BNSF, labor union reach tentative deal to allow train operations with 1 employee

One of the largest U.S. railroads and one of the largest labor organizations representing railroad workers have reached a tentative agreement to allow one person to operate a train on routes protected by a new collision-avoidance system required by Congress in 2008.

A BNSF Railway spokeswoman confirmed the agreeement with the International Association of Sheet Metal, Air, Rail and Transportation Workers. If ratified by union members, it would cover 60 percent of the BNSF system.

Under the agreement, a sole engineer would operate most trains with the support of a remotely based “master conductor” on routes equipped with Positive Train Control.

The agreement was first reported Thursday by Railway Age, a trade publication.

The union represents roughly 3,000 BNSF employees in far-flung locations from the Upper Midwest to the Gulf Coast to the Pacific Northwest. Some of the cities include Fort Worth, Texas; Kansas City and St. Louis, Mo.; and Tacoma, Seattle, Spokane and Pasco, Wash.

Roxanne Butler, a spokeswoman for BNSF, based in Fort Worth, Texas, said the agreement would not apply to trains carrying large volumes of hazardous materials, including crude oil and ethanol.

BNSF, which blankets the western two-thirds of the U.S., is the largest hauler of crude oil by rail in North America.

A Federal Railroad Administration emergency order last August required a minimum of two employees for such trains. Last July, an unattended crude oil train broke loose and rolled down a hill, derailing in the center of Lac-Megantic, Quebec, and igniting massive fires and explosions that killed 47 people. A sole engineer was in charge of the train.

The Transporation Safety Board of Canada has yet to release its findings on the causes of the disaster.

Congress required the installation of Positive Train Control following a head-on collision between a Metrolink commuter train and a Union Pacific freight train near Chatsworth, Calif., in August 2008.

The accident killed 25 people, including the train’s engineer, who had been texting at the time of the crash and may have missed a stop signal, according to the accident report from the National Transportation Safety Board.

PTC could have stopped the commuter train before it crossed into the path of the freight train. It also could have avoided a December derailment of a Metro-North commuter train near Spuyten Duyvil, N.Y. Four people were killed and dozens more were injured when the train entered a 30 mph curve at 82 mph and jumped the track.

However, PTC likely would not have stopped last year’s deadly crash in Quebec.

Most freight trains in the U.S. currently operate with at least two crew members. The reduction in crew size has allowed railroads to dramatically reduce their labor costs. As recently as the 1970s, many states required five or six employees to operate every train.

Amtrak and most commuter railroads typically have only one person at the controls.

After the Quebec crash, some members of Congress introduced legislation to require at least two employees to operate every train. In April, Federal Railroad Administration proposed a rule to establish a minimum crew size for most passenger and freight trains.

“Ensuring that trains are adequately staffed for the type of service operated is critically important to ensure safety redundancy,” said FRA Administrator Joseph Szabo in April.

Price coming down for low-income students at UMKC

KANSAS CITY, Mo. -- The University of Missouri-Kansas City finally has some good news for its lowest-income students.

Its net price is coming down.

Net price is the cost of attendance — tuition, books, housing, food, transportation and personal expenses — minus the scholarships and grants a student qualifies for from the federal government and the university. It's the amount students and their families are expected to borrow or pay out of pocket.

In 2010-11, UMKC was one of the 10 most expensive public colleges in the country for students coming from households where the family income was $30,000 a year or less. Net price: $16,798.

The next year was worse: $18,111.

But newly released numbers from the National Center for Education Statistics show the average net price for in-state freshmen dropped 14 percent, to $15,522, in 2012-13. That's a difference of $2,589.

"What I'm pretty pleased with, even excited about, is the fact that students who have zero to $30,000 in family income are paying less," Jennifer DeHaemers, associate vice chancellor for student affairs and enrollment management, told The Kansas City Star (http://bit.ly/1qcX0jR ). And UMKC says it expects to provide more help in the future.

But even with the lower price, UMKC's low-income students on average pay more than their counterparts at the other University of Missouri System schools in Rolla, $11,127; Columbia, $12,731; and St. Louis, $9,757. UMKC's net price also remains higher than at the University of Central Missouri in Warrensburg, $11,830; Kansas State University, $13,078; and the University of Kansas, $13,943.

The rising cost of college and pressure from the Obama administration to make college more affordable has many public colleges focused on lowering the cost for their neediest students.

It has taken three years for UMKC to see its efforts — a scholarship program that discounts the cost of tuition for low-income students, plus new endowed scholarships — work to lower its average net price.

"Our goal is to find more resources for need-based aid," DeHaemers said. "We have more need-based scholarships than we ever have had in the past."

But, she said, more are needed. "That is the way to impact the net price for students."

The school brought down its net price by making slight calculation adjustments that lowered the cost of attendance, while also giving out more need-based scholarships and continuing the Advantage Grant program that discounts the cost of tuition for Pell Grant-eligible, in-state undergraduates.

For the 2012-13 school year, UMKC awarded scholarships totaling almost $32 million to students from all income brackets.

The financial aid office also has seen an uptick in the number of low-income students who get their Free Application for Federal Student Aid, or FAFSA, in by March 1. Students who file forms for financial aid early are more likely to get need-based assistance from the school, DeHaemers said.

As at UMKC, net price for the lowest-income students also dropped on the university system's Rolla and St. Louis campuses.

But at the University of Missouri in Columbia, that price has crept up a few hundred dollars each of the last two years.

"Our object is not to have the net price go down but to maintain a net price that stays fairly constant and affordable," said Nick Prewett, MU director of financial aid. Keeping tuition down helps slow the rise in net price.

As of 2013, tuition at Missouri's four-year universities had increased an average of 5 percent since 2008, the lowest in the nation. State law prohibits colleges and universities from imposing tuition hikes greater than inflation.

Last year, University of Missouri System schools raised tuition 1.7 percent, but this year it will remain flat.

For the most part, the increase in net price at MU, Prewett said, is affected by larger enrollments that outpace increases in dollars available for need-based aid. Another factor is rising student costs of living that are not controlled by the university — transportation and off-campus housing, for example.

But the good news, Prewett said, is that "we are subsidizing students at a higher rate in 2012-2013 than we were in 2010-2011."

At Kansas State, the net price for the neediest students has inched up each year for the last three years.

"There is no doubt we would like to see our net price for those students go down," said Robert Gamez, associate director of student financial assistance.

But Gamez said the land-grant institution — where 80 percent of students are Kansas residents and 1 in 4 undergraduate students is eligible for Pell Grants — is challenged to lower the net price when shrinking state funding forces it to increase tuition every year.

Like UMKC, Kansas State hopes to attract more donors willing to put money toward supporting the neediest students.

"But from a fundraising perspective, it is challenging to raise dollars for need-based aid because a lot of donors focus on rewarding academic merit," Gamez said. "We definitely have our work cut out for us."

While many of these schools are focused on helping needy students pay for school, pressure is also on to increase graduation and retention rates along with enrollments and diversity on campus.

To that end, starting in 2012, the University of Kansas began a tuition reduction program similar to the one at UMKC for Pell Grant-eligible in-state students. The difference between the two schools' programs is that UMKC based its program purely on need. KU imposed academic standards requiring qualifying students to have at least a 3.25 GPA and an ACT of 22 or an SAT of 1020.

The University of Kansas shifted the focus of its scholarship dollars from solely access to merit, said Matt Melvin, vice provost for enrollment management. He said the university decided not to reach into its wallet for students with lots of need but little academic preparation to be successful.

That shift, in addition to increases in tuition and reduction in state support, has resulted in a net price for students in the lowest income bracket climbing from $10,906 in the 2010-11 school year to $13,943 for 2012-13.

"Our goal is not just to enroll students but to graduate students," Melvin said.

Melvin said public colleges and universities are "constantly in the nexus of balancing prestige, access and success. And there are not enough dollars to go around."

At UMKC, DeHaemers is expecting that next year may show another drop in net price for the lowest-income students. The school received a $175,000 matching grant from the university system that this fall will allow UMKC to dole out thousands of dollars more to low-income black and Latino students studying science, technology, engineering and math.

"It will be money they can use to cover expenses other than tuition," DeHaemers said. "That will help take the net price down."

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Information from: The Kansas City Star, http://bit.ly/1mmJYYJ

An AP Member Exchange shared by The Kansas City Star.

Double disasters taint Malaysia Airlines

HONG KONG -- Hit by two astonishing tragedies in quick succession, the Malaysia Airlines brand may become the airline industry's equivalent of asbestos or News of the World: toxic to the public and, experts say, impossible to redeem.

Malaysia Airlines Flight 17 was downed over eastern Ukraine on Thursday with 298 people aboard by what American intelligence authorities believe was a surface-to-air missile. Just four months earlier, a Malaysia Airlines jetliner carrying 239 people disappeared about an hour after taking off from Kuala Lumpur. The jet has still not been found, a source of profound unease for travelers and the aviation industry.

"I can't comprehend of anything they can do to save themselves," said Mohshin Aziz, an aviation analyst at Maybank in Kuala Lumpur, Malaysia.

"Perception-wise it really hits home," Aziz said. "It's very challenging. It's very difficult to fight against negative perception."

Even before the Flight 370 mystery, state-owned Malaysia Airlines was in serious financial trouble. In an industry notorious for impoverishing shareholders and irking customers, Malaysia Airlines had long stood out for its years of restructurings and losses.

That disaster along with the often bumbling response of Malaysia Airlines and the Malaysian government deeply scarred the carrier. Now, the once proud national airline is facing the unthinkable again.

Already losing about $1.6 million a day, there will be "no miracles" for Malaysia Airlines, said Aziz. Before the Ukrainian disaster, his opinion was the airline didn't have the capacity to survive beyond a year.

The airline's share price plummeted 11 percent Friday.

