Richard Adams dies at 65; gay marriage pioneer









Thirty-seven years ago, Richard Adams made history when he and his partner of four years, Anthony Sullivan, became one of the first gay couples in the country to be granted a marriage license. It happened in Boulder, Colo., where a liberal county clerk issued licenses to six same-sex couples in the spring of 1975.


Adams had hoped to use his marriage to secure permanent residency in the United States for Sullivan, an Australian who had been in the country on a limited visa and was facing deportation.


But Colorado's attorney general declared the Boulder marriages invalid. Several months later, Adams and Sullivan received a letter from the Immigration and Naturalization Service that denied Sullivan's petition for resident status in terms that left no doubt about the reason:





"You have failed to establish that a bona fide marital relationship can exist between two faggots," the notification read.


Adams, who later filed the first federal lawsuit demanding recognition of same-sex marriages, died Monday at his home in Hollywood after a brief illness, said his attorney, Lavi Soloway. He was 65.


Soloway described Adams and Sullivan as "pioneers who stood up and fought for something nobody at that time conceived of as a right, the right of gay couples to be married.


"Attitudes at the time were not supportive, to put it mildly," Soloway said. "They went on the Donahue show and people in the audience said some pretty nasty things. But they withstood it all because they felt it was important to speak out."


Born in Manila on March 9, 1947, Adams immigrated to the U.S. with his family when he was 12. He grew up in Long Prairie, Minn., studied liberal arts at the University of Minnesota and became a naturalized U.S. citizen in 1968.


By 1971 he was working in Los Angeles, where he met Sullivan and fell in love.


Four years later, the two men heard about Boulder County Clerk Clela Rorex: She had decided to issue marriage licenses to gay couples after the Boulder district attorney's office advised her that nothing in state law explicitly prohibited it.


On April 21, 1975, they obtained their license and exchanged marriage vows at the First Unitarian Church of Denver.


The Boulder marriages attracted national media attention, including an article in the New York Times that called Colorado "a mini-Nevada for homosexual couples." Rorex received obscene phone calls, as well as a visit from a cowboy who protested by demanding to marry his horse. (Rorex said she turned him down because the 8-year-old mare was underage.)


After their marriage, Adams and Sullivan filed a petition with the INS seeking permanent residency for Sullivan as the spouse of a U.S. citizen. In November 1975, they received the immigration agency's derogatory letter and lodged a formal protest. Officials reissued the denial notice without the word "faggots."


They took the agency to court in 1979, challenging the constitutionality of the denial. A federal district judge in Los Angeles upheld the INS decision, and Adams and Sullivan lost subsequent appeals.


In a second lawsuit, the couple argued that Sullivan's deportation after an eight-year relationship with Adams would constitute an "extreme hardship." In 1985 a three-judge panel of the U.S. 9th Circuit Court of Appeals rejected the hardship argument and opened the way for Sullivan to be sent back to Australia.


Because Australia had already turned down Adams' request for residency in that country, the couple decided the only way they could stay together was to leave the U.S. In 1985, they flew to Britain and drifted through Europe for the next year.


"It was the most difficult period because I had to leave my family as well as give up my job of 18 1/2 years. It was almost like death," Adams said in "Limited Partnership," a documentary scheduled for release next year.


The pair ended their self-imposed exile after a year and came home. They lived quietly in Los Angeles to avoid drawing the attention of immigration officials, but in recent years began to appear at rallies supporting same-sex marriage, Soloway said.


They were encouraged by new guidelines issued by the Obama administration this fall instructing immigration officials to stop deporting foreigners in long-standing same-sex relationships with U.S. citizens.


Although the policy change came more than three decades after Adams and Sullivan raised the issue, it gave Adams "a sense of vindication," Soloway said.


The day before he died, Sullivan told him that the most important victory was that they were able to remain a couple.


"Richard looked at me," Sullivan told Soloway, "and said, 'Yeah, you're right. We've won.'"


Adams, who was an administrator for a law firm until his retirement in 2010, is survived by Sullivan; his mother, Elenita; sisters Stella, Kathy, Julie and Tammie; and a brother, Tony.


elaine.woo@latimes.com





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Facebook’s SnapChat-Style Sexting App Is Called Poke (Seriously)






Oh, well would you look at Facebook, trying to make a Christmas funny with its SnapChat copycat app. It’s called Poke! Get it? Because SnapChat is what the kids are all using for their sexting these days, apparently, and Poke — you know, that once kinda flirty Facebook future that’s now pretty much useless — can kind of do the same thing, and it kind of sounds like some bad sexual pun, too! Funny, Facebook, very funny, and way to admit the dirty little truth behind “poking” that we knew all along.


RELATED: Facebook to Launch Its Own SnapChat as Social-Network Clone Wars Live on






Oh, wait. They’re serious? Oh, yeah: Friday afternoon Facebook released Poke, its rumored iPhone app for the incredible vanishing half-message “that makes it fun and easy to say hello to friends wherever you are.” But don’t get too heavy on the old-school “Poke” comparisons, because the new app can actually send regular messages, photos, or videos, too — but only for short periods of time, because that is apparently what the kids like doing these days, if SnapChat’s huge success is any indication. There’s more of a time-bomb component to Poke, though: users can choose how long someone sees a poke before it ceases to exist forever — so you could sext poke all day long, because that, too, is apparently what the kids like doing these days, if SnapChat’s huge, smashing, sexy success is any indication.


RELATED: The Life and Philosophy of Mark Zuckerberg


Why would anyone use Poke over SnapChat? Well, the Facebook app itself has a much smoother interface than SnapChat, and you can report people behaving badly, and everyone’s already on Facebook, right? Maybe this is the breaking point Justin Bieber could never hit, when something sexy goes from the tween set to actual human beings. We’ll let you know when Poke shows up in our iPhone’s App Store; for now we’re not entirely sure if this is just some bad joke. (Although it is in the iTunes Store, so… we’ll see?)


Social Media News Headlines – Yahoo! News





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Ashton Kutcher files for divorce from Demi Moore


LOS ANGELES (AP) — Ashton Kutcher filed court papers Friday to end his seven-year marriage to actress Demi Moore.


The actor's divorce petition cites irreconcilable differences and does not list a date that the couple separated. Moore announced last year that she was ending her marriage to the actor 15 years her junior, but she never filed a petition.


Kutcher's filing does not indicate that the couple has a prenuptial agreement. The filing states Kutcher signed the document Friday, hours before it was filed in Los Angeles Superior Court.


Kutcher and Moore married in September 2005 and until recently kept their relationship very public, communicating with each other and fans on the social networking site Twitter. After their breakup, Moore changed her name on the site from (at)mrskutcher to (at)justdemi.


Kutcher currently stars on CBS' "Two and a Half Men."


Messages sent to Kutcher's and Moore's publicists were not immediately returned Friday.


Moore, 50, and Kutcher, 34, created the DNA Foundation, also known as the Demi and Ashton Foundation, in 2010 to combat the organized sexual exploitation of girls around the globe. They later lent their support to the United Nations' efforts to fight human trafficking, a scourge the international organization estimates affects about 2.5 million people worldwide.


Moore was previously married to actor Bruce Willis for 13 years. They had three daughters together — Rumer, Scout and Tallulah Belle — before divorcing in 2000. Willis later married model-actress Emma Heming in an intimate 2009 ceremony at his home in Parrot Cay in the Turks and Caicos Islands that attended by their children, as well as Moore and Kutcher.


Kutcher has been dating former "That '70s Show" co-star Mila Kunis.


The divorce filing was first reported Friday by People magazine.


___


Anthony McCartney can be reached at http://twitter.com/mccartneyAP.


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Genetic Gamble : Drugs Aim to Make Several Types of Cancer Self-Destruct


C.J. Gunther for The New York Times


Dr. Donald Bergstrom is a cancer specialist at Sanofi, one of three companies working on a drug to restore a tendency of damaged cells to self-destruct.







For the first time ever, three pharmaceutical companies are poised to test whether new drugs can work against a wide range of cancers independently of where they originated — breast, prostate, liver, lung. The drugs go after an aberration involving a cancer gene fundamental to tumor growth. Many scientists see this as the beginning of a new genetic age in cancer research.




Great uncertainties remain, but such drugs could mean new treatments for rare, neglected cancers, as well as common ones. Merck, Roche and Sanofi are racing to develop their own versions of a drug they hope will restore a mechanism that normally makes badly damaged cells self-destruct and could potentially be used against half of all cancers.


