Apple CEO Tim Cook can expect a tough grilling about his company’s tax practices tomorrow when he appears before the U.S. Senate Permanent Subcommittee on Investigations hearing on “Offshore Profit Shifting and the U.S. Tax Code.” An 18-month bipartisan investigation — whose findings were summarized in a memo released today – charges that Apple’s offshore subsidiary, Apple Operations International, reported net income of $30B from 2009 to 2012 but “declined to declare any tax residence, filed no corporate income tax return, and paid no corporate income taxes to any national government for five years.” In addition, Ireland-based Apple Sales International generated $74B in sales income over four years but allegedly “paid taxes on only a tiny fraction of that income” after the company negotiated a deal with the government that enabled Apple to pay a tax rate of less than 2% vs the statutory rate of 12%.
Ashley Judd announced today “after serious and thorough contemplation” that she will not be running for the U.S. Senate. This comes after weeks of speculation that the Democrat supporting actress would challenge Republican Senate Minority Leader Mitch McConnell for his Kentucky seat next year. “Regretfully, I am currently unable to consider a campaign for the Senate. I have spoken to so many Kentuckians over these last few months who expressed their desire for a fighter for the people & new leader. While that won’t be me at this time, I will continue to work as hard as I can to ensure the needs of Kentucky families are met by returning this Senate seat to whom it rightfully belongs: the people & their needs, dreams, and great potential. Thanks for even considering me as that person & know how much I love our Commonwealth. Thank you!” said the actress via a series of TweetsWednesday afternoon. Not that Judd is entirely out of Washington politics – she plays the First Lady in the White House under attack action film Olympus Has Fallen, which came out last week.
Members of the Senate Antitrust Subcommittee didn’t seem to have the technical knowledge, the time, or perhaps the will to pin down Verizon and Comcast execs who testified at today’s hearing about the controversial partnership arrangement the companies created in December. Verizon agreed to pay $3.6B for wireless spectrum that several cable giants control, and both camps agreed to cross promote each other’s products in markets where they don’t compete head-to-head. The deal is under review at the Justice Department and FCC. Verizon says that the collaboration won’t affect its efforts to roll out FiOS video and broadband service. It “has always been intended to reach a relatively small” part of the country, the company’s General Counsel Randal Milch said. He added that “Wall Street punished us for the massive investment we made in FiOS…We owe it to our shareholders to give them a return.” Comcast EVP David Cohen echoed the theme that “there’s nothing in these transactions that will stop us from trying to beat the brains out of FiOS.”
A Republican effort to overturn the FCC’s net neutrality rules in the Senate was shot down today, two days after President Obama vowed to veto any such override. The regulations are set to take effect on November 20. Senate Democrats held off the charge with a 52-46 procedural vote that was mostly seen as symbolic after Obama’s pledge to block the rollback with what would have been only his third veto since taking office. The vote stopped the Republican bloc from further considering its resolution of disapproval, according to Politico; it’s unclear whether they group plans to mount another challenge. The White House backs the rules governing the Internet, saying that striking them down would “threaten the very foundations of innovation in the Internet economy and the democratic spirit that has made the Internet a force for social progress around the world.” That’s a sentiment backed by content creators and those who represent them, like the WGA, which applauded the Senate’s action today. “These regulations provide important safeguards for free speech, competition, innovation, and consumer choice,” WGA president Chris Keyser said. “The Web is far too important a public resource to hand over to a few powerful corporations.” On the other side of the debate, companies who provide Web services argue that the FCC doesn’t have the authority to set rules for the Internet. Verizon, for example, is among a …
Three weeks after signing off on the PROTECT IP Act, the Senate Judiciary Committee today approved the Commercial Felony Streaming Act, which classifies illegal online streaming of copyrighted content a felony. The bill essentially cleans up the language to make illegal streaming the same level of crime as illegal peer-to-peer downloading, which is already a felony. The move was praised by the Hollywood creative community, which is backing the tougher law. “The illegal streaming of motion pictures and television programming is as financially devastating for our industry as is illegal downloading,” said Jean Prewitt, president and CEO of the IFTA, which is part of an industry coalition that includes the MPAA and NATO. “Stealing is stealing, regardless of the means in which the product is being received. This legislation is a critical step forward in the piracy fight and, we commend the Committee for their support.” Said a joint statement from AFTRA, the DGA, IATSE, SAG, the International Brotherhood of Teamsters and the American Federation of Musicians:
Under normal circumstances in these trying times in Hollywood, the indies feel frozen out by the majors, and the exhibitors have big beefs with the studios, too. Yet here they are today united because of proposed federal legislation. A bipartisan coalition of several U.S. Senators — Patrick Leahy (D-Vermont), Chuck Grassley (R-Iowa), Orrin Hatch (R-Utah), Chuck Schumer (D-New York), Dianne Feinstein (D-California), Sheldon Whitehouse (D-Rhode Island), Lindsey Graham (R-South Carolina), Herb Kohl (D-Wisconsin), Chris Coons (D-Delaware) and Richard Blumenthal (D-Connecticut) — introduced and/or are sponsoring the Protect IP Bill, which aims to fight online infringement and counterfeiting by deterring, preventing, and rooting out websites that profit from trafficking in stolen content. Uniting in support of the bill are the major studios’ lobbying group the MPAA, The Independent Film & Television Alliance (IFTA), and the National Association of Theatre Owners (NATO).
According to the MPAA, the PROTECT IP Act targets foreign websites:
Formerly operating outside the realm of U.S. law, they would no longer be allowed to exploit U.S. registrars, registries, Internet service providers, payment processors, search engines and ad placement services to sustain their illicit online businesses. Internet sites that steal and distribute American intellectual property are often foreign-owned and operated, or reside at domain names that are not registered through a U.S.-based registry or registrar, setting them outside the scope of U.S. law enforcement.
The U.S. Senate today approved financial reform legislation that includes a ban on futures trading on motion picture box office results. Since the bill was already approved by the U.S. House Of Representatives, it now is on its way to the White House for President Obama’s signature. Bob Pisano, Interim CEO and President of the Motion Picture Association of America (MPAA) which vigiorously opposed movie futures trading, gave this statement:
“Speaking on behalf of a coalition that includes the Directors Guild of America (DGA), the Independent Film and Television Alliance (IFTA), the International Alliance of Theatrical Stage Employees (IATSE), the Motion Picture Association of America (MPAA) and its member companies, and the National Association of Theatre Owners (NATO), I want to thank the Congress for approving this measure.
After proposals for these speculative gaming platforms came to light, our industry came together to oppose these plans with an unprecedented coalition that included entertainment industry workers, creators, independent producers and distributors, studios and theater owners. We are pleased with final passage of this important legislation. Congress has acted decisively to ban proposed trading in box office futures and to make important reforms in the country’s financial regulatory system. We applaud the work the bill’s authors have done, and of course, the many Senators and Members who supported the provisions to prevent movie futures trading.”
Rod Blagojevich was considering appointing Oprah Winfrey to the Illinois Senate seat to replace Barack Obama, according to a wiretap played today at the former Illinois governor’s corruption trial. Per news reports, on the tape recorded on Dec. 2 Blagojevich and his former chief of staff John Harris go over replacement possibilities. The most intriguing ones raised by Blagojevich include California Gov. Arnold Schwarzenegger who doesn’t even live in Illinois and Winfrey.
“Oprah, by the way, is not far-fetched,” Blagojevich told Harris, noting her major role in the election of Obama to the presidency. “She’s up there so high, no one can assail this pick.”
Harris’ response? He thought making Winfrey a senator “was crazy.” “That’s where you’re wrong,” Blagojevich retorted.