Market Basket: Arthur S. blasts Arthur T.

In a blistering statement late last night, Market Basket shareholders aligned with majority owner Arthur S. Demoulas said they had repeatedly offered to sell the embattled grocery chain to Arthur T. Demoulas and accused the ousted CEO of acting in bad faith and sabotaging the company, adding that they were left with no choice but to explore other options for a sale.

"Arthur T. Demoulas' conduct to date, including his most recent public statement, continues to undermine Market Basket and the Class B shareholders (led by Arthur T.) have not indicated a willingness to engage in good-faith discussions for a sale," the Class A shareholders said in the statement. "The Class B shareholders have given us no choice at this time but to consider all available options to sell our equity."

It was the latest salvo in an escalating war of words between the rival factions in what experts say is a win-at-all-costs strategy that puts the 71-store chain at risk of suffering irreparable damage.

"It's almost like they have this scorched-earth policy where they'll just let the company fall to pieces," said supermarket analyst David Livingston of DJL Research in Milwaukee. "It's almost like going through a divorce. There became a point where I didn't care how much money I gave my ex-wife, I just wanted to get her out of my life."

Arthur S.'s side of the family controls 50.5 percent of Market Basket, while Arthur T.'s side controls the rest. Market Basket's board of directors has said it is evaluating several offers for the company. The Boston Globe has reported that Hannaford is a potential suitor, but the company has yet to confirm that.

The Class A shareholders, who have been silent until now, said they are still willing to sell to Arthur T. for the price he proposed and have also offered to provide financing.

"Our proposal would permit Arthur T. Demoulas to return to work immediately to work corroboratively to stabilize the business on terms proposed by the independent directors of the Market Basket Board," they said. "Our proposal, made last week and reiterated throughout this week, has not been accepted."

The directors on Friday offered to have Arthur T. return, but not as CEO, prompting his spokeswoman to accuse the board of trying to "stabilize the company, while they consider selling it to another bidder." Yesterday, the three directors issued a statement accusing Arthur T. Demoulas of holding customers and employees hostage.

"Business negotiations should not prevent our associates from earning a living or our customers from buying groceries," the directors said. "It is wrong to hold everyone hostage to gain a negotiation advantage."

Arthur T.'s spokeswoman declined to comment on the latest statement from the board and did not respond to an email on the shareholders' statement.

Livingston said the feuding Demoulas cousins may care more about beating the other than making the right decisions for the company.

"I think they're just trying to one-up each other," Livingston said. "Winning becomes more important than the money and winning becomes more important than customers and employees."

Market Basket store shelves have been empty and customers have gone elsewhere since workers launched protests and walkouts July 18 calling for the return of Arthur T., who was ousted by the board — led by Arthur S. Demoulas — in June. Some estimates have put business at the chain down as much as 90 percent.

"The value of the company is going down every day for an outside buyer," said Emily Porschitz, a management professor and expert on family owned businesses at Keene State University in New Hampshire. "Neither side seems to be giving an inch."

The latest statement from the directors did not sit well with employees.

"It's almost like they're calling us pawns," said Scott Ivers, manager of a store in Lowell.

John Savastis, manager of a store in Fitchburg, agreed.

"To make that kind of statement, that employees are being held hostage by Arthur T. Demoulas, it's ludicrous, it's ridiculous, it's disingenuous," Savastis said. "I don't see anyone having power over me, or having power over customers not shopping here."

Porschitz said the battle between cousins is the biggest obstacle to a resolution.

"The feud is so large and deep and long that they really can't have any kind of civil discussion," she said. "They're certainly not sitting down and having any productive communications."

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App lets musicians practice with a virtual orchestra

Many people learning to play an instrument practice by themselves and eventually give up out of sheer boredom. But a new app developed by a MassChallenge finalist gives both amateur and professional musicians the chance to play, virtually, at Carnegie Hall.

"Most music is meant to be played with other people," said Ann Chao, a pianist and flutist who founded Sonation last summer with cellist Paul Smith. "Cadenza helps you learn music in context by playing your instrument with a full orchestra so that you get to be the star."