Unlike Flight 370, the responsibility for which is pinned with Malaysia Airlines, the second disaster appears largely beyond the airline's control. It may, however, face questions about why it continued with flight paths over eastern Ukraine, which is the heart of a violent rebellion against Kiev, when some airlines were circumventing the country.

For air travelers in Asia, who have a multitude of options thanks to the budget airline boom, the latest incident will make the Malaysian carrier even less attractive. Its brand in the rest of the world, where it became known largely because of the Flight 370 mystery, will become more closely associated with the worst fears of fliers.

Danny Gokul, an Australian university student on a layover at Incheon International Airport in South Korea, said he had flown with Malaysian Airlines before and its service was "fantastic."

But he is now "very hesistant" about using the airline. "Flying is scary enough."

His friend, Dayne Rodgers, waiting for a flight to Brisbane, Australia said even very cheap fares might not convince him to fly with Malaysia Airlines.

"I don't know if my Mum would let me," he said.

Within Malaysia, the shock is palpably raw.

"I was stunned," said 48-year-old shopkeeper Reezal Mohamed. "At first I could not understand. It's unbelievable."

Malaysia Airlines has been in the red for the last three years. Last year, its losses ballooned to 1.17 billion ringgit ($363 million), nearly three times larger than its 433 million ringgit loss in 2012.

As a state-owned flag carrier, it is required to fly unprofitable domestic routes, and its strong union has resisted operational changes. Nimbler discount rivals such as Air Asia have expanded rapidly, while Malaysia Airlines has been like a supertanker, slow to change direction.

Seth Kaplan, managing partner of industry newsletter Airline Weekly, said the airline was in "worse shape" financially that almost any other airline before Flight 370 vanished.

"It's just hard to imagine that they could have even survived the first incident without a lot of government help and now they're going to need even more," he said.

Wright reported from Bangkok. AP Business Writer Youkyung Lee in Seoul, South Korea, AP writer Satish Cheney in Kuala Lumpur, Malaysia and AP Airlines Writer Scott Mayerowitz in New York contributed.

Marijuana edibles burgeoning into an industry

MONTPELIER, Vt. -- Move over, pot brownies.

The proliferation of marijuana edibles for both medical and recreational purposes is giving rise to a cottage industry of baked goods, candies, infused oils, cookbooks and classes that promises a slow burn as more states legalize the practice and awareness spreads about the best ways to deliver the drug.

Edibles and infused products such as snack bars, olive oils and tinctures popular with medical marijuana users have flourished into a gourmet market of chocolate truffles, whoopie pies and hard candies as Colorado and Washington legalized the recreational use of marijuana in the past year.

"You're seeing a lot of these types of products like cannabis cookbooks," said Erik Altieri, spokesman for the National Organization for the Reform of Marijuana Laws. "They've always been popular among a subset of marijuana, but with the fact that more and more people from the mainstream are able to consume, there's a lot more interest."

Many pot users turn to edibles because they don't like to inhale or smell the smoke or just want variety. For many people who are sick or in pain, controlled doses of edibles or tinctures can deliver a longer-lasting therapeutic dose that doesn't give them the high.

And there's money to be made.

BlueKudu, in Denver, started producing marijuana chocolate bars for medicinal purposes three years ago. Since recreational use became legal this year in Colorado, owner Andrew Schrot said, the wholesale business has more than doubled its sales from several hundred chocolate bars sold a day through dispensaries to more than 1,000, at $9 to $17 a piece.

"There seems to be quite a bit of intrigue about the infused products from the general public and consumer, especially tourists," Schrot said.

Cooking classes have sprung up. One in Denver — led by a chef who has turned out chocolate-covered bacon and Swedish meatballs with a marijuana-infused glaze — has grown so popular that it will be offered every week in August. It's also part of a vacation package that provides pot tourists with a stay at a cannabis-friendly hotel (vaporizer and private smoke deck included), a visit to dispensaries and growing operations, and the cooking class.

Students are advised not to smoke before they come to class because there's a lot to learn about the dosing and they will be sampling foods along the way.

"By the end of the class, everybody's pretty stoned," said founder J.J. Walker.

Mountain High Suckers in Denver sells lollipops and lozenges for medical marijuana users and plans to release treats for recreational users at the end of August. The company hopes they will take off.

"People are turning the corner and making lots of money in the rec department, and we expect to almost double the business in a year," said Chad Tribble, co-owner of Mountain High Suckers in Denver.

High Times, a 40-year-old monthly magazine based in New York, has always featured a cooking column with a recipe. At least 40,000 people attended its Cannabis Cup in Denver in April, a sort of trade show that includes judging of marijuana edibles, said editor-in-chief Chris Simunek.

"Like everything else in marijuana at the moment, it's sort of experiencing a renaissance where the more people get interested, the more experiments they do with it," Simunek said.

The magazine said its "Official High Times Cannabis Cookbook" is the top-selling title of the five it offers.

It's not just a hobby or business; there's a science involved.

THC, marijuana's psychoactive chemical, must be smoked or heated — as in cooked — to be activated. When ingested rather than inhaled, it provides a longer-lasting and often more intense feeling.

Users of pot edibles, such as cookies, are often advised to eat only a portion so they don't get too high. Education about proper dosing has become a priority after at least one death and a handful of hospital visits were linked to consuming too much of an edible.

The Washington state Liquor Control Board adopted rules to require recreational marijuana products to be labeled clearly as such; to be scored so a serving size is easy to distinguish; and to be approved by the board before sale.

In Vermont — one of 22 states that allow the use of medical marijuana, along with the District of Columbia — the Legislature this year passed a bill that allows more people to get medical marijuana and called for a study of financial effects if the state were to allow recreational use.

Bridget Conry, general manager of Champlain Valley Dispensary in Burlington, Vermont, and of Southern Vermont Wellness, another medical marijuana dispensary in Brattleboro, is already creating infused olive oils, tinctures and a gluten-free cracker. She expects soon to be making pestos and other infused foods, in manageable amounts that allow people to control dosing.

"We've always come from the perspective of like, who eats a quarter of a cookie?" Conry said. "We're trying to make our things portion-specific, because you know you want to eat the whole cookie."

Axed Nokia X phones suffered from lack of identity

NEW YORK -- The Nokia X phones that Microsoft discontinued this week blend two rival operating systems, but leave out the best of each.

As a result, the devices didn't become a runaway hit as Nokia's low-cost answer to serving emerging markets.

Nokia X phones were devised to be a gateway to the company's pricier Lumia phones. The operating system that runs the phones was to blend the core technology found in Google's Android system with services and designs found in Microsoft's own Windows Phone system. Nokia looked to Android as a way to sell phones with locally tailored apps unavailable on Windows.

But Microsoft completed its deal to buy Nokia's phone business in April, and Nokia X is gone less than three months later.

"Nokia tried to bring the best of both worlds on this device, but once you play around with it, this phone kind of falls short of how fantastic it could be," said Ramon Llamas, an IDC analyst who follows phones.

Although sales figures aren't available, Llamas said his research showed Nokia X was "not the one that everybody seems to be flocking to."

The Nokia X project is an example of clashing priorities that Microsoft CEO Satya Nadella is trying to curb with a refocusing effort that includes 18,000 job eliminations over the next year. In Thursday's announcement of the cuts, Microsoft said it will shift future Nokia X product designs to its Lumia line of Windows devices.

Although Microsoft Devices chief and former Nokia CEO Stephen Elop pinned the move on a need to align Nokia's strategy with Microsoft's, two other factors contributed to the downfall: Nokia X lacked an identity, while Windows got better.

Now, Microsoft is left to target emerging markets with Windows alone.

Nokia and Microsoft had been partners long before Microsoft bought the phone business. To maintain the relationship, Nokia sought to appease Microsoft by replacing many of the Google services on Android with Microsoft's services. Android staples such as Gmail, Google Maps and Google's app store are nowhere to be found. Instead, Nokia X phones have Here Maps from Nokia and Skype and OneDrive from Microsoft. The Nokia X home screen looks nothing like Android, but resembles Windows.

The thinking was that once Nokia X users were ready for higher-end phones, Lumia would be their choice because they are already accustomed to Microsoft's services and designs.

But Nokia adapted Android so much that it affected functionality. Software developers had to tweak some of their apps because Nokia X lacks key Google services. For instance, location services have to use Nokia's Here rather than Google Maps. In-app payments also had to be tweaked to allow billing through mobile carriers, something Nokia X enabled because many people in emerging markets lack credit cards.

Meanwhile, even as Nokia adopted the look of Windows, it didn't adopt its ease of use. It was more like a knockoff version of Windows.

Windows devices set themselves apart by offering colorful home-screen tiles stuffed with content. Instead of just a logo of Facebook, for instance, you get the first several words of notifications. For email, you get the email's sender and the start of the subject line, so users know whether there's anything worth opening the app for. Windows also lets you create tiles to serve as shortcuts to specific tasks within apps — such as places you go often using the mapping app.

Nokia X has none of that. Its home-screen tiles are static, like overblown versions of Android icons.

Now, Llamas said, Microsoft is under even more pressure to succeed with Windows in emerging markets. Although recent improvements help, he said, many phone makers by now have settled on Android for cheaper devices.

Nokia X did succeed at keeping prices low. Its four models range from $120 to $150. By contrast, Nokia's Lumia Icon costs $550 without subsidies that come with two-year service contracts. Apple's iPhone 5s and Samsung's Galaxy S5 cost even more.

In killing Nokia X, Microsoft isn't changing Nokia's commitment to serving emerging markets. Microsoft knows those regions are high-growth areas, as many people in the United States and other industrialized markets already have smartphones. Microsoft is also aware that those devices need to be affordable.

