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North Korea wants joint investigation with US over Sony hacking to prove it's not involved

SEOUL, South Korea - North Korea proposed a joint investigation with the U.S. into the hacking attack against Sony Pictures Entertainment, warning of "serious" consequences if Washington rejects a probe that it believes would prove Pyongyang had nothing to do with the cyberattack.

The proposal was seen by analysts as a typical ploy by the North to try to show that it is sincere, even though it knows the U.S. would never accept its offer for a joint investigation.

U.S. officials blame North Korea for the hacking, citing the tools used in the Sony attack and previous hacks linked to the North, and have vowed to respond. The break-in resulted in the disclosure of tens of thousands of confidential Sony emails and business files, and escalated to threats of terror attacks against U.S. movie theatres that caused Sony to cancel the Christmas Day release of "The Interview," a comedy about a plot to assassinate North Korean leader Kim Jong Un.

On Saturday, an unidentified North Korean Foreign Ministry spokesman in Pyongyang proposed the joint investigation with the U.S., saying the North knows how to prove it's not responsible for the hacking. He also said Washington was slandering Pyongyang by spreading unfounded rumours.

"The U.S. should bear in mind that it will face serious consequences in case it rejects our proposal for joint investigation and presses for what it called countermeasures while finding fault with" North Korea, the spokesman said in a statement carried by Pyongyang's official Korean Central News Agency, or KCNA.

"We have a way to prove that we have nothing to do with the case without resorting to torture, as the CIA does," he said, adding that the U.S. lacks any specific evidence tying North Korea to the hacking.

In Washington, a spokesman for the White House National Security Council, Mark Stroh, said the U.S. stands by the FBI's conclusion that "the North Korean government is responsible for this destructive attack."

"The government of North Korea has a long history of denying responsibility for destructive and provocative actions," Stroh said. "If the North Korean government wants to help, they can admit their culpability and compensate Sony for the damages this attack caused."

The United States was reaching out to China, North Korea's key ally, for help as President Barack Obama weighs possible responses to the cyberattack, said a senior administration official, who wasn't authorized to comment by name and requested anonymity. Although China holds considerable leverage over the North and its technological infrastructure, involving Beijing could pose complications because Obama has pointedly accused China of engaging in its own acts of cybertheft.

An editorial in the Global Times, a newspaper published by China's ruling Communist Party, said that any civilized country will oppose hacker attacks or terror threats, but it also condemned the movie. "The vicious mocking of Kim is only a result of senseless cultural arrogance," it said.

Koh Yu-hwan, a professor at Seoul's Dongguk University, called the North's proposal a "typical" tactic the country has taken in similar disputes with rival countries. In 2010, North Korea proposed a joint investigation after a South Korean-led international team concluded that the North was behind a torpedo attack that killed 46 South Korean sailors, though Pyongyang denied its involvement. South Korea rejected the North's offer for the joint probe.

"They are now talking about a joint investigation because they think there is no conclusive evidence," Koh said. "But the U.S. won't accede to a joint investigation for the crime."

On Friday, Obama declared that Sony "made a mistake" in shelving the satirical film about a plot to assassinate the North Korean leader, and pledged that the U.S. would respond "in a place and manner and time that we choose" to the hacking attack on Sony that led to the movie's withdrawal.

"I wish they had spoken to me first. ... We cannot have a society in which some dictator someplace can start imposing censorship," Obama said at a year-end news conference, speaking of executives at Sony Pictures Entertainment.

Sony said it had had no choice but to cancel distribution of the movie because theatres were refusing to show it.

U.S. options for acting against North Korea are limited. The U.S. already has severe trade sanctions in place, and there is no appetite for military action. Even if investigators could identify and prosecute the individual hackers believed responsible, there's no guarantee that any located are overseas would ever see a U.S. courtroom. Hacking back at North Korean targets by U.S. government experts could encourage further attacks against American targets.

North Korea and the U.S. remain technically in a state of war because the 1950-53 Korean War ended with an armistice, not a peace treaty. The rivals also are locked in an international standoff over the North's nuclear and missile programs and its alleged human rights abuses.

Earlier Saturday, North Korea angrily denounced a move by the United Nations to bring its human rights record before the Security Council and renewed its threat to further bolster its nuclear deterrent against what it called a hostile policy by the U.S. to topple its regime.

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Associated Press writer Eric Talmadge in Tokyo contributed to this report.

The Canadian Press


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Sony hacking case combines rare blend of international intrigue and Hollywood star power

LOS ANGELES, Calif. - The hackers who hit Sony Pictures Entertainment days before Thanksgiving crippled the network, stole gigabytes of data and spilled into public view unreleased films and reams of private and sometimes embarrassing executive emails.