No pharmaceutical company has ever conducted a major clinical trial of a drug in patients who have many different kinds of cancer, researchers and federal regulators say. “This is a taste of the future in cancer drug development,” said Dr. Otis Webb Brawley, the chief medical and scientific officer of the American Cancer Society. “I expect the organ from which the cancer came from will be less important in the future and the molecular target more important,” he added.


And this has major implications for cancer philanthropy, experts say. Advocacy groups should shift from fund-raising for particular cancers to pushing for research aimed at many kinds of cancer at once, Dr. Brawley said. John Walter, the chief executive officer of the Leukemia and Lymphoma Society, concurred, saying that by pooling forces “our strength can be leveraged.”


At the heart of this search for new cancer drugs are patients like Joe Bellino, who was a post office clerk until his cancer made him too sick to work. Seven years ago, he went into the hospital for hernia surgery, only to learn he had liposarcoma, a rare cancer of fat cells. A large tumor was wrapped around a cord that connects the testicle to the abdomen. “I was shocked,” he said in an interview this summer.


Companies have long ignored liposarcoma, seeing no market for drugs to treat a cancer that strikes so few. But it is ideal for testing Sanofi’s drug because the tumors nearly always have the exact genetic problem the drug was meant to attack — a fusion of two large proteins. If the drug works, it should bring these raging cancers to a halt. Then Sanofi would test the drug on a broad range of cancers with a similar genetic alteration. But if the drug fails against liposarcoma, Sanofi will reluctantly admit defeat.


“For us, this is a go/no-go situation,” said Laurent Debussche, a Sanofi scientist who leads the company’s research on the drug.


The genetic alteration the drug targets has tantalized researchers for decades. Normal healthy cells have a mechanism that tells them to die if their DNA is too badly damaged to repair. Cancer cells have grotesquely damaged DNA, so ordinarily they would self-destruct. A protein known as p53 that Dr. Gary Gilliland of Merck calls the cell’s angel of death normally sets things in motion. But cancer cells disable p53, either directly, with a mutation, or indirectly, by attaching the p53 protein to another cellular protein that blocks it. The dream of cancer researchers has long been to reanimate p53 in cancer cells so they will die on their own.


The p53 story began in earnest about 20 years ago. Excitement ran so high that, in 1993, Science magazine anointed it Molecule of the Year and put it on the cover. An editorial held out the possibility of “a cure of a terrible killer in the not too distant future.”


Companies began chasing a drug to restore p53 in cells where it was disabled by mutations. But while scientists know how to block genes, they have not figured out how to add or restore them. Researchers tried gene therapy, adding good copies of the p53 gene to cancer cells. That did not work.


Then, instead of going after mutated p53 genes, they went after half of cancers that used the alternative route to disable p53, blocking it by attaching it to a protein known as MDM2. When the two proteins stick together, the p53 protein no longer functions. Maybe, researchers thought, they could find a molecule to wedge itself between the two proteins and pry them apart.


The problem was that both proteins are huge and cling tightly to each other. Drug molecules are typically tiny. How could they find one that could separate these two bruisers, like a referee at a boxing match?


In 1996, researchers at Roche noticed a small pocket between the behemoths where a tiny molecule might slip in and pry them apart. It took six years, but Roche found such a molecule and named it Nutlin because the lab was in Nutley, N.J.


But Nutlins did not work as drugs because they were not absorbed into the body.


Roche, Merck and Sanofi persevered, testing thousands of molecules.


At Sanofi, the stubborn scientist leading the way, Dr. Debussche, maintained an obsession with p53 for two decades. Finally, in 2009, his team, together with Shaomeng Wang at the University of Michigan and a biotech company, Ascenta Therapeutics, found a promising compound.


The company tested the drug by pumping it each day into the stomachs of mice with sarcoma.


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Naomi Gleit helps keep Facebook growing









The gig: As senior director of Facebook Inc.'s growth, engagement and mobile team, Naomi Gleit helps grow the social network's 1-billion-plus user base.


Facebook employee No. 29: Few people outside Facebook have heard of Gleit, but she's the second-longest-serving Facebook employee, after Facebook founder Mark Zuckerberg. Gleit, 29, talked her way into a job at Facebook on July 18, 2005 — her birthday. She was Facebook's 29th employee, coming on board shortly after the company hit 1 million users and before anyone had an inkling of the colossus it would become.


Dogged spirit: Unlike most other early employees who eventually dispersed to seek new fortunes, Gleit says she has no intention of leaving Facebook. She gets that tenacity from her "tiger mom," a computer programmer who ferried her to ballet, piano, karate and Chinese lessons, and her Jewish father, an immigration lawyer who took her to Hebrew school, she said. "I know it sounds completely irrational, but I had no doubt in 2005 that Facebook would be something incredible in the future," she said.





Rival social networks: Her passion for Facebook began before she was hired, when she was a Stanford undergraduate studying science, technology and society, an interdisciplinary major. She wrote her senior thesis on why Facebook beat out rival college social networking site Club Nexus at Stanford. (Club Nexus was started by Stanford student and Turkish software engineer Orkut Büyükkökten, who went on to create Orkut, Google's first attempt at a social network.) Getting in on the ground floor at Facebook made her feel like she was taking part in something bigger than herself, the same feeling she got volunteering for six months in a refugee camp in Botswana, she said.


Growing with Facebook: Gleit helped Facebook push beyond colleges to high schools and eventually to everyone. In late 2007, when the torrid growth pace temporarily cooled, Zuckerberg tapped a team of five to reignite it and asked Gleit to lead product management. It fell to the growth team to identify the obstacles to the company's momentum. In a company ruled by engineers, Gleit, who never studied programming, earned respect with her analytical approach and intuitive understanding of people. "I always believed that growth was the most important thing, the most important way to impact the company," she said. There are now more than 150 people on the team. "It's been an incredible learning experience," she said. "Each year is different."


That magic moment: Those who work closely with Gleit say part of her success early on was her ability to seize on the "magic moment" that makes users fall in love with Facebook. She made it simpler to sign up, and she helped people find friends as soon as they joined. She also helped Facebook spread quickly to new countries by enlisting users to translate the service into more than 80 languages. Gleit helps her team parachute into new markets and traverse less-familiar languages and cultures. It's something that comes from her own passion to see the world and have new experiences. She has taught on a Navajo reservation and lived in a Buddhist monastery in Thailand.


One billion users: Around noon Sept. 14, Zuckerberg gathered with Gleit and dozens of employees in front of a big screen as the number of Facebook users crossed 1 billion. "The scale was insane," she said. "But that is not the goal. When Mark talks about his vision for Facebook, he talks about being able to connect everyone in the world to the people that they care about and provide some value for them every single day."


A problem solver: Zuckerberg calls on Gleit for high-profile projects. In May 2010, when Facebook was under siege because of how it was handling users' personal information, he put Gleit in charge of simplifying privacy settings. Last year she worked on a popular feature that lets users subscribe to a News Feed without having to become Facebook friends.


Betting on mobile: Now Gleit is focused on the future: mobile devices and how they can unlock emerging markets. Gleit knew back in 2011 that people would begin to log on to Facebook from mobile devices in greater numbers than from desktops, particularly in the developing world. So she traveled to Tel Aviv to buy Snaptu, which makes software that helps people on low-tech phones access Facebook, and she brought the whole team back to Silicon Valley with her. Now Facebook is surging in popularity on mobile devices in Tokyo and Nairobi, Kenya. "I have always been interested in technology and how it can be used to improve lives," Gleit said.


jessica.guynn@latimes.com





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Ashton Kutcher files for divorce from Demi Moore


LOS ANGELES (AP) — Ashton Kutcher filed court papers Friday to end his seven-year marriage to actress Demi Moore.


The actor's divorce petition cites irreconcilable differences and does not list a date that the couple separated. Moore announced last year that she was ending her marriage to the actor 15 years her junior, but she never filed a petition.


Kutcher's filing does not indicate that the couple has a prenuptial agreement. The filing states Kutcher signed the document Friday, hours before it was filed in Los Angeles Superior Court.


Kutcher and Moore married in September 2005 and until recently kept their relationship very public, communicating with each other and fans on the social networking site Twitter. After their breakup, Moore changed her name on the site from (at)mrskutcher to (at)justdemi.


Kutcher currently stars on CBS' "Two and a Half Men."


Messages sent to Kutcher's and Moore's publicists were not immediately returned Friday.


Moore, 50, and Kutcher, 34, created the DNA Foundation, also known as the Demi and Ashton Foundation, in 2010 to combat the organized sexual exploitation of girls around the globe. They later lent their support to the United Nations' efforts to fight human trafficking, a scourge the international organization estimates affects about 2.5 million people worldwide.