The day before Nokia announced its Android phones at a February wireless show in Barcelona, Spain, Microsoft unveiled plans to update its Windows Phone system. Among other things, the software runs more efficiently, so it doesn't require as much processing power. That update, Windows Phone 8.1, came out in May. Microsoft also began giving the Windows software to phone makers for free, the way Google has with Android. And it relaxed requirements for physical buttons. All that has made Windows phones cheaper to make.

The Nokia X phones do have some good touches, including slots for two SIM cards — something important for emerging markets, where phone rates vary so much that people often switch services depending on whom they are calling or texting. Windows didn't allow that until the May update.

The improvements made to Windows ultimately reduced the need for Nokia X. But even if that hadn't happened, it was doubtful Nokia X would have survived under new owners.

In his memo, Elop pointed out that "the role of phones within Microsoft is different than it was within Nokia."

Nokia's business had been to make phones. With Microsoft, the phones are a way to showcase the company's other offerings in services and software, including the Windows Phone system.

And Nokia X had no role in that.

Asian stocks shaky as jetliner downed over Ukraine

MUMBAI, India -- Asian stock markets fell Friday, unnerved by a ratcheting up of global political tensions after a Malaysian jetliner was shot down over Ukraine and Israel launched a ground offensive in the Gaza Strip.

Oil, meanwhile, has risen more than 2 percent in 24 hours following the announcement of fresh U.S. sanctions against Russia for what Washington says is its support of separatist rebels in eastern Ukraine.

Tokyo's Nikkei 225, the regional benchmark, tumbled 1.2 percent to 15,184.36 and Hong Kong's Hang Seng slipped 0.4 percent to 23,423.41. South Korea's Kospi was down 0.2 percent at 2,016.48.

Stocks in Taiwan and Australian also were lower, as were most markets in Southeast Asia. China's Shanghai Composite inched up 0.4 percent to 2,160.17.

Malaysia's benchmark stock index was down 0.4 percent to 1,876.21 after news that a Malaysian Airlines jetliner had been shot down over conflict-wracked Ukraine with 298 people aboard. Shares of Malaysia Airlines plummeted 11 percent.

Ukraine accused pro-Russian separatists of shooting down Malaysia Airlines Flight 17, sharply escalating the crisis and threatening to draw both East and West deeper into the conflict. The rebels denied downing the aircraft.

"While initial trader reaction has been to sell first and ask questions later, the more considered approach will involve waiting for further insight into the likelihood of this tragic event triggering an escalation of the situation in Ukraine," said Ric Spooner, chief market analyst at CMC.

It was the second disaster involving the Malaysian flag carrier this year. On March 8, a Malaysia Airlines Flight 370 vanished about an hour after taking off from Kuala Lumpur, spawning an international mystery that remains unsolved.

The shooting down of the Boeing 777 roiled markets worldwide, with Israel's launching of a ground invasion into Gaza adding to uncertainty.

Thousands of Israeli soldiers entered the territory late Thursday, escalating a 10-day campaign of heavy air bombardments to try to destroy Hamas' rocket-firing abilities.

In Europe, Britain's FTSE 100 closed down 0.7 percent at 6,738.32 on Thursday while Germany's DAX fell 1.1 percent to 9,753.88. The CAC-40 in France ended 1.2 percent lower at 4,316.88.

Russia's MICEX index fell by 3.8 percent, a day after the latest round of U.S. sanctions, which targeted two major energy firms, a pair of powerful financial institutions, eight weapons firms and four individuals. The U.S. penalties are meant to increase pressure to end the insurgency in eastern Ukraine believed to be supported by Moscow.

In the U.S., the Dow Jones industrial average closed down 0.9 percent at 16,976.81 and the broader S&P 500 index fell 1.2 percent to 1,958.12.

Oil prices continued to shoot up Friday over fears that new U.S. sanctions on Russia might affect supplies.

Benchmark U.S. crude for August delivery was up 56 cents to $103.75 in electronic trading on the New York Mercantile Exchange. The contract rose $1.99 the day before to close at $103.19.

In currencies, the euro rose to $1.3522 from $1.3516 late Thursday. The dollar rose to 101.32 yen from 101.21 yen.

Audit: Boston Redevelopment Authority a mess

BOSTON -- Boston Mayor Martin Walsh is promising to overhaul the agency that oversees development in the city after an audit found deep-rooted problems that have led to a failure to collect millions of dollars in lease payments and fees owed by developers.

The audit of the Boston Redevelopment Authority described an agency incapable of performing basic functions, such as tracking payments, collecting rents on public property, and enforcing agreements with developers to improve roads and parks in exchange for approval of their projects.

The BRA has controlled building projects in the city since the 1950s.

The audit also faulted the agency for not having a "central repository" for its documents, most of which are kept in paper files rather than electronically.

"Is it alarming that we find out that there's deals out there that the city hasn't been paid on? Absolutely. That should not happen," said Walsh, who ordered the audit when he took office.

The Economic Development Industrial Corp., a BRA subsidiary, has accrued $4.3 million in outstanding rent for space leased in the Seaport District and Boston Marine Industrial Park alone.

Brian Golden, the BRA's acting director, called the agency a "mess."

"The organization historically has paid more attention to its external mission, urban planning and real estate development, than to its internal operations. So, decades of this neglect of the internal operation has created an abject mess," he said.

Reform is critical as development in the city booms, Walsh said. "I'm hopeful that reforming the BRA will help to make our city an even more attractive place to do business," he said.

The audit was conducted by KPMG.

United will take $169M in charges with 2Q results

CHICAGO -- The parent company of United Airlines says it will take charges of $169 million against second-quarter earnings to cover costs of grounding planes and other moves.

United Continental Holdings Inc. said Thursday that it would report costs of $66 million to permanently ground 21 Embraer regional jets used by its United Express unit. The planes were leased until 2018. The company said it is grounding the planes because of high fuel prices, larger replacement jets and pilot shortages and could ground its nine remaining Embraer ERJ 135 planes in the fourth quarter.

United also cited other write-downs, costs it is still incurring from the 2010 merger of United and Continental, and $38 million in severance and benefits related to cutting jobs.

Figures released this week by the U.S. Department of Transportation showed that United cut more than 2,000 jobs, or 2.3 percent of its work force, between May 2013 and May 2014. Delta, American, US Airways and JetBlue all added jobs in that period, according to the government.

Chicago-based United is scheduled to report second-quarter results before the market opens on July 24. It lost $609 million in the first quarter while other major U.S. airlines made money, but United is expected to post a second-quarter profit.

The shares were down 7 cents to $44.83 in morning trading. They started the day up 19 percent in 2014, lagging gains of 72 percent for American Airlines Group Inc., 49 percent for Southwest Airlines Co., and 38 percent for Delta Air Lines Inc.

States sue 5-Hour Energy over ad claims

PORTLAND, Ore. -- Two attorneys general from the Northwest have sued the companies responsible for the popular 5-Hour Energy drink, alleging they engaged in deceptive advertising.

The Oregon lawsuit filed Thursday in Portland contends 5-Hour Energy falsely claims customers get extra energy and focus from a unique blend of ingredients, when the boost actually comes from a concentrated dose of caffeine.

The suit also targets claims that users don't experience a crash when the effects subside and that the product is OK for adolescents.

Oregon has been part of a group leading a 33-state investigation into the accuracy of the product's claims. Washington state's attorney general filed a similar lawsuit Thursday in King County Superior Court in Seattle.

Other states are expected to file suit as well, said Kristina Edmunson, a spokeswoman for the Oregon Department of Justice.

The lawsuits name Living Essentials LLC and Innovation Ventures LLC as defendants.

5-Hour Energy spokeswoman Melissa Skabich said the company will defend itself against what Skabich called civil intimidation.

"When companies are being bullied by someone in a position of power, these companies roll over, pay the ransom, and move on," Skabich said in a statement. "We're not doing that."

Oregon Attorney General Ellen Rosenblum said 5-Hour Energy violated the state's Unlawful Trade Practices Act. The lawsuit seeks monetary penalties as well as refunds to all Oregon buyers of the decaffeinated version of the product, which, according to the lawsuit, provides no extra energy or alertness.

"Plainly and simply, in Oregon you cannot promote a product as being effective if you don't have sufficient evidence to back up your advertising claims," Rosenblum said.

She and 5-Hour Energy have been in a tug-of-war over that evidence for more than a year, with her department seeking unredacted information showing how the formula for 5-Hour Energy provides its asserted benefits.

The heavily advertised energy drink was introduced a decade ago, and the lawsuit estimates it is sold at more than 100,000 retail locations in the United States.

The state officials investigating 5-Hour Energy say they are concerned about safety. The Food and Drug Administration said in November 2012 that it had received more than 90 reports over four years about illnesses, hospitalizations and deaths after the consumption of 5-Hour Energy.

The FDA said, however, that the reports did not prove that the energy drink caused the problems.

Follow Steven DuBois at http://bit.ly/1lV2w7J .

FAA investigates congressman's drone wedding video

WASHINGTON -- The Federal Aviation Administration indicated Wednesday that it is investigating whether a video of a congressman's wedding last month violated the agency's ban on drone flights for commercial purposes.

The agency's carefully worded statement doesn't mention Rep. Sean Patrick Maloney, D-N.Y., by name, but said it was looking into "a report of an unmanned aircraft operation in Cold Spring, New York, on June 21 to determine if there was any violation of federal regulations or airspace restrictions."

Maloney has acknowledged hiring a photographer to produce a video of his wedding using a camera mounted on a small drone. The wedding took place in Cold Spring on June 21. Maloney is a member of the House Transportation and Infrastructure Committee's aviation subcommittee, which oversees the FAA.

Top agency officials have testified extensively before Congress about their concern that commercial drones could collide with manned aircraft or injure people on the ground. Congress has been pressing the FAA to move faster on creating regulations that will allow commercial drones access to U.S. skies. The agency has been working on regulations for about a decade.