One month later, the Obama administration confirmed what many had suspected: The North Korean government was behind the punishing breach. U.S. officials are promising a response, unspecified so far.

It was an extraordinarily public reaction from the highest levels of American government, considering that far more vital domestic interests have taken hits from foreign hackers in recent years — including the military, major banks and makers of nuclear and solar power whose trade secrets were siphoned off in a matter of mouse clicks.

Yet even in a digital era with an endless cycle of cyberattacks, none has drawn the public's attention like the Sony breach and its convergence of sensational plotlines:

—an isolated dictator half a world away.

—damaging Hollywood gossip from the executive suite.

—threats of terrorism against Christmas Day moviegoers.

—the American president chastising a corporate decision to shelve a satirical film.

—normally reticent law enforcement agencies laying bare their case against the suspected culprits.

"I can't remember the U.S. talking about a proportional response to Chinese espionage or infiltration of critical infrastructure for that matter, as a policy issue in the same way that we're talking about this today," said Jacob Olcott, a cyberpolicy and legal issues expert at Good Harbor Security Risk Management and a former adviser to Congress.

President Barack Obama said Friday the U.S. would respond to the cyberattack, though he did not say how, after the FBI publicly blamed North Korea. He also criticized Sony's decision to cancel the release of "The Interview," a comedy about a plot to assassinate North Korea's leader.

"This is uncharted territory," said Chris Finan, a former White House cybersecurity adviser. "The things we do in response to this event will indelibly serve to influence future nation state behaviour."

North Korea has denied hacking the studio, and on Saturday proposed a joint investigation with the U.S., warning of "serious" consequences if Washington said no. The White House sidestepped the idea, said it was confident that North Korea was responsible and urged North Korean government officials to "admit their culpability and compensate Sony for the damages this attack caused."

At the same time, the U.S. was reaching out to China, North Korea's key ally, to ask for its co-operation as the U.S. weighs its response, said a senior Obama administration official, who wasn't authorized to comment by name and requested anonymity. Although China holds considerable leverage over the North and its technological infrastructure, involving Beijing could pose complications because Obama has pointedly accused China of engaging in its own acts of cybertheft.

Friday's announcement was a critical moment in an investigation that united the government and cybersecurity professionals who conducted painstaking technical analysis.

The breach was discovered days before Thanksgiving when Sony employees logged onto their computers to find a screen message saying they had been hacked by a group calling itself Guardians of Peace. Experts scoured months of system logs, determining through spikes in network traffic and other anomalies that the attackers had conducted surveillance on the network since spring.

The first goal was to determine the extent of the damage to the network, so crippled that investigators or any other visitors needed handwritten credentials to gain entry.

As they examined the malware, they detected that it was similar to DarkSeoul, used in attacks on South Korea banking and media institutions and connected to North Koreans.

Investigators determined the Internet protocol addresses used, and found that one in Bolivia was the same as one in the DarkSeoul hack. They also found time zone and language settings in Korean, and that the malware itself had source code believed to be held by North Korea.

The FBI statement said clues included similarities to other tools developed by North Korea in specific lines of computer code, encryption algorithms and data deletion methods. More significantly, the FBI discovered that computer Internet addresses known to be operated by North Korea were communicating directly with other computers used to deploy and control the hacking tools and collect the stolen Sony files.

That analysis, along with a North Korean official's declaration that "The Interview" was an "act of war," served to bolster the case for a North Korean motive.

In general, it's exceedingly difficult to pin down responsibility for a cyberattack because hackers typically try to throw investigators off their trail. North Korea's Internet infrastructure is air-gapped, or not directly connected to the outside world, except by proxies through other countries, so it's even more difficult to attribute the hack.

Even when investigators do zero in on suspected culprits, there's often a political calculation about when and whether to publicly name them. The Justice Department took the unusual step in May of announcing indictments against five Chinese military officials accused of cyberespionage, but in many other instances, the public never learns the nationalities of the hackers, much less their identities.

In Sony's case, the FBI had been cautious about assigning blame to North Korea despite the evidence. Just a week before the public announcement, FBI Director James Comey had told reporters, "Before we attribute a particular action to a particular actor, we like to sort the evidence in a very careful way to arrive at a level of confidence that we think justifies saying 'Joe did it' or 'Sally did it,' and we're not at that point yet."

Beyond the FBI's announcement Friday, there were no details on remedies for Sony, no statement holding North Korea responsible for the already-known criminal acts of leaking copyright material, and no demand that North Korea return the stolen data.

