Daily Business Briefing
Aug. 20, 2021, 11:50 a.m. ET
Aug. 20, 2021, 11:50 a.m. ET
Mike Richards, who was named the new host of “Jeopardy!†last week, is abruptly leaving the role as the beloved game show confronts a roiling controversy over offensive and sexist comments he made on a podcast several years ago.
Mr. Richards, who as the show’s executive producer helped oversee the search for Alex Trebek’s replacement — before he himself was named to the position — said on Friday in a staff memo that the controversy had made “clear that moving forward as host would be too much of a distraction for our fans and not the right move for the show.â€
“As such, I will be stepping down as host effective immediately,†Mr. Richards wrote.
But Sony Pictures Entertainment, which produces and distributes the game show, said that Mr. Richards would stay on as the program’s executive producer.
“We support Mike’s decision to step down as host,†Sony said in a statement. “We were surprised this week to learn of Mike’s 2013/2014 podcast and the offensive language he used in the past. We have spoken with him about our concerns and our expectations moving forward.â€
Sony added: “Mike has been with us for the last two years and has led the ‘Jeopardy!’ team through the most challenging time the show has ever experienced. It is our hope that as executive producer he will continue to do so with professionalism and respect.â€
The show’s search for a permanent replacement host will now start again, with a series of guest hosts to be scheduled. Mayim Bialik, the sitcom star, will remain as host of “Jeopardy!†prime-time specials.
Sony had announced Mr. Richards’s new role last Wednesday with great fanfare, calling him a “great talent.â€
But a report in The Ringer this week unearthed past offensive comments made by Mr. Richards on a podcast that led to denunciations from critics including the Anti-Defamation League.
In his memo on Friday, Mr. Richards wrote, “It pains me that these past incidents and comments have cast such a shadow on ‘Jeopardy!’ as we look to start a new chapter.â€
He concluded: “I know I have a lot of work to do to regain your trust and confidence.â€
This is a developing article. Check back for updates.
Topps has been synonymous with trading cards, particularly baseball cards, for 70 years.
That era will soon be over. Major League Baseball and the Major League Baseball Player’s Association are ending their licensing agreement with Topps in favor of a deal with Fanatics, the up-and-coming sports collectible brand. The loss of baseball rights also led to the abrupt cancellation on Friday of a plan for Topps to go public, casting its future into question.
The company, which also owns Bazooka gum, announced a deal in April to merge with a special purpose acquisition company, or SPAC, run by Mudrick Capital. The $1.3 billion merger was set to go to a shareholder vote next week.
Topps and Mudrick announced Friday morning that the deal is off, the day after they were notified that the baseball contracts would not be renewed when they expire in 2022 for players’ images, which are controlled by the players’ union, and 2025 for team logos, which are controlled by M.L.B.
Topps has been owned by Tornante, the investment firm of the former Walt Disney Company chief Michael Eisner, and the private equity firm Madison Dearborn since 2007, when the two acquired it for $385 million.
Fanatics, most recently valued at $18 billion, has been drawing on its ties to major sports league teams to expand beyond hats, hoodies and other branded merchandise. In June, it started a digital collectibles firm called Candy Digital, which has partnered with M.L.B. to introduce a series of nonfungible tokens. Fanatics has also poached a number of executives from sports teams, gambling companies and tech firms as it considers expanding into ticketing, betting and gambling.
The baseball deal reflects Fanatics’ growth ambitions, moving into the baseball card market at a time when they have exploded in popularity, amid growing interest from homebound traders and digital investors buying NFTs.
Fanatics will create a new trading card company and give both M.L.B. and the players’ union seats on the board, said a person familiar with the plans who spoke on condition of anonymity because those plans were not yet public. The union and M.L.B. will get a stake in the company, a shift to owning a piece of the company that makes money from its members’ images rather than simply licensing those images. Sports unions have in recent years bolstered their commercial arms to help players earn more from their likenesses.
Riding high on its new licensing deals, Fanatics could consider trying to acquire one of the three major card companies: Panini, Upper Deck or Topps, a person familiar with the company’s thinking said. That would mirror its strategy with the apparel company Majestic, which it acquired after winning the rights to make uniforms for M.L.B. that Majestic previously held.