"On their wedding day, Sean and Randy were focused on a ceremony 22 years in the making, not their wedding photographer's camera mounted on his remote control helicopter," Stephanie Formas, spokeswoman for Maloney, said in a statement.

The FAA has approved a few limited commercial drone operations. But the agency has also been sending letters to commercial operators across the country — including other videographers and companies that hire videographers — to cease their drone flights or face fines.

One videographer, Raphael Pirker, challenged the $10,000 fine the FAA tried to level against him for flying a small drone in an allegedly reckless manner near the University of Virginia. An administrative law judge sided with Pirker, whose attorney argued the agency can't ban commercial drone flights when it hasn't formally adopted safety rules governing drone flights. The FAA has appealed the case to the five-member National Transportation Safety Board. A decision is expected this fall.

Formas, citing the judge's ruling, said there was "no enforceable FAA rule" or regulation that applied to "a model aircraft like the helicopter used in the ceremony."

The wedding photographer subcontracted Parker Gyokeres of Propellerheads Aerial Photography in Trenton, New Jersey, to shoot the video. Gyokeress posted outtakes of the wedding on his company's website and created a YouTube video.

Maloney's wedding video was first reported by the New York Daily News.

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Online:

Outtakes of Rep. Sean Patrick Maloney wedding video http://bit.ly/1rlqlbo

Japan wary as US, Europe up sanctions on Russia

TOKYO -- For Japan, the ramping up of sanctions by the West against Russia can be summed up in a familiar phrase: It's complicated.

The tug-of-war over Ukraine threatens to derail Japanese Prime Minister Shinzo Abe's moves toward rapprochement with Russia. Relations between Japan and Russia have suffered for decades due to a territorial dispute that has prevented the signing of a peace treaty after World War II.

Yet Japan must toe the line on sanctions: It cannot spurn its main ally the U.S., nor European partners. It also has good reason to stand strong against Russia's apparent support for pro-Russian insurgents who have destabilized swaths of eastern Ukraine, given the parallels with China's ambitions toward disputed Japanese-controlled islands in the East China Sea.

Japan's chief government spokesman offered only vague support Thursday for the coordinated American and European moves targeting Russian energy firms, financial institutions, arms suppliers and four individuals.

"We are watching the situation of the EU and U.S.," Chief Cabinet Secretary Yoshihide Suga said at a regular briefing. "Working with the international community is our stance regarding Ukraine, so we would like to take appropriate measures in line with that attitude."

His terse reply says plenty about Japan's ambivalence over the issue.

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LIMITED SANCTIONS

Japan has imposed sanctions on Russia, but in a very limited way. It has suspended bilateral talks on some issues, and imposed an entry visa ban on 23 individuals, whom it hasn't publicly named.

"Japan is really signaling to Russia that it's not fully committed to the sanctions. It's going along but wants to keep a balanced position," said James D. J. Brown, a political science professor at Temple University's Japan campus in Tokyo.

The visa ban apparently doesn't apply to Sergey Naryshkin, who as chairman of the lower house of Russia's parliament was sanctioned by the U.S. and EU after Russia annexed Crimea. He visited Japan last month to inaugurate a cultural festival, where he delivered a message from Putin praising the event as a way of "enhancing our mutual trust."

Naryshkin also dined with former Japanese Prime Minister Yoshiro Mori, who had been shuttling between Tokyo and Moscow as an unofficial envoy, having declared resolution of the territorial dispute his "lifelong duty."

A visit by Russian President Vladimir Putin to Japan planned for the fall appears to be still in the works.

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THE ENERGY AND CHINA FACTORS

Tokyo is wary about Beijing cozying up to Moscow, said Valerie Niquet, a senior research fellow at the Foundation for Strategic Research in Paris.

"Tokyo remains interested in rapprochement with Russia to balance Beijing," she said.

Energy is one vital bond. Japanese and Russian companies are pushing ahead with projects, including a liquefied natural gas facility in Sakhalin to increase shipments to Japan and other Asian countries.

"The Russians are not open at all to accepting a lot of investments from China including in energy, so they've built a strong working relationship with Japan," Niquet said.

Putin has also obliged Abe by remaining neutral on the islands in the East China Sea that are claimed by both Tokyo and Beijing.

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TERRITORIAL CONUNDRUM

Despite those shared interests, it is unclear if Japan and Russia can bridge their dispute over four islands just off the northern tip of Hokkaido.

The Russians captured the islands at the end of World War II, but they are claimed by Japan and a pet cause of Japanese nationalists.

Brown noted that, given Russia's insistence on protecting Russian speakers in Crimea, it seems unlikely that Moscow would give up sovereignty over islands populated mostly by Russian speakers.

Conn. employers add jobs for 5th straight month

HARTFORD, Conn. -- Connecticut's labor market continued to strengthen as employers added jobs for the fifth straight month in June, driving the unemployment rate to its lowest level in more than five years, the state Department of Labor reported on Thursday.

Employers added 1,700 jobs in June for a total of 5,300 new jobs since June 2013. Adding to the positive jobs picture was an upward revision of job gains in May, to 6,000 from the initial report of 5,800.

The unemployment rate fell to 6.7 percent from 6.9 percent in May, the lowest since December 2008, a year into the worst recession in decades. It's still substantially higher than the U.S. rate of 6.1 percent.

The state unemployment rate peaked at 9.5 percent in October and November 2010, and has fallen slowly since.

"Connecticut's unemployment rate continues to decline for all the right reasons, such as broad industry job growth coupled with declining unemployment and an expanding labor force," said Andy Condon, the Labor Department's research director.

Summer hiring also seems to have begun at expected rates, he said.

Gary Rose, politics professor at Sacred Heart University in Fairfield, said the strengthening job market could help Democratic Gov. Dannel P. Malloy in his bid for a second term.

"It's just one trend. But any trend, large or small, that moves in the right direction helps the incumbent," he said.

Connecticut has recovered about 62 percent of the 119,100 jobs that were lost during the March 2008-to-February 2010 employment downturn. In comparison, the national economy has recovered all jobs that were lost. The recession officially ended in June 2009, though economic growth nationally and in Connecticut has been slow.

Economist Don Klepper-Smith, who served as an adviser to former Republican Gov. M. Jodi Rell, called the June numbers lackluster.

Job growth in Connecticut since June 2013 was 0.3 percent, one-sixth the national rate of 1.8 percent, he said.

"In this respect, watching the Connecticut labor market progress is like watching paint dry," Klepper-Smith said.

Hiring was led by the state government, which added 1,400 jobs. The Labor Department said that may have been related to summer hiring.

Peter Gioia, economist for the Connecticut Business and Industry Association, said Connecticut is benefiting from the strengthening national economy. In particular, increased demand from outside Connecticut is helping the state's financial services, manufacturing and aerospace industries.

Maine nursing homes to get an additional $13M

AUGUSTA, Maine -- After weeks of wrangling with Democrats over funding for nursing homes, Gov. Paul LePage announced Thursday that Maine's roughly 100 facilities will get an additional $13.1 million this fiscal year through an arrangement that doesn't require the Legislature's approval.

The Republican governor's administration said it identified $4.6 million in savings within the Department of Health and Human Services, which will draw down $8.5 million in federal dollars to increase Medicaid reimbursements. That's on top of $12.3 million in state and federal dollars the facilities were already set to receive this fiscal year under a bill that went into law without LePage's signature.

Officials representing the long-underfunded facilities said that wasn't enough. Since lawmakers left in May, LePage and GOP lawmakers have urged Democratic leaders to haul lawmakers back to Augusta to pass a $5 million bill to fix the existing shortfall. In the meantime, two nursing homes have announced they will soon shutter their doors.

LePage said Thursday that his administration won't "stand by anymore and listen to slick-talking politicians giving lip service."

"That time is over. We are taking action. And the Legislature isn't part of this solution. They are part of the problem," he said.

Democrats defied LePage's calls to reconvene the Legislature, saying he had the power to call them into a special session. They said his latest announcement is more proof that LePage, who's running for re-election this November, is using nursing homes to try to take political cover for his policies that they say have hurt Maine seniors.

"Why would he sit on $4.6 million in savings, when nursing homes were struggling? And why would he call on lawmakers to return to Augusta when he already had the funding?" Democratic House Speaker Mark Eves of North Berwick said in a statement.

Nursing homes are currently reimbursed by the state for residents in the Medicaid program based on their expenditures in 2005 and have received only one slight cost-of-living boost in the last several years, according to the Maine Health Care Association. The measure the Legislature approved last session requires the state to reallocate funding based on more recent expenditures.

LePage originally wanted to aid the nursing homes by taking $5 million of tobacco settlement funds, which are meant for anti-smoking campaigns. The bipartisan budget-writing committee spiked that measure in the final hours of the session after lawmakers were told LePage would veto it if amended.

LePage and DHHS Commissioner Mary Mayhew said Thursday that they don't need legislative approval under the new plan because they are reallocating money within the department. The department is using money left over from last fiscal year — which ended in June — that Mayhew said came from initiatives that improved efficiencies in the Medicaid program.

Mayhew said the state must develop a long-term solution to deal with its rapidly aging population. Maine's median age of 43.5 years is the highest in the country. That's more than six years older than the U.S. median age of 37.4 years.

"We have got to continue to work ... to effectively build and plan for a system that will meet the needs of this population," Mayhew said.

In the supplemental budget — which lawmakers approved over LePage's veto — nursing homes will also get $5 million in the budget year that begins next June and $5 million the following year.

Nissan CEO: Japan female bosses goal too ambitious

TOKYO -- Nissan's chief executive, who has long made a point of promoting women to management positions, said the Japanese prime minister's plan to boost female bosses to 30 percent by 2020 is too ambitious.

The participation of women in Japan's workforce is very low by developed nation standards. Women make up 2.9 percent of manager-level and higher positions at Japanese companies employing 5,000 or more people. Abe wants to increase the number of women in jobs at all levels because Japan's population is aging and its workforce is shrinking.