"It seems highly unusual for the U.S. government to make an announcement like the FBI made today without a corresponding plan of action, which is exactly what was missing from the statements," Olcott said. "It was a press release to encourage more companies to work with the FBI in the future, but we actually don't really know why."

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Tucker reported from Washington. Associated Press writer Josh Lederman in Hawaii contributed to this report.

Follow Abdollah on Twitter at http://www.twitter.com/latams and Tucker at http://www.twitter.com/etuckerAP

The Canadian Press


Sony cyberattack gets muted coverage in Japanese media

Japan's biggest newspaper, Yomiuri Shimbun, featured a story about Sony Corp. on its website Friday. It wasn't about hacking. It was about the company's struggling tablet business.

Over at newswire Kyodo News, just after the FBI formally blamed North Korea for the cyberattack, mega pop group AKB48 topped headlines online instead.

While American journalists have extensively covered the fallout from the unprecedented Sony hacking attack, it hasn't exactly been massive news in Japan. Stories certainly surfaced after President Barack Obama weighed in on the issue at his year-end press conference Friday. But overall it has received relatively modest attention, mostly in short stories on the inside pages of Japan's major newspapers.

This might all be perplexing to the rest of the world since Sony is one of Japan's most iconic global brands. Here are a few reasons why the story hasn't gotten major play in Japan's mainstream media:

SONY vs SONY PICTURES

While Sony Pictures is technically part of the Sony empire, it has long been run as an entirely separate U.S. company. So far, the Japanese media seems to view the hack as an American problem rather than a domestic one. Indeed, at Sony headquarters itself, officials have refused all comment and referred questions about Sony Pictures to the movie division's headquarters in Culver City, California.

"This is seen mainly as an attack on Hollywood," Damian Thong, a senior analyst at Macquarie Capital Securities in Tokyo, said earlier this week. "I feel they want to clean it up as fast they can and just get on with life."

The studio shelved the Christmas Day release of the North Korea spoof movie "The Interview" after the hackers threatened to attack theatres that showed the film. But for Japan, the movie's demise hardly matters. Sony Pictures never planned to show the film there.

NEWSPAPER DEMOGRAPHICS

Japan's newspapers, which have the highest daily circulations in the world, are inclined to avoid news that is technologically complex. Like hacking. Nobuyuki Hayashi, a veteran freelance tech journalist and consultant based in Tokyo, said the tendency stems from reporters and editors who often don't have a deep understanding of technology. And neither do their aging readers.

"If you are technically savvy and need information (about the Sony hack), you will get it from the Web news media," Hayashi said. "Some technically-savvy people subscribe to a printed newspaper as well, but that's only to read other kinds of news."

OTHER NEWS

It has been a newsy December in Japan, especially with national elections last weekend. Prime Minister Shinzo Abe's Liberal Democratic Party locked up a solid majority in the lower house and reaffirmed his hold on power for up to four more years. In addition to politics, the national chatter was focused on a big blizzard that hit the northern island of Hokkaido this week, dumping heavy snow, derailing trains and killing several people.

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AP Business Writer Elaine Kurtenbach contributed to this report.

The Canadian Press




AP Interview: Coelho says Sony hack threatens us all if society lives in fear

GENEVA - Brazilian author Paulo Coelho says the Sony hack threatens us all if society doesn't enforce important values: our individual and collective freedom of expression and an unwavering refusal to negotiate with anonymous terrorists.

The bestselling author said in an interview Friday with The Associated Press that he was prepared to make himself an example — even if it meant inviting criticism and potential threats — if Sony Pictures had taken him up on his $100,000 offer for the rights to its cancelled film.

Defending these values is a matter of the highest concern for "everyone on the planet, everyone who believes in freedom of expression," he said, drawing parallels with the plight of fellow author Salman Rushdie, who spent years in hiding after his novel "The Satanic Verses" drew death threats from the Iranian government.

His plan was to release the film on his blog in the unlikely event Sony took him up on his spontaneous offer via Twitter for the controversial film "The Interview" that Sony cancelled after threats from anonymous hackers.

"I thought that they could take the offer so as not to lose face," Coelho said. "You know, 'In a gesture of good will, we are going to accept $100,000 even if we put $44 million in this movie because we believe in freedom of information.' ... Tomorrow the film would be there."

The author of "The Alchemist" acknowledged he would have been afraid if he had released the film, particularly because he travels and could be vulnerable, but he would have been more ashamed of himself if he didn't at least try.

"So live with fear or live with shame? Better to live with fear," he said at his luxury Geneva home, where his phone and Internet service were mysteriously out of service in an apparent attack directed at him. "In the name of something that is more important than I am, as a physical person."