The technology behind Cadenza came out of National Science Foundation-funded research that enables the app to predict with astonishing accuracy what you will do next, based upon your playing pattern, and synchronize the pre-recorded orchestra to your tempo accordingly, said Chao, 27.

When the piece is over, Cadenza incorporates what it has learned about your style into future sessions so that the next time you play the same piece, the orchestra will fit your playing even more precisely, even if you don't play exactly the same way again, she said.

The app allows for mistakes and wrong notes as a natural part of music practice, Chao said. The accompaniment will stop only if you do or if you've made significant errors, such as missing every note for several measures, she said.

Usually, you can just pick up where you left off, and Cadenza will figure out where you are in the piece, Chao said.

"I tried it out and was actually blown away by how well it connects and works with the input it gets from my playing," said Johannes Moser, a cellist who'll be playing his debut in January with the Boston Symphony Orchestra. "I think it's a great way of introducing younger players and amateurs to the sonic experience of performing with an orchestra."

Beginning this fall, people who play any of nine instruments — violin, viola, cello, flute, clarinet, oboe, bassoon, trumpet or French horn — will be able to download the iPad app for free and pay for the music they want to play, just like iTunes.

Based at the Harvard Innovation Lab, Sonation has added more than 150 tracks of classical music to Cadenza and will continue to expand its library, Chao said.

The company also will create apps to serve other types of musicians, as well, she said.

Letitia Jap, a New England Conservatory student, is using a prototype version that Sonation made available to her violin professor, Nicholas Kitchen.

"I thought it was a fascinating invention," Jap said in an email. "It looked like a karaoke version for instruments. It has taught me how to be more articulate with my playing, as well as how to cue/lead better. ... You become more aware of harmony changes, as well as orchestra line. You learn to respond to them."

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Ashton Kutcher's A+ viral site accused of plagiarism

Ashton Kutcher probably wishes he was being Punk'd right about now.

The actor's viral content site Aplus.com (stylized as A+) is being accused of plagiarizing articles from the Huffington Post, BuzzFeed and Cracked, among other outlets, the Daily Dot reports.

The online venture, which was started in 2011 and relaunched in 2013, aggregates web content, primarily listicles and popular videos and photos, to "leverage viral social storytelling to create positive change in the world."

Kutcher, an A+ co-founder and an investor, heavily promotes the site's content on his personal Twitter and Facebook accounts, according to the Daily Dot. The actor-turned-tech-investor also has financial ties to Skype, Flipboard and Foursquare.

The Daily Dot cites a slew of articles (screengrabbed before being removed by A+) that were either copied word for word, lifted with minor changes or reproduced without proper attribution.

The posts in question include a human interest piece titled "This Girl Was Sent Home in Tears Because Her Dress Was Too Short So Her Mom Did The Most Awesome Thing Ever," which is comparable to a BuzzFeed article by Ryan Broderick. BuzzFeed recently fired its own political editor Benny Johnson over plagiarism charges.

Another example is the listicle "50 Awesome Tattoos Inspired By Books You Grew Up With As A Kid," which bears a striking resemblance to Buzzfeed's "50 Incredible Tattoos Inspired By Books From Childhood."

"We take these allegations seriously and are looking into them," Evan Beard of A+ told the Daily Dot in a statement. "The content that was removed was taken down as a precautionary measure. Respecting the intellectual property of others is extremely important to us."

This includes the removal of all articles dated before July, as well as tweets from before August 6 and Facebook posts from before August 4.

(C) 2014 Variety Media, LLC, a subsidiary of Penske Business Media; Distributed by Tribune Content Agency, LLC

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China's inflation stays at 2.3 percent in July

BEIJING — China's consumer price index rose 2.3 percent in July from a year earlier, well below the ruling Communist Party's 3.5 percent target for the year.

The latest inflation rate was unchanged from June, according to data released Saturday by the National Bureau of Statistics.

The rise in the index was driven largely by higher food prices, which increased by 3.6 percent. Prices for fruits and eggs rose the fastest.

Experts expect the inflation to stay stable this year, leaving room for interest rate cuts or other measures to stimulate the economy if necessary.