Nissan Chief Executive Carlos Ghosn is advocating that women make up 10 percent of Nissan's managerial ranks in Japan by 2017.

But Ghosn said he wasn't about to rush things just because having women visible in management ranks has become more topical in Japan.

The proportion of women in management at Nissan in Japan is now 7 percent, although it's higher for Nissan globally at 10 percent.

When asked why he was not as ambitious about empowering women as Abe, Ghosn said he didn't want a negative effect by having women fail as a result of being promoted with insufficient experience, which would be a step backward.

He instead hoped to have women "advancing safely," he said

"I'm being conservative. I'm being prudent," Ghosn told the Foreign Correspondents' Club of Japan in Tokyo.

The Geneva-based World Economic Forum ranked Japan 105th in last year's Global Gender Gap Report, which measures economic equality and political participation. Iceland was No. 1, followed by the Scandinavian nations. Germany was 14th and the U.S. 23rd.

Women make up 3.9 percent of board members of listed Japanese companies, versus 12 percent in the U.S. and 18 percent in France, according to the Organization for Economic Cooperation and Development.

A Brazilian-born Frenchman of Lebanese ancestry, Ghosn was critical of the sexist corporate culture of Japan Inc. almost as soon as he arrived in 1999.

Ghosn, who also heads Nissan's alliance partner Renault SA of France, has led a business overhaul at Nissan.

Japanese prime ministers rarely last too many years in office and so it is possible Abe will never be held accountable for the numerical targets he has set for promoting women.

It's a different situation for Ghosn, who answers to investors, reporters and consumers on all the promises that he makes.

Although Nissan was quick to wave the flag of promoting women, it has not been as quick to tap them to its board of directors.

Japanese rival Honda Motor Co. appointed a woman to its board for the first time earlier this year.

Toyota Motor Corp., the world's top automaker, has no women on its board, and has said it has no immediate plan to add any.

Ghosn stressed Nissan sees women as important car buyers, and what they look for, such as seat positioning, interior materials and safety features, are critical in developing models.

That's why it's in Nissan's interests to have women in "decision-making" positions, he said.

For US and Europe, divisions over Russia penalties

WASHINGTON -- The United States and Europe are seeking to maintain a united front against Russia with coordinated announcements of new economic sanctions, but divisions persist over how aggressive the West should be in punishing Moscow for its threatening moves in Ukraine.

The penalties announced by the White House on Wednesday were broad in scope, targeting two major Russian energy firms, a pair of powerful financial institutions, eight weapons makers and four individuals.

Leaders in Europe, which has a far deeper economic relationship with Russia than the U.S., were more restrained, ordering investment and development banks on the continent to suspend financing agreements with Moscow. They also asked EU foreign ministers to consider targeting people or companies involved in the unrest in Ukraine — a decision that could affect Russian oligarchs or members of the Kremlin inner circle.

Even the U.S. penalties stopped short of the most stringent actions the West has threatened, which would entail fully cutting off key sectors of Russia's economy. But officials said those steps were still on the table if Russia fails to abide by the West's demands to stop supporting pro-Russian insurgents who have destabilized swaths of eastern Ukraine.

"What we are expecting is that the Russian leadership will see once again that its actions in Ukraine have consequences, including a weakening Russian economy and increasing diplomatic isolation," President Barack Obama said as he announced the U.S. penalties from the White House.

Russian President Vladimir Putin, sounding unperturbed, said the U.S. was only hurting itself by putting American companies that want to operate in Russia at a competitive disadvantage.

At a news conference in Brazil, Putin said through a translator, "They are undermining the positions of their energy companies."

"They made one mistake, and now they insist on making another one," he said.

Until now, the U.S. and Europe have limited their sanctions on Europe to travel bans and asset freezes aimed at individuals and entities, including some with close ties to Putin. But those measures have done little to change Putin's calculus, with the Pentagon announcing Wednesday that Russian troops were again massing along the border with Ukraine. In Ukraine itself, pro-Russian rebels in the east have lost much ground but now seem to be hunkering down for what could be extended urban warfare.

Ukraine and the West have accused Russia of fomenting the insurgency by sending troops and weapons across its border with the former Soviet republic, something Moscow denies. The insurgency was sparked by Russia's annexation of the Crimean Peninsula from Ukraine earlier this year.

While Obama has put a premium on responding to the provocations in coordination with Europe, the White House has grown increasingly frustrated with the continent's reluctance to impose sanctions on Russian economic sectors. EU leaders fear such penalties could have negative impacts on their own economies, given their close financial relationships with Russia.

U.S. officials summoned European diplomats to the White House on Monday to discuss the matter and warn that Obama was prepared to take unilateral action if the EU did not take stronger measures during a meeting in Brussels on Wednesday.

After meeting late into the night, the EU said it was asking the European Investment Bank to sign no new financing agreements with Moscow. The EU also agreed to suspend financing of the new European Bank for Reconstruction and Development operations in Russia.

European leaders also signaled for the first time their willingness to go after Russian companies "that are materially or financially supporting actions undermining or threatening Ukraine's sovereignty, territorial integrity and independence." They ordered their foreign ministers to draw up a list of such people or entities by the end of the month.

Lithuanian President Dalia Grybauskaite, whose nation borders Russia, said the EU had to get tougher with Moscow "because if Putin's aggressive policy isn't stopped, he will go further."

The targets of the U.S. sanctions include two major Russian energy firms: Novatek, the country's largest independent natural gas producer; and Rosneft, Russia's largest petroleum company and third-largest natural gas producer. The penalties bar both from getting long-term loans from U.S. entities.

Also targeted were leading Russian financial institutions, the Russian development bank VEB and Gazprombank, the banking arm of Russia's state energy behemoth Gazprom. The sanctions restrict their ability to access U.S. capital markets.

Steven Pifer, the former U.S. ambassador to Ukraine, said the American sanctions will add uncertainty to a Russian economy that has already been showing signs of weakness.

"These are serious sanctions. They target major Russian energy companies and financial institutions," said Pifer, who currently works as an analyst at the Brookings Institution in Washington.

The sanctions were welcomed with muted praise from some Republicans on Capitol Hill, who have contended that Obama's warnings of tougher action have been little more than empty threats.

"While the delay in imposing real costs on Russia has been damaging to U.S. credibility, today's announcement by the administration is definitely a step in the right direction," said Tennessee Sen. Bob Corker, the top Republican on the Foreign Relations Committee.

Also included on Wednesday's sanctions list were four individuals: Putin adviser Igor Shchegolev, Russian State Duma Deputy Speaker Sergei Neverov, Ukrainian separatist leader Aleksandr Borodai and Sergey Beseda, an official with Russia's Federal Security Service, the intelligence agency that replaced the KGB after the collapse of the Soviet Union.

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Dahlburg reported from Brussels. Associated Press writers Nedra Pickler and Deb Riechmann in Washington and Laura Mills in Moscow contributed to this report.

Follow Julie Pace at http://bit.ly/1rx2jak and John-Thor Dahlburg at http://bit.ly/WecnLe

Memo from Microsoft exec Elop announcing job cuts

Microsoft Executive Vice President Stephen Elop sent employees of the company's devices business a memo detailing its job cut plans. Microsoft said it would cut up to 18,000 jobs over the next year, with about 12,500 related to Microsoft's acquisition of Nokia's phone business in April. Elop was Nokia's CEO before the acquisition. Here's his memo.

Hello there,

Microsoft's strategy is focused on productivity and our desire to help people "do more." As the Microsoft Devices Group, our role is to light up this strategy for people. We are the team creating the hardware that showcases the finest of Microsoft's digital work and digital life experiences, and we will be the confluence of the best of Microsoft's applications, operating systems and cloud services.

To align with Microsoft's strategy, we plan to focus our efforts. Given the wide range of device experiences, we must concentrate on the areas where we can add the most value. The roots of this company and our future are in productivity and helping people get things done. Our fundamental focus — for phones, Surface, for meetings with devices like PPI, Xbox hardware and new areas of innovation — is to build on that strength. While our direction in the majority of our teams is largely unchanging, we have had an opportunity to plan carefully about the alignment of phones within Microsoft as the transferring Nokia team continues with its integration process.

It is particularly important to recognize that the role of phones within Microsoft is different than it was within Nokia. Whereas the hardware business of phones within Nokia was an end unto itself, within Microsoft all our devices are intended to embody the finest of Microsoft's digital work and digital life experiences, while accruing value to Microsoft's overall strategy. Our device strategy must reflect Microsoft's strategy and must be accomplished within an appropriate financial envelope. Therefore, we plan to make some changes.

We will be particularly focused on making the market for Windows Phone. In the near term, we plan to drive Windows Phone volume by targeting the more affordable smartphone segments, which are the fastest growing segments of the market, with Lumia. In addition to the portfolio already planned, we plan to deliver additional lower-cost Lumia devices by shifting select future Nokia X designs and products to Windows Phone devices. We expect to make this shift immediately while continuing to sell and support existing Nokia X products.

To win in the higher price segments, we will focus on delivering great breakthrough products in alignment with major milestones ahead from both the Windows team and the Applications and Services Group. We will ensure that the very best experiences and scenarios from across the company will be showcased on our products. We plan to take advantage of innovation from the Windows team, like Universal Windows Apps, to continue to enrich the Windows application ecosystem. And in the very lowest price ranges, we plan to run our first phones business for maximum efficiency with a smaller team.

We expect these changes to have an impact to our team structure. With our focus, we plan to consolidate the former Smart Devices and Mobile Phones business units into one phone business unit that is responsible for all of our phone efforts. Under the plan, the phone business unit will be led by Jo Harlow with key members from both the Smart Devices and Mobile Phones teams in the management team. This team will be responsible for the success of our Lumia products, the transition of select future Nokia X products to Lumia and for the ongoing operation of the first phone business.

