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Boeing is in more hot water
The airplane maker’s board is meeting in San Antonio as the company faces renewed heat over its handling of the 737 Max after it disclosed that one of its pilots had warned about trouble with its automated flight system in 2016 — two years before the first of two fatal plane crashes.
“Granted, I suck at flying, but even this was egregious,” the pilot, Mark Forkner, had told a colleague about the system and its erratic behavior in flight simulations. The instant-message exchange happened months before the F.A.A. cleared the 737 Max for flight.
“I basically lied to the regulators (unknowingly),” Mr. Forkner added. (A lawyer for Mr. Forkner said that his client had been referring to the simulator software, not the plane, and that there was no “lie.”)
“The existence of the messages strikes at Boeing’s defense that it had done nothing wrong regarding the Max,” write David Gelles and Natalie Kitroeff of the NYT, “because regulators had cleared the plane to fly, and potentially increases the company’s legal exposure as it faces civil and criminal investigations and multiple lawsuits related to both crashes.”
“This is the smoking gun,” Representative Peter DeFazio, Democrat of Oregon, told the NYT. “This is no longer just a regulatory failure and a culture failure. It’s starting to look like criminal misconduct.”
It’s unclear how Boeing’s board will respond to the latest news. It began meeting yesterday and is expected to reconvene today. (Directors have already stripped Dennis Muilenburg, the company’s C.E.O., of his chairman title.) Several top executives were expected to fly to San Antonio yesterday.
Trump’s Doral reversal highlights problem of mixing business and politics
President Trump announced over the weekend that he would drop plans to host the next Group of 7 summit at his Doral resort in Florida, after pushback from both political parties. It again highlighted the issues of his not divesting his personal business while in office.
Mr. Trump changed course on hosting the summit at Doral after moderate Republicans advised him that it was a bad idea. They’ve increasingly lost patience with the president amid the withdrawal of U.S. forces from Syria and the affair over Ukraine.
Trump aides have said that the president wanted to show off the property to a global audience. Mick Mulvaney, the acting White House chief of staff, said that Mr. Trump “still considers himself to be in the hospitality business.” And the president continues to tout his properties to foreign leaders, Politico writes. (It’s worth noting that the Trump Doral has struggled financially over the past two years.)
But experts said the move violated the spirit of government ethics rules. “It is really just about him ordering the country to pay him money,” Paul Rosenzweig, a Department of Homeland Security official in the George W. Bush administration, told the NYT. “It is just indefensible.”
All of this casts a glare on Mr. Trump’s promise to recuse himself from anything to do with his properties, the NYT notes. In remarks before he was sworn in, he said, referring to his sons, “They are going to be running it in a very professional manner. They’re not going to discuss it with me.”
Carl Icahn is close to a succession plan, of sorts
The longtime corporate raider will probably name his son, Brett, as his successor when he steps down, he told Cara Lombardo of the WSJ. Of course, that’s not expected to happen anytime soon.
• “Brett, 40, is likely to rejoin Icahn Enterprises in the coming months after a more than three-year hiatus,” Ms. Lombardo writes. “He would run a small new investment fund.”
• “For over a year on and off, father and son have been negotiating an arrangement that has already stretched to a roughly 90-page contract.”
• “Nothing is official yet and neither appears to be in any rush, partly because Brett is bearish on the market and hasn’t seen many good investment opportunities with stocks near all-time highs.”
• Mr. Icahn, 83, has no plans to step aside in the near term: “He envisions keeping up his recent rate of roughly five new activist campaigns a year and says nothing compares to the thrill of being immersed in a negotiation.”
Boris Johnson lost another Brexit battle, but the war continues
British lawmakers dealt another blow to the prime minister over the weekend, with a vote that delayed any approval of his Brexit deal. But Mr. Johnson remains within striking distance of his goal of removing Britain from the E.U., Stephen Castle and Mark Landler of the NYT write.
His government believes that it has the votes to win Parliament’s approval of the Brexit deal this week, drawing from Mr. Johnson’s Conservative Party, from lawmakers he had expelled for rebelling and from dissident members of the opposition Labour Party.
Labour and other opposition parties are struggling to unite around a common strategy. They haven’t been able to decide on whether to push for another public referendum on Mr. Johnson’s deal or for a general election.
Still, opposition lawmakers are likely to try to attach amendments to Mr. Johnson’s deal that will bog it down in legislative processes, potentially preventing Britain’s withdrawal from the E.U. by the Oct. 31 deadline.
And the bloc is weighing its response. On Saturday, Mr. Johnson reluctantly sent a legally obligated request to the E.U. asking for a Brexit extension until January. The bloc is not expected to make its decision for at least a week.
More: The new head of Citigroup’s operations in Europe, the Middle East and Africa said he remained optimistic about London’s standing as a global financial hub post-Brexit.
Mark Hurd, Oracle’s co-C.E.O., is dead at 62
The veteran tech executive, who garnered both success and scandal at Hewlett-Packard before joining Oracle, died on Friday. The company didn’t disclose a cause of death, though he had been on a medical leave since last month.
He began his career at NCR, where he developed a reputation as an operations whiz — which he took to HP when he became C.E.O. there in 2005. “He was really focused working and making things leaner and more efficient,” said Antonio Neri, the C.E.O. of Hewlett Packard Enterprise, one of the two companies spun out from HP.