Sony defended its decision after President Barack Obama said during a press conference that the studio had "made a mistake" in dropping "The Interview," a satirical film about a plot to assassinate North Korea's leader, and he pledged the U.S. would respond "in a place and manner and time that we choose" to the attack that led to the withdrawal. The FBI blamed the hack on the communist government.

Sony said the cancellation happened only because the country's top theatre chains pulled out. "This was their decision," Sony said in a statement.

Coelho made clear he wasn't defending the movie itself but rather that he decried the "culture of fear" and apparent willingness to "negotiate with terrorists" that he said undercuts people's freedom of expression and the principle of not negotiating with terrorists. He also expressed admiration for actor George Clooney's attempt to highlight the same values of sticking one's neck out to defend our freedom of information by putting forward a petition for Hollywood bigwigs to sign — though none did.

Clooney said the entertainment industry should seek release of "The Interview" online, telling the trade site Deadline that he urged Sony to "do whatever you can to get this movie out. Not because everybody has to see the movie, but because I'm not going to be told we can't see the movie. That's the most important part."

Coelho said he was unable to reach any executives to discuss the decision not to screen the film before a projected Dec. 25 release, but he thinks the studio ignored his offer because of fear that more Sony hacked emails would be divulged.

"What I'm doing here is much more a kind of political statement: fight for you rights," he said. "We live in a moment where fear rules, and this cannot continue."

The Canadian Press


Federal court finds protesters in contempt for ignoring order to halt anti-whaling campaign

SAN FRANCISCO - Radical environmentalists who threw acid and smoke bombs at Japanese whalers were found in contempt of court Friday for continuing their relentless campaign to disrupt the annual whale hunt off the waters of Antarctica.

The 9th U.S. Circuit Court of Appeals ordered a commissioner to determine how much Paul Watson and members of the Sea Shepherd Conservation Society he founded owe Japanese whalers for lawyer fees, damage to their ships and for violating the court order to stop their dangerous protests.

The Japanese whalers are demanding $2 million in addition to their attorney fees and damage and cost to their ships for warding off the protests.

The environmentalists' exploits have been documented on the long-running Animal Planet reality TV series "Whale Wars."

Sea Shepherd said in a statement it is disappointed with the ruling and considering its legal options.

"We are considering our legal options at this time, including the possibility of an appeal," it said.

In 2012, the court ordered Sea Shepherd to stay at least 500 feet from Japanese whalers and to halt dangerous activities like attempting to ram the whalers and throwing smoke bombs and bottles of acid at their ships. The crews of Sea Shepherd ships also drag metal-reinforced ropes in the water to damage propellers and rudders, launch flares with hooks, and point high-powered lasers at the whalers to annoy crew members.

The Japanese whalers filed a lawsuit in Seattle in 2011 seeking a court order halting the Sea Shepherd's campaign.

The 9th Circuit in December 2012 ordered the Sea Shepherd's to stop harassing the Japanese fleet and for the group's four ships to stay at least 500 feet from the whalers.

Watson then transferred all of Sea Shepherd's U.S. assets to foreign entities controlled by the group. Sea Shepherd has organizations in Australia, Belgium, France, Germany, the Netherlands and the United Kingdom.

Watson also stepped down from the board of directors of Sea Shepherd organizations in the U.S. and Australia. Sea Shepherd Australia took over management of "operation zero tolerance," the group's annual harassment campaign of the whalers in the Southern Ocean.

Watson also resigned as captain of the Sea Shepherd's flagship the "Steve Irwin," but remained aboard as an "observer."

In February 2013, the 9th Circuit appointed a commissioner to investigate whether Watson and members of the Sea Shepherd should be held in contempt. The commissioner concluded on Jan. 31 that the Sea Shepherd wasn't in violation of the court order because the harassment campaign was being managed outside the United States. The same month, the group's "Steve Irwin" vessel with Watson aboard collided with a Japanese whaler.

On Friday, a three-judge panel rejected the commissioner's findings. The 9th Circuit ruled that the transfer of assets and control of the Sea Shepherd to Australia and other countries didn't change its 2012 order to the group to cease its dangerous activities.

Contrary to the commissioner's conclusions, the 9th Circuit said Watson and the Sea Shepherd's U.S. affiliate could be found liable for aiding and abetting the organization's foreign offices to violate the court's injunction.

"Sea Shepherd U.S. is liable because it intentionally furnished cash payments, and a vessel and equipment worth millions of dollars, to individuals and entities it knew would likely violate the injunction," Judge Milan Smith wrote for the unanimous panel. The court ordered the case sent back to the commissioner to determine how much the whalers are owed.

