Tag Archives: Business

Apple reaches possible settlement with the startup it sued for trade secret theft

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Apple has reached a possible settlement with Rivos, the Mountain View startup it accused in 2022 of poaching its employees and stealing its trade secrets. In the companies' filing seen by Bloomberg and Reuters, they told the US District Court for the Northern District of California that they have signed an agreement that "potentially settles the case." Their deal would allow Apple to conduct a forensic examination of Rivos' systems, as well as of its activities. 

When Apple sued Rivos, it said the startup led a "coordinated campaign" to hire away employees from its chip design division. Apple also accused the defendant of instructing the employees it hired away to steal presentations and other proprietary information for unreleased iPhone chip designs that cost billions of dollars to develop. Rivos countersued Apple last year, accusing the larger company of restricting employees' ability to work elsewhere and of hindering emerging startups' growth by using anticompetitive measures. 

The court dismissed Apple's trade secret claims against Rivos in April 2023, though the company was allowed to file a revised complaint. Apple already settled with its six former employees who filed a countersuit against Apple along with Rivos after they dropped their claims against each other last month. Both companies are now requesting the court to put their cases on hold until March 15, when they expect the settlement to be completed. 

This article originally appeared on Engadget at https://www.engadget.com/apple-reaches-possible-settlement-with-the-startup-it-sued-for-trade-secret-theft-121513902.html?src=rss

FTC accuses Microsoft of misrepresenting its Activision Blizzard plans after layoffs

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One week after Microsoft laid off nearly 2,000 employees in its gaming division, the Federal Trade Commission is accusing Microsoft of contradicting its pledge to allow Activision Blizzard to operate independently post-acquisition. The FTC filed a complaint in a federal appeals court on Wednesday, arguing that last week's downsizing, which affected employees of Activision Blizzard, "contradicts Microsoft’s representations in this proceeding." The FTC is asking for a temporary pause of Microsoft's acquisition of Activision Blizzard as it further investigates potential antitrust issues.

In its arguments to the FTC over the past two years, Microsoft said it would treat Activision Blizzard as a vertical acquisition and suggested that it wouldn't need to institute layoffs, since there would be no redundancies. On January 30, Microsoft announced it was cutting 1,900 jobs across Activision Blizzard, ZeniMax and Xbox after identifying "areas of overlap" specifically between Microsoft and Activision Blizzard. This discrepancy is the core of the FTC's complaint.

"Microsoft’s recently-reported plan to eliminate 1,900 jobs in its video game division, including in its newly-acquired Activision unit, contradicts the foregoing representations it made to this Court," the FTC's complaint said. "Specifically, Microsoft reportedly has stated that the layoffs were part of an 'execution plan' that would reduce 'areas of overlap' between Microsoft and Activision, which is inconsistent with Microsoft’s suggestion to this Court that the two companies will operate independently post-merger."

Though the UK's Competition and Markets Authority approved Microsoft's $69 billion acquisition of Activision Blizzard in October, the FTC hasn't seen satisfaction regarding its own antitrust concerns. The FTC is still challenging the acquisition, which means there's a possibility that Microsoft will be forced to divest all or part of Activision Blizzard.

In Wednesday's complaint, the FTC argued that the recent layoffs also undermine its own ability to order relief for employees who were negatively affected in the acquisition.

Microsoft's layoffs join an avalanche of mass firings in the video game industry, specifically in the past few months. An estimated 10,500 people in video games lost their jobs in 2023 — and already in 2024, 6,000 workers have been laid off.

Microsoft on Thursday filed a response to the FTC's complaint, arguing that the regulator has not provided evidence of harm resulting from the Activision Blizzard acquisition. Microsoft's letter to the federal appeals court reads, in part, "Consistent with broader trends in the gaming industry, Activision was already planning on eliminating a significant number of jobs while still operating as an independent company. The recent announcement thus cannot be attributed fully to the merger."

A Microsoft spokesperson also provided Engadget the following statement: "In continuing its opposition to the deal, the FTC ignores the reality that the deal itself has substantially changed. Since the FTC lost in court last July, Microsoft was required by the UK competition authority to restructure the acquisition globally and therefore did not acquire the cloud streaming rights to Activision Blizzard games in the United States. Additionally, Sony and Microsoft signed a binding agreement to keep Call of Duty on PlayStation on even better terms than Sony had before."

Update, February 8 2024, 12:30PM ET: This story was updated to include Microsoft's response to the FTC complaint.