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Judge grants preliminary injunction to Lionsgate over 'Expendables 3' piracy

Lionsgate was granted a preliminary injunction on Friday in its attempt to limit the scope of piracy of "The Expendables 3" after a leaked high-quality copy of the film showed up on file-sharing sites.

U.S. District Judge Margaret Morrow earlier this week issued a temporary restraining orderbarring six sites from linking or hosting copies of the movie. But she extended that to an injunction after none of them responded.

Her order also prohibits any third party from "taking any action that induces, causes or materially contributes to" the infringement of Lionsgate's copyright, including hosting, linking or providing access to such things as torrent files and trackers. She also ordered banks, payment processors and advertisers to shut down accounts connected to the sites.

In court filings, Lionsgate said that the copy of the movie was obtained through "fraudulent or otherwise unlawful means." Within days of its July 24 discovery of the leak, the film was available on hundreds of websites. As of July 31, it was downloaded 2.1 million times worldwide on peer-to-peer networks, including 247,000 downloads in the U.S., according to the studio. About 21,000 of them were in the Los Angeles area.

Lionsgate also estimates that the movie was downloaded or streamed on "hundreds of thousands, or millions" of time outside of peer-to-peer networks. The studio's contractor, MarkMonitor, sent 2,770 takedown notices, and while most complied, the studio named some of those that did not in its complaint. They include limetorrents.com, billionuploads.com, hulkfile.eu, played.to, swankshare.com and dotsemper.com.

Lionsgate said that an investigation of the leak is ongoing.

(C) 2014 Variety Media, LLC, a subsidiary of Penske Business Media; Distributed by Tribune Content Agency, LLC

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Ga. trial shows food safety relies on honor system

ALBANY, Ga. — Jurors at the nation's first federal criminal trial stemming from a deadly outbreak of food-borne illness are learning a disconcerting fact: America's food safety largely depends on the honor system.

Witnesses say Stewart Parnell and others at Peanut Corporation of America knowingly shipped salmonella-tainted products, and that they sent customers lab results from other clean batches rather than wait for tests to confirm their products were free of deadly bacteria.

Defense lawyers correctly noted for the jurors that salmonella tests aren't even required by federal law.

Parnell and his two co-defendants face long prison sentences if convicted of knowingly shipping the contaminated peanut products linked to a nationwide salmonella outbreak that killed nine people and sickened 714 across 43 states in 2008 and 2009.

Their plant in rural Blakely, Georgia, was shut down and the company went bankrupt. Long after consumers ate contaminated peanut butter, ice cream, energy bars and other products, the outbreak prompted one of the largest food recalls in U.S. history.

But Stewart Parnell, his brother and food broker, Michael Parnell, and quality assurance manager Mary Wilkerson aren't charged with killing anybody. In fact, prosecutors agreed not to mention the death toll to the jurors.

The 76-count indictment instead accuses the Parnell brothers of defrauding customers that used Peanut Corporation's contaminated products as ingredients. Stewart Parnell and Wilkerson are charged with concealing information from federal investigators.

Only some customers — such as Kellogg's — required the plant to ensure it's shipments were salmonella-free.

"If they didn't require it, it did not get tested," Samuel Lightsey, who managed the Georgia plant during the outbreak, told jurors Friday.

Lightsey pleaded guilty to seven criminal counts in May and agreed to testify in exchange for a lighter sentence.

Food and Drug Administration investigators ultimately discovered that lab tests had showed contamination in the plant's chopped nuts, peanut butter or peanut paste 12 times during the two years before the outbreak.

FDA inspector Janet Gray walked the jury through documents showing at least eight of those salmonella-tainted lots were shipped to customers anyway.

"There is no legal requirement for testing at all for salmonella," Tom Bondurant, Stewart Parnell's defense lawyer, told jurors during opening statements Aug. 1. "There wasn't then, and there's not now."

That's true and it could be a problem for prosecutors in the case, said Jaydee Hanson of the Center for Food Safety.

But defense lawyers have a problem of their own — and that goes back to the honor system.