Moore was previously married to actor Bruce Willis for 13 years. They had three daughters together — Rumer, Scout and Tallulah Belle — before divorcing in 2000. Willis later married model-actress Emma Heming in an intimate 2009 ceremony at his home in Parrot Cay in the Turks and Caicos Islands that attended by their children, as well as Moore and Kutcher.


Kutcher has been dating former "That '70s Show" co-star Mila Kunis.


The divorce filing was first reported Friday by People magazine.


___


Anthony McCartney can be reached at http://twitter.com/mccartneyAP.


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Alabama to End Isolation of Inmates With H.I.V.


Jamie Martin/Associated Press


The H.I.V. ward of an Alabama women's prison in 2008. The state was ordered to stop segregating inmates with the virus.







A federal judge on Friday ordered Alabama to stop isolating prisoners with H.I.V.




Alabama is one of two states, along with South Carolina, where H.I.V.-positive inmates are housed in separate prisons, away from other inmates, in an attempt to reduce medical costs and stop the spread of the virus, which causes AIDS.


Judge Myron H. Thompson of the Middle District of Alabama ruled in favor of a group of inmates who argued in a class-action lawsuit that they had been stigmatized and denied equal access to educational programs. The judge called the state’s policy “an unnecessary tool for preventing the transmission of H.I.V.” but “an effective one for humiliating and isolating prisoners living with the disease.”


After the AIDS epidemic of the 1980s, many states, including New York, quarantined H.I.V.-positive prisoners to prevent the virus from spreading through sexual contact or through blood when inmates tattooed one another. But most states ended the practice voluntarily as powerful antiretroviral drugs reduced the risk of transmission.


In Alabama, inmates are tested for H.I.V. when they enter prison. About 250 of the state’s 26,400 inmates have tested positive. They are housed in special dormitories at two prisons: one for men and one for women. No inmates have developed AIDS, the state says.


H.I.V.-positive inmates are treated differently from those with other viruses like hepatitis B and C, which are far more infectious, according to the World Health Organization. Inmates with H.I.V. are barred from eating in the cafeteria, working around food, enrolling in certain educational programs or transferring to prisons near their families.


Prisoners have been trying to overturn the policy for more than two decades. In 1995, a federal court upheld Alabama’s policy. Inmates filed the latest lawsuit last year.


“Today’s decision is historic,” said Margaret Winter, the associate director of the National Prison Project of the American Civil Liberties Union, which represented the inmates. “It spells an end to a segregation policy that has inflicted needless misery on Alabama prisoners with H.I.V. and their families.”


Brian Corbett, a spokesman for the Alabama Department of Corrections, said the state is “not prejudiced against H.I.V.-positive inmates” and has “worked hard over the years to improve their health care, living conditions and their activities.”


“We will continue our review of the court’s opinion and determine our next course of action in a timely manner,” he wrote.


During a monthlong trial in September, lawyers for the department argued that the policy improved the treatment of H.I.V.-positive inmates. Fewer doctors are needed if specialists in H.I.V. focus on 2 of the 29 state’s prisons.


The state spends an average of $22,000 per year on treating individual H.I.V.-positive inmates. The total is more than the cost of medicine for all other inmates, said Bill Lunsford, a lawyer for the Corrections Department.


South Carolina has also faced legal scrutiny. In 2010, the Justice Department notified the state that it was investigating the policy and might sue to overturn it.


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E-book restrictions leave 'buyers' with few rights








There's a crass old joke about how you can never buy beer, just rent it. Who would think that the same joke applies to book buying in the digital age?


But that's the case. Many people who'll be unwrapping iPads, Amazon Kindles or Barnes & Noble Nooks on Tuesday morning and loading them with bestsellers or classics won't have any idea how limited their rights are as their books' "owners."


In fact, they won't be owners at all. They'll be licensees. Unlike the owners of a physical tome, they won't have the unlimited right to lend an e-book, give it away, resell it or leave it to their heirs. If it's bought for their iPad, they won't be able to read it on their Kindle. And if Amazon or the other sellers don't like what they've done with it, they can take it back, without warning.






All these restrictions "raise obvious questions about what 'ownership' is," observes Dan Gillmor, an expert on digital media at Arizona State University. "The companies that license stuff digitally have made it clear that you own nothing."


Typically, e-book buyers have no idea about these complexities. How could they? The rules and limitations are embodied in "terms of service" documents that Amazon, Apple, B&N and other sellers shroud in legalese and bury deep in their websites. That tells you how little they want you to know.


The rules are based, in turn, on the 1998 Digital Millennium Copyright Act, with which Congress hoped to balance the rights of copyright holders and content users. "In the digital environment, that's always been the trickiest balance to strike," Annemarie Bridy, a specialist in intellectual property law at the University of Idaho, told me. In those terms, the DMCA looks like a failure.


Both camps have important rights to protect. Let's start with copyright owners.


In the non-digital world, copyright ends with the first sale of each copyrighted object. Under the "first sale" doctrine, once you buy a book, that physical book is yours to lend, give away, or resell. Copyright is safeguarded by the limitations of physical transfer — once the book is given or loaned, the original buyer no longer has access to it. If a library owns five copies of a book, only five borrowers can read it at the same time. Theoretically a book can be photocopied, but only at great effort and with a perceptible loss of quality.


In digital-dom, however, technology allows infinite copies to be made, with no loss of quality. Absent the usual restrictions, one could give away an e-book and still have it to read. Unrestricted transferability becomes a genuine threat to the livelihood of authors, artists, filmmakers, musicians.


So some limitation is sensible. That's usually done through digital rights management, or DRM, which encodes copy or usage limitations into the digital file. The DMCA protected DRM by outlawing efforts to circumvent it (with a few exceptions).


The question is whether the balance has tipped too far in favor of the booksellers, at the consumers' expense. The answer is yes.


For one thing, DRM has put far too much power in the hands of digital booksellers. Amazon, in particular, has shown it can't be trusted with that power. In 2009, having learned that it inadvertently had sold unauthorized e-book versions of George Orwell's "1984" and "Animal Farm" through its website, the company simply deleted those e-books from buyers' Kindles stealthily, without warning.


An uproar followed, not least because Amazon's Orwellian behavior involved those Orwellian masterpieces. Amazon settled a subsequent lawsuit by promising never to steal a book back from a Kindle without the device owner's permission.


But earlier this year, the company was revealed to have unilaterally shut down the access of Linn Jordet Nygaard, a Norwegian Kindle owner, to her library of 43 e-books, for reasons it refused to divulge. Another uproar, and Amazon backed down again, restoring Nygaard's account — again without explanation. Amazon refused my request for comment.


Another downside of e-book DRM is that most e-books are tied to the seller's reading device or apps. Buy a book from Amazon, and you can read it only on a Kindle or Amazon app. Buy it from Apple, and it can be read only on an Apple device.


This lock-in gives the booksellers power over not only consumers but publishers. In fact, it led several publishers to make a price-fixing deal with Apple that aimed to undermine Amazon's market power, but ended with their getting whacked with a big federal antitrust fine instead.


Moreover, notwithstanding the public impression that digital is forever, nothing is permanent in the digital world. In fact, digital content can be less permanent than physical books. In libraries you can find volumes that date back hundreds of years and can still be read (if carefully); but there are digital files that date back only a decade yet are completely unintelligible today.


Nowhere does Amazon, Apple or any other distributor pledge to support its digital formats in perpetuity. Quite the contrary: They typically warn that they can cancel their service at any time, without warning, in a way that could end your access to a lifetime of e-book purchases in the flash of an electron. They could also go out of business, leaving millions of dependent customers in the lurch.


Amazon keeps your purchased content for free on its own servers — the term is "in the cloud" — for downloading to your Kindles as needed. You pay once for an e-book and can use it on all the Kindles you own. I can't find any written promise by Amazon that this storage will always be free. If it announces a few years from now that henceforth there will be a monthly fee to store books purchased, say, more than 10 years ago, what rights will you have to resist? None.


There are ways to protect your e-books from grasping e-booksellers or the future. Programs available on the Web can strip the DRM code from your purchased items — for books, one possible method involves an e-library management program called Calibre. The program easily can be augmented with a DRM-stripping application so you can convert e-books sold in any proprietary format into a different format or even as plain text.


But is it legal? No one is quite sure, and that's a problem. The DMCA makes it unlawful to circumvent certain DRM protection, but doing so on an item you've bought and want to keep in a different format for your own use — not to make multiple copies for sale — may not break the law. On the other hand, distributing software that enables that is illegal under the DMCA even if the goal is legitimate, which is absurd.