This article originally appeared on Engadget at https://www.engadget.com/ftc-accuses-microsoft-of-misrepresenting-its-activision-blizzard-plans-after-layoffs-215502314.html?src=rss

The Biden administration now requires large cryptocurrency miners to report their energy use

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The Biden administration recently announced that it would be requiring large cryptocurrency mining operations to report electricity usage, via a press release from The Energy Information Administration. This follows concerns that the industry could pose a threat to the nation’s electricity grids and hasten the impacts of climate change.

To that end, the EIA has targeted 137 “identified commercial cryptocurrency miners” working in the US. These operations account for around 2.3 percent of national energy usage. This breaks down to 90 terawatt-hours per year, which is more than Finland, Belgium and Chile use in that same time period. The world’s crypto miners used as much electricity in 2023 as the entire country of Australia. That's a whole lot of energy for Shiba Inu-branded internet money with no practical application.

The data collection started this week. The survey aims to get a sense of the industry’s growing demands and which parts of the country are the biggest crypto hotbeds, so as to refine policy later on. The EIA has already discovered that nearly 38 percent of all bitcoin is mined in the US, which is up from 3.4 percent in 2020.

“As cryptocurrency mining has increased in the United States, concerns have grown about the energy-intensive nature of the business and its effects on the US electric power industry,” the EIA said in a report that offered further details behind the survey.

The EIA went on to note that large crypto mining operations could strain the electricity grid during peak periods, force higher energy prices for average consumers and negatively impact energy-related carbon dioxide emissions. Most of the electricity generated throughout the world comes from burning fossil fuels, and that process releases carbon dioxide into the atmosphere.

The clean energy advocacy group RMI estimates that US cryptocurrency mines release 25 to 50 million tons of CO2 into the atmosphere every year. That’s around the same amount as the yearly diesel emissions from the US railroad industry. 

The biggest mining operations in the country are scattered throughout 21 states, but largely clustered in Texas, Georgia and New York. This is especially dangerous for Texans, as the state’s energy grid is already notoriously fragile. Ben Hertz-Shargel, who leads energy research consultancy firm Wood Mackenzie, told Ars Technica that crypto mining operations are not only placing a higher burden on the state’s energy grid, but increasing prices for consumers. 

Energy costs in Texas are based on real-time demand, so Hertz-Shargel estimates that state residents see an increase of 4.7 percent in their monthly utility bills due to cryptocurrency mining. He also said that mining operations tend to open up shop next to pre-existing renewable energy facilities, which draws clean power away from nearby homes and businesses.

It’s not all doom and gloom in the crypto world. Back in 2022, Ethereum announced a software update to make mining ether more eco-friendly. The Ethereum Foundation claims this reduces the carbon emissions of its mining operations by more than 99 percent. However, ether accounts for just 17 percent of the global cryptocurrency market share.

This article originally appeared on Engadget at https://www.engadget.com/the-biden-administration-now-requires-large-cryptocurrency-miners-to-report-their-energy-use-182831778.html?src=rss

DoorDash increases NYC delivery fees following new minimum wage rules

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DoorDash customers in NYC will notice a new fee tacked onto their bill when they purchase food for delivery through the app. The company has started charging users $2 more for deliveries in NYC as a response to the city's new minimum wage law, a spokesperson has confirmed to Business Insider. It warned users back in December that the new minimum pay rate, which it called "ill-conceived" and "extreme," will have "significant consequences for everyone" who uses its platform and will "force [it] to raise fees for orders." Other major cities implementing a minimum pay rate for app-based deliveries will also be affected. Seattle customers, for instance, were recently hit with new fees worth 10 cents to $3.40 order. 

Under the new regulations, services like Uber, DoorDash and Grubhub will have to pay workers at least $18 an hour. DoorDash has chosen to pay drivers $29.93 for every active hour only, which means they're unpaid for the time they spend waiting for orders to come in. When the company published its response to Seattle's new rules, it said it was going to reduce the suggested tip amount for each purchase "in order to better balance the impact of these new costs and provide the best experience for consumers." 

Customers can still tip any amount they want, but they may be less inclined to tip as much as before due to the added fees. That's one possible direct impact to drivers, since as DoorDash notes in its announcement, they get 100 percent of customers' tips. That hasn't always been the case. Back in 2019, news reports exposed the company's practice of pocketing tips and using that money to pay for drivers' guaranteed fees, which should've come from DoorDash itself. The food delivery service only introduced a new earnings and tipping policy that ensures drivers are getting their tips shortly after those reports came out. 