But Mr. Hurd’s time at HP was tainted by a couple of scandals:
• He conceded to Congress that he had authorized a spying operation, organized by the board, into the source of leaks to reporters. “There is no excuse for this aberration,” he testified.
• He left HP after disclosing that he had had a relationship with a female consultant and had fudged some expense reports.
Tech moguls offered up litanies of praise.
• “Mark was my close and irreplaceable friend, and trusted colleague,” Larry Ellison, Oracle’s chairman, said.
• “We lost an iconic leader in high-tech,” John Chambers, Cisco’s former C.E.O., told CNBC.
• “He was a self-made success in the industry & presided over mega accomplishments,” Bill McDermott, SAP’s former C.E.O., tweeted.
Oracle is likely to name a replacement for Mr. Hurd to work alongside Safra Catz, its other co-C.E.O. Potential successors include Don Johnson, the head of the company’s cloud infrastructure unit, and Steve Miranda, the head of its applications division.
Why so many workers are on strike
By many measures, the U.S. economy is performing strongly. But from G.M. plants to Chicago’s public schools, workers are picketing — because, Noam Scheiber of the NYT reports, they feel that they haven’t gotten their share of America’s economic gains.
• “To an extent, the pattern of strikes reflects a recurring feature of the labor market: Workers typically become bolder the longer an expansion continues, using the leverage they have when jobs are harder to fill to demand greater compensation,” Mr. Scheiber writes.
• “Overall strike activity has fallen sharply since the 1970s, as the ranks of unions have been depleted, dropping to about 10 percent of the work force from over 25 percent.”
• “Now, though, workers appear increasingly willing to walk off the job. Last year, the number of workers who participated in significant strikes soared to nearly 500,000, its highest point since the mid-1980s.”
• “The backdrop for this trend is a rising gap between the money employers are making and the portion they’re sharing with workers. The share of the national income that workers receive fell in the early 2000s to its lowest level since World War II according to some measures, then collapsed further in 2009. It has yet to recover.”
Matthieu Pigasse is stepping down as Lazard’s global head of banking to start a new venture.
Thomson Reuters has reportedly hired the headhunting firm Spencer Stuart to find a successor to Jim Smith, its C.E.O.
President Trump plans to nominate Dan Brouillette as the next energy secretary, replacing Rick Perry.
The speed read
• SoftBank’s financial rescue plan for WeWork reportedly values the co-working company at below $8 billion; the tech conglomerate had valued the business at $47 billion in January. (Bloomberg)
• Proxy advisory firms, which advise institutional investors on how to vote in corporate elections, are increasingly under scrutiny from regulators. (FT)
• Shale oil companies desperate for cash are raising money through new financial transactions that resemble mortgage-backed bonds. (WSJ)
• Chinese regulators have eased profitability requirements for mergers involving companies that trade on its stock markets, in a bid to help restructure its corporate markets. (Reuters)
Trump impeachment inquiry
• The Justice Department said yesterday that it wouldn’t have met with Rudy Giuliani to discuss one of his clients had it known that federal prosecutors in New York were investigating two of his associates. (NYT)
• Trump administration officials are reportedly worried that Mr. Giuliani’s work for foreign clients could cast a shadow on his work for the White House. (Axios)
Politics and policy
• Officials from the Group of 20 countries signaled support for a plan to reshape international tax rules for corporations to close loopholes for multinationals. (WSJ)
• The Trump re-election campaign is vastly outspending Democrats and their allies on digital ads. (NYT)
• Senator Elizabeth Warren said yesterday that she would release a proposal showing how she plans to pay for her Medicare-for-all health care plan. (NYT)
• A new study shows that the benefits of estate taxes for states greatly outweighs the risks of the wealthy moving to other jurisdictions to avoid them. (NYT)
• Jamie Dimon of JPMorgan Chase called Libra, the Facebook cryptocurrency project that has been criticized by regulators worldwide, “a neat idea that will never happen.” Yet it could still prompt global banking authorities to coordinate policies on digital currencies. (Business Insider, FT)
• A bipartisan group of lawmakers sent a letter to Tim Cook, the Apple C.E.O., criticizing him for taking down an app used by Hong Kong protesters to see where police activity was. (CNBC)
• Huawei said it was in early talks with U.S. telecom companies to supply them with its 5G wireless data technology. (Reuters)
• Advertisers have spent millions of dollars on social media influencers. Now they’re questioning the wisdom of doing so. (WSJ)
Best of the rest
• A landmark federal trial over the opioid epidemic begins today. Here’s are the key things to know. (NYT)
• Sanofi recalled its over-the-counter heartburn drug Zantac in the U.S. and Canada amid regulator concerns that it contains low levels of a known carcinogen. And Johnson & Johnson has recalled 33,000 bottles of baby powder after discovering asbestos in one of them. (NYT)
• A Goldman Sachs banker, Bryan Cohen, has been charged with organizing an insider-trading scheme in which he tipped off a trader about deals involving clients of the firm. (FT)
• The streaming rights to “South Park” are reportedly close to being sold, and could fetch up to $500 million. (Bloomberg)
• The billionaire Kenneth Dart is buying up the Cayman Islands — just as the archipelago faces an existential threat from climate change. (NYT)
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