Former Chrysler dealers sue for more compensation

A group of car dealers who lost their businesses in Chrysler’s 2009 bankruptcy sued the government Thursday, claiming their dealer franchises were closed without adequate compensation.

The 64 former Chrysler dealers said in the lawsuit that the Treasury Department violated their constitutional rights by failing to compensate them for taking their auto businesses. They alleged damages of at least $130 million.

Lawyers for the dealers said the closures prevented a “significant disruption” in the U.S. auto industry and economy but said “this is a loss that should not, however, be borne by a few individual auto dealers but . . . must in fairness and justice be borne by the public as a whole.”

The Treasury Department declined comment on the lawsuit.

Chrysler closed 789 auto dealers, or about one quarter of its dealer network, in its June 2009 bankruptcy to make the companies viable. 

Delta agrees to improve services for the disabled

The Transportation Department is ordering Delta Air Lines Inc. to pay a $2 million civil penalty after complaints about the way the airline treated disabled passengers.

The government says Delta’s handling of disabled passengers actually got worse after an investigation in 2003. The complaints that led to the new penalty were from 2007 and 2008.

Delta has to pay $750,000 of the penalty. The balance can be used to improve its service for disabled passengers above what the law requires.

Delta admitted no wrongdoing. It says it will install more elevators, and allow customers to specify what type of wheelchair help they need when they buy a ticket on the airline’s website. 

Weight Watchers gains as quarterly earnings soar

Shares of Weight Watchers International Inc. soared Thursday after the weight management services provider said fourth-quarter earnings more than doubled, and it expects a much higher 2011 profit than analysts forecast.

Company shares rose 40 percent, or $18.07, to $62.99 in midday trading.

The New York company earned $48.9 million, or 66 cents per share, in the three months that ended Jan. 1. That’s up from $18.7 million, or 24 cents per share, in the prior-year quarter, when a $35.6 million charge weighed down performance. 

Drudge settles lawsuit alleging copyright violation

Court records in Las Vegas show the founder of the Drudge Report website has settled a copyright infringement lawsuit with a company that sued on behalf of the Denver Post newspaper over a photo showing an airport pat-down.

Righthaven LLC filed a notice of dismissal in U.S. District court in Nevada on Tuesday, saying a written agreement was reached with website operator Matt Drudge. The dismissal with prejudice means Righthaven won’t refile in the case.

Drudge did not immediately return an e-mail and Righthaven did not immediately return a call seeking comment.

Details of the settlement aren’t in the filing.

Righthaven is a Las Vegas company that sues website operators over copyright issues on behalf of newspapers, including the Post and the Las Vegas Review-Journal. 

Court gives Borders the OK to begin liquidating assets

A judge has granted Borders Group approval on an interim basis to use $400 million of the $505 million in financing it has been offered to pay its vendors back and keep its business going, including honoring its loyalty program and gift cards.

The decision late Wednesday is the start of a lengthy and difficult process for Borders, which filed for bankruptcy protection on Wednesday.

The No. 2 U.S. bookseller is attempting to reorganize so it can emerge from bankruptcy protection a smaller and profitable company.

Borders is accepting bids in an auction for companies to run its store closings and clearance sales.

Hilco Group is the stalking horse bidder, meaning the liquidating service must be paid a breakup fee of $1 million if it is not chosen in the auction.

The auction was scheduled to begin today. Store clearance sales are expected to begin on Saturday, according to court filings.

Chief Judge Arthur Gonzalez of the Southern District U.S. Bankruptcy Court in New York did not rule Wednesday on Borders’ plan to close 200 stores. In a filing CFO Scott Henry said Borders might try to close up to another 75 stores. 

Atlantic City gets a boost as work on casino resumes

Revel Entertainment said Thursday it has secured the final $1 billion-plus it needs to finish its half-built casino on the Atlantic City Boardwalk, a project that is widely considered the best chance for the nation’s second-largest gambling market to recover from four years of plunging revenue.

The remaining $1.15 billion in financing was secured Thursday, and work on the stalled project will resume as quickly as possible, Kevin DeSanctis, Revel’s CEO, told The Associated Press.

“We’re extremely pleased to be moving forward,” DeSanctis said. “We think we will have a really positive impact on Atlantic City and South Jersey.”

Bob Griffin, CEO of Trump Entertainment Resorts and president of the Casino Association of New Jersey, said Revel’s resumption marks “the rebirth of Atlantic City.”

Revel was begun in 2007, before the national recession hit and credit markets dried up. It ran out of money in January 2009 and halted work with just the exterior nearing completion. 

Smucker finds right balance managing price fluctuations

J.M. Smucker Co. managed to make the recent ups and downs in ingredient costs work in its third quarter, partly by making price increases for coffee stick.

Food makers across the board have been struggling to balance their prices with recent run-ups in their costs for milk, sugar, wheat, corn and other key ingredients.

Companies want to charge more to make up the difference, but are hesitant to raise them too far too fast and scare cost-conscious shoppers away.

Smucker has raised prices on products such as coffee without losing customers. But it has also cut prices on peanut butter and other items 

Liz Clairborne trims losses, but outlook hurts stock

Clothing maker and seller Liz Claiborne Inc. said Thursday that its fourth-quarter loss narrowed as it trimmed expenses, compared with a year earlier, when it recorded a charge to reflect the falling value of some of its assets.

But a lackluster outlook that the company said fell short of its goals and concerns about rising costs combined to push the stock down Thursday afternoon.

Liz Claiborne said it lost $30.1 million, or 32 cents per share, in the period that ended Jan. 1, compared with a loss of $41.7 million, or 45 cents per share, a year earlier. The company said its adjusted loss from continuing operations was 3 cents per share, compared with a loss of 15 cents per share a year earlier.