The Canadian Press


Dodgers end Yankees' 15-year streak as biggest spender, owe most tax

NEW YORK, N.Y. - The Los Angeles Dodgers have ended the New York Yankees' 15-year streak as Major League Baseball's biggest spenders and owe more than $26.6 million in luxury tax.

The Dodgers finished with a record payroll of $257,283,410, according to final calculations made by Major League Baseball on Friday and obtained by The Associated Press. That is more than $20 million above the previous high, set by the Yankees last year.

For the first time since the current luxury tax began in 2003, the Yankees won't be paying the most. The luxury tax was put in place as a slowdown on spending by high-revenue teams, and teams pay based on the amount they are over the $189 million threshold.

The Dodgers owe $26,621,125 based on a $277.7 million payroll for purposes of the tax, which calculates payroll based on the average annual value of contracts for players on the 40-man roster and includes benefits. That raises the team's two-year total to $38 million.

Los Angeles, which flopped out of this year's playoffs in the division round and is seeking its first World Series title since 1988, pays the tax at a 30 per cent rate because it has gone over the threshold for the second straight year. The Dodgers' rate would increase to 40 per cent if they go over in 2015, which is likely.

The Yankees cut their payroll and owe $18.3 million in tax, down from $28.1 million for 2013. New York originally hoped to get under the threshold but wound up more than $36 million over. The Yankees have gone over every year, totalling nearly $271 million. New York pays at a 50 per cent rate, the highest called for in baseball's collective bargaining agreement.

Checks to the commissioner's office are due by Jan. 21. Tax money is used to fund player benefits and MLB's Industry Growth Fund.

Four teams wound up less than $10 million under the threshold: Detroit ($187 million), Philadelphia and Boston ($186 million each), and the Los Angeles Angels and World Series champion San Francisco ($180 million apiece).

Three of baseball's five-biggest spenders missed the playoffs this year, with the Yankees joined by Philadelphia and Boston. Among the 10 playoff teams, three were in the bottom half by payroll: AL champion Kansas City was 19th, Oakland 23rd and Pittsburgh 27th.

The Mets' regular payroll of $92.9 million was the team's lowest since $93.1 million in 2001 and $82.2 million in 2000.

MLB calculated the average salary at $3,692,123, up 11 per cent from 2013 for the steepest increase since 2001. The players' association has not yet released its final 2014 average.

The Canadian Press


CNRL oilsands well breach fouls aquifer east of Edmonton, well shut down

BONNYVILLE, Alta. - A breach at a Canadian Natural Resources Ltd. oilsands operation east of Edmonton has fouled a groundwater aquifer in the area.

The Alberta Energy Regulator says CNRL (TSX:CNQ) reported a break in a well at its Wolf Lake high pressure cyclic steam stimulation project in late October.

The regulator says since then the company discovered elevated levels of hydrocarbons in the aquifer about 50 kilometres south of Bonnyville.

Ryan Bartlett, a spokesman for the regulator, says the well has stopped operating and CNRL can't resume operations until the well meets regulatory requirements.

He says public health and safety are not at risk and the nearest private water wells are 15 kilometres away.

He says CNRL will be required to clean up the aquifer.

The Canadian Press


4,400 people file adoption papers for dogs seen on first ever Fox Dog-A-Thon for rescue dogs

LOS ANGELES, Calif. - More than 4,400 people filed adoption papers for homeless dogs during what was billed as the first all-star dog adoption telethon, producers say.

"If only half of those result in adoptions, that would be huge," director Michael Levitt said.

Seventy dogs from rescues across the country were featured on the two-hour Thanksgiving night telecast — a show the producer see becoming a fixture in the future.

More than 4 million people tuned in to the show, which was co-hosted by actresses Hilary Swank and Jane Lynch, and aired on donated time from the Fox Network.

Besides the permanent homes offered, 250 people signed up as foster parents for homeless dogs, Levitt said.

Swank said for her, the magic of "Cause for Paws: An All-Star Dog Spectacular" was "watching the dream of saving hundreds of dogs turn into the reality that became thousands as the awareness was raised of the severe homeless pet problem."

She added the show was the best holiday gift she could receive.

"Knowing that lives were saved as people opened their hearts and homes to new four-legged family members warms my heart and touches my soul more than you can imagine," Swank said.

Levitt said the goal was to educate people in an entertaining way and show them the joy that comes from rescuing animals.

"There was one amazing comment after another posted on social media, including people who posted pictures of dogs they went out and rescued because of the show," the director said.

Singer-actress Miley Cyrus confirmed just three days before the show that she would be there, Levitt said. She agreed to do a segment on pit bulls, writing her own copy and doing her own research. It was a side of Cyrus some people have never seen, he said.

