CLOs

Chris Licht, the chief executive and chair of CNN, departed the company on Wednesday, reports CNN Business (7 June, Darcy). Licht’s departure comes after a year marked by layoffs, shrinking profits, low ratings, the firing of two anchors, and low employee morale. His tenure was dogged by media criticism, often the result of leaks from employees. The final straw may have been a 15,000-word profile in The Atlantic that published on Friday. The piece, in which the author spoke to more than 100 CNN employees, called into question Licht’s ability to lead the organization.

From "CNN Chair and CEO Chris Licht Is Out"
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Canadian bookstore chain Indigo Books and Music has seen an exodus of nearly half of its board of directors and has announced that company founder Heather Reisman will retire later this summer, reports the Toronto Globe and Mail (7 June, Robertson). The retailer on Wednesday announced that four of its 10 directors have stepped down. Indigo founder Heather Reisman has served as executive chair of the board since last September, when she stepped back as chief executive officer, promoting Peter Ruis to the top job. Indigo did not announce who will serve as the new executive chair. Robert Haft is currently the board’s lead director. The board departures occur amid a challenging period for Indigo. In February, a cyberattack took down the retailer’s e-commerce operations and leaked sensitive information about current and former employees. Indigo is also operating in a difficult environment, as shoppers are cutting back on the type of non-essential purchases that make up a sizable portion of Indigo’s product assortment.

From "Indigo Sees Nearly Half Its Board Exit"
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WE Soda, the world’s largest producer of natural soda ash, confirmed its intention to seek a listing on the London Stock Exchange, reports Bloomberg (7 June, Gopinath, Spence), marking what is likely to be the city's largest initial public offering (IPO) of the year. The company, backed by Turkish industrial conglomerate Ciner Group, said indirect net proceeds from the offering are expected to be about US$800 million. WE Soda may seek a valuation of about US$7.5 billion, based on its earnings and traded peers, Bloomberg News reported last week. The listing will help boost London’s flagging IPO market, where just under US$600 million has been raised so far this year. It’s the first high profile IPO in the city since Oxford Nanopore Technologies in 2021.

From "WE Soda Presses Ahead with UK IPO Likely to Be London’s Biggest Listing of 2023"
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Israel's Teva Pharmaceutical Industries on Wednesday agreed to pay the US state of Nevada US$193 million to settle claims that its marketing practices fueled opioid addiction, according to a report published by Haaretz (8 June). Nevada was one of two states, along with New Mexico, that did not join a US$4.35 billion nationwide settlement with the drugmaker last year. New Mexico has also since settled. Nevada, along with other states and thousands of local governments, accused Teva and other drugmakers of downplaying the addiction risks of opioid pain drugs.

From "Teva to Pay Nevada US$193 Million over Role in Opioid Epidemic"
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A marketing campaign by Shell was banned by the UK Advertising Standards Authority (ASA) on Wednesday for implying a big proportion of its business was in low carbon energy even though fossil fuels make up the “vast majority” of its operations, reports the Associated Press (7 June, Davey). A television commercial, a YouTube video, and a poster campaign in Bristol, England, variously described providing large numbers of British homes with 100 percent renewable energy, installing electric vehicle charging points, and driving the energy transition. In its ruling, the ASA found consumers would interpret the marketing materials as making a “broader claim about Shell as a whole providing cleaner energy.” Although Shell does have a clean energy business, the company estimates its operations released almost 1.4 billion tons of carbon dioxide in 2021.

From "Shell’s Clean Energy Campaign Is Misleading, UK Advertising Watchdog Says"
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An adviser to Europe's top court said on Thursday that Amazon should not pay €250 million in back taxes to Luxembourg as ordered by EU competition enforcers, reports Reuters (8 June, Chee), citing errors in the EU regulator's assessment. The European Commission in its 2017 decision said Amazon paid no taxes on almost three-quarters of its profits from EU operations due to a Luxembourg tax arrangement allowing it to channel profits to a holding company tax-free. The EU antitrust watchdog equated the tax deal to illegal state aid. However, a lower tribunal in 2021 scrapped the EU decision. "The Commission erred in deciding that Luxembourg had granted unauthorized state aid to Amazon in the form of tax advantages," Advocate General Juliane Kokott at the EU Court of Justice (CJEU) said in a non-binding opinion. "The reference system relied on by the Commission in order to review whether there was a selective advantage, namely the OECD Transfer Pricing Guidelines rather than Luxembourg law, was incorrect." Kokott said the General Court's judgment annulling the EU decision should be upheld.