"The problem is that the company committed big-time fraud," Hanson said.

Public outcry over the peanut case and several other outbreaks of food borne illness led Congress to pass the Food Safety Modernization Act of 2011, which was supposed to give the FDA more resources and enforcement power.

Three years later, most of its rules have not been published, and the FDA still doesn't require that products be free of salmonella when shipped, said Hanson. His organization sued the FDA and won a federal consent decree ordering the agency to implement the law by next year.

Salmonella causes an estimated 1.2 million illnesses every year in the United States, with about 23,000 hospitalizations and 450 deaths, according to the U.S. Centers for Disease Control and Prevention. The bacteria can cause severe diarrhea and vomiting, with infections that spread throughout the body, killing people who aren't quickly treated with antibiotics. The elderly, infants and people with compromised immune systems are particularly vulnerable.

The CDC says it has tracked salmonella outbreaks since 1962. It even has an interactive map with county-by-county information on the impact. And while many sources are never discovered, dozens of food producers have been identified through the years. Some egregious incidents have resulted in fines, and victims have found private attorneys to file civil lawsuits that often get settled out of court. But illnesses, and deaths, continue.

"Could all these people have been charged criminally with something? The answer is, hell yes," said Bill Marler, an attorney who claims to have won $500 million for victims of food-borne illnesses over the past two decades.

Three other cases — a salmonella outbreak traced to eggs in Iowa, a listeria outbreak blamed on dirty cantaloupes in Colorado and an E. coli outbreak linked to Odwalla juices in California — resulted in federal plea deals without prison time. This is the first to go to trial, Marler said.

"I'm a firm believer in using the civil justice system to hold people accountable. But these criminal prosecutions have really got people's attention," said Marler. "It's a completely different viewpoint that these CEOs and managers have when they're facing jail time and fines that aren't insured."

Meanwhile, the FDA lacks the resources to regularly inspect food producers, and when outbreaks happen, they largely depend on their goodwill to find the source.

FDA investigator Bob Neligan testified that when he first arrived at the Georgia plant on Jan. 9, 2009, he immediately asked for any information or records related to positive salmonella tests. Lightsey told inspectors that the plant's only brush with salmonella had turned out to be a false-positive test, Neligan said, and Stewart Parnell offered no further information.

"Records are voluntary," Neligan told the jury. "It has been my experience in my 25 years (with FDA) that, when there is a concern regarding a nationwide food-borne illness, a firm is usually more than willing to hand over as many records as they can to resolve the issue quickly."

But in this case, it took five days of pressing before Lightsey said there had been three confirmed tests for salmonella, Neligan said, and only when investigators repeatedly asked for more information did he reveal two others. He said it took a rare FDA order demanding two full years of production, shipping and microbial testing records within 24 hours to come up with the rest.

Lightsey now says he should have spoken up after discovering the company was lying about its salmonella tests, but didn't take it seriously enough at the time.

"I never would have shipped anything that I thought would hurt someone," he testified. "In my mind, I wasn't intentionally hurting anyone."

___

Associated Press Writer Michael Warren in Atlanta contributed to this report.

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Senators propose letting cable customers decide which TV stations they want

Sen. Jay Rockefeller (D-W. Va.) and Sen. John Thune (R-S.D.) are proposing that subscribers to cable and satellite services be allowed to choose which broadcast channels they want to pay for as part of their multichannel package.

Their proposal was met with immediate opposition on Friday from the broadcast lobby -- and praise from groups representing pay-TV providers and smaller cable systems.

The rationale behind the proposal has been to limit the blackouts that occasionally take place when multichannel operators negotiate with broadcasters for retransmission rights, according to The Hill. A showdown between CBS and Time Warner Cable last year saw a month-long blackout on the latter's systems.

Rockefeller, the chairman of the Senate Commerce Committee, and Thune, its ranking member, plan to attach their proposal to the Satellite Television Extension and Localism Act, which is now making its way through Congress. That legislation would renew provisions that allow satellite companies to carry broadcast signals to rural customers.