This article originally appeared on Engadget at https://www.engadget.com/doordash-increases-nyc-delivery-fees-following-new-minimum-wage-rules-105051707.html?src=rss

Comcast agrees to kill 10G branding after advertising watchdogs said it was misleading

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Comcast is discontinuing its its “Xfinity 10G Network” branding to describe its internet service after a National Advertising Review Board (NARB) panel found that the term could mislead consumers into thinking that Comcast’s cellular and broadband services would offer much faster speeds than current-generation networks. Comcast rivals T-Mobile and Verizon had challenged the branding with the National Advertising Division (NAD), an ad industry watchdog, which had recommended that Comcast get rid of it in October 2023. Comcast’s confusing branding is at the heart of this challenge: “5G” refers to mobile internet, while “10G” refers to 10-gigabit broadband speeds typically delivered to homes through physical infrastructure.

On Wednesday, the NARB said that it agreed with the NAD’s decision and recommended that Comcast “discontinue use of the term 10G in the product service name ‘Xfinity 10G Network’ and when 10G is used descriptively to describe the Xfinity network.” The NARB found that the branding could mislead consumers into thinking that “10G” offered significantly faster speeds than current-generation 5G networks

The NARB also decided that using “10G” to refer to home broadband, as Comcast did, was misleading because consumers would assume that they would get 10-gigabit internet speeds on every Xfinity connection. In reality, as Ars Technica pointed out, getting those speeds requires getting Xfinity’s fiber-to-the-home connection, which typically costs hundreds of dollars more in monthly fees, installation, and activation over Xifnity’s regular cable broadband plans.

In a statement that Comcast provided to the NARB, the company agreed to stop using the misleading branding in its marketing. "Although Comcast strongly disagrees with NARB's analysis and approach, Comcast will discontinue use of the brand name 'Xfinity 10G Network' and will not use the term '10G' in a manner that misleadingly describes the Xfinity network itself," Comcast said. 

The company said, however, that it still “reserves the right” to use both “10G” and “Xifnity 10G” in ways that do “not misleadingly describe the Xfinity network itself”, so expect both terms to still show up in Xfinity marketing, just, hopefully, in less misleading ways.

This article originally appeared on Engadget at https://www.engadget.com/comcast-agrees-to-kill-10g-branding-after-advertising-watchdogs-said-it-was-misleading-185550194.html?src=rss

Tesla sued by 25 California counties for allegedly mishandling hazardous waste

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Tesla is facing a lawsuit from 25 California counties accusing it of mishandling hazardous waste at facilities around the state, according to a complaint filed in San Joaquin County Superior Court. The lawsuit, which seeks civil penalties and an injunction forcing Tesla to correctly handle waste, was filed after months of negotiations reportedly broke down. Civil penalties could amount to as much as $70,000 per violation per day, Reuters reported.

Los Angeles, San Francisco and other counties accused Tesla of improperly labeling and disposing of materials at transfer stations or landfills "not permitted to accept hazardous waste." Waste materials include "lubricating oils, brake fluids, lead acid batteries, aerosols, antifreeze, cleaning fluids, propane, paint, acetone, liquified petroleum gas, adhesives and diesel fuel," the complaint states. It adds that Tesla "continues to do so at and/or from its facilities."

Tesla revealed that it was being probed by California district attorneys over its waste management handling in a 2022 Securities and Exchange Commission (SEC) filing. It stated at the time that it "had implemented various remedial measures, including conducting training and audits and enhancements to its site waste management programs," according to TechCrunch. It said in October 2023 that it was in settlement talks with District Attorneys across California, but those apparently failed to bear fruit.

Tesla has previously faced legal repercussions over its handling of waste. In 2019, it reached a settlement with the Environmental Protection Agency over federal hazardous materials violations. As part of that, Tesla agreed to properly manage waste at its Fremont plant and pay a $31,000 fine. 

This article originally appeared on Engadget at https://www.engadget.com/tesla-sued-by-25-california-counties-for-allegedly-mishandling-hazardous-waste-082034366.html?src=rss

Elon Musk’s $56 billion Tesla pay package has been tossed out by the court

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In 2018, Tesla awarded Elon Musk a $56 billion pay package that helped propel him to the top of world's richest lists. Now, a judge in Delaware has rendered the deal between the company and the CEO to be invalid and called the compensation an "unfathomable sum" that's unfair to shareholders. As initially seen and reported by Chancery Daily on Threads, the court of Chancery in Delaware has released its decision on the lawsuit filed by Richard Tornetta. The Tesla shareholder accused the automaker of breaching its fiduciary duty by approving a package that unjustly enriches its chief executive.

