After Losses, Yet Another Overhaul For Sony

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DealBook: After Scandal, SAC Capital Begins to Fade to Black

After Leaving Office, Bloomberg Is More Hands-On at Old Company

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Markets in Flux After Mixed Data Reports

U.S. stocks declined slightly on Monday after mixed economic reports, which showed a slowdown in growth in the U.S. services sector and a rebound in new orders for factory goods.

The technology sector was the day’s leading decliner after a downgrade by Morgan Stanley. Notes on Twitter and eBay weighed on the shares of both companies.

Despite the day’s decline, the Dow Jones industrial average and the S&P 500 were still significantly above than their 200-day moving averages - a move below these technical levels often triggers more selling.

In the United States, data showed the pace of growth in the services sector slowed for a second straight month in December while new orders for U.S. factory goods rebounded in November.

Globally, service industry growth slowed sharply in China in December but picked up across most of Europe, suggesting that an uneven global economic performance persists.

“We believe a slower, extended economic recovery provides a supportive backdrop for stocks,” said Jonathan Golub, chief U.S. market strategist at RBC Capital Markets, in New York. The firm raised its year-end target on the S&P 500 to 2,075, about 13 percent above current levels.

The Dow Jones industrial average fell 0.3 percent to close at 16,425.10. The S&P 500 ended the day at 1,826.77, while The Nasdaq Composite closed at 4,113.68.

Volume was expected to be lighter than usual due to icy conditions that snarled travel across the U.S. Midwest. Thousands of flights were canceled or delayed over the weekend, as forecasters warned that life-threatening cold was heading eastward.

Apparel retailer Men’s Wearhouse mounted a hostile bid for rival Jos. A. Bank Clothiers with an increased offer, days after the smaller rival raised its buyout defenses. Men’s Wearhouse shares gained 2.2 percent to $51.68, and Jos. A Bank shares added 4.5 percent to $56.87.

Twitter shares fell 3.9 percent to $66.29 after being downgraded by Morgan Stanley. The stock had surged nearly 70 percent in the past six weeks.

Morgan Stanley cut eBay to “neutral weight,” sending its shares down 2.8 percent to $51.78.

Ford Motor Co and its local partners boosted sales in China by nearly 50 percent last year, nudging past Japanese giants Toyota and Honda to make big inroads into the world’s largest auto market. Ford shares rose 0.7 percent to $15.58.

Solar panel shares were in focus. ReneSola rose 3.7 percent to $4.22 after the company secured a contract to supply solar panels to a solar project developer based in Japan. SolarCity jumped 9.1 percent to $64.67 after Goldman Sachs added the stock to its “conviction buy” list.

The U.S. Senate is set to vote at 5:30 p.m. (2230 GMT) to confirm Janet Yellen as the next chair of the Federal Reserve. Yellen, who has been the Fed’s vice chair since 2010, is poised to become the first woman to head the U.S. central bank. She is widely seen as continuing the policies set in place by Ben Bernanke, who will step down as Fed chairman at month’s end.

(Editing by Jan Paschal)

Tesla CEO Defends Electric Cars After Battery Fire

"For consumers concerned about fire risk, there should be absolutely zero doubt that it is safer to power a car with a battery" than a conventional gas-powered vehicle, Musk said in a blog post on Tesla's website.

Tesla shares fell more than 5 percent this week, the sharpest weekly decline since mid-August, after images and a video emerged Wednesday of a Model S on fire after an accident near Seattle Tuesday morning.

The fire occurred after the driver struck a large metal object on the highway. The object punched a hole three inches in diameter through the quarter-inch armor plate protecting the battery pack with a peak force of about 25 tons, Musk said.

The alert system onboard the Model S instructed the driver to pull over and he left the vehicle before the fire broke out. There were no injuries.

The video of the burning car was posted online Wednesday by auto blog Jalopnik and has been widely disseminated by other media. News of the accident sparked a sharp decline in the company's stock on Wednesday and Thursday.

Shares rebounded Friday and were up 4.4 percent at $180.98 on the Nasdaq.

The accident that led to the fire stemmed from a "highly uncommon occurrence," Tesla's head of sales and service, Jerome Guillen, said in an email exchange with the owner of the damaged Model S that was included with Musk's post Friday.

Guillen said the Model S drove over a "large, oddly shaped metal object" which hit the leading edge of the car's undercarriage and then rotated into its underside. Guillen described this as the "pole vault effect."

The driver, identified by the emails as Rob Carlson, said he was a Tesla investor and that the battery underwent a controlled burn that was exaggerated by images online.

"I guess you can test for everything, but some other celestial bullet comes along and challenges your design," Carlson wrote in the email.