Even if reformatting a file you own is legal, what if you don't own it? The hard-to-find terms of service of e-book sellers specify that you're only licensing a book, not buying it (although the Amazon order page does say you're "buying" it). "In the digital context, it's not clear that the 'first sale' has ever occurred," says Bridy.


It should be a top priority for Congress to clear out the murk. Buyers of e-books must have the explicit right to reformat their purchases and save backup copies for their own use, permanently. The sale of an e-book must be irrevocable. On the other side, it must remain strictly illegal to make multiple unauthorized copies of any copyrighted work for distribution. Lending by libraries, one digital copy at a time, should be facilitated — it tends to widen the audience for books.


The guiding principle must be that an e-book owner's rights and responsibilities parallel those of a book owner, and the same must go for authors, publishers and booksellers. "Someone once observed to me that if libraries were being invented today, publishers would try to make them illegal," Gillmor says.


Clarify these rules of e-book commerce, and the book market will reap the benefit. The power of electronic booksellers over publishers might be reduced, and consumers would know what they were buying — and would own what they bought. Leave the rules as vague as they are, and the victims will be authors, consumers and publishers.


Michael Hiltzik's column appears Sundays and Wednesdays. Reach him at mhiltzik@latimes.com, read past columns at latimes.com/hiltzik, check out facebook.com/hiltzik and follow @latimeshiltzik on Twitter.






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Hedge fund manager alleges Herbalife is 'pyramid scheme'









Herbalife Ltd. is girding for a fight against a Wall Street money man who's betting $1 billion that the company is nothing more than what he called a "pyramid scheme."


The Los Angeles maker of nutritional products rushed to defend itself Thursday against a hedge fund manager's accusation.


Hedge fund titan Bill Ackman accused Herbalife of paying its sales staff far more money to recruit new distributors than to actually sell its products.





That results in the roughly 2.6 million distributors at the bottom of the sales pyramid making little or no income, while a handful at the top hauls in millions, he said.


"This is the best-managed pyramid scheme in the history of the world," Ackman said.


The company denied the allegation and accused Ackman of trying to manipulate the stock. Herbalife shares slumped 10% on Thursday and are off 21% in the two days since Ackman announced that the company is in his sights.


"Today's presentation was a malicious attack on our business model based largely on outdated, distorted and inaccurate information," Herbalife said in a statement. "We are not an illegal pyramid scheme."


Herbalife, which bills itself as a so-called multilevel marketer, has beaten back similar accusations in the past. But the company has rarely faced a nemesis such as Ackman.


The 46-year-old billionaire has fashioned a career on high-stakes gambits in controversial companies. His fund firm, Pershing Square Capital Management, manages $12 billion.


Showdowns between companies and skeptical investors historically play out behind closed doors, especially in the normally sleepy pre-holiday period.


But in a measure of the aggressive tactics favored by an emerging breed of activist investors, Ackman launched a public blitzkrieg Thursday. He gave a flashy multimedia presentation to a packed conference room in New York that was streamed live on the Internet.


"I've never seen anything quite like it," said Timothy Ramey, an analyst at D.A. Davidson & Co. "I've never seen an investor spend 31/2 hours of time at a major venue being webcast and then make TV appearances to make his point. It's the largest orchestrated bull or bear case that I've ever seen."


The brawl has potential repercussions for both sides.


Ackman claimed to have spent one year doing intensive research on Herbalife's operations, an unusually extended period given Wall Street's thirst for immediate results.


Earlier this year, Ackman began betting that Herbalife's stock would fall sharply.


His fund is "shorting" more than 20 million shares of the company. In a short sale, an investor borrows stock and sells it immediately, hoping to later buy the shares at a reduced price and return them to their actual owner.


Ackman promised to donate all profit from his Herbalife bet to charity, and portrayed his public diatribe as intended for the public good.


"I'm very fortunate to have the means to pursue this," he said. "I am independently wealthy. When I believe in something, I can say what I want and do what is right."


For Herbalife, the fight threatens to damage its credibility among investors who have always been sensitive to claims that its business is illegitimate.


Herbalife, which was founded in 1980, sells a line of diet powders, bars, drinks and vitamins through a network of independent distributors in more than 80 countries. The company reported sales of $3.5 billion in 2011.


Its chief executive, Michael O. Johnson, was the highest paid executive in the United States last year, hauling in more than $89 million in salary, exercised stock options and other compensation, according to GMI Ratings, a corporate governance firm.


The company has fought criticism of its business model throughout its existence.


In 2008, for example, self-proclaimed fraud buster Barry Minkow shorted Herbalife's stock and then accused the company of a host of misdeeds. The company survived those accusations and Minkow ultimately went to prison on unrelated charges.


This was the second time this year that investors punished Herbalife because of questions about its business practices. Herbalife shares fell 20% in May after hedge fund operator David Einhorn asked pointed questions during an earnings call.


"We operate at the highest ethical and quality standards, and our management and our board are constantly reviewing our business practices and products," Herbalife said. "We also hire independent, outside experts to ensure our operations are in full compliance with laws and regulations."


Ackman and Herbalife engaged in a bitter and bizarre war of words, with Johnson saying the United States will "be better when Bill Ackman is gone."


Ackman interpreted the statement as a threat and said he has hired a security firm to protect him.


stuart.pfeifer@latimes.com


walter.hamilton@latimes.com





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Reacting to users’ outcry, Facebook’s Instagram reverts to prior policy on advertising






SAN FRANCISCO – Instagram has abandoned wording in its new terms-of-service agreement that sparked outcry from users concerned it meant their photos could appear in advertisements.


In a blog post late Thursday, the popular mobile photo-sharing service says it has reverted to language in the advertising section of its terms of service that appeared when it was launched in October 2010.






Instagram is now owned by Facebook Inc. and maintains that it would like to experiment with different forms of advertising to make money.


Its blog post says that it will now ask users’ permission to introduce possible ad products only after they are fully developed.


The outcry to the changes announced earlier this week led the company to clarify that it has no plans to put users’ photos in ads.


Social Media News Headlines – Yahoo! News





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Marilyn Monroe subway grate photo on view in NYC


NEW YORK (AP) — A famous image of Marilyn Monroe with her skirt billowing atop a New York City subway grate is on display in a picture-perfect spot: outside the Times Square subway station.


The supersized version of Sam Shaw's well-known picture is part of an exhibit. The exhibit also features eight of Shaw's other Monroe pictures, on view inside the 42nd Street-Bryant Park station on the B, D, F, M and 7 lines.


The show opened Thursday. It'll be up for a year.


Shaw shot the subway grate photo for the 1955 film "The Seven Year Itch." He took the other pictures in 1957.


The exhibit is part of the Metropolitan Transportation Authority's Arts for Transit program. Manager Lester Burg says matching a mass transit setting with a popular figure from mass culture seemed a good fit.


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Hedge fund manager alleges Herbalife is 'pyramid scheme'









Herbalife Ltd. is girding for a fight against a Wall Street money man who's betting $1 billion that the company is nothing more than what he called a "pyramid scheme."


The Los Angeles maker of nutritional products rushed to defend itself Thursday against a hedge fund manager's accusation.


Hedge fund titan Bill Ackman accused Herbalife of paying its sales staff far more money to recruit new distributors than to actually sell its products.





That results in the roughly 2.6 million distributors at the bottom of the sales pyramid making little or no income, while a handful at the top hauls in millions, he said.


"This is the best-managed pyramid scheme in the history of the world," Ackman said.


The company denied the allegation and accused Ackman of trying to manipulate the stock. Herbalife shares slumped 10% on Thursday and are off 21% in the two days since Ackman announced that the company is in his sights.


"Today's presentation was a malicious attack on our business model based largely on outdated, distorted and inaccurate information," Herbalife said in a statement. "We are not an illegal pyramid scheme."


Herbalife, which bills itself as a so-called multilevel marketer, has beaten back similar accusations in the past. But the company has rarely faced a nemesis such as Ackman.


The 46-year-old billionaire has fashioned a career on high-stakes gambits in controversial companies. His fund firm, Pershing Square Capital Management, manages $12 billion.


Showdowns between companies and skeptical investors historically play out behind closed doors, especially in the normally sleepy pre-holiday period.


But in a measure of the aggressive tactics favored by an emerging breed of activist investors, Ackman launched a public blitzkrieg Thursday. He gave a flashy multimedia presentation to a packed conference room in New York that was streamed live on the Internet.


"I've never seen anything quite like it," said Timothy Ramey, an analyst at D.A. Davidson & Co. "I've never seen an investor spend 31/2 hours of time at a major venue being webcast and then make TV appearances to make his point. It's the largest orchestrated bull or bear case that I've ever seen."


