Administration Rejects Union Pleas on Health Law

The decision, likely to infuriate some of Mr. Obama’s closest political allies, denies federal tax credits to workers who receive health coverage under employee benefit plans sponsored by more than one employer. Such plans are common in construction and other industries.

Under the 2010 health care law, the tax credits will be available starting next year to low- and moderate-income people who buy private insurance in state-based marketplaces known as exchanges. The administration’s decision was made by the Treasury Department, but almost surely approved by the president.

The Treasury said its conclusion resulted from a straightforward reading of the 2010 health care law, which says that workers are not eligible for premium tax credits if they have been offered affordable coverage under an employer-sponsored plan that provides minimum value.

“An individual who is covered by an eligible employer-sponsored plan would not be eligible to receive a premium tax credit,” the Treasury said in a letter to Congress.

The Obama administration said that workers covered by multiemployer plans already received a substantial tax benefit. Their coverage is typically financed by contributions from employers, and, like most other employer-provided coverage, these contributions are not counted as taxable income to the employees, the administration said.

The Treasury letter was sent Friday to Representative Dave Camp, Republican of Michigan and chairman of the Ways and Means Committee, and Senator Orrin G. Hatch of Utah, the senior Republican on the Finance Committee.

They had warned the administration on Tuesday not to “provide a special exemption to unions at the expense of American taxpayers.”

In a joint statement on Friday night, Mr. Camp and Mr. Hatch said: “There has been far too much special treatment for politically favored friends of Obamacare. When it comes to employers and taxpayers picking up the health care tab for labor unions — it appears that is a price that is simply too high. Perhaps even this administration recognizes that there are limits to them stretching the law to reward their friends.”

Labor leaders criticized the health care law at a convention of the A.F.L.-C.I.O. in Los Angeles this week. They said the law could destabilize the employer-based system of health insurance and encourage some companies to dump workers into the newly created health insurance exchanges. Richard Trumka, the president of the A.F.L.-C.I.O., had conveyed those concerns directly to Mr. Obama and other White House officials.

In a letter to the top Democrats in Congress in July, James P. Hoffa, president of the Teamsters, and two other union presidents said that perverse incentives in the Affordable Care Act were “already creating nightmare scenarios.” They said that “numerous employers have begun to cut workers’ hours” to avoid the cost of providing them health benefits.

And the labor leaders said that multiemployer health plans should be eligible for tax credits, just as commercial insurance companies will be able to receive such credits to help pay premiums of low- and moderate-income people.

Union leaders said they were particularly annoyed that Mr. Obama had denied their request while granting relief sought by employers. The administration delayed by one year, to 2015, a requirement for larger employers to offer coverage to full-time employees.

DealBook: Judge Rejects Fed’s Cap on Debit Card Fees

Superior Court Rejects Sandusky's Attorney's Appeal

An attorney representing convicted serial child molester Jerry Sandusky may not invoke the work-product doctrine to avoid complying with a protective order issued by the judge who presided over Sandusky's trial, which was put in place days after grand jury materials in the case were allegedly leaked to the media.

DealBook: Hedge Fund Rejects Proposal by Hess to End Proxy Fight

Ángel Franco/The New York TimesHess, an oil and gas company, holds its annual meeting on Thursday.

8:22 p.m. | Updated
The Hess Corporation on Monday offered a concession to an activist investor after the investor’s board nominees waived their rights to a contentious compensation plan.

Hess, an oil and gas company, said it was prepared to support two of the five nominees put forward by the activist hedge fund Elliott Management. But the company’s proposal, which was intended to end a proxy fight waged by Elliott, was promptly rejected by the hedge fund.

Elliott, which has said Hess suffers from a lack of discipline and poor oversight, said on Monday that Hess’s latest proposal was a “P.R. stunt.”

“If Hess were serious, they would have engaged in substantive conversation with Elliott rather than blast out desperate press releases,” Elliott said in a statement on Monday evening.

The exchange was the latest development in the continuing fight between Elliott and Hess, which said on Friday that it would separate the positions of chairman and chief executive. The company hopes all five of its board nominees are elected at the annual meeting on Thursday.

Elliott’s nominees, who have the support of the influential proxy advisory firms Institutional Shareholder Services and Glass Lewis, announced on Monday that they would give up a compensation plan from Elliott that could have paid them millions of dollars.

The arrangement, which would have tied director compensation to Hess’s stock price, was causing an “ongoing distraction,” the nominees said in a letter to Hess shareholders on Monday.

“While each of us believes that these arrangements are appropriate and consistent with the performance of our duties as independent directors, each of us has made the decision to waive our right to receive these payments from Elliott,” the letter said.