From "Amazon Should Not Pay US$268 Million in Luxembourg Back Taxes, EU Court Adviser Says"
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Boeing was sued on Wednesday by a company that accused the aerospace giant of stealing trade secrets for NASA's Space Launch System rocket and then building components with "critical" safety flaws that could endanger astronauts, reports Reuters (7 June, Stempel). Wilson Aerospace said it worked with Boeing for two years starting in 2014 after Boeing, fearing the loss of billions of dollars of NASA revenue, sought its help in safely attaching engines to the rocket. According to a complaint filed in Seattle federal court, Boeing then canceled Wilson's work on the project yet kept using its intellectual property without receiving "full instructions" on how to build and install it, creating safety risks. "Boeing has captured billions of dollars in revenue because of the infringement of Wilson's trade secrets" and must turn over "all revenues and profits Boeing has obtained as a result," the complaint said. Wilson also said Boeing stole trade secrets related to bolt installation tools for its 787 Dreamliner aircraft. It said Boeing had asked it to design the tools in 2012.

From "Boeing Accused in Lawsuit of Stealing Trade Secrets for NASA Rocket"
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Meta has been ordered to “provide proper medical, psychiatric, and psychological care” to a group of Facebook moderators in Nairobi following a ruling in a Kenyan employment court, reports the Guardian (7 June, Kimeu). The instruction by Judge Byram Ongaya formed part of a broader interim ruling that saw the moderators’ jobs restored after they sued Meta in March for a mass firing. About 260 screeners in Facebook’s moderation hub in Nairobi were declared redundant early this year as the company switched its moderation provider from the US company Sama, with which it had worked since 2019, to the European firm Majorel. Moderators claim they were laid off in a bid to suppress growing worker complaints over low pay and lack of mental health support. The court heard testimony of the traumatic, often violent, nature of the content the moderators dealt with on a daily basis. Discontent at the Nairobi hub reportedly began to surface after a former moderator, Daniel Motaung, filed a case against Meta and Sama last year, accusing them of unreasonable working conditions, union-busting, and exposure to graphic content at work with inadequate psychological support. The group of moderators in the March lawsuit have made similar claims. The next sitting on the moderators’ case, on Thursday, follows a ruling by Kenya’s employment tribunal last week that Meta was the “primary” employer of the content moderators in the Nairobi hub and Sama only an agent. The court also said that, on an initial assessment, no proper justification for the redundancy had been shown. The employment tribunal confirmed its previous orders, blocking Meta and Sama from proceeding with any layoffs and Meta from switching from Sama to Majorel until a final ruling on the case is made.

From "Meta Ordered to Offer Mental Health Care to Moderators in Kenya"
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Barnes & Noble Inc. employees at a four-story Manhattan bookstore in New York City voted to unionize, reports Bloomberg (7 June, Eidelson), expanding a new labor foothold at the longtime union-free brand. Workers voted in favor of joining the Retail Wholesale and Department Store Union (RWDSU), according to a spokesperson for the US National Labor Relations Board, which conducted the election Wednesday. RWDSU, an affiliate of the United Food & Commercial Workers Union, also prevailed in a vote last month among Barnes & Noble Education Inc. staff on Rutgers University’s campus in New Jersey, and another UFCW chapter won a May vote at a Barnes & Noble location in Massachusetts.

From "Barnes & Noble Staff Vote to Unionize Manhattan Store"
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Austrian anti-corruption authorities have charged Siegfried Wolf, a supervisory board member of Porsche SE, the holding company of Volkswagen Group, with money laundering in relation to a decades-old fighter jets deal, reports the Financial Times (7 June, Nilsson, Jones). Wolf is one of two indicted “entrepreneurs," according to several sources. The case involves allegations of “hidden assets” amounting to about €6.8 million and funds exchanged into gold and kept in Switzerland, Austria’s state economic crime and corruption prosecutor said. Wolf, who also sits on the supervisory boards of German car suppliers Schaeffler and Vitesco, has faced previous scrutiny. News website Der Spiegel reported in April that he had personally written to Vladimir Putin, offering to help him rebuild the Russian car industry using his contacts in Germany. In 2010 Wolf became chair of Oleg Deripaska’s Russian Machines, the industrial and engineering conglomerate, and in 2012 became chair of the European arm of Sberbank, the Russian state-backed lender. Until Russia’s invasion of Ukraine, he was on the board of Deripaska’s carmaker Gaz.