The brawl has potential repercussions for both sides.


Ackman claimed to have spent one year doing intensive research on Herbalife's operations, an unusually extended period given Wall Street's thirst for immediate results.


Earlier this year, Ackman began betting that Herbalife's stock would fall sharply.


His fund is "shorting" more than 20 million shares of the company. In a short sale, an investor borrows stock and sells it immediately, hoping to later buy the shares at a reduced price and return them to their actual owner.


Ackman promised to donate all profit from his Herbalife bet to charity, and portrayed his public diatribe as intended for the public good.


"I'm very fortunate to have the means to pursue this," he said. "I am independently wealthy. When I believe in something, I can say what I want and do what is right."


For Herbalife, the fight threatens to damage its credibility among investors who have always been sensitive to claims that its business is illegitimate.


Herbalife, which was founded in 1980, sells a line of diet powders, bars, drinks and vitamins through a network of independent distributors in more than 80 countries. The company reported sales of $3.5 billion in 2011.


Its chief executive, Michael O. Johnson, was the highest paid executive in the United States last year, hauling in more than $89 million in salary, exercised stock options and other compensation, according to GMI Ratings, a corporate governance firm.


The company has fought criticism of its business model throughout its existence.


In 2008, for example, self-proclaimed fraud buster Barry Minkow shorted Herbalife's stock and then accused the company of a host of misdeeds. The company survived those accusations and Minkow ultimately went to prison on unrelated charges.


This was the second time this year that investors punished Herbalife because of questions about its business practices. Herbalife shares fell 20% in May after hedge fund operator David Einhorn asked pointed questions during an earnings call.


"We operate at the highest ethical and quality standards, and our management and our board are constantly reviewing our business practices and products," Herbalife said. "We also hire independent, outside experts to ensure our operations are in full compliance with laws and regulations."


Ackman and Herbalife engaged in a bitter and bizarre war of words, with Johnson saying the United States will "be better when Bill Ackman is gone."


Ackman interpreted the statement as a threat and said he has hired a security firm to protect him.


stuart.pfeifer@latimes.com


walter.hamilton@latimes.com





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Family, fans say goodbye to Jenni Rivera









Jenni Rivera was remembered in death the same way she was celebrated in life: on an illuminated stage, with thousands of fans chanting her name.


The singer, who was killed in a plane crash earlier this month, was honored Wednesday with what her family called a "celestial graduation," a musical memorial that packed the Gibson Amphitheatre with 6,100 people and drew hundreds more outside.


The more than two-hour farewell could have been mistaken for a concert, if not for the crowd's tears and the ruby-red casket on stage. In front of it was a cluster of white roses, the type of flower Rivera's family asked fans to bring. Behind it was a single microphone, left unused.





Family members — clad head-to-toe in white — praised Rivera as a "perfectly imperfect" mother and a guerrera, Spanish for "female warrior." Her father, Pedro Rivera, a noted singer of the Mexican ballads known as corridos, said goodbye by performing a song he wrote about her, "La Diva de la Banda."


Rivera's 11-year-old son, Johnny Lopez, addressed the sea of mourners in a white suit and red bow tie. His father died a few years ago.


"Mama, I've been crying so much these last few days. I miss you so much," he said, his voice breaking. "I hope you're taking care of my dad and I hope he's taking care of you, too."


He added: "I want to thank everyone for loving my mom."


Rivera, a Long Beach native, first gained fame via her banda music, a Mexican regional style heavy on machismo and brass instruments. A rare woman in the genre, Rivera often sang — in Spanish and English — about her chaotic personal life: three husbands, five children and struggles with her weight and domestic violence.


Rivera sold more than 20 million albums and, in recent years, had started to expand her business empire. She had a weekly radio program, clothing and cosmetics lines and a hand in several reality shows, including "I Love Jenni."


She and six others were killed Dec. 9 when a private jet that had departed Monterrey, Mexico, nose-dived 28,000 feet in 30 seconds and smashed into mountainous terrain. Rivera was 43.


"My sister, Jenni, died in a plane accident, but it was not an accident," Pedro Rivera Jr., a pastor and Rivera's brother, told the crowd in Spanish. "God has a purpose for all of us and God let us borrow her for 43 years and enjoy her."


It was clear how deeply Rivera had touched her legion of fans.


At the memorial, several well-known Latino singers performed, including Ana Gabriel, Olga Tanon and Joan Sebastian.


Outside, her fan base arrived early, blasting her music from cars decorated with tributes: "Jenni, we love you" and "We are going to miss you." They wore Jenni Rivera T-shirts and Jenni Rivera pins and waved handmade posters. One woman said Rivera was now performing "in a concert with God."


Lidia Farrias and her husband, Jose, drove three hours from Santa Maria. They didn't have tickets — the event sold out within minutes — so they shivered outside, eyes fixed on two jumbo screens streaming the memorial. Farrias said Rivera's frank lyrics had encouraged her to be a stronger woman.


"Whenever I listened to her songs, I felt like I could tackle anything," she said.


Denise Montalvo, 15, had left San Diego at 1 a.m. with her mother, aunt and two family friends. She admired Rivera for striving to obtain a better life, just like Denise's family. The teenager said Rivera wanted her funeral to be a celebration, reflecting her song "Cuando Muere una Dama" — "When a Lady Dies."


"We're trying not to be sad," she said.


That was hard for fans, particularly as the memorial wound down. One by one, each of Rivera's family members placed a white rose on her casket. Some whispered to it. Some kissed it. Then they walked away.


ruben.vives@latimes.com


adolfo.flores@latimes.com


Times staff writer Ashley Powers contributed to this report.





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New Online Privacy Loophole Lets Facebook Advertise to Kids






Mark Zuckerberg‘s been eager to find a way to get more kids on Facebook for years, and on Wednesday, the Federal Trade Commission handed it to him on a platter. That might be overstating it a little bit. It’s more like the FTC served it to him on a platter covered in plastic wrap with a note attached that says “Do not open.” Nevertheless, should Facebook decided to see what’s inside, experts in online privacy for children say the social network could legally start peddling everything from kids’ bicycles to that new gender-neutral Easy Bake Oven.


RELATED: German Official Urges Citizens to Stop Using Facebook






After months of deliberating and plenty of lobbying on both sides of the issue, the FTC updated the controversial Children’s Online Privacy Protection Act (COPPA) this week. The changes were absolutely designed to better protect children in the privacy-invading era of social media, especially from the data-hungry advertisers who want to sell them things. Websites like Facebook don’t allow kids to sign up without their parents permission, generally because COPPA has prohibited them from collecting the kinds of information they need to serve them ads. And why would they want a user to whom they couldn’t serve ads? Under the new FTC rules, parental permission is required for just about anything a kid would do on Facebook, including uploading photos, videos and geolocational information. Tracking tools like cookies are also verboten without a parent’s permission.


RELATED: What Police Learn About You When They Subpoena Your Facebook Account


But there’s a loophole. The new rules say very plainly that no parental permission is needed “for the sole purpose of supporting the website or online service’s internal operations, such as contextual advertising, frequency capping, legal compliance, site analysis, and network communications.” The key phrase there is “contextual advertising,” which is an ad product Facebook has been working on for a while. Facebook’s version basically reads your News Feed and shows you ads that are relevant, or contextual, to what you’re reading. As a few people have pointed out, this opens a door for Facebook to start exploring the idea of ad-supported profiles for kids. Alan Simpson, the vice president of child privacy advocacy group Common Sense, isn’t happy about this idea. “Common Sense doesn’t like this part, and the industry lobbyists probably do,” he told TechCrunch Monday evening.


RELATED: What Facebook Does to Kids’ Brains


Now, there are a lot of ifs in this scenario. Based on the magnitude and sensitivity of the issue, Facebook probably doesn’t want to go scaring a bunch of parents by sneaking through loopholes to show their kids Easy Bake Oven ads. It has been nearly a decade and a half since COPPA got an update, though, and Mark Zuckerberg isn’t really known for his patience. Of course, Facebook could do what they’ve been doing for ages, which is look over their shoulder while kids lie about having permission and sign up anyways.


Social Media News Headlines – Yahoo! News





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Miss USA Olivia Culpo is crowned Miss Universe


LAS VEGAS (AP) — A 20-year-old Boston University sophomore and a self-described "cellist-nerd" brought the Miss Universe crown back to the United States for the first time in more than a decade when she won the televised contest Wednesday.


Olivia Culpo beat out 88 other beauty queens from six continents at the Planet Hollywood casino on the Las Vegas Strip to take the title from outgoing champion Leila Lopes of Angola.