Kevin Draper and Ephrat Livni contributed reporting.
When states began cutting off federal unemployment benefits this summer, their governors argued that the move would push people to return to work.
New research suggests that ending the benefits did indeed lead some people to get jobs, but that far more people did not, leaving them — and perhaps also their states’ economies — worse off.
A total of 26 states, all but one with Republican governors, have moved to end the expanded unemployment benefits that have been in place since the pandemic began. Many business owners blame the benefits for discouraging people from returning to work, while supporters argue they have provided a lifeline to people who lost jobs in the pandemic.
The extra benefits are set to expire nationwide next month, although President Biden on Thursday encouraged states with high unemployment rates to use separate federal funds to continue the programs.
To study the policies’ effect, a team of economists used data from Earnin, a financial services company, to review anonymized banking records from more than 18,000 low-income workers who were receiving unemployment benefits in late April.
The researchers found that ending the benefits did have an effect on employment: In states that cut off benefits, about 26 percent of people in the study were working in early August, compared with about 22 percent of people in states that continued the benefits.
But far more people did not find jobs. In the 19 states ending the programs for which researchers had data, about two million people lost their benefits entirely, and a million had their payments reduced. Of those, only about 145,000 people found jobs because of the cutoff. (The researchers argue the true number is probably even lower, because the workers they were studying were the people most likely to be severely affected by the loss of income, and therefore may not have been representative of everyone receiving benefits.)
Cutting off the benefits left unemployed workers worse off on average. The researchers estimate that workers lost an average of $278 a week in benefits because of the change, and gained just $14 a week in earnings (not $14 an hour, as previously reported here). They compensated by cutting spending by $145 a week — a roughly 20 percent reduction — and thus put less money into their local economies.
“The labor market didn’t pop after you kicked these people off,†said Michael Stepner, a University of Toronto economist who was one of the study’s authors. “Most of these people are not finding jobs, and it’s going to take them a long time to get their earnings back.â€
The findings are consistent with other recent research that has found that the extra unemployment benefits have had a measurable but small effect on the number of people working and looking for work. The next piece of evidence will come Friday morning, when the Labor Department will release state-level data on employment in July.
Coral Murphy Marcos contributed reporting.
China on Friday approved a law that will limit the collection and use of personal data, a step that reflects public unease about the power of big tech companies but is unlikely to curb the Chinese government’s extensive ability to surveil its citizens.
According to the official Xinhua news agency, the Personal Information Protection Law — which some legal experts have called China’s version of the European Union’s General Data Protection Regulation, or G.D.P.R. — bars the collection “to excess†of people’s data. It calls for better mechanisms for individuals to file complaints about how their data is used.
The new law forbids businesses from using their information on customers to charge them “unreasonably†higher prices. And it requires that facial recognition equipment installed in public places be clearly labeled.
Companies that break these rules face fines, as do their employees. The full text of the new law, which comes into effect on Nov. 1, has yet to be made public.
China has come down hard this year on its once high-flying internet industry. Giants like Alibaba, Tencent, Meituan, Ant and Didi were able to grow and acquire influence over huge segments of the economy in large part because Beijing barely regulated their business practices. Now, the government is racing to catch up.
An earlier draft of the privacy law said its provisions applied to the Chinese government as well. It forbade official agencies from processing personal data beyond what was “necessary†for their legally prescribed duties.
But the government and the police in China have claimed expansive authority to monitor people, often in the name of public security. And it is unclear how much the new law will change that. The G.D.P.R. in Europe specifically restricts the legal justification government bodies can claim for processing personal data.
As cryptocurrency businesses seek to join the finance mainstream, many are following the same playbook: They hire former government officials. Bringing them onboard is one thing, but keeping them around is another, the DealBook newsletter reports.