A curved metal object that fell off a semi-trailer likely caused the damage to the car, Musk said. If a gas-powered car hit the same object on the highway, "the result could have been far worse," he added.

"A typical gasoline car only has a thin metal sheet protecting the underbody, leaving it vulnerable to destruction of the fuel supply lines or fuel tank, which causes a pool of gasoline to form and often burn the entire car to the ground," Musk wrote in his blog post.

Musk did not say if Tesla would make any changes to the Model S battery design as a result of the accident. A Tesla spokeswoman did not immediately respond to an emailed question asking if such changes were under consideration.

The fire was the latest in a string of problems for lithium-ion batteries, which are used heavily in electric cars sold by various automakers. Such batteries are lighter and more powerful than lead-acid and nickel-metal hydride batteries, but they pose an increased safety risk.

This was Tesla's first battery fire. General Motors Co's Chevrolet Volt and Mitsubishi's i-MiEV have faced similar problems in the last couple of years. Boeing Co also dealt with lithium-ion battery fires in its new Dreamliner plane earlier this year.

Emergency officials at Tuesday's accident said firefighters struggled to extinguish the flames in the Model S.

Musk said in his blog post that firefighters were right to use water to douse the fire, but they erred in puncturing the battery's metal firewall. Doing so created holes that allowed the flames to vent upwards into the front section of the car.

(Reporting by Deepa Seetharaman; additional reporting by Ben Klayman; editing by Matthew Lewis and Andrew Hay)

High & Low Finance: After a Fraud, Regulators Go After a Bank

In such a scheme, money that is supposed to be invested is really used to line the pockets of the Ponzi promoter or to pay previous investors. A lot of money has to flow through bank accounts, and it flows in ways that differ from what the promoter tells investors is happening. Banks are in a unique position to notice what is going on before the money is all gone.

But it is extremely rare for a bank to face sanctions for not noticing.

The typical judicial attitude was expressed last year when the United States Court of Appeals for the 11th Circuit upheld the dismissal — before a trial or any discovery of evidence — of a class-action suit against Bank of America by investors who had lost money in a pyramid scheme run by a promoter named Beau Diamond.

Even assuming that the plaintiffs could prove that Mr. Diamond “engaged in atypical business transactions, such as numerous wire transfers unrelated to any legitimate business activity,” the appellate court ruled, that would not be enough. The allegations in the suit were insufficient to render “plausible” a conclusion that the bank had “actual knowledge” of what Mr. Diamond was doing, so there was no need for a trial.

See no evil, face no liability.

That is why a joint regulatory action filed last week by the Securities and Exchange Commission, the Office of the Comptroller of the Currency and the Financial Crimes Enforcement Network, a part of the Treasury Department, seems so noteworthy. TD Bank, an American subsidiary of Canada’s large Toronto-Dominion Bank, agreed to pay $52.5 million to settle accusations that it had helped a Florida lawyer named Scott W. Rothstein commit one of the more brazen Ponzi schemes of recent years.

It is not clear, however, whether this represents a new attitude on the part of regulators to try to force banks to pay attention to possible Ponzi schemes — just as the Patriot Act requires them to monitor possible terrorist financing — or whether it is an isolated response to a particularly egregious case. Certainly the regulators had evidence, much of it provided by Mr. Rothstein in an effort to minimize his sentence, suggesting that one or more bank employees knew they were helping him deceive investors.

If regulators do not go after banks, the banks are usually home free. Some bankruptcy trustees for collapsed Ponzi schemes have tried to sue banks to recover money for defrauded investors only to have judges rule that because the trustee is standing in the shoes of the fraudster, such suits are not permitted. But when investors try to sue the banks, they can run up against rules limiting class-action suits and a Supreme Court decision saying that only the government — not victims — can bring suits contending that a bank, or anyone else, aided and abetted a fraud.

The Rothstein Ponzi scheme was created by a lawyer who had burst onto the Fort Lauderdale scene, living large and making highly publicized charitable donations. His firm, Rothstein, Rosenfeldt & Adler, employed 70 lawyers. He was vice chairman of a Florida Bar Association grievance committee that heard ethics complaints against lawyers. He was named to a committee to advise on state judicial appointments.

And he put together a $1.2 billion Ponzi scheme, according to the federal charges to which he pleaded guilty.

His scheme involved persuading investors to put money into “structured settlements.” Supposedly, these were settlements of cases that involved complaints like sexual harassment. The companies, he explained, had agreed to pay money over time to his clients in return for their silence. Those clients would sell the right to the payments in return for an upfront payment from the investor. He assured the investor that all the money had in fact been paid into escrow accounts he administered.