Culpo wore a tight navy blue mini-dress with a sequined bodice as she walked on stage for the competition's opening number. Later in the night, she strutted in a purple and blue bikini, and donned a wintery red velvet gown with a plunging neckline.


Culpo's coronation ends a long losing spell for the U.S. in the competition co-owned by Donald Trump and NBC. An American had not won the Miss Universe title since Brook Lee won in 1997.


No one seemed more surprised than Culpo's family, who "looked at her like she had three heads" when told them she was entering the Miss Rhode Island contest last year, her father Peter recalled.


"We didn't know a thing about pageants," he said.


She won that contest in a rented $20 dress with a hole in it and then began working out, dieting, and studying current events on flashcards to compete for the Miss USA crown.


Culpo was good enough during preliminary Miss Universe contests to be chosen as one of 16 semifinalists who moved on to compete in the main show. Her bid lasted through swimsuit, evening wear, and interview competitions that saw cuts after each round.


She won over the judges even after tripping slightly during the evening gown competition. Telecasters pointed it out but also noted her poised recovery.


Moments before she won, Culpo was asked whether she had she had ever done something she regretted.


"I'd like to start off by saying that every experience no matter what it is, good or bad, you'll learn from it. That's just life," she said. "But something I've done I've regretted is probably picking on my siblings growing up, because you appreciate them so much more as you grow older."


One of those siblings, 17-year-old Gus, was cheering from the front row with his sister's glittering Miss Rhode Island sash wrapped around his shoulders


Miss Philippines, Janine Tugonon, came in second, while Miss Venezuela, Irene Sofia Esser Quintero, placed third. All the contestants spent the past two weeks in Sin City, where they posed in hardhats at a hotel groundbreaking, took a painting lesson, and pranked hotel guests by hiding in their rooms.


After the show, Culpo appeared wearing a white gold crown atop her long brown hair and told a group of reporters she hoped to bring the country some good news in the wake of the deadly school shooting in Connecticut.


"It's such an honor to be representing the USA in an international beauty contest in spite of all the tragedy that's happened in this country lately," she said. "I really hope that this this will raise everybody's spirits a little."


The daughter of two professional musicians, Culpo grew up in Cranston and spent her summers at band camp. She has played the cello alongside world-renowned classical musician Yo-Yo Ma, and followed in her parents' footsteps with performances at Carnegie Hall in New York City.


Her father called her the "nerdiest" of her siblings, and her brother recalled that she was "really chubby and sort of weird when she was younger."


They speculated that the same single-mindedness that helped her master the cello in second grade propelled her rapid rise through the beauty pageant ranks.


With her promotion, Miss Maryland Nana Meriwether becomes the new Miss USA.


The Miss Universe pageant was back in Las Vegas this year after being held in Sao Paulo in 2011. It aired live on NBC and was streamed to more than 100 countries.


The panel of 10 judges included singer Cee Lo Green, "Iron Chef" star Masaharu Morimoto and Pablo Sandoval of the San Francisco Giants.


Asked on the red carpet whether he found playing in the World Series or judging the beauty pageant to be more difficult, Sandoval said both were hard.


As Miss Universe, Culpo will receive an undisclosed salary, a wardrobe fit for a queen, a limitless supply of beauty products, and a luxury apartment in New York City.


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Europe Proposes New Tobacco Rules





BRUSSELS — Health warnings should cover 75 percent of cigarette packs but governments should also have leeway to require plain packaging, the European Commission said Wednesday.







Yves Logghe/Associated Press

European Commissioner for Health and Consumer Policy Tonio Borg held up a mock package of cigarettes during a news conference on proposals to revise the Tobacco Products Directive, at the European Commission headquarters in Brussels on Wednesday.







The commission’s proposal would also ban cigarettes containing large quantities of flavorings including menthol and vanilla, restrict the sale of slimmer cigarettes and maintain a ban in most of the European Union on a form of chewing tobacco called snus.


The proposals still are less strict than in Australia, where a prohibition on logos and colorful designs went into effect this month. But the proposed ban on slim and super-slim cigarettes that are marketed to young women “is a positive development and a world first,” said the Smoke Free Partnership, a European organization that promotes tobacco control and research.


Tonio Borg, the E.,U. commissioner for health and consumer policy, said the overall goal of the so-called Tobacco Products Directive was to make smoking less attractive and to discourage young people from tobacco consumption.


“Consumers must not be cheated,” Mr. Borg said. “Tobacco products should look and taste like tobacco products, and this proposal ensures that attractive packaging and flavorings are not used as a marketing strategy.”


But Unitab, a European association of tobacco growers, said regulators had declared “total war” on their industry. The increased restrictions on branding would make price the deciding factor in tobacco sales; that in turn would favor suppliers from countries with lower production costs and put thousands of jobs in Europe at risk, the association said.


Written health warnings already must cover about 40 percent of a cigarette pack in the Union, although some countries also use pictorial warnings. In the future, Mr. Borg would like pictorial warnings to be mandatory, and for the warnings to cover three-quarters of the front and back of each pack of cigarettes, and half of each side.


E.U. officials conceded that the entire top and bottom sides of cigarette packs sold in Europe still could be used for branding under Mr. Borg’s proposals. Member states could opt to require plain packaging, however.


The directive also would require that smokeless electronic cigarettes providing more than a certain amount of nicotine should be available only in outlets like pharmacies. National or Europe-wide “test panels” would determine what quantities of flavoring like menthol should be banned, they said.


Much of the interest in the legislation in recent months had focused on apparent attempts to influence its wording.


Mr. Borg’s predecessor, John Dalli, resigned in October after the commission concluded that he had probably known about an attempt by a lobbyist to solicit a multimillion-dollar payoff in exchange for easing the ban on snus. The product can be sold only in Sweden, where some people consider it a safer alternative to smoking.


Mr. Dalli denied the allegations and said he was forced to resign under pressure from José Manuel Barroso, the president of the commission. Mr. Dalli also said his ouster had jeopardized chances for the revised directive to be passed before the current term of the European Parliament, which must approve the legislation, expires in 2014.


Mr. Borg suggested Wednesday that the law still could be adopted before the Parliament’s term expires, and go into force in 2015 or 2016.


But the Smoke Free Partnership warned that lobbying still could water down the proposals on labeling and packaging, as well as the ban on flavors and slim cigarettes. Governments and members of the European Parliament “are likely to face attempts by the tobacco industry to further block, weaken and delay this important legislation,” said Florence Berteletti Kemp, the director of the partnership.


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UBS to pay $1.5 billion to settle Libor charges









UBS has agreed to pay a fine of $1.5 billion to authorities and plead guilty to a felony count of wire fraud, the most recent developments in a far-reaching probe into how banks manipulated interest rates leading up to the financial crisis.


Two former traders were also charged with conspiracy in a complaint unsealed Wednesday, the first people charged criminally in the Libor scandal.


"We cannot and we will not tolerate misconduct on Wall Street of the kind admitted to by UBS today and by Barclays last June," said Assistant Atty. Gen. Lanny Breuer, head of the criminal division. In June, Barclays was the first bank to settle with authorities, paying $450 million.





The fine was one of the biggest leveled against a financial institution by American and British authorities, just short of the $1.9-billion fine HSBC agreed to pay last week over money laundering allegations.


The charges relate to the ways traders leaned on banks to manipulate the London interbank offered rate, or Libor, to benefit their own trading positions.


Officials said that from 2006 through 2009 UBS traders placed bets on the movement of Libor and manipulated the rate, which is used as a benchmark to set interest rates for many mortgages, credit cards and other consumer lending instruments. The traders profited by knowing which way the Libor would move.


In coming months, the probe probably will expand to include other banks that help determine the Libor, analysts say. But it's the criminal charges that turned some heads on Wall Street on Wednesday.


The plea agreement on wire fraud charges by a UBS subsidiary in Japan, which included a $100-million fine, marks the first time since 2005 that a major financial institution has pleaded guilty to criminal charges, the Justice Department said.


"For a bank to admit to criminality is kind of mind-blowing," said Peter Shapiro, managing director of Swap Financial Group in South Orange, N.J. "Obviously, they didn't do that easily — that was something that must have been a big priority of enforcement agencies."


Enforcement agencies have been feeling some pressure to level blame on financial institutions in the wake of the financial crisis, Shapiro said. No senior financial executives have served jail time for their roles in the financial crisis.


"Both the regulators and enforcement agencies feel somewhat beleaguered by the repeated assertions that they failed to deliver enough heads on a plate as a response to the financial crisis," he said.