The world’s biggest cryptocurrency exchange, Binance, has made hiring former regulators central to its efforts to burnish its reputation. In April, its American subsidiary, Binance.US, hired the former acting comptroller of the currency, Brian Brooks, as chief executive. At the time, he said that “managing reputation†among regulators was a priority. But Mr. Brooks resigned abruptly this month, citing “strategic differences.â€
Diversifying Binance.US’s ownership structure was crucial to Mr. Brooks’s plans to create a more transparent business and address regulators’ concerns. But Binance’s founder, Changpeng Zhao, demanded to retain control, making some potential investors uneasy. Mr. Brooks and Mr. Zhao both recognized reputational liabilities, but they apparently could not agree on how to address them.
Coinbase, the largest U.S. crypto exchange — where Mr. Brooks was chief counsel before going into government — in April hired Brett Redfearn, who previously led a division of the Securities and Exchange Commission. He resigned in July because of a shift in strategic focus at the company, Coinbase said.
And there’s more where that came from. Jay Clayton, a former S.E.C. chair, on Thursday joined the advisory board of the crypto custody provider Fireblocks. Greg Monahan, a former criminal investigator at the Treasury Department, joined Binance this week in an anti-money laundering role. The former Commodity Futures Trading Commission chair, Chris Giancarlo, in April joined the board of BlockFi, which is in the cross hairs of securities regulators in several states. And the world’s biggest crypto venture capital fund, at Andreessen Horowitz, is run by a former federal prosecutor, Katie Haun.
William A. Ackman, the billionaire hedge fund manager, is pivoting again to try to save Pershing Square Tontine Holdings, his $4 billion special purpose acquisition company, or SPAC, which has faced a series of setbacks since it was introduced a year ago. In a letter to investors posted late Thursday, he proposed an overhaul that could lead to the SPAC shutting down, returning its cash to investors and being reborn in a new guise, the DealBook newsletter reports.
To recap, Mr. Ackman’s SPAC, the largest of its kind, promoted many investor-friendly features, like tying the sponsor’s pay more closely to post-merger performance. But when he announced he had identified a deal, a complex transaction that involved buying a minority stake in Universal Music while spinning out two other blank-check vehicles, regulators balked, and the plan was scrapped last month. This week, the SPAC was hit with a lawsuit that challenged the fundamental structure of the SPAC, prompting Ackman’s change in approach.
“The mere existence of the litigation may deter potential merger partners†from engaging with the SPAC, Mr. Ackman wrote. The appeals process could drag on, and the SPAC has only 11 months left to announce a deal.
Mr. Ackman suggested that his SPAC was a stand-in for a broader campaign by academics and lawyers against all blank-check firms, which have boomed over the past year. “The two law professors who concocted the legal theory behind the complaint conceded to the press that their motivation in bringing the lawsuit was ‘to reform’ the entire SPAC industry,†he wrote.
“All is not lost, however,†Mr. Ackman said. He proposed replacing his SPAC with a new blank-check vehicle called a SPARC, which he first proposed as part of the aborted Universal Music deal. If the SPARC structure is approved by the Securities and Exchange Commission and the New York Stock Exchange, which Mr. Ackman said he was in talks with, investors in the SPAC will get their money back at the $20-per-share initial public offering price and also receive warrants to buy into the SPARC.
In a SPAC, investors buy shares in a public shell company formed to make an acquisition within a two-year time frame. In a SPARC, investors don’t put in money up front, and instead receive a right (the “R†in SPARC) to buy in once the vehicle announces a merger target, which isn’t subject to any time limits.
Investors who bought when Mr. Ackman’s SPAC was trading above its I.P.O. price would have a loss crystallized by being forced to take cash at the offer price. Some are taking to social media to vent their frustrations, with plenty of colorful language. Time will tell if the accompanying right to buy into the SPARC is worth it, if it ever comes to that.
Some of the animatronics at Disney’s parks have been doing their herky-jerky thing since the Nixon administration. The company knows that nostalgia won’t cut it with today’s children. In early June, Disney’s animatronic technology took a sonic leap forward with a “stuntronic†robot, and that’s just the start. READ THE ARTICLE →
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OnlyFans said on Thursday that it would ban sexually explicit imagery starting in October.
The company, a social media platform where users can sell subscription access to content, said in a statement that it would block users from posting explicit photos and videos at the request of its “banking partners and payout providers.†OnlyFans said it would still allow people to post imagery containing nudity that complied with its guidelines.