As part of the effort, we plan to select the appropriate business model approach for our sales markets while continuing to offer our products in all markets with a strong focus on maintaining business continuity. We will determine each market approach based on local market dynamics, our ability to profitably deliver local variants, current Lumia momentum and the strategic importance of the market to Microsoft. This will all be balanced with our overall capability to invest.

Our phone engineering efforts are expected to be concentrated in Salo, Finland (for future, high-end Lumia products) and Tampere, Finland (for more affordable devices). We plan to develop the supporting technologies in both locations. We plan to ramp down engineering work in Oulu. While we plan to reduce the engineering in Beijing and San Diego, both sites will continue to have supporting roles, including affordable devices in Beijing and supporting specific US requirements in San Diego. Espoo and Lund are planned to continue to be focused on application software development.

We plan to right-size our manufacturing operations to align to the new strategy and take advantage of integration opportunities. We expect to focus phone production mainly in Hanoi, with some production to continue in Beijing and Dongguan. We plan to shift other Microsoft manufacturing and repair operations to Manaus and Reynosa respectively, and start a phased exit from Komaron, Hungary.

In short, we will focus on driving Lumia volume in the areas where we are already successful today in order to make the market for Windows Phone. With more speed, we will build on our success in the affordable smartphone space with new products offering more differentiation. We'll focus on acquiring new customers in the markets where Microsoft's services and products are most concentrated. And, we'll continue building momentum around applications.

We plan that this would result in an estimated reduction of 12,500 factory direct and professional employees over the next year. These decisions are difficult for the team, and we plan to support departing team members with severance benefits.

More broadly across the Devices team, we will continue our efforts to bring iconic tablets to market in ways that complement our OEM partners, power the next generation of meetings & collaboration devices and thoughtfully expand Windows with new interaction models. With a set of changes already implemented earlier this year in these teams, this means there will be limited change for the Surface, Xbox hardware, PPI/meetings or next generation teams.

We recognize these planned changes are broad and have very difficult implications for many of our team members. We will work to provide as much clarity and information as possible. Today and over the coming weeks leaders across the organization will hold town halls, host information sharing sessions and provide more details on the intranet.

The team transferring from Nokia and the teams that have been part of Microsoft have each experienced a number of remarkable changes these last few years. We operate in a competitive industry that moves rapidly, and change is necessary. As difficult as some of our changes are today, this direction deliberately aligns our work with the cross company efforts that Satya has described in his recent emails. Collectively, the clarity, focus and alignment across the company, and the opportunity to deliver the results of that work into the hands of people, will allow us to increase our success in the future.

Regards,

Stephen

Gold, silver prices rise on news of downed plane

Gold and silver prices rose Thursday following news that a passenger plane crashed in eastern Ukraine.

Ukrainian officials said the plane was shot down, though both the government and the pro-Russia separatists fighting in the region denied any responsibility.

The incident brought investors new worries about the region. Tensions have been building between Russia and the West over the conflict in Ukraine and Russia's annexation of the Crimean Peninsula.

Traders moved money into precious metals futures, a traditional safe-haven investment favored in time of geopolitical instability.

Gold for August delivery rose $17.10, or 1.3 percent, to $1,316.90 an ounce. Silver for September delivery rose 36 cents, or 1.7 percent, to $21.34 an ounce.

It was the biggest one-day gain for gold since June 19, after the Federal Reserve said it would keep interest rates low. Gold rose 3.3 percent that day.

In addition to global tensions, low interest rates and the associated risk of inflation also tend to drive up gold prices.

In other metals trading, October platinum rose $18, or 1.2 percent, to $1,503.70 an ounce. September palladium rose $8.35, or 1 percent, to $885.10 an ounce.

Copper for September delivery edged up less than a penny to $3.22 a pound.

Crop futures were mixed. Wheat jumped 13 cents, or 2.4 percent, to $5.51 a bushel. Corn rose half a penny to $3.87 a bushel and soybeans fell eight cents to $10.94 a bushel.

Oil prices rose. Benchmark U.S. crude for August delivery rose $1.99, or 2 percent, to $103.19 a barrel.

Wholesale gasoline was little changed at $2.88 a gallon, heating oil was also nearly unchanged at $2.86 a gallon.

Natural gas slumped 17 cents, or 4 percent, to $3.954 per 1,000 cubic feet.

Putin: US sanctions hurt bilateral ties, US firms

MOSCOW -- President Vladimir Putin on Thursday lamented the latest round of U.S. sanctions against Russia, saying they will stalemate bilateral relations and hurt not only Russian but also American businesses.

Russia's benchmark MICEX plummeted 2.6 percent at the opening Thursday upon news of the sanctions while Russia's biggest oil company, Rosneft, was nearly 5 percent down.

Putin's comments came hours after President Barack Obama announced broader sanctions against Russia, targeting two major energy firms, a pair of powerful financial institutions, eight weapons firms and four individuals. The increased U.S. economic pressure is designed to end the insurgency in eastern Ukraine that is widely believed to be backed by the Kremlin.

The U.S. penalties, however, stopped short of the most stringent actions the West has threatened, which would fully cut off key sectors of Russia's oil-dependent economy. But officials said those steps were still on the table if Russia fails to abide by the West's demands to stop its support for pro-Russia insurgents who have destabilized swaths of eastern Ukraine.

Pro-Russia insurgents have been fighting government troops in eastern Ukraine for four months now in a conflict that the U.N. says has killed over 400 and displaced tens of thousands. The conflict took off shortly after Russia annexed the mostly Russian-speaking Ukrainian peninsula of Crimea.

In televised comments Thursday, Putin said the sanctions are "driving into a corner" relations between the two countries as well as the interests of American companies and "the long-term national interests of the U.S. government and people."

Putin warned Washington that the sanctions will backlash against American companies working in Russia.

The most noticeable companies on the list are Rosneft and Russia's largest independent gas producer, Novatek. Both are now barred from getting long-term loans from U.S. entities.

Moscow-based investment bank Sberbank-CIB said in a note to investors that Russian companies cannot replace long-term loans from the U.S. immediately.

"While Asian and Middle Eastern money can step in to fill the gap, we expect that this will take time," the note said, adding that borrowing will also cost more.

Rosneft has a multibillion-dollar deal with ExxonMobil, which among other things allowed Exxon to develop lucrative oil fields in Russia.

"We gave this American company the right to work on the shelf," Putin said in Brazil, referring to Exxon's potential exploration on the Russian Arctic shelf. "So, what, the United States does not want it to work there now?"

Putin made no mention of the additional sanctions levied Wednesday by the 28-nation European Union, which urged the European Investment Bank to sign no new financing agreements with Moscow and was suspending operations in Russia financed by the European Bank for Reconstruction and Development. European nations have much closer energy and other economic ties with Russia and have not imposed as tough sanctions as the United States.

Igor Sechin, Rosneft's CEO and a close confidante of Putin, dismissed the sanctions as "unfounded, subjective and unlawful," adding that his company "had no role in the events in Ukraine."

Sechin said their lawyers have to yet to explore how hurtful the sanctions could be but added that the company has enough money in reserves to refrain from taking out new loans for a while.

Rosneft posted $2.5 billion in net profit in the first quarter of the year and about $3.5 billion in free cash flow.

"This is the wrong way," Sechin said, referring to the sanctions, in comments carried by Interfax. "But I think God sees everything and will put things right."

President Obama Responds to Malaysia Airlines Flight 17

President Obama calls to President Poroshenko of Ukraine aboard Air Force One to discuss the tragic crash of Malaysia Airlines Flight 17. July 17, 2014. (Official White House Photo by Pete Souza)

This afternoon, aboard Air Force One, President Obama placed separate telephone calls to President Poroshenko of Ukraine and Prime Minister Najib of Malaysia to discuss the tragic crash of Malaysia Airlines Flight 17.

Here's a readout of the President’s call with President Poroshenko of Ukraine:

President Obama spoke with Ukrainian President Poroshenko this afternoon to discuss the tragic crash of flight Malaysian Airlines 17. President Poroshenko welcomed the assistance of international investigators to ensure a thorough and transparent investigation of the crash site. President Obama assured him that U.S. experts will offer all possible assistance immediately. The Presidents emphasized that all evidence from the crash site must remain in place on the territory of Ukraine until international investigators are able to examine all aspects of the tragedy.

And a readout of President Obama’s call with Prime Minister Najib of Malaysia:

President Obama called Malaysian Prime Minister Najib today to express condolences to the people of Malaysia for the terrible loss of Malaysia Airlines Flight 17 in Ukraine, as well as all the families who lost loved ones in this tragic event. The President told the Prime Minister that United States has offered immediate assistance to support a prompt international investigation. President Obama reaffirmed the strength of the friendship between the United States and Malaysia and underscored that the United States stands ready to provide any assistance or support necessary.

Bernadette Meehan is Deputy Spokesperson of the National Security Council.

White House Urges Lawmakers To Address Popular Tax Dodge

Audio for this story from All Things Considered will be available at approximately 7:00 p.m. ET.

Treasury Secretary Jacob Lew has signaled his intention to push for legislation shutting down "corporate inversions," techniques used commonly by companies to dodge the corporate income tax. Lew sent a letter to lawmakers laying out his rationale for supporting such a move.

Amid Roiled Landscape Of Border Politics, Obama's Plans May Change

The Obama administration's request for more funds on immigration could get a congressional vote soon. Meanwhile, the crisis at the border is complicating Obama's plan to take unilateral action to ease deportations. The politics of immigration are shifting quickly.

Lawmakers Call For GM's Top Lawyer To Step Down

Delphi, the company that made the defective ignition switch in General Motors vehicles, has stayed out of the harsh glare in the recall scandal. But that changed Thursday, as Delphi's CEO joined GM CEO Mary Barra and GM's top lawyer for a grilling on Capitol Hill.