The director said he couldn't imagine that there wouldn't be more telethons because this one was so successful.

Viewers also donated more than $200,000 during the telethon that will be distributed to eligible rescues. The show had more than 150,000 unique users and over 1 million page views after the special aired.

Some of the rescues represented on the telethon reported getting an additional 15,000 hits on their websites in the days after the telethon.

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Online:

"Cause for Paws: An All-Star Dog Spectacular," www.fox.com/causeforpaws

The Canadian Press


Staples says 1.2 million customer cards may have been exposed in security breach

PORTLAND, Ore. - Staples Inc. says nearly 1.2 million customer payment cards may have been exposed during a security breach earlier this year.

The office supply retailer announced in October that it was looking into a potential credit card breach, adding to a long list of retailers recently hit by cyberattacks.

Staples said Friday that an investigation shows that the criminals used malware that may have allowed access to information for transactions at 115 of its U.S. stores, which total more than 1,400. That includes cardholder names, payment card numbers, expiration dates and card verification codes.

The Framingham, Massachusetts-based company is offering free identity protection services — including credit monitoring, identity theft insurance a free credit report — to customers who might be at risk.

The security breach affected different stores at different times between July and September.

Staples said that it has also received reports of fraudulent card use tied to four of its New York stores between April and September. While it found no evidence of malware at those stores, it is also offering the protection services to customers there as well.

A number of retailers have suffered security breaches in recent memory.

During last year's holiday shopping season, Target Corp. disclosed that it was hit with an attack that exposed details of as many as 40 million credit and debit card accounts. Home Depot announced in September that a data breach affected 56 million debit and credit cards, and later said hackers also stole 53 million email addresses. And the cyberattack on Sony Pictures Entertainment that came into the spotlight this week has put a number of companies on high alert to attend to the security of their own networks.

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For more information about the incident, including dates of potential access and how to sign up for free credit monitoring, visit the company website at http://staples.newshq.businesswire.com/statement

The Canadian Press


Would Obama consider Republican Keystone bill? 'I'll see what they do,' he says

WASHINGTON - U.S. President Barack Obama spent five minutes disparaging the potential benefits of the Keystone XL pipeline Friday.

He then kept it alive with five words.

At a wide-ranging year-end news conference Friday, Obama maintained his recent pattern of expressed skepticism about the project: He played down its job potential, said it wouldn't lower gas prices for Americans and, employing the language of pipeline opponents, said it would merely help Canadian "tar sands" companies export their product overseas.

When given the chance to twist in the knife, however, the president relented.

He was asked whether he'd veto the Keystone XL bill that will likely be sent to his desk by the new Republican Congress, perhaps early in the new year, and he replied: ''I'll see what they do.''

The Republicans have said a Keystone bill will be their No. 1 priority in January, and also said they'll allow amendments to the bill — which could turn it into a vehicle for legislative deal-making. A pro-pipeline Democrat has urged fellow lawmakers to pack the bill with a few of the president's priorities to get him to sign it.

Obama made clear Friday what some of his legislative priorities are.

One is reform of the convoluted, three-decade-old U.S. tax code. And he specifically mentioned another when asked about Keystone XL. What would really create jobs, Obama said, far more than the few thousand associated with the pipeline, would be if Congress funded the refurbishment of national infrastructure.

''When you consider what we could be doing if we were rebuilding our roads and bridges around the country, something that Congress could authorize, we could probably create hundreds of thousands of jobs or a million jobs,'' he said.

''So, if that's the argument, there are a lot of more direct ways to create well-paying American construction jobs.''

Obama remains the key player in the pipeline debate, which has raged in the U.S. for years and foreshadowed newer disputes now plaguing the Canadian oil industry.

Obama can not only decide whether to sign or veto a bill; he can also choose whether to approve the project through the normal, non-legislative regulatory process.

His administration says it can't complete that regular process while the route through Nebraska remains in dispute. The state supreme court there could rule any week, in a case involving the constitutionality of the process used to sign off on the route.

Obama's comments have frustrated pipeline proponents — who say they're so wrong even his own State Department contradicts them.

A State Department review has concluded that Keystone wouldn't be used to export crude oil overseas. As for refined petroleum, much of it would belong to American companies that own oilsands properties and also the U.S. Gulf Coast refineries. In addition, the pipeline would pick up oil in the U.S. Midwest.

Canada's ambassador to the U.S. emphasized some of those points in response to Obama.

''I did not know Canada just gained North Dakota and Montana,'' Gary Doer said Friday, referring to the non-Canadian oil that would enter the pipeline.

''The pipeline includes (U.S.) Bakken oil.''

