Pacific Northwest Xcyte Therapies of Seattle said it has laid off 12 employees, or 14 percent of its staff, after halting its effort to...

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Pacific Northwest

Xcyte Therapies

Xcyte Therapies of Seattle said it has laid off 12 employees, or 14 percent of its staff, after halting its effort to develop an immune-system therapy against leukemia.

The company, which announced Monday that it is refocusing on HIV, said Chief Operating Officer Stewart Craig is among them. He will receive $139,090 as severance, equal to six months’ salary and health benefits.

Xcyte said severance, benefits and outplacement services will result in a second-quarter charge of $255,000.

Boise Cascade

IPO price cut, then canceled

Boise Cascade canceled an initial public offering of stock yesterday, after earlier in the day cutting the price of the offering.

“Market conditions in general aren’t receptive to an IPO at the moment,” said Mike Moser, a spokesman for the Boise, Idaho-based company. “The company is operating well, the businesses are performing well, and we didn’t think we were getting fair value for our shareholders.”

Boise Cascade said earlier yesterday in a regulatory filing that it was cutting the price of the offering to $17 to $19 a share from a May 2 estimate of $24 to $26. The company had hoped to sell 16 million shares.

Net proceeds were to go to existing shareholders: Forest Products Holdings, a unit of Madison Dearborn Partners; and OfficeMax.


5 stores to close in Washington

Grocery chain QFC said it would close five underperforming stores in Washington, including locations in Federal Way, Midway, Burien, Rainier Beach and Vancouver.

QFC President Donna Giordano said the current sales volumes at these stores didn’t allow it to offer the types of products and customer service “that best represent QFC.”

The company did not disclose the number of employees affected by the closures but said it planned to relocate as many to other stores “when and where it is possible.”

The grocery chain will operate 79 stores in Washington and Oregon after the cuts.


Pirating costs billions in sales

Microsoft, Symantec and other software makers lost $8 billion in sales in Asia Pacific last year because 53 percent of all the software installed in the region was pirated, an industry trade group said.

China and Vietnam remained the worst countries for software piracy in the region, with more than 90 percent of the software copied, according to a study by Business Software Alliance and International Data.

Compiled from Seattle Times business staff and Bloomberg News

Treasury Department

Deadline extended for health spending

Workers who overfund pretax health-care-spending accounts may have an extra 2 ½ months after year-end to spend the money before being forced to forfeit unused funds, the Treasury Department announced yesterday.

The ruling is expected to ease the annual late-year frenzy of spending on eyeglasses and other less-than-pressing medical needs that has developed as a result of use-it-or-lose-it rules that govern these flexible-spending accounts. Each year, thousands of Americans belatedly realize they haven’t spent the money they have set aside, and rush to do so.

In these accounts, workers decide before the beginning of the year how much they’d like to set aside.

If they underestimate their expenses at the beginning, they have to pay some of those costs with after-tax dollars, missing some potential tax savings. But if they overestimate and don’t spend the money, they lose it altogether. The money goes to their employer.

Morgan Stanley

Award to Perelman exceeds $1.4 billion

Morgan Stanley must pay billionaire financier Ron Perelman more than $1.4 billion in damages, awarded by a jury that said it found clear evidence the investment firm acted fraudulently in Perelman’s 1998 sale of his Coleman camping-gear company to Sunbeam.

The jury deliberated for nearly four hours yesterday before deciding on $850 million in punitive damages. On Monday, the same jury awarded Perelman compensatory damages of $604.3 million.

Perelman, the Revlon cosmetics chief, had sought $1.8 billion in punitive damages.

United Airlines

Union reports talks making progress

The union representing 20,000 ramp workers and customer-service agents at United Airlines reported “significant progress” yesterday in negotiations aimed at averting a contract deadlock and threatened strike.

The International Association of Machinists and Aerospace Workers gave the upbeat report as it continued marathon talks with United to work out a deal before this afternoon, when a bankruptcy-court trial is due to resume on United’s proposal to impose lower pay and benefits.

The union — the largest at the nation’s No. 2 carrier — said that while differences remained over pensions and job security, the two sides were exchanging revisions to try to wrap up a tentative contract agreement.

Delta Air Lines

Bankruptcy unlikely in 2005, analyst says

Delta Air Lines shares got a much-needed boost yesterday, as an analyst asserted that the struggling carrier may not be in jeopardy of bankruptcy until next year.

The positive comments came a day before the company’s annual meeting.

J.P. Morgan airline analyst Jamie Baker said in a research note that the probability of a Chapter 11 filing by the Atlanta-based company in 2006 remains high, though he believes a filing this year is not as likely.

Shares of Delta rose 29 cents, or 9.6 percent, to close at $3.30 in trading yesterday.


Talks on subsidies expected to resume

European Union Trade Commissioner Peter Mandelson said he will resume discussions “shortly” with U.S. Trade Representative Rob Portman about subsidies to aircraft makers Boeing and Airbus.

Talks between the two sides over aid for the world’s only two makers of large commercial planes collapsed before an April 11 deadline amid accusations from the U.S. that Mandelson didn’t clearly express the limits on his authority to negotiate.

“I expect to be discussing it again with him shortly,” Mandelson told journalists in Brussels yesterday. “We’ve lost time recently, for which I do not take responsibility. There remains a window of opportunity to negotiate, and I intend to use it.”

Portman, who on April 29 took over the stalled dispute together with the job of chief U.S. trade negotiator from Robert Zoellick, met Mandelson in Paris on May 2. Both sides said then they want to avoid resorting to a World Trade Organization panel to resolve the dispute.

Toys R Us

Stockholders to vote on proposed buyout

Stockholders of Toys R Us are to meet June 23 in New York to vote on the proposed $6.6 billion buyout of the nation’s No. 2 toy seller by a private consortium, the company said yesterday.

Stockholders of record as of the close of business tomorrow will be allowed to vote at the meeting or by proxies that are to be mailed out Monday, the company said.

Toys R Us plans to file its definitive proxy with federal regulators early next week, spokesman Susan McLaughlin said.

The company expects no major differences with a preliminary proxy, filed May 2, that envisioned a price of $26.75 a share, the same as was announced in March. A closing in July is still anticipated.

The company is being bought by two equity firms, Bain Capital Partners and Kohlberg Kravis Roberts, and a real-estate developer, Vornado Realty Trust.

Federal Reserve

Departure creates 2nd board vacancy

Edward Gramlich, a member of the Federal Reserve Board since 1997, announced yesterday that he plans to leave the central bank this summer and return to academia.

Gramlich, 65, submitted his resignation, effective Aug. 31, in a letter to President Bush. Gramlich said he will not attend the Aug. 9 meeting of the Federal Open Market Committee, the group that sets interest-rate policy in the United States.

His departure will open up a second seat on the 12-member committee for Bush to fill.

Federal Reserve Board member Ben Bernanke is moving to the White House staff as chairman of the president’s Council of Economic Advisers. The three-member council gives economic advice to the president.


5th CEO takes helm at chip maker

In a rare handoff of the leadership reins at Intel, President Paul Otellini took over yesterday as chief executive officer of the world’s largest chip maker while his predecessor, Craig Barrett, replaced the legendary Andy Grove as chairman.

Otellini is the fifth CEO in the company’s 37-year history, following only Barrett, Grove and co-founders Gordon Moore and Robert Noyce.

The former sales-and-marketing executive also is the first to run the company without a background in science or engineering.

Intel’s board had announced the transition in November, and it was made official at the company’s annual shareholder meeting yesterday.

Compiled from The Los Angeles Times Washington Post News Service, Bloomberg News and The Associated Press