Under the compensation plan, Elliott would have paid any nominees who won a seat and served for a year an aggregate $30,000 for each percentage point Hess’s stock price outperformed that of a peer group of stocks over three years beginning in January 2013.

Hess responded favorably to that letter from Elliott’s nominees, saying in a statement that it showed that the nominees had acknowledged that the proposed compensation plan was “wrong.”

“As we have said all along, Elliott’s directors compromised their independence and judgment by agreeing to accept Elliott’s compensation scheme,” John H. Mullin III, the lead independent director of Hess, said in a statement.

Hess then went further, saying it was “ready to be responsive” to the possibility of adding directors nominated by Elliott. The company said it was prepared to add two of Elliott’s nominees “whom we would choose in consultation with shareholders.”

“We would effect this change promptly after annual meeting if all five of Hess’ new, independent nominees are elected,” the company said.

That did not sit well with Elliott, which said in a statement: “Hess should accept all five shareholder nominees and replace as many of their incumbent directors with management’s nominees as is reasonable.

Wash. jury rejects claim of actress who sued IMDb

SEATTLE (AP) - A federal jury in Seattle on Thursday rejected a claim brought by a little-known actress who first lied about how old she was on the popular Internet Movie Database, then sued the company when it published her true age.

Cyprus Rejects Bank Deposit Tax, Scuttling Bailout Deal

The lawmakers sent President Nicos Anastasiades back to the drawing board with international bailout negotiators to devise a new plan that might still enable the country to receive a financial lifeline, while avoiding a devastating default that could reignite the euro crisis.

Lawmakers rejected the plan, with 36 voting no and 19 abstaining, arguing that it would be unacceptable to take money from account holders. One member of Parliament who was out of the country did not vote.

Marios Karoyian, the head of the Democratic Party in Mr. Anastasiades’s coalition government, called the bailout terms an “attack” against Cyprus. “The decision for a haircut is unethical and erodes the foundation of the E.U.,” he said. “We’re dealing with raw blackmail that could lead to the collapse of the euro zone.”

Analysts have raised the possibility of a bank run in Cyprus and a cut-off of financing to Cypriot banks from the European Central Bank if the measure did not pass. It is still possible banks might not be able to open their doors Thursday, the day that a scheduled bank holiday was supposed to end.

Michael Olympios, chairman of the Cyprus Investor Association said Parliament’s rejection of the bailout deal “will buy us some time to see if we can come up with a better agreement.”

He said one possibility under active consideration was for a Russian bank to buy Cyprus's biggest troubled lender, Cyprus Popular Bank, in a deal that could reduce the amount of the €10 billion bailout sought by Cyprus. Any such move would very likely be backed by the Kremlin, Mr. Olympios added, and could reduce the tax that Russian depositors might otherwise have to pay.

The Cypriot finance minister headed to Moscow earlier in the day to seek financial assistance from Russia.

The bailout measure failed Tuesday night despite a revision that would have removed some objections by exempting small bank accounts from the levies.

The European Central Bank indicated late Tuesday that it would not immediately cut off emergency cash — without which Cypriot banks probably could not survive. In a terse statement, the E.C.B. said it had taken note of the Cypriots Parliament’s decision and was consulting with the International Monetary Fund and European Commission, its partners in the so-called troika of international lenders that are trying to keep Cyprus financially afloat.

But, in a tacit warning that it would not provide the so-called emergency liquidity assistance forever, the E.C.B. said it would stick to rules that allow lending only to solvent banks. The Cyprus banks, while wobbly, are not yet insolvent. “The E.C.B. reaffirms its commitment to provide liquidity as needed within the existing rules,” the central bank said.

The original terms of the bailout, as reached last weekend, called for a one-time tax of 6.75 percent on deposits of less than €100,000, or $129,000, and a 9.9 percent tax on holdings of more than €100,000. The taxes, a condition imposed by Cyprus’s fellow E.U. members, were meant to raise €5.8 billion of the total €10 billion bailout cost.

Under the revision put forward by Mr. Anastasiades early Tuesday, depositors with less than €20,000 in the bank would be exempt, but the taxes would remain in place for accounts above that amount.

The rejection drew loud cheers and cries of joy from a crowd of more than 500 protesters who had gathered in front of Parliament since late afternoon, carrying banners denouncing what they said was a confiscation of their private funds. Some wielded unflattering posters of Chancellor Angela Merkel of Germany, a day after a demonstrator breached security at the German Embassy and climbed to the roof, throwing down the German flag.

“Today, Germany is engaging in Nazism again, not with the weapon of force, but with money,” said a pensioner, Dimitris, 67, who would give only his first name.

This article has been revised to reflect the following correction:

Correction: March 19, 2013

An earlier version of this article misstated the vote totals in Parliament. The vote was 36 against and 19 abstaining, not 36 against and 19 in favor.