U.S. officials also announced criminal charges against two former senior traders for UBS in connection with the scandal. Tom Alexander William Hayes, 33, of Britain, was charged with conspiracy and wire fraud, and Roger Darin, 41, of Switzerland, was charged with conspiracy. Both remain abroad, but the Justice Department will try to extradite them.


"The motivation here was nothing short of sheer greed, and the scheme was nothing short of a shell game, a Wall Street version of three-card monte," said Kevin Perkins, associate director of the FBI, which helped investigate the case.


More criminal charges at other banks could follow, said Anthony Sabino, professor of law at the Tobin College of Business at St. John's University.


"Once you start to round up some accused bad guys, that leads to more people being rounded up," he said. "This is a vast conspiracy among a multitude of banks, which therefore implicates a multitude of individuals."


Much of the activity took place at UBS Japan Securities Co., where Hayes was a senior trader. The Justice Department released internal UBS messages in which Hayes and others talked about their alleged manipulation.


In one from November 2006, Hayes told a UBS employee who submitted rate information for the Libor that he and Darin "skew the Libors a bit" and then said he needed the six-month rate to stay high for three days.


UBS traders were often colorful and emphatic in their pleadings, according to documents released by Britain's Financial Services Authority. One wrote, "I need you to keep it as low as possible.... If you do that, I'll pay you, you know, $50,000, $100,000, whatever you want."


The UBS fine was larger than that leveled on Barclays earlier in the year because UBS' misconduct was "considerably more serious than Barclays' because it was more widespread within the firm," the Financial Services Authority said. At least 45 individuals at UBS were involved in or aware of the rate-fixing practice.


UBS said that it had fully cooperated with authorities and that the interest-rate manipulations were the isolated actions of certain employees.


"Their misconduct does not reflect the values of UBS nor the high ethical standards to which we hold every employee," UBS CEO Sergio Ermotti said in a statement.


Analysts say that there's still potential for significant civil suits against UBS and other banks, which could be more damaging than the fines levied against them. Keefe, Bruyette & Woods, an equity research firm, estimated in July that potential industry damages could reach $35 billion.


Those estimates were validated Wednesday when the Inspector General for the Federal Housing Finance Agency estimated that government-owned Fannie Mae and Freddie Mac may have lost a combined $3 billion because of reduced interest payments on securities and other holdings. Officials at FHFA, which regulates Fannie and Freddie, have not confirmed the estimate but are evaluating potential issues involved with the Libor manipulation.


There are barriers to further lawsuits — the burden of proof will be high, analysts at Keefe, Bruyette & Woods said. To move forward with civil suits, plaintiffs would have to prove that traders were conspiring, said John C. Coffee, a Columbia Law School expert in corporate fraud.


"But that said, the size of the potential liability is mushrooming," he said.


Times reporter E. Scott Reckard contributed to this report. Semuels reported from Los Angeles and Puzzanghera from Washington.





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Panel faults security failures in Benghazi attacks









WASHINGTON — The State Department was guilty of "systematic failures" in security that made the deadly Sept. 11 terrorist attacks on the U.S. mission in Libya possible, a high-level investigative panel concluded in an unflinching examination made public late Tuesday.


The panel faulted the department for ignoring requests from U.S. diplomats in Tripoli for security assistance and for relying on ill-prepared local militias and inadequate equipment to protect the mission in Benghazi. It found that two key bureaus failed to properly coordinate their security planning, and it pointed to a failure in leadership by officials at several levels.


"Systematic failures and leadership and management deficiencies at senior levels within two bureaus of the State Department resulted in a … security posture that was inadequate for Benghazi and grossly inadequate to deal with the attack that took place," the report says.





The attacks by dozens of Islamist militants killed Ambassador J. Christopher Stevens and three other Americans and set off a broad reexamination of how the U.S. government protects its thousands of diplomats in dangerous parts of the world. The incident has also become the focus of a months-long battle between the Obama administration and Republican critics, who contend officials have sought to cover up their lapses.


United Nations Ambassador Susan Rice was among those caught up in the political fray, eventually withdrawing her name from consideration as secretary of State after fierce criticism of her comments on television talk shows regarding the Benghazi attacks.


According to the report, which is likely to represent the government's lasting judgment on the attacks, the assault was the calculated effort of militants and not a "spontaneous" reaction of an outraged crowd, the first explanation offered by U.S. officials.


Yet the five-member independent panel said that, despite the lapses, no officials had failed to carry out their duties in a way that required disciplinary action.


It also determined that there had been "no immediate, specific intelligence" on the threat against the mission.


The report prepared for lawmakers includes classified sections.


Secretary of State Hillary Rodham Clinton said in a letter to congressional committees that she has accepted "every one" of the Accountability Review Board's 29 recommendations, several of which remain classified.


She praised the board, saying that it had offered "a clear-eyed look at serious, systematic challenges that we have already begun to fix."


To begin remedying the problems, officials are planning to reallocate $1.3 billion that was to be spent in Iraq to add hundreds of Marine guards and diplomatic security personnel, and to bolster security infrastructure in dangerous locations.


The board, which was convened in September, was led by retired Ambassador Thomas Pickering and former Joint Chiefs of Staff Chairman Adm. Michael G. Mullen. The two will meet Wednesday in closed session with the Senate and House foreign affairs committees to discuss the findings.


On Thursday, the committees will convene again in public session to discuss the report with Clinton's deputies, William J. Burns and Thomas Nides. Clinton had agreed to appear before the committees Thursday, but asked to be excused last weekend after suffering a mild concussion in a fall. She has told the committees she would answer their questions in January.


The report criticizes officials for waiting to react to specific threats rather than anticipating the dangers that U.S. officials could face in a deteriorating security environment.


More than a year after the end of the end of a revolution that brought down Libyan leader Moammar Kadafi, the nation is still overrun by rival armed groups and lacks a central authority that can guarantee security for foreign missions, as it is required to do under international agreements.


Accountability Review Boards are set up under federal law to examine failures and assign blame. This one found shortcomings in the bureaucratic system, in personnel and equipment.


The report details how the Libyan militias that were supposed to protect the compound were not capable of carrying out the assignment. It deems the mission's fire-safety equipment and physical protections inadequate, and adds that the security arrangements were weakened by the relative inexperience and rapid turnover of personnel, despite their courage.


It also cites "diminished institutional knowledge, continuity and mission capacity."


The report says the mission security shortcomings were made clear by Stevens' trip to Benghazi. Stevens, one of the most respected U.S. diplomats in the region, believed that he faced no special threat in his visit to Benghazi, even though the general level of risk had been on the rise for much of the year.


And the security officials assigned to protect him were not even aware of the specifics of his plans to travel outside the compound during his visit, the panel said.


The investigative panel found that although officials in the U.S. Embassy in Tripoli had sought more security staffing in Benghazi, they had generally not done enough to try to improve security at the lightly protected Benghazi mission.


It said their faith in a local militia and contract security personnel was "misplaced," noting that some militia members had stopped accompanying the mission vehicles to protest their salary and hours.


Among State Department personnel, "there appeared to be very real confusion over who, ultimately, was responsible and empowered to make decisions based on both policy and security considerations," the report says.


The report says certain senior officials in the State Department's Diplomatic Security and Near East Affairs bureaus, whom it didn't identify, "demonstrated a lack of proactive leadership and management ability" in their responses. "However, the board did not find a reasonable cause to determine that any individual employee breached his or her duty," it adds.


The report calls for a strengthening of security and for the department to "urgently review the proper balance between acceptable risk and expected outcomes in high risk, high threat areas."


paul.richter@latimes.com





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Leak reveals Polaroid’s Android-powered camera with interchangeable lenses






Samsung’s (005930) Galaxy Camera and Nikon’s (NINOY) Coolpix S800c are just the beginning of a swath of Android-powered cameras. Newly leaked images and specs point to Polaroid reviving its camera business with what could be the world’s first Android camera with interchangeable lenses. With no official name yet, the tentatively named IM1836 camera will reportedly feature a 18.1-megapixel sensor, 3.5-inch touchscreen, pop-up flash, Wi-Fi, HDMI and Android 4.0.


[More from BGR: A guide to all the insane predictions made by Google’s new engineering director]






The Galaxy Camera and Coolpix S800c do a fine job taking pictures that are considerably better than what you get from a smartphone, but they still can’t match a mirrorless camera with a good lens. At first glance, Polaroid’s camera looks to be a rebadged Nikon 1 J2, but the resemblance only runs skin deep, as PhotoRumors reports the camera only takes MicroSD cards.