The American Television Alliance, an organization of cable, satellite and telephone companies, said that the proposal would "provide consumers with great choice and transparency and would end retrans blackouts once and for all."

Matthew Polka, president and CEO of the American Cable Assn., said that the proposal would "put consumers first" and "provide consumers with more choice in the selection of TV station programming than they have seen in decades."

Nevertheless, the proposal is likely to face fierce opposition for broadcasters, who have seen retransmission fees as an increasingly lucrative revenue stream, now totaling an estimated $4 billion. Allowing customers to choose whether they want to pay a station's set fee in order to get the channel very likely would cut into that, as it gives them an "ala carte" option. Many large cable providers and media companies have generally been opposed to such an "ala carte" option when it comes to non-broadcast channels, as it is likely that many of those channels would not be able to survive under such a scenario.

Of course, any consumer with an antenna can get all the broadcast channels for free if they want to go through the trouble of setting one up.

Dennis Wharton, spokesman for the National Assn. of Broadcasters, said that the proposal "represents a significant rewrite of the Communications Act. Given the shortness of time between now and the end of the Congressional session, we question whether there is sufficient time for key committees in Congress to give this proposal the thorough review that is warranted."

(C) 2014 Variety Media, LLC, a subsidiary of Penske Business Media; Distributed by Tribune Content Agency, LLC

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Is it necessary for owner to baby his 2004 Corvette?

I own a 2004 Corvette coupe purchased new in 2003. It has only 6,000 miles on it and is driven once a month in spring, summer and fall. I have a battery tender and had the battery replaced in 2010 for safety. I originally had yearly services, have had the coolant replaced a couple of times again to play it safe. I always have Mobil 1 oil changes and always drive to fully warm up the car — no short trips. I have been going every two years for the past couple of services. The car is covered in an attached garage. I try to get non-oxy gas and put a fuel stabilizer in every fall. Can I go even longer, say three years at this annual mileage? I have developed a small leak of transmission fluid from the transaxle. It appears to stop at a drop or two if I increase driving. I have been told seals can sometimes leak if the car is not driven regularly. What do you think about my maintenance program?

In a word — overkill. Like you, I'm a hard-core Corvette enthusiast. I have a pair now — the 1970 C3 Stingray I've owned and driven since 1972 and a 2009 C6 that I purchased in 2012. For the first two decades of its life, I serviced the C3 within an inch of its life, as you've been doing. Then, as I began driving it less and less each year, I began doing less and less maintenance. I just serviced it this spring — oil/filter/lube/brake fluid — for the first time in four years. The car still runs well, shows no signs of neglect and still puts a smile on my face every time I drive it, about once a month, like you.

I service the C6 per GM's maintenance schedule. I put about 4,000 miles and one oil/filter change per year on the car — no small expense with 10.5 quarts in the dry sump oil system. I change the clutch fluid every couple of months, and the brake fluid every two years. At 19,000 miles, I plan to change the air and cabin filters this year.

Like you, I spent decades over-maintaining my vehicles. Three reasons: I bought them used and had to keep them at least 10 years/150,000 miles; I couldn't afford to have them professionally serviced; and, of course, peace of mind.

Was it necessary? No. Is it wrong to over-maintain? No. It's your vehicle, you obviously are fully vested in owning and enjoying it and if your maintenance schedule gives you peace of mind, continue with it.

One caveat: I wouldn't go longer than two years on the oil and filter — just for the peace of mind.

I have a 2008 Toyota Avalon, excellent condition, 90,000 miles. I have had this car serviced regularly at the Toyota dealership ... oil changes, filters, tire rotations, etc. Now that I am due for 90,000-mile service and a brake job, is it best for me to have this done at the Toyota dealership (more expensive) or at a reliable auto service center, of which it appears there are many?

I looked at the 90,000-mile maintenance schedule for your Toyota and see that the only items requiring replacement are the air and cabin filters, and the engine oil and filter. Tire rotation and a number of inspections are also suggested. I see no reason why these services could not be successfully performed by an independent service agency. The fact that you mention "there are many" and don't identify a specific shop you've dealt with, along with the fact that you've had the vehicle serviced at the dealership so far suggests that you should stick with what's worked for you. The dealer has all your service records and apparently has done satisfactory work for you, so why change?