Senate Re-Authorizes Government's Role In Terrorism Insurance

The Senate has voted to reauthorize terrorism risk insurance, to help businesses stay solvent in the event of attacks. The bill faces a tougher road in the House, where some Republicans want to reduce the potential price tag for taxpayers.

Factory growth fastest in 3 years in Philly region

By CHRISTOPHER S. RUGABER The Associated Press

WASHINGTON -- Manufacturing in the Philadelphia region surged in July, expanding at its fastest pace in more than three years, as new orders, shipments, and hiring all rose.

The Federal Reserve Bank of Philadelphia said Thursday that its index of regional factory activity rose to 23.9 in July from 17.8 in June. Any reading above zero indicates growth. July's figure is the highest since March 2011. It also is much higher than last year's average of 6.4, according to Jim O'Sullivan, an economist at High Frequency Economics.

The data comes after a separate Fed report Wednesday suggested manufacturing output nationwide increased at a healthy pace in the April-June quarter. That's fueling the economy's return to growth after a dismal first quarter.

The Philly Fed report, and a similar report from the New York Fed Tuesday, suggests that U.S. manufacturing output continued to grow in July and will also boost growth in the third quarter.

Manufacturing in the New York region expanded in July at the fastest pace in more than four years, the New York Fed said.

In the Philly Fed report, measures of new orders and shipments jumped to the highest levels in 10 years, according to Dean Maki, an economist at Barclays Capital.

"The numbers are volatile but this is a startling gain," said Ian Shepherdson, chief economist at Pantheon Macroeconomics.

The Philadelphia Fed's survey covers manufacturing in Pennsylvania, New Jersey and Delaware.

Airbus beats Boeing at Farnborough in orders race

FARNBOROUGH, England -- Airbus beat rival Boeing in the aircraft order stakes at this year's Farnborough International Airshow, garnering nearly twice as many orders and commitments.

The victory by the European aircraft manufacturer is its second in a row in the unofficial airshow competition after last year's triumph in Paris — the French capital and Farnborough, a town in southern England, alternate the location of the airshow.

For years, the airshow has served as a platform for a sales race between the world's two major aircraft makers, who are having to cater to customers increasingly interested in new-generation, energy-efficient planes to offset huge increases in the price of jet fuel.

Though Airbus clinched more deals at Farnborough, Boeing insisted that it has won more in the year to date. It put its figure at 783 against Airbus' 645.

Airbus said Thursday its orders and commitments at Farnborough for 496 aircraft were valued at $75 billion. Demand for its A320neo, or "new engine option," was particularly strong. Boeing, meanwhile, secured business worth $40.2 billion for 201 airplanes.

"The orders and commitments we've received at this record-breaking Farnborough for both the A330neo and A320neo families are together an unequivocally resounding endorsement for these most cost-efficient aircraft," said John Leahy, Airbus' chief operating officer.

Airbus' orders intake included the largely updated versions of its A330 wide body aircraft, which launched this week. Airbus says the plane is more fuel efficient and has a longer range to help it compete against Boeing's 787 Dreamliner.

Edward Hunt, a senior consultant with IHS, put Airbus' win in part to the fact that the Airbus plane was sort of an old standby. The A330 has sold well and is widely in use, making it simple to service and avoiding the necessity to train pilots on a new aircraft.

But he said both manufacturers had similar offerings and that what airlines were looking for were good deals.

Each company tends to inflate its sales figures — and save up previously announced agreements to make a big splash at the show. Customers regularly negotiate enormous discounts, but the details on such sales are usually secret.

"Airbus has definitely caught up," said Hunt. "If I were Boeing, I would be a little bit worried."

But Hunt said the race for top numbers at the airshow obscures the fact that aircraft are purchased all year long — where buyers can take their time and have a tour of the factory.

Of the 496 orders and commitments Airbus announced this week, 369 were for the A320 family of planes, which generally seat up to 180 passengers. The A320 new engine option incorporates the latest technology together with sharklet wing tips that help deliver fuel savings.

Airbus's biggest order came from SMBC Aviation Capital, an aircraft leasing company that focuses on emerging markets. The company ordered 110 A320s equipped with the more fuel-efficient new engine option, and five A320s with the "current" engine option. Hong Kong Aviation Capital ordered 70 planes, including 40 A320neo models and 30 A321neos.

Boeing's orders were also dominated by single-aisle planes, with the Boeing 737 accounting for 123 of the company's 201 orders. China's Hainan Airlines made a commitment to buy 50 737 MAX 8 models, reaffirming its practice of flying only Boeing single-aisle planes. Monarch Airlines, a U.K.-based carrier that serves holiday destinations around Europe, plans to buy 30 of the same aircraft, too.

"If we're underestimating anything it is the growth of the industry," said aviation analyst Howard Wheeldon. "There are new players."

Though single aisle planes sold the best, the larger ones did well too.

Wheeldon noted that air travel has become accessible and possible in many regions where even a few years ago easy, cheap and available air travel was unthinkable. One of Airbus' biggest customers was Air Asia X, which bought 50 A330-900 neos worth about $13.8 billion.

Boeing last week forecast that the Asia-Pacific region would drive demand for aircraft over the next 20 years, with single-aisle planes dominating the market.

Airlines will take delivery of 36,770 planes valued at $5.2 trillion from 2014 through 2033, Boeing estimated in a market outlook released July 10. Boeing forecast that 70 percent of those deliveries would be single-aisle planes seating up to 230 people, with the Asia-Pacific region accounting for almost 37 percent of overall sales.

"Based on the overwhelming amount of orders and deliveries, we see the heart of the single-aisle market in the 160-seat range," Randy Tinseth, Boeing's vice president for commercial aircraft marketing, said when the forecast was released. "There's no question the market is converging to this size, where network flexibility and cost efficiency meet."

Coakley seeking delay of hearing on Partners deal

BOSTON -- Attorney General Martha Coakley is asking a Suffolk Superior Court judge to delay a scheduled hearing on an agreement her office reached with Partners HealthCare.

The deal would let the state's largest hospital and physicians' network acquire South Shore Hospital and Hallmark Health Systems.

Coakley has said the deal resolves her antitrust investigation into Partners and would fundamentally alter the organization's negotiating power for 10 years while controlling health costs across Partner's network.

Massachusetts' Health Policy Commission said the acquisition of Hallmark, which runs two community hospitals north of Boston, would reinforce Partners' market power.

A spokesman for Coakley said the office always retained the option to renegotiate portions of this agreement relating to Hallmark and will wait for the commission's final report before sealing the agreement.

The hearing was originally scheduled for Aug. 5.

Tourism department presents new Tennessee logo

NASHVILLE, Tenn. -- Tennessee's tourism agency has a new logo and ad campaign aimed to spark travelers' interest in a vacation that can only be made in Tennessee.

The Tennessee Department of Tourist Development's "Made in Tennessee" campaign features original music from Tennessee musicians and highlights other unique aspects of the state.

Tourism Commissioner Susan Whitaker said in a news release announcing the new branding that the campaign will emphasize Tennessee's scenic beauty, music, history and family-friendly attractions.

The campaign will include famous Tennessee residents like Dolly Parton and Jack White.

According to the department, tourism is Tennessee's No. 2 industry, with a $16.2 billion annual economic impact.

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On the Internet:

http://bit.ly/1yxtdmk

http://bit.ly/1zNlXV0

2 Tennessee hospitals working on merger

MANCHESTER, Tenn. -- The two hospitals in Manchester that are less than three miles apart may merge.

The Tullahoma News reported (http://bit.ly/1pdnPz0 ) that United Regional Medical Center and Medical Center of Manchester have taken the first steps toward a combination of the two hospitals.

URMC will file an application for a Certificate of Need with the Tennessee Health Services Development Agency next month. The move would mean both hospitals will combine operations and move operations into the Medical Center of Manchester location on Interstate Drive.

If approved, "most medical operations" at URMC location would be discontinued.

After a Certificate of Need is filed, the Tennessee Health Services Development Agency will schedule a public hearing. If the certificate is approved, the companies would then file additional notices with various other governmental agencies, including Medicare.

"We are really working closely together with Medical Center (of Manchester) but I want to really emphasize that these are just the beginning steps," URMC chief executive officer Martha McCormick said.

In its application, URMC will seek regulatory approval to relocate to MCM's building and MCM will file a Certificate of Need to shut down its emergency room. Once combined, the facility will likely operate under a new name that has not been chosen.

United Regional's filing cites the need for the two hospitals, which are located approximately 2.4 miles apart, to combine operations to "create a stronger health care facility that can afford to invest in state-of-the-art equipment and recruit more primary care physicians to the area." The application also details a financial transaction in which the ownership groups of the two hospitals would be combined.

Medical Center of Manchester president J. Stanley Rogers and his partners built MCM approximately 30 years ago.

"Putting these two hospitals together is long overdue," said Rogers.

Unemployment dips to 6.6 percent in New Jersey

TRENTON, N.J. -- Officials say New Jersey's unemployment rate inched down to 6.6 percent in June, its lowest level in more than five years.

The report released Thursday by the state Labor Department and based on data collected by the U.S. Bureau of Labor Statistics shows the unemployment rate down 0.2 percentage points in June.

The state's private sector added 9,600 workers to payrolls last month. The report also finds that private sector job growth was larger in May than first reported. Revised numbers show 2,900 private sector jobs were created in May.

The public sector shed 1,400 jobs in June.

New Jersey's unemployment rate remains higher than the 6.1 percent national average.

Memo from Microsoft exec Elop announcing job cuts

Microsoft Executive Vice President Stephen Elop sent employees of the company's devices business a memo detailing its job cut plans. Microsoft said it would cut up to 18,000 jobs over the next year, with about 12,500 related to Microsoft's acquisition of Nokia's phone business in April. Elop was Nokia's CEO before the acquisition. Here's his memo.