Cyprus Rejects Bank Deposit Tax, Scuttling Bailout Deal

The lawmakers sent President Nicos Anastasiades back to the drawing board with international bailout negotiators to devise a new plan that might still enable the country to receive a financial lifeline, while avoiding a devastating default that could reignite the euro crisis.

Lawmakers rejected the plan, with 36 voting no and 19 abstaining, arguing that it would be unacceptable to take money from account holders. One member of Parliament who was out of the country did not vote.

Marios Karoyian, the head of the Democratic Party in Mr. Anastasiades’s coalition government, called the bailout terms an “attack” against Cyprus. “The decision for a haircut is unethical and erodes the foundation of the E.U.,” he said. “We’re dealing with raw blackmail that could lead to the collapse of the euro zone.”

Analysts have raised the possibility of a bank run in Cyprus and a cut-off of financing to Cypriot banks from the European Central Bank if the measure did not pass. It is still possible banks might not be able to open their doors Thursday, the day that a scheduled bank holiday was supposed to end.

Michael Olympios, chairman of the Cyprus Investor Association said Parliament’s rejection of the bailout deal “will buy us some time to see if we can come up with a better agreement.”

He said one possibility under active consideration was for a Russian bank to buy Cyprus's biggest troubled lender, Cyprus Popular Bank, in a deal that could reduce the amount of the €10 billion bailout sought by Cyprus. Any such move would very likely be backed by the Kremlin, Mr. Olympios added, and could reduce the tax that Russian depositors might otherwise have to pay.

The Cypriot finance minister headed to Moscow earlier in the day to seek financial assistance from Russia.

The bailout measure failed Tuesday night despite a revision that would have removed some objections by exempting small bank accounts from the levies.

The European Central Bank indicated late Tuesday that it would not immediately cut off emergency cash — without which Cypriot banks probably could not survive. In a terse statement, the E.C.B. said it had taken note of the Cypriots Parliament’s decision and was consulting with the International Monetary Fund and European Commission, its partners in the so-called troika of international lenders that are trying to keep Cyprus financially afloat.

But, in a tacit warning that it would not provide the so-called emergency liquidity assistance forever, the E.C.B. said it would stick to rules that allow lending only to solvent banks. The Cyprus banks, while wobbly, are not yet insolvent. “The E.C.B. reaffirms its commitment to provide liquidity as needed within the existing rules,” the central bank said.

The original terms of the bailout, as reached last weekend, called for a one-time tax of 6.75 percent on deposits of less than €100,000, or $129,000, and a 9.9 percent tax on holdings of more than €100,000. The taxes, a condition imposed by Cyprus’s fellow E.U. members, were meant to raise €5.8 billion of the total €10 billion bailout cost.

Under the revision put forward by Mr. Anastasiades early Tuesday, depositors with less than €20,000 in the bank would be exempt, but the taxes would remain in place for accounts above that amount.

The rejection drew loud cheers and cries of joy from a crowd of more than 500 protesters who had gathered in front of Parliament since late afternoon, carrying banners denouncing what they said was a confiscation of their private funds. Some wielded unflattering posters of Chancellor Angela Merkel of Germany, a day after a demonstrator breached security at the German Embassy and climbed to the roof, throwing down the German flag.

“Today, Germany is engaging in Nazism again, not with the weapon of force, but with money,” said a pensioner, Dimitris, 67, who would give only his first name.

This article has been revised to reflect the following correction:

Correction: March 19, 2013

An earlier version of this article misstated the vote totals in Parliament. The vote was 36 against and 19 abstaining, not 36 against and 19 in favor.

Judge rejects case challenging Seattle arena deal

SEATTLE (AP) - A Washington state judge rejected a lawsuit Friday aimed at undoing a deal to build a new professional basketball and hockey arena in Seattle ? a key part of plans to bring the NBA back to town.

US Supreme Court rejects Okla. personhood appeal

OKLAHOMA CITY (AP) - The U.S. Supreme Court on Monday refused to take up an Oklahoma Supreme Court ruling that said a proposal to grant "personhood" to human embryos would be an improper ban on abortion.

Judge rejects NY gas drilling lawsuit against feds

ALBANY, N.Y. (AP) - A federal judge has rejected state Attorney General Eric Schneiderman's lawsuit seeking to force a full environmental review before the Delaware River Basin Commission allows natural gas drilling in a watershed that provides drinking water for millions of New Yorkers.

Judge Rejects Beasley Firm's Abuse of Process Suit in Estate Case

In the latest chapter in the fight over the estate of famed trial lawyer James E. Beasley Sr., his old firm is appealing a decision that its claim against another law firm for alleged abuse of civil process was filed too late.