Paul Brand, author of "How to Repair Your Car," is an automotive troubleshooter, driving instructor and former race-car driver. Readers may write to him at: Star Tribune, 425 Portland Ave. S., Minneapolis, Minn., 55488 or via email at paulbrand@startribune.com. Please explain the problem in detail and include a daytime phone number. We cannot provide personal replies.

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Boston ‘permits’ hacks

Boston kicked off its first "hackathon" yesterday, turning to the local tech community to come up with ways to improve the city's outdated permitting system.

"Today is the first step in creating a user-friendly, fully online, permitting process," Mayor Martin J. Walsh told a room full of software developers yesterday at the start of the two-day "HubHacks" at District Hall in the Seaport District.

This weekend is the "centerpiece" of the city's plans to overhaul the permitting system, Walsh said.

Andrew Arace, an engineer at Geonetics in Boston, was working on a better method to search for addresses in the city's master database. He has been working with the city to improve the system, but said he came to the hackathon to build something that the city might not come up with on its own.

"We'd like to show what's possible," Arace said.

Arace and his teammates were working on one of four challenges this weekend. Other teams are trying to improve the process for obtaining permits for moving vans, and create a comprehensive system for finding the necessary permits for a specific job and a tracking system for permits.

William 'Buddy' Christopher Jr., the city's new head of the Inspectional Services Department, said the current permitting process is too complicated.

"Right now the process is very confusing; it's laden with contradictions; it's laden with inconsistencies," Christopher said.

Tech-savvy enough to wear a smartwatch and have several hackathons under his belt, Christopher said such events can produce great results.

"You get to experience people who look at things so differently and they ask all the right questions," Christopher said.

Yesterday, software developers and potential permit users worked side-by-side.

"I'm actually looking to open my own restaurant," said Adrian Wong, who said he has found most of the permits he will need are not available online.

Bill Oliver, a former IT director for a city in Connecticut, said he is spending his weekend working on Boston's permitting system because he has seen what happens with ineffective government systems.

"People want better government," he said. "They want it to work for them, not against them."

After this weekend, the city will put out a request for proposals to help improve the online permitting system, with the idea that many of the projects from this weekend will be formally submitted.

"Technology is never a solution by itself," said Jascha Franklin-Hodge, the city's new chief information officer. "But it's impossible to tackle the challenges, big or small, without great technology."

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Judge denies GM motion to dismiss ignition suit

NEW YORK — A Georgia judge has denied a motion by General Motors to dismiss a wrongful death case against the automaker and set a trial date for April 2016.

The family of Brooke Melton, a 29-year-old nurse who died in a 2010 car crash near Atlanta, sued GM, alleging that a faulty ignition switch in her 2005 Chevrolet Cobalt unexpectedly shut off the engine, causing her to lose control of the car.

They settled last year with GM for $5 million, but the case exposed how GM let millions of cars stay on the road even after discovering ignition switch flaws linked to at least 13 deaths. The case led to GM recalling 2.6 million older small cars to replace faulty switches.

The Meltons filed a new complaint in May that GM fraudulently concealed evidence during the first case.

Meanwhile, GM had filed for dismissal of the case because they said it had already been settled, but that was denied on Saturday.

"We continue to believe that the parties reached a good faith settlement last year and that the court's prior order dismissing all claims against GM with prejudice after that settlement prevents plaintiffs from pursuing the same claims a second time," GM said in a statement. "GM will review the court's order once it is entered and will evaluate its options."

Lance Cooper, an attorney for the Meltons, said a judge gave GM two weeks to respond to a document request from the Meltons attorneys. He added it will be up to the jury to decide if the Meltons need to return the $5 million they were awarded in the settlement. They had offered to return it in an effort to reopen the case.

The Melton case touched off a recall crisis at GM that has resulted in 54 recalls involving 29 million vehicles this year. And it brought federal investigations, cover-up allegations and a $35 million fine from federal regulators for delays in reporting safety problems.

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