Briefcase

Judge declares mistrial in Philip Morris ‘Lights’ suit

ST. LOUIS – A St. Louis judge declared a mistrial Tuesday in a $700 million lawsuit against Philip Morris USA, after jurors failed to reach agreement on whether Missouri smokers were misled into believing that light cigarettes were safer than regular cigarettes.

The ruling by St. Louis Circuit Judge Michael David ended a class-action lawsuit that was originally filed in 2000 and went to trial just last month. Jurors began deliberations Oct. 18 and were into their fifth day before the judge declared the mistrial.

Stephen Swedlow, lead attorney for the plaintiffs, said he will take the case to trial again. Swedlow noted that the jury had announced it had voted 8-4 in favor of the plaintiffs, just one favorable vote short of the nine needed to return a civil verdict under Missouri law.

“After 11 years of pretrial proceedings and a month and a half of testimony, today’s mistrial shows that the plaintiffs failed to convince a jury of their claims,” said Murray Garnick, Philip Morris’ associate general counsel. “We continue to believe that these claims are baseless and today’s mistrial shows that we have powerful defense in these ‘Lights’ cases.”

Associated Press

Federal Reserve rejects MetLife plan to increase dividend

NEW YORK – MetLife Inc. said Tuesday that the Federal Reserve has blocked its plans to increase its dividend and repurchase stock from shareholders.

The insurance company says it needs approval from the Fed because of its ownership of Metlife Bank, which takes deposits and makes home loans.

The Fed concluded that the company’s plans should be tested under the next round of stress tests, scheduled for next year.

The decision raises questions over whether MetLife’s banking operations are strong enough to withstand another economic downturn.

CEO Steven Kandarian, in a statement, maintained that Metlife is well capitalized, adding “our analysis shows that the company’s current capital level and financial strength support capital action increases.”

Associated Press

IBM names first female CEO after longtime chief steps down

SAN FRANCISCO – IBM Corp. ushered in Virginia Rometty as the company’s first female CEO on Tuesday, as Sam Palmisano stepped down from the position.

Palmisano, who turned 60 this year, has been CEO for nearly a decade. He will stay on as chairman. Virginia “Ginni” Rometty, 54, is in charge of IBM’s sales and marketing, and has long been whispered about by industry watchers as Palmisano’s likely heir.

Rometty’s appointment will be effective Jan. 1.

IBM shares fell $1.59, or 0.9 percent, to $178.77 in extended trading, after the change was announced.

Associated Press

Delta plans to cut flights, will likely raise ticket prices

MINNEAPOLIS – Delta will cut back on flights next year and probably be more expensive for passengers, too.

The nation’s second-biggest airline said on Tuesday that it will reduce flying through the rest of this year and into next year. CEO Richard Anderson said Delta is determined to price fares high enough to cover fuel costs, which rose by $1 billion in the third quarter compared to a year ago.

Delta’s earnings rose by 50 percent, despite the higher cost of fuel, in large part because the airline charged more for its tickets.

All the big airlines except Southwest raised fares by up to $5 each way on Monday, for the second time in a week. With Southwest sitting out the increase, it may not stick.

Associated Press