From "Porsche SE Board Member Charged with Money Laundering"
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Tesla may face a class-action lawsuit after 240 Black factory workers in California described racism and discrimination at the electric automaker’s San Francisco Bay Area plant, reports the Associated Press (8 June, Har). Testimonies filed Monday in Alameda County Superior Court comes from contractors and employees who worked on the production floor of the factory, mostly between 2016 to the present. Lawyers suing Tesla, Inc. estimate at least 6,000 workers could be part of the class. The individual testimonies are part of a 2017 lawsuit brought by Marcus Vaughn, who complained in writing to human resources and to Tesla CEO Elon Musk of a hostile work environment in which he was called slurs by co-workers and supervisors. No investigation was conducted and he was fired for “not having a positive attitude,” according to his lawyers. The lawsuit is just one of several lawsuits alleging racism, harassment, and discrimination at the plant.

From "Black Workers at California Tesla Factory Allege Rampant Racism, Seek Class-action Status"
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Class-action lawsuits are set to roll out throughout the European Union, reports the Wall Street Journal (7 June, Vanderford). Though some EU states had delved into allowing class actions previously, a new directive scheduled to come into effect later this month will expand the mechanism across the bloc. Countries will have to allow suits based on EU laws touching on areas such as data privacy, the environment, food labeling, airline delays, and insurance, among others. The new regime does create new-EU level class-action courts but instead directs EU member states to create enabling legislation with a minimum number of certain characteristics. Qualified entities, such as nonprofit consumer groups, would be allowed to bring such actions. The European Union recommended its member states retain a “loser pays” funding model for class-action suits, leaving consumer groups that bring suits deemed non-meritorious potentially on the hook for some company legal expenses. The bloc also recommended against the use of punitive damages and has not mandated the kind of “opt out” suit that is common in the United States. But member states are free to adopt their own, tougher regimes.

From "Companies on the Defensive as European Union Rolls Out Class-action Lawsuits"
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Hong Kong's Department of Justice applied to the city’s High Court for an injunction banning the broadcasting or distribution — including on the Internet and any media accessible online — of the song “Glory to Hong Kong,” reports the Wall Street Journal (6 June, Purnell). While the legal action doesn’t name any specific companies, Google has been swept up in a controversy over the song as authorities move to stifle dissent using a national security law imposed by China in the city almost three years ago. The government’s application for the court order includes links to 32 videos on Google’s YouTube related to the song, which became an unofficial anthem for anti-government protesters in 2019 and has been effectively outlawed by authorities after the security law was brought in. The song has remained accessible and shared by users on services such as Google, YouTube, Meta Facebook, and Twitter. Unlike in mainland China, web access has long been largely open in Hong Kong. Foreign companies often cite the free flow of information as a reason they are based there.

From "Hong Kong’s Legal Bid to Ban Protest Song Challenges Google"
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The PGA Tour and DP World Tour have agreed to merge with Saudi Arabia-backed circuit LIV Golf, reports BBC News (6 June). The announcement means pending litigation between the golf tours will be halted and they will move forward as part of the same enterprise. An agreement has been signed that will combine the PGA Tour and LIV's commercial operations and rights into a new, yet to be named for-profit company. The agreement includes the DP World Tour, formerly known as the European Tour. LIV Golf is backed by the Saudi Arabia Public Investment Fund, an entity controlled by the Saudi crown prince and which has been embroiled in anti-trust lawsuits with the PGA Tour over the last year.

From "PGA Tour & DP World Tour Agree to Merger with LIV Golf"
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S&P Global on Friday cautioned that it still had a negative outlook on France’s creditworthiness, reports the New York Times (6 June, Alderman). In restating a negative outlook first published in January, the ratings agency cited concern about France’s ability to rein in its public finances amid already elevated general government debt. S&P Global cautioned that “political fragmentation” under President Emmanuel Macron’s watch had raised questions over his government’s ability to carry out policies to stoke more growth and rein in the budget deficit. At the end of April, Fitch Ratings cut France’s sovereign credit rating by one notch, to AA–, after a downgrade in December. Scope Ratings, a European agency, put a negative outlook on its assessment of France last month.