Judge Kathaleen McCormick wrote in the decision that Musk "enjoyed thick ties" with the directors who were in charge of negotiating his pay package on behalf of Tesla, which means there "was no meaningful negotiation over any of the terms of the plan." The judge also talked about how Musk owned 21.9 percent of the automaker when the package was negotiated. That gave him "every incentive to push Tesla to levels of transformative growth," because he stood to gain $10 billion for every $50 billion in market capitalization increase. 

"Swept up by the rhetoric of 'all upside,' or perhaps starry eyed by Musk’s superstar appeal, the board never asked the $55.8 billion question: Was the plan even necessary for Tesla to retain Musk and achieve its goals?" the judge wrote in the court document. As The Washington Post notes, she ruled that Tornetta is entitled to a "rescission" and has ordered Tesla and its shareholders to carry out her decision and undo the deal. Musk's camp, however, can still appeal her ruling. 

Musk has sold some of his Tesla stocks to help pay for his acquisition of Twitter, now X, from the time his pay package was approved. At the moment, he owns around 13 percent of Tesla, though he recently said that he wants 25 percent control over the company before he's comfortable growing it to be a leader in AI and robotics. 

In response to the court's decision, Musk tweeted: "Never incorporate your company in the state of Delaware." He also posted a poll asking followers whether Tesla should change its state of incorporation to Texas, where its physical headquarters are located. 

This article originally appeared on Engadget at https://www.engadget.com/elon-musks-56-billion-tesla-pay-package-has-been-tossed-out-by-the-court-074235803.html?src=rss

Lawsuit says 23andMe hackers targeted users with Chinese and Ashkenazi Jewish heritage

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In October 2023, 23andMe admitted that it suffered a data breach that compromised its users' information. The company has been hit with several lawsuits since then, and according to The New York Times, one of them is accusing 23andMe of failing to notify customers that they were specifically targeted for having Chinese and Ashkenazi Jewish heritage. They also weren't told that their test results with genetic information had been compiled in curated lists that were then shared on the dark web, the plaintiffs said. 23andMe recently released a copy of the letters it sent to affected customers, and they didn't contain any reference to the users' heritage. 

The lawsuit was filed in federal court in San Francisco after the company revealed that the hack had gone unnoticed for months. Apparently, the hackers started accessing customers' accounts using login details already leaked on the web in late April 2023 and continued with their activities until September. It wasn't until October that the company finally found out about the hacks. On October 1, hackers leaked the names, home addresses and birth dates of 1 million users with Ashkenazi Jewish ancestry on black hat hacking forum BreachForums. 

After someone responded to the post asking access to "Chinese accounts," the lawsuit said the poster linked to a file containing information on 100,000 Chinese users. The poster also said they had access to 350,000 Chinese profiles and could release more information if there was enough interest. In addition, the same poster allegedly returned to the forum in mid-October to sell data on "wealthy families serving Zionism" after the explosion at Al-Ahli Arab Hospital in Gaza. 

"The current geopolitical and social climate amplifies the risks" to users whose data was exposed, according to the lawsuit, since the leaked information included their names and addresses. The plaintiffs want their case to be heard by a jury and are seeking compensatory, punitive and other damages.

This article originally appeared on Engadget at https://www.engadget.com/lawsuit-says-23andme-hackers-targeted-users-with-chinese-and-ashkenazi-jewish-heritage-132423486.html?src=rss

The FTC is investigating Microsoft, Amazon and Alphabet’s investments into AI startups

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The Federal Trade Commission is launching an inquiry into massive investments made by Microsoft, Amazon and Alphabet into generative AI startups OpenAI and Anthropic, the agency announced on Thursday. The FTC said that it had issued “compulsory orders” to the companies and would scrutinize their relationships with AI startups to understand their impact on competition.

“History shows that new technologies can create new markets and healthy competition,” FTC Chair Lina Khan said in a statement. “As companies race to develop and monetize AI, we must guard against tactics that foreclose this opportunity. Our study will shed light on whether investments and partnerships pursued by dominant companies risk distorting innovation and undermining fair competition.” The companies have 45 days to respond to the agency. 