He spread the profits of the Ponzi scheme around, according to the federal charges, using money to “provide gratuities to high-ranking members of police agencies in order to curry favors with such police personnel and to deflect law enforcement scrutiny.” Political contributions were made with the money “in a manner designed to conceal the true source of such funds and to circumvent state and federal laws governing the limitations and contribution of such funds.” He sponsored fund-raisers for, among others, Gov. Charlie Crist, Senator John McCain and President George W. Bush.

For their first wedding anniversary, in 2009, he and his wife, Kimberly, attended an Eagles concert, where Don Henley dedicated a song, “Life in the Fast Lane,” to them. That cost him a $100,000 charitable contribution.

Floyd Norris comments on finance and the economy at nytimes.com/economix

Off the Charts: Five Years After Chaos, Shares of Many Big Banks Are Still Struggling

Two weeks later, Lehman Brothers failed and a panic began. The crisis demonstrated how interconnected the world financial system had become and how vulnerable even apparently healthy banks were when their competitors began to crumble. In the weeks that followed, most large banks around the world had to be bailed out. Their share prices plummeted.

Since then, however, some big banks have performed much better than others — a difference based to a significant extent on just how well, or badly, each bank had been run in the months and years leading up to the crisis.

The accompanying charts show the performance of 25 large banks around the world. As the crisis began, each of them ranked in the top 20 in the world in at least one of three measurements — market capitalization, book value or total assets.

In the weeks and months that followed, all but one of them lost at least half of their market value, as measured in the local currency of the bank’s primary market. The exception was a Chinese bank, the Industrial and Commercial Bank of China, whose shares lost less than a third of their value.

The charts also show the performance of the Bloomberg World Bank Index, which comprises more than 140 banks and has done better than most of the large bank stocks. This was a crisis where bigger was not necessarily better, and where some of the largest banks proved to be far from adequately capitalized, notwithstanding what their books had indicated before Lehman collapsed.

This spring, the world bank index got back to within 3 percent of its level at the end of August 2008, although it has since slipped back and is now 11 percent lower. Few of the large banks shown have done as well.

But a handful of banks turned out to be profitable long-term investments that August. Shares of both JPMorgan Chase and Wells Fargo in the United States are now more than 40 percent higher than they were. Shares of two of the three Chinese banks shown — Bank of China and China Construction Bank — are higher now than they were five years ago, while the third is approximately unchanged. In Britain, HSBC is up about 13 percent, a much better performance than was shown by other large European banks. It did not hurt that HSBC had a significant presence in many developing countries, most of which rode out the recession reasonably well even though some have stumbled this year.

Floyd Norris comments on finance and the economy at nytimes.com/economix.

DealBook: After Mishaps, Nasdaq Loses Standing to Rivals

DealBook: Big Name Is Leaving Boies’s Firm After a Year

Privatization Chief Quits After Another Misstep In Big Greek Asset Sales

One of the ways Greece plans to dig itself out of debt is through the sale of state-owned assets. But that effort has been besieged by missteps.

The latest involved Stelios Stavridis, the chairman of the government privatization agency, who had overseen one of the country’s first big asset sales — a one-third stake in the state gambling company, OPAP, for 652 million euros. But then he hitched a ride to a vacation spot on the private jet of a Greek oil magnate involved in the deal.

Government officials insisted that Mr. Stavridis’s ouster from the privatization agency, Taiped, was “for ethical reasons” and would not upset the country’s state sell-off effort. But the privatization program has suffered from political upheaval and delays and has fallen far short of the revenue targets set by Greece’s so-called troika of foreign creditors, the European Commission, the European Central Bank and the International Monetary Fund.

The Greek finance minister, Yannis Stournaras, on Sunday sought Mr. Stavridis’s resignation from Taiped after a newspaper quoted the chairman as saying he had traveled last week on the Lear jet of the oil and shipping oligarch Dimitris Melissanidis, a major stakeholder in the Greek-Czech consortium Emma Delta, which agreed to buy the OPAP stake in May.

The contract was signed Aug. 12 after much wrangling over the details. A few hours later, Mr. Stavridis, a 65-year-old Swiss-trained engineer, joined the oil magnate on his plane, which dropped Mr. Stavridis on Cephalonia, an island in the Ionian Sea where he spends his summer vacations. “Melissanidis, who was traveling to France, offered to take me with him to accommodate me,” Mr. Stavridis was quoted as telling the Proto Thema newspaper, which published a photograph of him, smiling, sitting next to a flight attendant.

Speaking to the Greek private television channel Skai after his firing on Monday, Mr. Stavridis defended his decision to fly on Mr. Melissanidis’s jet, noting that the trip had come long after the OPAP deal was completed. He referred to “hypocrisy” in Greek society which, he said, was interested in “the facade rather than the essence.”