The Keystone comments came during a wide-ranging press conference where Obama also:

—Criticized Sony Pictures for bowing to threats and pulling the movie, ''The Interview,'' which angered the North Korean government. Obama said that sets a terrible precedent.

''We cannot have a society in which some dictator someplace can start imposing censorship here in the United States,'' he said. ''Because if somebody is able to intimidate folks out of releasing a satirical movie, imagine what they start doing when they see a documentary that they don't like or news reports that they don't like... That's not what America is about.''

—Defended his deal to reopen diplomatic relations with Cuba, after 53 years. He addressed criticism that he helped sustain the Castro regime, by making a deal without any concessions on democratic rights.

Obama said the old approach hasn't made Cuba more democratic, but perhaps more international contact will.

—Appeared to revel in some recent political wins. After a year of geopolitical crises and a crushing midterm election, Obama completed 2014 with a historic, if controversial, announcement affecting nearly 5 million illegal immigrants; a deal to restore relations with Cuba after 53 years; and a funding bill that eliminates the risk of a government shutdown for a year.

— With files from Dean Bennett in Calgary

The Canadian Press


T-Mobile paying at least $90M, mostly in refunds to customers, for unwanted text services

WASHINGTON - T-Mobile US will pay at least $90 million, mostly in refunds, for billing customers for cellphone text services they didn't order, under a settlement with federal regulators.

The Federal Trade Commission announced the agreement Friday with T-Mobile over billing for unauthorized charges, a practice known as "cramming." T-Mobile, the fourth-largest U.S. cellphone company, is paying at least $67.5 million in refunds to affected customers plus $18 million in fines to the 50 states and the District of Columbia, and $4.5 million in fines to the Federal Communications Commission.

The FTC sued T-Mobile in July, accusing it of billing customers for subscriptions to text services like $9.99-per-month horoscopes, ringtones, "flirting tips" or celebrity gossip updates that they didn't want or authorize.

T-Mobile collected 35 per cent to 40 per cent of the charges, even after being alerted by customers that they were bogus, the FTC alleges. That earned the company hundreds of millions of dollars, the agency said.

"We learned during this case that T-Mobile was in bed with the crammers," said Travis LeBlanc, head of the FTC's enforcement bureau. He was referring to the third-party companies that put charges on phone bills for text services. Many consumers aren't aware that third-party companies can do that, the regulators say.

Officials told reporters on a conference call that the $90 million was a floor, not a maximum, for the amount that T-Mobile could end up paying. "It could be well north of $100 million," said Bill Sorrell, the attorney general of Vermont.

A T-Mobile spokeswoman said the company had no immediate comment on the settlement. T-Mobile began a refund program in July and has said it has notified current and former customers. The company didn't provide an estimate of how much it has paid in refunds to date.

T-Mobile US Inc., based in Bellevue, Washington, is controlled by Germany's Deutsche Telekom AG. It's the No. 4 U.S. cellphone carrier after Verizon Wireless, AT&T Mobility and Sprint.

The settlement must be approved by a federal court in Seattle, where the FTC filed its lawsuit.

Under the settlement, T-Mobile must provide full refunds to all its customers affected by the "cramming," and the amount it pays in refunds and fines must reach at least $90 million. If the payout doesn't reach that amount, the difference between what T-Mobile pays and $90 million will go to the FTC for additional relief to consumers, consumer education or other uses.

T-Mobile also must contact all of its affected customers, both current and former, to tell them about the refund program and how they can make a claim. That must be done in a "clear and conspicuous way," the FTC said. Going forward, T-Mobile must get customers' explicit consent before putting third-party charges on their bills. The company must clearly indicate any third-party charges on the bills.

The settlement with T-Mobile came two days after another federal regulator, the Consumer Financial Protection Bureau, sued rival Sprint Corp. for alleged cellphone "cramming." The CFPB is seeking an unspecified money penalty against Sprint.

The T-Mobile agreement is the second-largest settlement for the government over mobile cramming. In October, AT&T Mobility agreed to a $105 million settlement with the FTC. Officials said that with the two settlements, about half of all U.S. cellphone users now will be protected from abusive third-party charges.

"Mobile cramming is an issue that has affected millions of American consumers, and I'm pleased that this settlement will put money back in the hands of affected T-Mobile customers," FTC Chair Edith Ramirez said in a statement Friday. "Consumers should be able to trust that their mobile phone bills reflect the charges they authorized and nothing more."

__

Refund site for T-Mobile customers: http://t-mobilerefund.com/

The Canadian Press


BlackBerry says he'll never be as 'super-human' as investors want

WATERLOO, Ont. - BlackBerry chief executive John Chen is frustrated by negative investor reaction to the smartphone company's latest quarterly results, which he says are within the parameters of the plan he has outlined for months.