Ever since OpenAI released ChatGPT at the end of 2022, generative AI has exploded, sparking both excitement about its potential to increase productivity as well as anxiety about job losses. Against this backdrop, the world’s largest tech companies have been racing to develop their own versions of the tech as well as pouring billions of dollars into smaller startups creating it. 

Microsoft, for instance, invested more than $13 billion into OpenAI for a 49 percent stake, using the startup’s tech to add generative AI capabilities to Bing, its own search engine, as well as Windows and Office. Amazon and Alphabet invested $4 billion and $2 billion respectively in Anthropic, an AI startup that makes a chatbot called Claude.

In an opinion column in The New York Times last year, the FTC’s Khan wrote that “the expanding adoption of AI risks further locking in the market dominance of large incumbent technology firms” and argued for AI regulation.

As part of its investigation, the FTC is seeking information about the specifics of Microsoft, Amazon and Alphabet’s investments, decisions around new product releases, oversight rights, analyses of market share and potential for sales growth among other details.

The US isn’t the only country examining Big Tech’s ties with generative AI startups. The UK’s Competition and Markets Authority said last month that it was examining whether Microsoft’s investment into OpenAI was subject to antitrust law.

In a post on X in December, Microsoft’s president Brad Smith characterized the company’s OpenAI investment as a partnership “that has fostered more AI innovation and competition, while preserving independence for both companies.” Microsoft currently has a non-voting observer seat on OpenAI’s board, which, said Smith, was “very different from an acquisition.”

“We hope the FTC’s study will shine a bright light on companies that don’t offer the openness of Google Cloud or have a long history of locking-in customers – and who are bringing that same approach to AI services," a Google spokesperson told Engadget.

"The U.S. has assumed a global AI leadership position because important American companies are working together," Rima Alaily, Microsoft's vice president for Competition and Market Regulation, told Engadget in a statement. "Partnerships between independent companies like Microsoft and OpenAI, as well as among many others, are promoting competition and accelerating innovation. We look forward to providing the FTC with the information it needs to complete its study.”

Spokespeople from Amazon and Anthropic declined to comment. OpenAI did not respond to a request for comment from Engadget.

This article originally appeared on Engadget at https://www.engadget.com/the-ftc-is-investigating-microsoft-amazon-and-alphabets-giant-investments-into-ai-startups-190939602.html?src=rss

France fines Amazon $35 million over ‘intrusive’ employee surveillance

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France’s data privacy watchdog organization, the CNIL, has fined a logistics subsidiary of Amazon €32 million, or $35 million in US dollars, over the company’s use of an “overly intrusive” employee surveillance system. The CNIL says that the system employed by Amazon France Logistique “measured work interruptions with such accuracy, potentially requiring employees to justify every break or interruption.”

Of course, this system was forced on the company’s warehouse workers, as they seem to always get the short end of the Amazon stick. The CNIL says the surveillance software tracked the inactivity of employees via a mandatory barcode scanner that’s used to process orders. The system tracks idle time as interruptions in barcode scans, calling out employees for periods of downtime as low as one minute. The French organization ruled that the accuracy of this system was illegal, using Europe’s General Data Protection Regulation (GDPR) as a legal basis for the ruling.

To that end, this isn’t being classified as a labor case, but rather a data processing case regarding excessive monitoring. “As implemented, the processing is considered to be excessively intrusive,” the CNIL wrote, noting that Amazon uses this data to assess employee performance on a weekly basis. The organization also noted that Amazon held onto this data for all employees and temporary workers.

Amazon responded with a lengthy statement on the matter, writing “we strongly disagree with the CNIL’s conclusions, which are factually incorrect, and we might appeal the decision.” Amazon went on to say that it's not the only company in the logistics industry that uses a connected warehouse system of this sort, going on to tout the system for balancing the “workload between teams so that we can keep processing orders in a safe and efficient manner.” It did say it would extend the threshold limit of its system, potentially giving employees a longer window before alerts start coming in.

Amazon did say it’s mulling an appeal, so we’ll keep an eye on this story as it develops. Over on the other side of the pond, the company has found itself practically living in hot water. Amazon was found to be responsible for more than half of warehouse worker injuries in 2022 and has been accused of unfair labor practices on several occasions. As a matter of fact, the company’s logistics division churns through employees at such a high rate that it ends up costing Amazon $8 billion each year. Maybe it needs a corporate monitoring system of some kind.

This article originally appeared on Engadget at https://www.engadget.com/france-fines-amazon-35-million-over-intrusive-employee-surveillance-161302822.html?src=rss