“I am not a monk and I won’t hide,” said Mr. Stavridis, who founded Piscines Ideales, one of Europe’s largest manufacturers of swimming pools in 1991. More recently, he was head of the Athens water board, Eydap, which is also in the country’s privatizations portfolio.

Less than six months ago, Mr. Stavridis’s predecessor, Takis Athanasopoulos, was accused of a breach of faith during a previous stint at the head of the state electricity board. Prosecutors accused him of commissioning a power station in central Greece even though he knew it could not operate profitably.

The main left-wing opposition party, Syriza, which has vowed to reverse all privatizations if it comes to power, said Taiped was “a tool of the troika” whose goal was “the biggest sell-off of state wealth that Europe has seen since the era of East Germany.” In a statement on Monday, Syriza described the Stavridis affair as “the first clear admission of the dirty relationship between the government of the memorandum and business interests,” referring to the Greek deals for foreign loans.

The troika has urged Athens to speed up state sell-offs and to step up tax collection to raise much-needed money. But revenue targets have been revised downward several times. The original target of 50 billion euros by 2016 was later changed to 19 billion euros, then to 15 billion euros. Since last year, the troika has focused on annual targets. But Taiped is expected to fall 1 billion euros short of its 2.5 billion euro target for 2013.

Common Sense: After Post Sale, Spotlight Shines More Intensely on The Times

Great journalism takes courage. It takes a sense of public mission. It takes independence. It takes time. Perhaps most of all, it takes money.

For decades, America’s great newspaper families had all of these. They shielded their editors and reporters from the pressures of advertisers and the short-term interests of public shareholders and Wall Street analysts. Subscribers were attracted to great journalism, advertisers followed, and big profits flowed to the family members and shareholders.

This week’s announcement that the Graham family had decided to sell The Washington Post and most of its publishing assets to Amazon’s chief executive, Jeffrey Bezos, surely quashed any lingering doubts that the old model is all but dead.

The sale of The Post inevitably puts The New York Times in the spotlight: will the Sulzbergers succumb to the forces that led most every other major newspaper family to sell?

“It’s absolutely true that the family did not want to be out there all by themselves,” Alex Jones, author of “The Trust: The Private and Powerful Family behind The New York Times,” and the director of the Joan Shorenstein Center on the Press, Politics and Public Policy at the John F. Kennedy School of Government at Harvard, told me this week. “They’re now the only iconic newspaper family, and it’s a lonely place to be.” Mr. Jones said he spoke to several family members after the Post announcement, and said they were shocked by the news. Nonetheless, “They’re absolutely committed to the stewardship of The New York Times,” he said.

The chairman and publisher of The Times, Arthur Sulzberger Jr., and his cousin, Michael Golden, the vice chairman, confirmed that this week. In a statement, they said, “The Times is not for sale” and stressed that the company was “profitable and generates very strong cash flow, which we believe makes us perfectly able to fund our future growth.” They added, “The Times has both the ideas and the money to pursue innovation.”

That The Times and its controlling family would be among the last survivors should come as no surprise, since it is the strongest of the great newspapers journalistically, and it is profitable. The Times has won 112 Pulitzer Prizes since 1918, including four this year, more than any other newspaper. A week ago, The Times reported quarterly operating earnings of $77.8 million, up 13 percent from a year earlier.

By contrast, The Washington Post’s newspaper division had losses of $53.7 million last year, with no end in sight.

Donald Graham, the chairman and chief executive of The Washington Post Company, who spoke to Mr. Sulzberger shortly after the sale was announced, told me this week: “I don’t think our deal has any implications whatever for The New York Times Company. The Post and The Times are completely different businesses, as different as, say, The Post and The Wall Street Journal. The Times is quite profitable and should be for a long time.”

But Mr. Graham also said the Post sale was not just about profits or money. As he put it in his letter this week to Post employees, “The point of our ownership has always been that it was supposed to be good for The Post.” He added, “The newspaper business continued to bring up questions to which we have no answers,” and concluded, “We were certain the paper would survive under our ownership, but we wanted it to do more than that. We wanted it to succeed.”

In the wake of the announcement, the Sulzberger family held two meetings, one with the Ochs-Sulzberger family trust, which owns a controlling stake in the company, and the other with the broader family, to discuss the Post sale and the decision to issue a statement from Mr. Sulzberger and Mr. Golden. The family surely has much to discuss, because it faces the same question the Graham family did: Would The Times be better off both journalistically and financially under different ownership?