A spokeswoman for the company did not respond to questions about who had made the request or what had prompted the shift. OnlyFans has become a source of income for two million creators, including sex workers, during the pandemic.
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For the first time, a major awards show is going where the eyeballs are.
The Academy of Country Music Awards will be streamed live on Amazon Prime Video starting next year, Amazon said on Thursday in an announcement with the company that produces the show, Dick Clark Productions.
The ACMs, as they are known, will become the first significant awards telecast to move entirely online. The chief executive of the Academy of Country Music said in a statement that moving the ceremony to Amazon “will deliver the broadest possible audience and, simultaneously, deliver massive value to our artists whose music lives inside this ecosystem, enabling fans to discover and stream music as they watch.â€
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Charles Schwab, one of the country’s biggest brokerage firms, said on Thursday that it was delaying its return to the office until at least January. The company, which has about 20,000 employees, is the latest firm to push back plans to recall employees. Amazon has also delayed its return until January, and Lyft has pushed its return to February. Other companies, including Google, BlackRock and Wells Fargo, have postponed their returns until October.
Schwab also said it would give “the vast majority†of its employees a “special†5 percent raise, starting in late September. Walt Bettinger, the chief executive, said the raises were a thank-you for “outstanding results for our clients and growth for the company.†Employees that receive incentive-based compensation and senior executives will not be eligible for the raises.
Facebook says it has added several security features to help people in Afghanistan control their accounts as fears rise of reprisals from the Taliban.
In a series of tweets late Thursday, Facebook’s head of security said the company had temporarily disabled the ability to view and search the friends lists of Facebook accounts inside Afghanistan. He also said the platform, which is seeing a proliferation of new Taliban accounts despite a ban on the group, had provided a tool to help Afghans quickly lock their accounts if they feared being targeted.
The unprecedented measures target one of the most fundamental Facebook features: the friends list. They represent a frank acknowledgment from the company, which has long touted its ability to connect the world, of the risks of having personal information available on social networks.
Since the Taliban retook control of Afghanistan this week, their promises of amnesty and reconciliation have been undermined by reports that their soldiers are engaging in reprisal attacks and forcibly cracking down on protests.
In the days since the militants took over cities including Kabul, the capital, many Afghans have shuttered their social media accounts and deleted messages out of fear that their digital footprints could make them targets of the former insurgents. In the past, the Taliban have meted out brutal retribution against Afghans with ties to the country’s former government or Western countries such as the United States.
The Taliban have nevertheless become sophisticated users of social media. During the summer offensive that catapulted them to power, they used social media platforms to spread their messages.
Facebook’s head of security, Nathaniel Gleicher, also urged people with friends in Afghanistan to consider tightening their own privacy settings.
The social network’s strict bans on the Taliban have pushed many of its most influential voices and officials to Twitter. Still, the platform has struggled to keep out all accounts. Dozens of new ones have appeared on the site in recent days, presenting the company with the difficult question of how to regulate a group that now controls Afghanistan.
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U.S. stocks rose slightly in early trading Friday, with the S&P 500 treading higher. The benchmark index rose 0.5 percent, heading to close the week on a positive note after a few days of tumultuous trading.
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Asian stocks dropped on Friday after Chinese authorities approved new regulations that will curb data collection by technology companies. Hong Kong’s Hang Seng fell 1.8 percent.
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Shares for Alibaba dropped 2.6 percent, while the Chinese e-commerce company JD.com dipped 2 percent.
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West Texas Intermediate, the U.S. crude benchmark, fell 1.4 percent on Friday to $62.81 a barrel.
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The manufacturing company Deere slipped less than 1 percent in early trading after it reported that sales rose 29 percent from last year to $11.527 billion during its third quarter.
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Shares for Foot Locker jumped 7 percent after the sportswear company said in its quarterly earnings report that revenue rose 9.5 percent, while same-store sales climbed 6.9 percent, led by women and children footwear.
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Johnson & Johnson stock rose 7 percent after the company’s chief executive, Alex Gorsky, announced he would step down after nearly a decade. In recent years, the company has grappled with a series of challenges, including prominent lawsuits and trials, as well as the tumultuous rollout of its Covid-19 vaccine.
