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Economy Briefs

- The Washington Times - Tuesday, August 9, 2011

STRIKE

Injunctions sought against Verizon strikers

WILMINGTON, Del. — Verizon Communications Inc. has sought court injunctions to prevent striking workers from blocking access to the company's facilities, a spokesman said on the third day of a strike involving almost half of the company's wireline employees.

Two unions representing 45,000 workers called a strike Sunday after a labor contract expired and several weeks of talks for a new contract failed.

Verizon has sought injunctions to prevent "illegal" and "reprehensible" strike activities such as keeping managers out of buildings, company spokesman Rich Young said.

Verizon got an injunction in Pennsylvania and filed for one in Delaware, and Mr. Young said the company would seek injunctions in any state where strikers block buildings.

While the company said it is holding high-level talks with union representatives, the injunctions are the latest sign of increasingly hostile relations outside the negotiating room. The Communications Workers of America has accused Verizon managers of injuring picketers.

LAWSUIT

Goldman Sachs sued over risky mortgages

LOS ANGELES — The U.S. regulator of credit unions is suing Goldman Sachs & Co. for more than $491 million in damages for losses incurred by five failed wholesale credit unions that bought mortgage-backed securities from the investment bank.

The National Credit Union Administration filed the lawsuit Tuesday in U.S. District Court in Los Angeles.

The federal regulatory agency says Goldman Sachs misrepresented the risks of the mortgage-backed securities it sold.

The agency says that when the value of the securities plunged, that led to the failure of the credit unions.

Regulators have asserted similar claims in lawsuits against JPMorgan Chase & Co. and Royal Bank of Scotland PLC.

The NCUA says it may sue five to 10 other banks in coming weeks.

AIRLINES

Long airport delays jump for 2nd straight month

NEW YORK — More than a dozen planes sat on the tarmac for more than three hours in June, the government said Tuesday. It's the second month in a row that the number of three-hour delays reached double digits since a government rule went into effect more than a year ago aiming to limit them.

The Department of Transportation said 14 planes were stuck on the tarmac for more than three hours in June. There were 16 such delays in May. There were only 20 in the full year before that. The rule threatening millions of dollars in fines for delays of three hours or more was implemented April 29, 2010.

DOT hasn't fined an airline for violating the rule, because it says that none of the delays was serious enough to justify the big penalties. Nearly all of them were caused by bad weather.

The recent uptick in delays could draw fire from passenger-rights advocates who first pushed for financial penalties. In June 2009, there were 268 delays of more than three hours. In June 2010, there were only three.

CIRCULATION

Newsstand sales of magazines are down

NEW YORK — Sales of U.S. magazines at newsstands and other retail outlets fell 9 percent in the first six months of the year, a sign of readers trimming discretionary spending, according to figures from an industry trade group released Tuesday.

Although overall circulation was down just 1 percent, the larger drop in the single-copy sales figure is troubling for magazine publishers. Publishers typically make more from those sales than from subscriptions, which are sold at a discount so publishers can boost circulation and lure advertisers.

Single-copy sales have been steadily declining. The Audit Bureau of Circulations, an industry trade group, says that in the latest period, the 418 titles examined sold 29.8 million copies at retail outlets, compared with 32.8 million a year earlier. Overall circulation was 301 million, down from 305 million.

The figures include digital sales, such as those on Apple's iPad tablet computer.

AUTO

GM to halve number of vehicle frames it makes

DETROIT — General Motors Co. has plans to become leaner in the future, cutting costs so it will make even stronger profits than it has so far this year, company executives told industry analysts Tuesday.

The company also said it will increase factory capacity 45 percent in Brazil, Russia, India and China by 2014 to take advantage of growth.

However, Chairman and CEO Dan Akerson cautioned that there is much uncertainty with volatility in the stock market and global debt concerns, saying it's difficult to predict what will happen to car and truck sales this year.

GM said it plans to cut costs by halving the number of frames it bases its vehicles on across the globe. In 2010, GM had 30 frames, known in the industry as platforms. By 2018, it plans to cut that number to 14. It also will sell more of the cars and trucks built on those platforms around the globe, saving on manufacturing, engineering and design costs. The company also plans to cut the number of engines it develops.

From wire dispatches and staff reports

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