DealBook: After Going All In During Mining Boom, BHP Cuts Its Ambitions

Wall Street Closes Lower on Uncertainty After Fed Officials’ Views

Dennis Lockhart, president of the Federal Reserve Bank of Atlanta, told Market News International in an interview that the Fed could begin trimming the size of the stimulus program as soon as September, but might wait longer if the expected economic growth in the year's second half fails to materialize.

Later in the session, Chicago Fed President Charles Evans echoed the sentiment when he said the central bank will probably decrease the program later this year and could do so as early as next month, depending on the economic data.

Fed officials "are all hedging themselves, which is why the market continues to just be a little bit confused and why it is going to churn," said Ken Polcari, director of the NYSE floor division at O'Neil Securities in New York.

"There is really no reason at the moment for the market to go higher because it is still too unclear."

One catalyst for Monday's downturn in the Dow and the S&P 500 was provided by Richard Fisher, president of the Federal Reserve Bank of Dallas. He said he supported scaling back the central bank's stimulus next month unless economic data takes a turn for the worse.

The S&P 500's decline on Tuesday was its biggest fall since June 24 as investors continued to take profits from the recent rally that drove the Dow Jones industrial average and the benchmark S&P to back-to-back record closing highs late last week.

The Dow Jones industrial average fell 93.39 points or 0.60 percent, to end at 15,518.74. The S&P 500 declined 9.77 points or 0.57 percent, to 1,697.37. The Nasdaq Composite dropped 27.182 points or 0.74 percent, to 3,665.77.

Earlier, the Dow fell as low as 15,473.40, while the S&P 500 touched a session low of 1,693.29, and the Nasdaq hit an intraday low of 3,654.672.

The S&P 500 has risen for five of the past six weeks, gaining more than 7 percent over that period.

Volume was light for the second straight day, with about 5.5 billion shares traded on the New York Stock Exchange, NYSE MKT and Nasdaq, below the daily average of 6.36 billion. The thin volume exaggerated the market's swings.

Monday marked the lowest volume for a full-day session so far this year. With major U.S. economic data like the nonfarm payrolls report and earnings from bellwethers out of the way, volume is expected to be light throughout the week.

Walt Disney Co posted a slightly higher quarterly profit that beat Wall Street's expectations, even though its movie studio earnings declined, in results released after the closing bell. Disney's stock fell 1 percent to $66.35 in extended-hours trading. The stock ended regular trading at $67.05, up 1.6 percent.

During the regular session, the biggest drag on the Dow was International Business Machines Corp. The stock dropped 2.3 percent to $190.99 after Credit Suisse cut its rating to "underperform" from "neutral," saying growth would be a challenge for IBM in the future. Credit Suisse also cut its price target on the Dow component by $25 to $175. IBM topped the list of the Dow's 10 worst-performing stocks.

Bank of America shares declined 1.1 percent to close at $14.64 after the U.S. Justice Department and the Securities and Exchange Commission filed civil lawsuits against the bank for what government lawyers said was a fraud on investors involving $850 million of residential mortgage-backed securities. The stock was among the Dow's 10 bottom performers.

The S&P financial index lost 0.9 percent.

Retailers' shares were among the day's biggest losers. American Eagle Outfitters shares tumbled 12 percent to $17.57 a day after the retailer said its second-quarter profit would be hurt by weak sales and margins. A number of analysts downgraded the stock. The S&P retail index slipped 0.4 percent.

Of the 418 companies in the S&P 500 that had reported earnings for the second quarter through Tuesday morning, Thomson Reuters data showed that 67.5 percent have topped analysts' expectations, in line with the average beat over the past four quarters. On the revenue side, the data showed that 54 percent have reported revenue above estimates, more than in the past four quarters but below the historical average.

Declining stocks outnumbered advancing ones on the NYSE by a ratio of about 3 to 1, while on the Nasdaq, more than two stocks fell for every one that rose.

(Editing by Jan Paschal)

DealBook: After Tourre Decision, UBS Pays $50 Million to Settle

After a Fee Dispute With Time Warner Cable, CBS Goes Dark for Three Million Viewers

CBS stations went black just after 5 p.m. Eastern time. Both sides then issued statements blaming the other for being unreasonable in the negotiations, which were extended from Monday.

The dispute centers on what are known as retransmission fees, which cable companies have increasingly been compelled to pay to broadcasters, despite vigorous protest. CBS’s president, Leslie Moonves, has been a leader in seeking retransmission fees for broadcasters.

The decision to black out the stations means that Time Warner Cable subscribers will not be able to watch CBS programming until a deal is reached. In the past, subscribers have reacted with anger at such suspensions, but generally because they have missed specific programs. In this case, the summer programming roster does not contain many highly popular shows that might drive a settlement. CBS’s biggest appeal this summer is from the show “Under the Dome,” which will not have a new episode until Monday.