[More from BGR: How not to fix Apple Maps]


Polaroid might not be a major player, but as more companies start incorporating Android into their cameras, there’s going to be a shift in the features consumers expect from them. In the next few years, novelty features such as Wi-Fi, cellular data and photo editing apps will be the norm and we’ll laugh at how we ever lived without them.


This article was originally published by BGR


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Cassadee Pope wins Season 3 of 'The Voice'


NEW YORK (AP) — Cassadee Pope, who was country singer Blake Shelton's protege on the third season of NBC's "The Voice," has won the show's competition.


The 23-year-old singer is stepping out into a solo career after performing with a band called Hey Monday. Her victory over Scottish native Terry McDermott and long-bearded Nicholas David was announced at the end of a two-hour show Tuesday.


"The Voice" has grown into a hit for NBC and was the key factor in the network's surprising success this fall.


The show's status was affirmed by the stream of hitmakers who performed on the finale. They included Rihanna, Bruno Mars, the Killers, Smokey Robinson and Peter Frampton.


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Instagram draws ire over new user rules









SAN FRANCISCO — When it comes to policy changes, Instagram could have used a filter of its own.


Its usually devoted users threatened to delete their accounts en masse Tuesday if the popular photo-sharing app did not roll back new terms of service that appeared to give the company ownership of their images. Instagram users — about 100 million now — snap the photos on their smartphones, apply digital filters to enhance the photos and then instantly share them with friends.


"Dear @Instagram, why did you think we'd just be OK with your new terms? They are NOT COOL. Signed, The Entire Internet," Jason Pollock, a Los Angeles filmmaker and social media consultant, wrote on Twitter.





Instagram founder Kevin Systrom tried to calm the uproar and reassure users in a blog post Tuesday afternoon.


"Instagram does not claim any ownership rights over your photos," he wrote. "We respect that your photos are your photos. Period."


Instagram's new terms of service announced Monday included a clause stating that Instagram had the right to turn images into advertisements without any approval from or compensation for users starting Jan. 16. — part of Facebook's drive to make money from the service it bought this year for $715 million in cash and stock.


That angered amateur and professional photographers alike — even Facebook Chief Executive Mark Zuckerberg's wedding photographer.


"Pro or not if a company wants to use your photos for advertising they need to TELL you and PAY you," Noah Kalina said on Twitter.


The effort to make money from Instagram users struck a nerve. According to the Pew Research Center's Internet & American Life Project, nearly half of Internet users post photos and videos online that they have created themselves.


Kurt Opsahl, a senior staff attorney with the Electronic Frontier Foundation, said Instagram quickly realized it had "overplayed its hand." But its mea culpa blog post still contains plenty of loopholes, he said.


"They say they don't have any plans to put your photos in an advertisement, but nevertheless that is the permission they were seeking," Opsahl said. "We will have to see what the language of the terms of service looks like after they revise it."


Jeff Lawrence, a 29-year-old DJ, graphic designer and photographer from Seattle, said he'll decide if he's dumping Instagram after he sees what the company plans to do in black and white.


"Thankfully we are all Internet savvy enough to know that people can say one thing and do another," said Lawrence, an avid Instagram user. "I am going to wait and see if Instagram takes this criticism to heart and changes the terms of service."


The backlash underscored the rising tensions between users of free social media services and the companies that are trying to profit from them. More users are asking for more control over how these companies handle their information.


Clayton Cubitt, 40, a photographer and filmmaker from Brooklyn, N.Y., quickly dubbed the new terms of service a "suicide note" from Instagram.


He urged his fellow Instagram users to revolt against the current policies at social media companies that he described as "you have a free place to post content and in exchange the company sucks the soul out of your life."


"They look at users as a herd to milk," Cubitt said.


His rants may have angered Zuckerberg, but Zuckerberg's sister Arielle Zuckerberg publicly "liked" Cubitt's Instagram snapshot of the most controversial part of Instagram's terms of service.


It's unclear if the Instagram backlash will cause lasting damage to the service.


Hacker collective Anonymous had urged its more than 780,000 Twitter followers to ditch Instagram with the hashtag #BoycottInstagram and posted screen shots from followers who had. The servers of Instaport.me, which helps users download their photos from Instagram, were overloaded Tuesday as Instagram users deleted their accounts and switched to other options such as Hipstamatic and Twitter's new photo service that has filters similar to Instagram. Yahoo said it has seen "strong interest" in its new Flickr app for iPhones.


Many Instagram users said they would give Instagram the benefit of the doubt — for now.


"I am going to rage about it, and get people to rage about it, until we change their policy," Pollock, 31, said in an interview. "There is just something so personal and beautiful about Instagram. Hopefully they don't completely ruin it."


jessica.guynn@latimes.com





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Adam Lanza's family had kept a watchful eye on him









STAMFORD, Conn. — When the parents of Adam Lanza divorced, the settlement left Nancy Lanza with $24,150 a month in alimony payments and able to live a comfortable life and care for her troubled son.


Nancy Lanza, 52, was her son's first victim Friday, shot to death in the spacious homethey shared, authorities said. Adam, 20, then took his mother's car to Sandy Hook Elementary School, where he shot his way into the building and opened fire, killing 20 children and six adults before turning a gun on himself.


New details emerged Monday about how Adam Lanza's family and the staff at his high school kept a watchful eye over the reserved boy, who seemed to spend much of his time in solitude after finishing high school.





PHOTOS: Sandy Hook shootings


Friends of the family said he suffered from Asperger's syndrome, a form of autism. As early as age 10, Adam Lanza was taking medication, according to his former baby sitter, Ryan Kraft, now an aerospace engineer in Hermosa Beach.


"I know there was something administered. I'm not sure what," he said. There were never any signs that Lanza was dangerous, he said. "There were no red flags that would say something like this would happen."


Nancy Lanza cautioned Kraft to never let him out of his sight, even briefly. "The instructions were to always supervise him visually," he said.


FULL COVERAGE: Sandy Hook shootings


That echoed recollections from others who said Nancy Lanza was a constant presence in her son's life. "She truly cared for both of her sons deeply," said Amanda d'Ambrose, 23, whose brother befriended Adam Lanza in high school. "I just want the world to know what a beautiful soul that she is."


John Wlasuk, who played Babe Ruth baseball with Lanza as a youth, said the boy's mother was "always at the games, always really involved with her kids."


Wlasuk said he sometimes went to the Lanza house with his father, a plumber, who told him of the room in the basement where Lanza spent a lot of time playing video games. As Wlasuk's father described it, the room had posters of military weaponry, and Lanza would be playing violent video games such as "Call of Duty."


"I wouldn't say it was a shrine to the military or anything, a couple of posters with a bed and a desk and a computer," he said.


Richard Novia, who formerly advised the Newtown High Schooltechclub that was one of Lanza's few social outlets, said Lanza had been placed in a special program for students who were considered at risk of being bullied — though he had no recollection of Lanza being harassed.


Novia said he was told that Lanza had a medical condition that hindered his ability to feel pain, so that if he cut himself or stubbed his toe, he might not even know he was hurt and could continue to harm himself.


When Lanza was in elementary school, his mother fretted about his schooling.


"She was concerned mainly that Adam wasn't fitting in well in his classroom," said Wendy Wipprecht, whose son had also been diagnosed with a form of autism. She said Nancy Lanza considered moving her son to a private Catholic school, orhomeschooling him, but did not join sessions of any of the local autism parents' support groups that Wipprecht attended.


"She may have decided that there wasn't a support group that would fit," Wipprecht said. "Who knows. She may have been overwhelmed."


There is no mention of Adam Lanza's emotional troubles or any domestic strife in his parents' divorce papers. Last week, Ryan Lanza told investigators that the divorce could have had an effect on his younger brother.


Peter and Nancy Lanza married in 1981 in New Hampshire. She sued her husband for divorce in 2008, citing irreconcilable differences.


In their 2009 settlement, Nancy and Peter Lanza agreed to joint custody of Adam, then 17, who would live with his mother but have regular visits from his father. In addition to the alimony, Peter Lanza would cover the children's medical insurance.


Court records show that Nancy Lanza was due to receive $289,800 in alimony in 2012, or $24,150 each month. Peter Lanza, an executive at General Electric who was earning an annual salary of about $445,000 in 2009, also would pay for both their sons' college and graduate school educations and for a car for Adam.


The street where Nancy Lanza and her son lived was reopened by police Monday. The borders of the grassy, tree-lined hill it sits on are still cordoned off with yellow police tape.


shashank.bengali@latimes.com


molly-hennessy-fiske@latimes.com


kim.murphy@latimes.com


Bengali and Hennessy-Fiske reported from Newtown, Conn., and Murphy from Seattle.





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