From "Macron Faces Fresh Test as Outlook for French Finances Dims"
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A group of US state attorneys general and oil industry, farming, and truck driver groups filed legal challenges to the US government's decision to approve California's plans to require a rising number of zero-emission heavy-duty trucks, reports Reuters (6 June, Shepardson). The US Environmental Protection Agency (EPA) in March approved a pair of waivers under the Clean Air Act sought by California to set heavy-duty vehicle and engine emission standards. The states filed a petition in the US Court of Appeals for the District of Columbia challenging the decisions. Similar challenges were filed by the Owner-Operator Independent Drivers Association, the American Petroleum Institute, the Illinois Soybean Association, the National Association of Convenience Stores, and Diamond Alternative Energy, a unit of Valero, as well as other groups. California Governor Gavin Newsom in March said the EPA waivers would allow the state to require half of all heavy-duty trucks sold in the state be electric by 2035. Opponents say the new rules are challenging to implement, will increase supply chain costs, and will make trucks too expensive for small business owners.

From "State AGs, Industry Groups Challenge US Approval of California Truck Rules"
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Merck filed a lawsuit on Tuesday in a bid to block the US government’s plan to curb drug prices paid by the Medicare insurance program, reports the Washington Post (6 June, Rowland). Merck’s lawsuit labels the government’s negotiating rules a “sham” and a form of “extortion.” Merck argued in a statement that reducing Medicare prices will discourage future investment in the development of new therapies, which has been the industry’s argument against price controls for decades. It also argues the administration’s move toward price curbs is an illegal taking of property. “By coercing Merck to provide its drug products at government-set prices, the program takes property for public use without just compensation in violation of the Fifth Amendment,” the company stated. It said Medicare’s rules violates Merck’s free speech rights by forcing drug companies to agree that prices were set through negotiation, even though Merck views the negotiation terms as a form of dictated price controls. In the colorfully worded lawsuit, it labels the process “political Kabuki theater.” In framing its case in constitutional terms, it said it will appeal all the way to the US Supreme Court if necessary.

From "Merck Sues over Medicare Price Negotiations"
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TikTok's owner ByteDance has been accused of allowing Chinese Communist Party (CCP) members to access the data of Hong Kong civil rights activists and protesters, reports BBC News (7 June, Hoskins). Users who uploaded "protest-related content" were also identified and monitored, former ByteDance executive Yintao Yu alleges in a US court filing. The CCP members were also able to access US TikTok user data, Yu says. The allegations are contained in a San Francisco Superior Court filing made this week as part of a lawsuit brought by Yu. In the filing, Yu claimed that members of a CCP committee had access to a "superuser" credential, which allowed them to view all data collected by ByteDance. He also alleged that the committee members were not ByteDance employees but were physically present at the company's offices in Beijing. This was common knowledge among senior executives, said Yu, who for around a year from August 2017 was a head of engineering in the US for ByteDance.

From "ByteDance Accused of Helping China Spy on Hong Kong Activists"
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Realtek Semiconductor sued rival Taiwanese chipmaker MediaTek in Northern California federal court on Tuesday, claiming MediaTek paid a company that sues over patents a "secret litigation bounty" to file meritless lawsuits in the United States to disrupt its business, reports Reuters (6 June, Brittain). The lawsuit accuses MediaTek of conspiring with IPValue Management in an effort to drive Realtek out of the market and monopolize the industry for chips used in smart televisions and set-top boxes. Realtek said MediaTek signed a patent licensing agreement with IPValue subsidiary Future Link Systems LLC in 2019 that included the secret "bounty" agreement. The agreement was revealed last year in patent litigation involving Future Link in West Texas federal court and at the US International Trade Commission, according to the lawsuit. Realtek said Future Link has kept details of the agreement "buried under confidentiality obligations and protective orders."

From "Realtek Sues Semiconductor Rival MediaTek over Patent 'Bounty' Agreement"
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C.H. Robinson Worldwide on Tuesday named former Ford Motor and Amazon.com executive Dave Bozeman as its CEO, reports the Wall Street Journal (6 June, Berger), as the nation's biggest freight broker struggles with declining revenue and Ancora Holdings Group urging a breakup of the company. Ancora wants it to spin off its global forwarding unit. Bozeman will succeed Scott Anderson, C.H. Robinson's former chair who has been serving as interim CEO since the company's board fired Bob Biesterfeld at the end of 2022. Anderson will remain a board member.

From "Freight Broker C.H. Robinson Names Ford Executive as CEO"
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