But the network does have the P.G.A. golf championship coming in a week. CBS emphasized on Friday that this week’s P.G.A. event was being led by Tiger Woods, who always draws viewers. And CBS, which broadcasts two soap operas, is also likely to gain support from those viewers.

Further down the road is the N.F.L. season, which might be a driving factor in why Time Warner Cable acted now.

Richard Greenfield, a media analyst who follows the company for BTIG Research, said the cable company was in “a once-in-a-lifetime position” to fight this battle because at the moment it does not face the overwhelming leverage of N.F.L. games and the most popular prime-time shows.

In addition, two top series on the Showtime network, owned by CBS, “Dexter” (which is in its final season) and “Ray Donovan,” are now also off the air, even though customers pay a separate fee for them. Time Warner Cable said it would offer a rebate to Showtime subscribers, as well as access to other subscription channels like Starz.

Time Warner Cable has insisted that the fee increases that CBS is asking for are unreasonable; CBS has argued it provides far more value than many cable networks that require much higher fees. Some reports have said CBS is asking for an increase of about 100 percent, to $2 a subscriber, from $1.

A spokesman for the Federal Communications Commission said that the agency was disappointed that the companies had not reached an agreement. “We urge all parties involved to resolve this situation as soon as possible.”

Despite recriminations on Friday from both sides, the negotiations are expected to resume as soon as Monday. That does not mean a quick settlement is likely, however. Mr. Greenfield said he could foresee CBS’s being dark “six weeks, if not more.” An executive close to the CBS side of the talks predicted 10 to 14 days.

In the meantime, CBS is sending messages on the radio and through other outlets urging viewers to complain to Time Warner Cable. The cable company, for its part, was telling customers to buy an antenna or sign up for Aereo, the new service that offers broadcast signals, and was also urging its customers to watch the missing CBS shows through streaming Web sites.

But for customers with Time Warner Cable broadband on Friday, CBS.com was blocking the streaming of shows, instead posting messages.

In almost every previous showdown over retransmission fees, the cable company’s stand has crumbled in short order. Mr. Greenfield said this time could be different because Time Warner Cable could take steps like appealing to Congress and selling CBS’s channel position to another bidder.

CBS stressed that it had never been taken off the air in a retransmission dispute and that it had not stopped offering extensions to keep the talks going.

Maureen Huff, a spokeswoman for Time Warner Cable, said, “We’ve accepted numerous extensions at this point, but it’s become clear that no matter how much time we give them, they’re not willing to come to reasonable terms.”

Brian Stelter contributed reporting.

This article has been revised to reflect the following correction:

Correction: August 2, 2013

Because of an editing error, an earlier version of this article misstated at one point which company suspended the service. It was Time Warner Cable, not CBS.

Siemens to Oust Chief After String of Setbacks That Prompted Profit Warning

FRANKFURT — The supervisory board of Siemens, one of Germany’s largest companies, said that it would fire its chief executive at a meeting on Wednesday and replace him with an insider following a string of problems that led to a profit warning last week.

Peter Löscher, an Austrian who has been chief executive of the electronics and engineering giant since 2007, is taking the blame for a series of missteps that have plagued the company during the last year, including a late delivery of high-speed trains for the German national railroad and delays in completing offshore wind turbine projects.

The German news media reported that Joe Kaeser, a member of Siemens’s managing board and its chief financial officer, would be most likely to replace Mr. Löscher, but a company spokesman said on Sunday that he could not confirm the reports. In a statement Saturday, Siemens, based in Munich, said its supervisory board would name another member of the company’s executive board as chief executive, but it did not say who.

Siemens’s fortunes have consequences for the German economy as a whole because it is one of the country’s largest employers, with about 120,000 workers, and because it is something of a bellwether for the country’s industrial sector.

Along with automobiles, the German economy is based on the production of high-priced goods that are sold to governments and corporations. Siemens’s broad array of products includes gear for power generation, trains and other transportation equipment, and medical devices like X-ray scanners. Problems at Siemens are potentially a bad omen for the country.

On Thursday, Siemens shares plunged 6 percent after the company said it would not meet its profit goals for the fiscal year that begins Oct. 1. Siemens did not give a detailed explanation for the expected shortfall, attributing it to “lower market expectations.” But it appeared to reflect a combination of weaker-than-expected economic growth in crucial markets as well as management mistakes.

The profit warning fed concern that demand for German exports from China and other developing markets may no longer be strong enough to compensate for the weak European economy. Sales in the United States, where Siemens has 60,000 employees, also appear to be falling short of expectations despite the recovering growth in America.

Germany has weathered the euro zone crisis better than other countries because its machinery and engineering divisions have been able to tap developing markets, especially China. But recently the Chinese economy has been cooling, while Europe remains in recession.