"They're not listening to what I said," Chen told a roundtable of reporters Friday from the company's head office in Waterloo, Ont., after posting third-quarter financial results.

"They're giving me credit for being more of a super-human being than I really am."

The head of BlackBerry, who was brought in just over a year ago to make the money-losing operation profitable, zeroed in on the investment community, saying analysts boosted their expectations for BlackBerry's revenue higher than they should have.

"We told them that this quarter the revenue would be lower, and none of them listened — they jacked their revenue up," he said.

"There's a level of frustration on our part that they don't understand the steps we have to go through to strengthen the balance sheets."

Earlier in the day, BlackBerry Ltd. (TSX:BB) delivered a financial report showing progress was being made in improving the bottom line. But investors focused mainly on weakness in the company's revenue.

Shares of the company dropped as much as 10 per cent shortly after the results were released, recovering most of the decline later in the day. BlackBerry stock ended down 12 cents or one per cent at C$11.55 on the Toronto Stock Exchange.

In the third quarter, BlackBerry posted US$793 million in revenue, versus analyst predictions of US$931 million, and down from $1.19 billion a year ago.

Net losses were narrowed to US$148 million, equivalent to 28 cents per share, compared with a far deeper loss of US$4.4 billion or US$8.39 per share in the same period a year ago.

On an adjusted basis, the smartphone maker delivered a small profit of $6 million, or one cent per share, beating expectations of an adjusted loss of five cents per share, according to data compiled by Thomson Reuters.

BlackBerry recognized revenue on 1.9 million devices in the quarter, which compared with 2.1 million phones sold during the second quarter.

The pullback offers another sign of shifting priorities at the company as services and software revenues begin to eclipse the money it's garnering from handsets. During the period, 46 per cent of revenue came from phones, while another 46 per cent was from services it offers and eight per cent from software.

Sales of BlackBerrys slipped 10 per cent in the three months ended Nov. 29, a period which saw the company introduce the large-screen Passport model as a way to slow the rapid decline of its smartphone customer base.

The period was also characterized by BlackBerry selling off its inventory of older devices, sometimes at deep discounts. About 93 per cent of the old products have been removed from its stock, Chen said.

Chen aims to double its revenues from software in its next financial year, starting in March, helped by the launch of the next generation of its BlackBerry Enterprise Service software, called BES12.

Earlier this week, BlackBerry launched the Classic model, a throwback to its popular older smartphones, but with an updated design and features.

Chen told analysts that early orders for the Classic "are ahead" of the Passport smartphone that was released three months ago. While Chen didn't provide sales figures for the Classic, about 200,000 Passport phones had been sold in its first few days of release, mostly through pre-orders, suggesting the Classic has sold more.

BlackBerry is also making some headway in bringing corporate customers back on side, Chen said.

The company reported that 30 per cent of subscribers to its BES10 offering, which provides security and services for corporate users, had migrated from competitors in mobile device management.

BlackBerry has also partnered with Boeing to develop a higher-level security platform for the Boeing Black smartphone, which was designed specifically for defence and security customers, like the U.S. Department of Defense.

"We see the need for end-to-end, layered security in the mobile ecosystem that supports our defence and security customers," said Boeing spokesman Andrew Lee in an email.

Chen told analysts on a conference call that the technology will be installed on Android smartphones using BES12.

"That, by the way, is all they allow me to say," he added.

Follow @dj_friend on Twitter

Note to readers: This is a corrected story: A previous version included an incorrect figure for year-ago loss comparison. The correct figure is $4.4 billion.

The Canadian Press


Sony defends shelving of 'The Interview' after Obama criticism: 'We had no choice'

NEW YORK, N.Y. - Following pointed criticism from President Barack Obama for shelving "The Interview," Sony Pictures Entertainment on Friday defended its decision, claiming it had no choice but to cancel the film's Christmas Day theatrical release.

Obama said during a press conference Friday that Sony "made a mistake" in dropping "The Interview."

However, the studio fired back, saying the cancellation happened only because the country's top theatre chains pulled out.

"This was their decision," Sony said in a statement.

Sony insists it has only cancelled the Christmas Day release and that it has been "actively surveying alternatives" to release the film on a different platform.

In an interview with CNN Friday, Sony Pictures Entertainment CEO Michael Lynton said "the President, the press and the public are mistaken about what happened."

The Canadian Press


Canadian Press NewsAlert: Sony defends decision to shelve 'The Interview.'

LOS ANGELES, - Sony Pictures defends decision to shelve 'The Interview,' says "We had no choice."

More to come.

The Canadian Press




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