jersey's casinos and two racetracks that offer sports betting, helping them start to rebound financially.
The state Division of Gaming Enforcement shows the casinos and tracks collectively won $326.3 million from gamblers in August.
That figure was heartening to the casinos because it came in a month where they were restricted to operating at 25 percent of capacity, and it also included a doubling of internet gambling revenue compared to a year ago.
All told, the casinos and tracks saw their revenue decline by 7.5 percent compared to August 2019, when they were going full-blast and there was no pandemic.