Siemens had already reported a 7 percent decline in sales during the first three months of 2013, to 18 billion euros, or about $24 billion. On Thursday, the company is scheduled to announce earnings for the quarter that ended June 30.

Mr. Kaeser, reported as the likely replacement for Mr. Löscher, is a 56-year-old Siemens veteran credited with keeping the company on a steady course after the previous chief executive, Klaus Kleinfeld, resigned under pressure in 2007. Mr. Kleinfeld is now chief executive of the aluminum producer Alcoa.

Mr. Löscher, 55, was the latest in a line of Siemens chiefs who have tried to focus the sprawling company on its most profitable businesses and make it easier to manage. Under Mr. Löscher, Siemens spun off its Osram lighting unit, and this month it sold its half of a joint venture with Nokia that supplies equipment for mobile telecommunication networks.

Those moves raised money and simplified the company but were not enough to compensate for other problems, including delays in delivering high-speed ICE trains to Deutsche Bahn, the German railway.

Members of the supervisory board met informally on Saturday and will make the management changes formal at a regular meeting scheduled for Wednesday.

DealBook: After Filling in a Blank, Trader Finishes Testimony

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Gloucester County Sued After Lawyer Dies at Courthouse

The widow of a 42-year-old lawyer who went into cardiac arrest and died at the Gloucester County courthouse is suing the county, alleging negligence by first responders was the cause of death.

After a Stumble, Tech Lobby Refocuses on Immigration

Mr. Green was pressing the flesh to drum up support for Fwd.us, the advocacy group he created with financial backing from his college roommate, Mark Zuckerberg, the Facebook co-founder, and several of their mostly young millionaire friends in Silicon Valley. It was a critical moment for the organization, because soon after making its debut this spring, Fwd.us fumbled badly.

Its stated goal was to overhaul immigration law. But its first steps included financing flashy, campaign-style television ads for conservative lawmakers, whose votes were seen as crucial to passing an immigration bill in the Senate. The ads promoted their pet conservative causes, including the Keystone XL pipeline. Fwd.us immediately lost many of its existing and would-be supporters in the valley.

Now the group is trying to turn around its image as it gears up for the fight for immigration overhaul in the House.

For now, its ads focus squarely on immigration rather than other more incendiary issues like drilling in Alaska or health insurance regulation. Its most recent television spot, for example, praised Kelly Ayotte, Republican of New Hampshire, for supporting the Senate bill last week despite significant opposition in her state. Its latest Web ad is a paean to the ultimate American ideal: the Statue of Liberty.

The group also has a new executive director, Todd Schulte, a veteran political aide with the Washington experience that Mr. Green lacks. And it is organizing tried-and-true town hall meetings like the one here to rally industry support for lawmakers who support a more open immigration policy, including provisions to let tech companies bring in many more foreign engineers. Others are planned in critical battleground districts, like Utah and North Carolina.

This evening, Mr. Green invited entrepreneurs to speak about their run-ins with the immigration bureaucracy. A few engineers from overseas had joined the meeting using Skype; slow-moving, teleporting robots wheeled iPads around the room, showing their disembodied faces glowing on screen. One member of Congress was here to hear their complaints: Representative Mike Honda, a Democrat from nearby San Jose.

Despite the apparent tweaks to its approach, Fwd.us contends its original strategy worked, helping rally senators to pass the landmark immigration bill last week.

“I would argue we’ve been pretty consistent,” said Rob Jesmer, campaign manager at Fwd.us. “We are going to use a lot of different things to try and pass this, to try to affect the process.”

After weeks of silence, Mr. Zuckerberg publicly defended his organization’s strategy in mid-June, calling it necessary and “unique.”

“That approach — of actually trying to work with people on both sides — is what makes us unique,” he wrote in response to questions on his Facebook page, adding: “And without bringing people in different parties and with different views together, meaningful reform will never happen.”

His office declined numerous requests for an interview.

The group has not revealed how much money it has raised so far, saying only that it is enough to make a difference in the process. Nor has it revealed any details on how it plans to sway the Republican-controlled House, except that it will back lawmakers who support a favorable immigration bill.

“I like to think we here in Silicon Valley have a different — and I hope, better — way of doing things,” Paul Graham, a venture capitalist and a founder of the technology incubator Y Combinator said about his hopes for Fwd.us.

This is precisely what complicates Fwd.us’s mission. Its principal constituents, the wealthy entrepreneurs of the valley, like to think of themselves as exceptional — except that some of its tactics have been criticized here precisely for reflecting an unexceptional Beltway approach.