Hello there,

Microsoft's strategy is focused on productivity and our desire to help people "do more." As the Microsoft Devices Group, our role is to light up this strategy for people. We are the team creating the hardware that showcases the finest of Microsoft's digital work and digital life experiences, and we will be the confluence of the best of Microsoft's applications, operating systems and cloud services.

To align with Microsoft's strategy, we plan to focus our efforts. Given the wide range of device experiences, we must concentrate on the areas where we can add the most value. The roots of this company and our future are in productivity and helping people get things done. Our fundamental focus — for phones, Surface, for meetings with devices like PPI, Xbox hardware and new areas of innovation — is to build on that strength. While our direction in the majority of our teams is largely unchanging, we have had an opportunity to plan carefully about the alignment of phones within Microsoft as the transferring Nokia team continues with its integration process.

It is particularly important to recognize that the role of phones within Microsoft is different than it was within Nokia. Whereas the hardware business of phones within Nokia was an end unto itself, within Microsoft all our devices are intended to embody the finest of Microsoft's digital work and digital life experiences, while accruing value to Microsoft's overall strategy. Our device strategy must reflect Microsoft's strategy and must be accomplished within an appropriate financial envelope. Therefore, we plan to make some changes.

We will be particularly focused on making the market for Windows Phone. In the near term, we plan to drive Windows Phone volume by targeting the more affordable smartphone segments, which are the fastest growing segments of the market, with Lumia. In addition to the portfolio already planned, we plan to deliver additional lower-cost Lumia devices by shifting select future Nokia X designs and products to Windows Phone devices. We expect to make this shift immediately while continuing to sell and support existing Nokia X products.

To win in the higher price segments, we will focus on delivering great breakthrough products in alignment with major milestones ahead from both the Windows team and the Applications and Services Group. We will ensure that the very best experiences and scenarios from across the company will be showcased on our products. We plan to take advantage of innovation from the Windows team, like Universal Windows Apps, to continue to enrich the Windows application ecosystem. And in the very lowest price ranges, we plan to run our first phones business for maximum efficiency with a smaller team.

We expect these changes to have an impact to our team structure. With our focus, we plan to consolidate the former Smart Devices and Mobile Phones business units into one phone business unit that is responsible for all of our phone efforts. Under the plan, the phone business unit will be led by Jo Harlow with key members from both the Smart Devices and Mobile Phones teams in the management team. This team will be responsible for the success of our Lumia products, the transition of select future Nokia X products to Lumia and for the ongoing operation of the first phone business.

As part of the effort, we plan to select the appropriate business model approach for our sales markets while continuing to offer our products in all markets with a strong focus on maintaining business continuity. We will determine each market approach based on local market dynamics, our ability to profitably deliver local variants, current Lumia momentum and the strategic importance of the market to Microsoft. This will all be balanced with our overall capability to invest.

Our phone engineering efforts are expected to be concentrated in Salo, Finland (for future, high-end Lumia products) and Tampere, Finland (for more affordable devices). We plan to develop the supporting technologies in both locations. We plan to ramp down engineering work in Oulu. While we plan to reduce the engineering in Beijing and San Diego, both sites will continue to have supporting roles, including affordable devices in Beijing and supporting specific US requirements in San Diego. Espoo and Lund are planned to continue to be focused on application software development.

We plan to right-size our manufacturing operations to align to the new strategy and take advantage of integration opportunities. We expect to focus phone production mainly in Hanoi, with some production to continue in Beijing and Dongguan. We plan to shift other Microsoft manufacturing and repair operations to Manaus and Reynosa respectively, and start a phased exit from Komaron, Hungary.

In short, we will focus on driving Lumia volume in the areas where we are already successful today in order to make the market for Windows Phone. With more speed, we will build on our success in the affordable smartphone space with new products offering more differentiation. We'll focus on acquiring new customers in the markets where Microsoft's services and products are most concentrated. And, we'll continue building momentum around applications.

We plan that this would result in an estimated reduction of 12,500 factory direct and professional employees over the next year. These decisions are difficult for the team, and we plan to support departing team members with severance benefits.

More broadly across the Devices team, we will continue our efforts to bring iconic tablets to market in ways that complement our OEM partners, power the next generation of meetings & collaboration devices and thoughtfully expand Windows with new interaction models. With a set of changes already implemented earlier this year in these teams, this means there will be limited change for the Surface, Xbox hardware, PPI/meetings or next generation teams.

We recognize these planned changes are broad and have very difficult implications for many of our team members. We will work to provide as much clarity and information as possible. Today and over the coming weeks leaders across the organization will hold town halls, host information sharing sessions and provide more details on the intranet.

The team transferring from Nokia and the teams that have been part of Microsoft have each experienced a number of remarkable changes these last few years. We operate in a competitive industry that moves rapidly, and change is necessary. As difficult as some of our changes are today, this direction deliberately aligns our work with the cross company efforts that Satya has described in his recent emails. Collectively, the clarity, focus and alignment across the company, and the opportunity to deliver the results of that work into the hands of people, will allow us to increase our success in the future.

Regards,

Stephen

Durant, Rousey win top athlete honors at ESPYs

LOS ANGELES -- Kevin Durant won two ESPY Awards, including male athlete of the year, and mixed martial arts star Ronda Rousey earned female athlete honors, becoming the first UFC fighter to claim a trophy in the biggest category at the show honoring the year's best performances Wednesday night.

Durant also won best NBA player, ending LeBron James' two-year reign in both categories.

"Everybody helped me out along the way," the Oklahoma City Thunder star said. "My beautiful mom watching at home who couldn't be here. My favorite teammate, Russell Westbrook."

Durant beat out fellow male athlete nominees Miguel Cabrera of the Detroit Tigers, Peyton Manning of the Denver Broncos and boxer Floyd Mayweather during the show hosted by rapper Drake at the Nokia Theatre.

Rousey, the first female UFC champion, won over WNBA star Maya Moore, Olympic champion skier Mikaela Shiffrin and Brenna Stewart of national champion Connecticut.

The winners in most categories were determined by fan voting.

Rousey didn't attend, with presenter Chrissy Teigen saying the fighter had surgery a day earlier.

Manning didn't go home empty-handed. He collected two trophies: best NFL player and record-breaking performance. Manning won his fifth MVP award last season, when he set single-season records by passing for 55 touchdowns and more than 5,500 yards.

The Super Bowl champion Seattle Seahawks won best team. Their All-Pro cornerback, Richard Sherman, won breakthrough athlete.

The best game was the Iron Bowl matchup between No. 1 Alabama and No. 4 Auburn, with the Tigers winning 34-28 on the final play to spoil the Tide's BCS hopes.

Led by goalie Tim Howard, the U.S. men's soccer team won best moment for its run to the round of 16 in the World Cup.

Soccer star Cristiano Ronaldo of Portugal won best international athlete.

Drake zinged Howard and Sherman in his opening monologue. The rapper joked about banned Clippers owner Donald Sterling, saying, "We're a few hundred yards from Staples Center, which is as close as Donald Sterling is allowed to get."

Clippers star Blake Griffin laughed until the camera caught him and he acted serious, drawing laughs. Griffin and Drake teamed up for a funny pre-taped bit in which they pretended to be each other while spewing insults, with rapper Chris Brown joining in. Brown, who has been in and out of jail, jokingly introduced himself as "America's sweetheart."

James wasn't on hand, but Drake noted the superstar's recent decision to return to the Cleveland Cavaliers after winning two NBA titles in Miami.

"You know what 40 million gets you in Miami? A really nice house," Drake said. "You know what 40 million gets you in Cleveland? Cleveland, you get the whole thing."

Drake mixed in song, too. He crooned "Honorable Mention," a tune he said was dedicated to the runner-ups, including Triple Crown loser California Chrome and NASCAR driver Danica Patrick.

Lil' Wayne cracked up as Drake sang "Side Pieces," full of references to the on-the-road cheating that goes on in sports. Drake noted a lot of men in the audience wanted the song to be over.

Drake revisited Sterling with a rap accompanied by video of the Clippers owner saying he isn't a racist. The screen displayed the hashtag of Sterlingneverlovedus.

Later, Drake teamed up with WNBA star Skylar Diggins for a sketch. She went in to kiss Drake, who has acknowledged his affection for her, but the smooch landed on his forehead and not his lips.

Gregg Popovich won best coach-manager for guiding the San Antonio Spurs to the NBA championship. Spurs player Kawhi Leonard earned the championship performance award to go with his MVP award from the NBA Finals.

Westbrook won best comeback athlete, having overcome his latest knee surgery to help the Thunder reach the Western Conference finals.

Stewart won best female college athlete, while Creighton basketball star Doug McDermott won male college athlete.

Olympic snowboarders Jamie Anderson and Sage Kotsenburg won best female and male Olympian. Kotsenburg won the first gold medal of the Sochi Games in men's snowboard slopestyle.

The Arthur Ashe Courage award went to St. Louis Rams draftee Michael Sam, who announced earlier this year that he is gay. The former Missouri defensive end will be trying to make the Rams' roster when training camp opens. If he does, Sam would be the NFL's first openly gay player.

Sam teared up throughout his speech and his voice faltered at times.

"Great things can happen when you have the courage to be yourself," he told the audience.

Hall of Famer Jim Brown hugged Sam on his way to the stage.

The Ashe award is named for the late tennis player who died in 1993 after contracting AIDS from a blood transfusion.

The Jimmy V Award for Perseverance was given to ESPN "SportsCenter" anchor Stuart Scott, who is fighting a recurrence of cancer first diagnosed seven years ago.

The Pat Tillman Award for Service was given for the first time to Josh Sweeney, a retired Marine who lost both his legs after an explosion in Afghanistan. He scored the lone goal for the U.S. sled hockey team that beat the Russians for gold earlier this year at the Paralympics in Sochi.