In addition to the controversial ads, Fwd.us hired well-known Washington lobbyists. Its subsidiaries count political veterans like Haley Barbour, a former Mississippi governor and a Republican, and Joe Lockhart, a former spokesman for the Clinton administration, as board members.

Some Washington lobbyists say rewarding lawmakers with costly television ads could have unforeseen consequences for the industry, not least by considerably raising the price of influence.

“Most companies face multiple issues in D.C.,” said Alan Davidson, who was Google’s legislative director in Washington from 2005 to 2012, and is now a visiting scholar at the Sloan School of Management at the Massachusetts Institute of Technology.

“High-profile ad buys on unrelated social issues might help in one debate, but can alienate future allies and set unrealistic expectations,” he said. “Hopefully this is just another sign of the tech community’s evolution and growing engagement in public policy.”

Mr. Zuckerberg has said that he chose to tackle immigration after hearing the life stories of unauthorized students at a junior high school near Facebook’s headquarters in Menlo Park, where he taught a class. Although Mr. Green was his choice to lead Fwd.us, Mr. Zuckerberg has taken the heat for the group’s missteps. Lately, several people in Silicon Valley have singled out Mr. Green for mismanaging the campaign and in turn, damaging Mr. Zuckerberg’s brand.

“If you come out, as Mark did, you come out as a public piñata,” said one investor, who, like many people interviewed for this article, declined to be named, because, he said, he did not want to inflame sentiments. The investor said Mr. Green had asked him this year for a “seven-figure” contribution, with no explanation of Fwd.us’s strategy. He called it a “gun to the temple” approach.

Another industry investor surmised that Mr. Zuckerberg’s personal image had suffered because of the negative attention to the group. “It is not with the masses,” the investor said. “It’s with a few people, insiders in Silicon Valley who have checks to write. A lot of them are angry and disappointed about Joe Green’s approach.”

Mr. Green sent him an e-mail solicitation in early June, the investor said, which he declined because he disagreed with the group’s tactics so far.

Fwd.us declined requests for an interview with Mr. Green. Mr. Jesmer described him as the organization’s “visionary” and said, “We talk to him 14 times a day.”

A graduate of Harvard, Mr. Green in 2007 created a Facebook application for online advocacy and fund-raising, called Causes, and in 2011, joined NationBuilder, a company that makes digital tools for political campaigns. He stayed for just under a year, before joining Fwd.us.

Jonathan Nelson, founder of a networking group, Hackers and Founders, said Mr. Green saw himself as a “pragmatic idealist.” The two met for a beer at Antonio’s Nut House, a popular pub in Palo Alto, in mid-June. Mr. Green, he recalled, said he wanted to win the immigration fight in Washington — and was willing to play ball, Beltway style. Mr. Nelson replied that Mr. Green had misread his fellow geeks.

“It’s a sin in the techno religion to play dirty politics,” Mr. Nelson said.

2 Infant Formula Makers to Cut Prices After China Starts an Investigation

Wyeth Nutrition, which Nestlé bought last year, said this week that it had been cooperating with the investigation by the National Development and Reform Commission of China and was responding by cutting prices and improving sales and marketing practices.

Danone, which has also acknowledged that its Dumex unit was cooperating with the Chinese commission, said in an e-mail statement that it was preparing a price cut proposal with details to be disclosed later.

Both companies, along with Mead Johnson Nutrition and Abbott Laboratories, said earlier this week that they were being investigated by the Chinese commission.

In a statement, Wyeth Nutrition said it “decided to implement a price reduction” of products from July 8 through 2014. “The average reduction will be at 11 percent, with the biggest single product price reduction at 20 percent.”

The company said it would not raise prices on any new products over the next year. Wyeth did not give any further details.

Analysts said the investigation could result in fines and tougher rules governing imports into an infant milk market expected to grow to $25 billion by 2017. The firms could face fines ranging from 1 percent to 10 percent of their annual sales, the state-run Xinhua news agency quoted experts as saying.

Some analysts see the inquiry as possibly part of a broader Chinese plan to increase consumption of local infant-milk products. Mothers turned away from Chinese milk powder in 2008 when infant formula tainted with the industrial compound melamine killed at least six babies and made thousands sick with kidney stones.

China has since made efforts to crack down on persistent food safety problems that have included chemical-laced pork and infant milk contaminated with cancer-causing agents.

Some Chinese producers of infant formulas have started forming partnerships with foreign companies to try to increase brand recognition and gain technical expertise.

Foreign brands may also soon have to rely on their Chinese partners if they want greater access to the Chinese market. The Chinese government has expressed an interest in bringing the supply chain under the control of Chinese firms as part of its goal of reducing the number of local infant formula producers to 10 from more than 200 within two years.