(MICHIGAN) — The Justice Department is investigating conduct at Abbott Laboratories’ infant formula plant in Sturgis, Michigan, in connection with a contamination investigation that closed the plant last year, a source familiar with the matter told ABC News.
The monthslong shutdown of the plant amid a investigation helped trigger a nationwide formula shortage.
An Abbott spokesperson told ABC News, “DOJ has informed us of its investigation and we’re cooperating fully.”
The DOJ did not immediately respond to a request for comment.
The Consumer Protection branch of the DOJ is conducting the criminal investigation, the source familiar said.
The discovery of Cronobacter sakazakii bacteria inside Abbott’s Sturgis plant prompted a massive voluntary formula recall in February, after four babies who had consumed Abbott’s formula contracted a Cronobacter infection.
Two of the infants subsequently died, although Abbott maintains there has not been conclusive evidence that its formula caused the infant illnesses, since none of the Cronobacter strains found at their plant matched the two samples genetically sequenced from the sickened infants.
Food and Drug Administration officials said the investigation remains ongoing.
Ultimately, it was the combined findings of Cronobacter inside Abbott’s plant — along with a pattern of serious operational deficiencies and consumer complaints — which led to the plant’s closure.
The plant reopened in June and restarted production of its largest formula Similac in August.
Mateusz Slodkowski/SOPA Images/LightRocket via Getty Images
(NEW YORK) — Companies across the tech industry have announced layoffs, affecting thousands of workers in the first few weeks of 2023. Company officials have often cited economic uncertainty and fears of a recession in their job-cutting, cost-cutting decisions.
It follows a volatile 2022, which was also marred with layoffs by the thousands across major tech brands.
Google
Alphabet Inc., the parent company of Google, said it will cut roughly 12,000 jobs from its global workforce on Friday, Jan. 20.
The decision will impact approximately 6% of the company’s employees.
“This will mean saying goodbye to some incredibly talented people we worked hard to hire and have loved working with,” said Google’s CEO Sundar Pichai in an email to Google employees on Friday morning.
“I’m deeply sorry for that. The fact that these changes will impact the lives of Googlers weighs heavily on me, and I take full responsibility for the decisions that led us here.”
Pichai told employees the company is “bound to go through difficult economic cycles” and will “reengineer our cost base, and direct our talent and capital to our highest priorities.”
Microsoft
Microsoft said on Jan. 18 it will lay off 10,000 employees this year, affecting nearly 5% of Microsoft’s global workforce.
The layoffs at Microsoft arrive in response to “macroeconomic conditions and changing customer priorities,” the company said in a filing with the Securities and Exchange Commission.
“As we saw customers accelerate their digital spend during the pandemic, we’re now seeing them optimize their digital spend to do more with less,” Microsoft CEO Satya Nadella said in a memo to employees on Wednesday.
He continued, “We’re also seeing organizations in every industry and geography exercise caution as some parts of the world are in a recession and other parts are anticipating one.”
Amazon
In early January, Amazon announced plans to eliminate just over 18,000 roles total, including impending layoffs announced in November. The majority of roles being cut are in Amazon Stores and People Experience and Technology Solutions teams, according to an email sent to employees from Amazon CEO Andy Jassy.
Jassy had warned in November that job cuts at the e-commerce giant would continue in early 2023. Amazon employs roughly 1.5 million employees around the globe.
“This year’s review has been more difficult given the uncertain economy and that we’ve hired rapidly over the last several years,” the message read.
It continued, “We typically wait to communicate about these outcomes until we can speak with the people who are directly impacted. However, because one of our teammates leaked this information externally, we decided it was better to share this news earlier so you can hear the details directly from me.”
Coinbase
Coinbase, a cryptocurrency trading platform, announced it will lay off 950 people, in a Jan. 10 statement from CEO Brian Armstrong.
“As we examined our 2023 scenarios, it became clear that we would need to reduce expenses to increase our chances of doing well in every scenario,” Armstrong said in the statement.
“While it is always painful to part ways with our fellow colleagues, there was no way to reduce our expenses significantly enough, without considering changes to headcount.”
Vox Media
Vox Media is also laying off employees, according to the Vox Media Union.
In a statement on Twitter, the union said, “We were informed today that the company is laying off around 7 percent of its workforce, and some of our members have been impacted. We’re furious at the way the company has approached these layoffs, and are currently discussing how to best serve those who just lost their jobs.”
ABC News’ Max Zahn and Jon Haworth contributed to this report.
(NEW YORK) — T-Mobile says they discovered a “bad actor” was taking information through a single application, according to an SEC filing by the company this week.
“The preliminary result from our investigation indicates that the bad actor(s) obtained data from this API for approximately 37 million current postpaid and prepaid customer accounts, though many of these accounts did not include the full data set,” the SEC filing dated Jan. 19 says.
The wireless giant is facing the second major breach in as many years. They said the activity started on Nov. 25 and they notified the proper agencies when they discovered the hack on Jan. 5, 2023.
“We are continuing to diligently investigate the unauthorized activity,” T-Mobile said. “In addition, we have notified certain federal agencies about the incident, and we are concurrently working with law enforcement. Additionally, we have begun notifying customers whose information may have been obtained by the bad actor in accordance with applicable state and federal requirements.”
The company said they were able to trace the identity of the activity and stop it.
The Cybersecurity and Infrastructure Security Agency (CISA) has previously warned of major hacks occurring on or around holidays — and it would appear this started around Thanksgiving.
The company says the most sensitive customer data wasn’t taken but some personal information was.
“The API abused by the bad actor does not provide access to any customer payment card information (PCI), social security numbers/tax IDs, driver’s license or other government ID numbers, passwords/PINs or other financial account information, so none of this information was exposed. Rather, the impacted API is only able to provide a limited set of customer account data, including name, billing address, email, phone number, date of birth, T-Mobile account number and information such as the number of lines on the account and plan features.”
After the first hack, the company says they went through extensive cybersecurity measures.
(NEW YORK) — Alphabet Inc., the parent company of Google, said Friday that it will cut about 12,000 jobs from its global workforce, affecting approximately 6% of the company’s employees.
“I have some difficult news to share,” Google’s CEO Sundar Pichai wrote in an email to Google employees on Friday morning. “We’ve decided to reduce our workforce by approximately 12,000 roles … This will mean saying goodbye to some incredibly talented people we worked hard to hire and have loved working with. I’m deeply sorry for that. The fact that these changes will impact the lives of Googlers weighs heavily on me, and I take full responsibility for the decisions that led us here.”
Employees who are being laid off in the United States will be paid during the notification period — a minimum of 60 days — and will also receive a severance package starting at 16 weeks salary plus two weeks for every additional year they spent at Google.
Google also said that they would pay out the 2022 bonuses and remaining vacation time to the employees that are being laid off as well as “six months of healthcare, job placement services, and immigration support for those affected.”
“As an almost 25-year-old company, we’re bound to go through difficult economic cycles. These are important moments to sharpen our focus, reengineer our cost base, and direct our talent and capital to our highest priorities,” Pichai said. “Being constrained in some areas allows us to bet big on others. Pivoting the company to be AI-first years ago led to groundbreaking advances across our businesses and the whole industry.”
Pichai said that in spite of the layoffs, Google is “getting ready to share some entirely new experiences for users, developers and businesses.”
“Google’s products are better than ever,” he wrote. “We have a substantial opportunity in front of us with AI across our products and are prepared to approach it boldly and responsibly.”
Said Pichai: “When I look around Google today, I see that same spirit and energy driving our efforts. That’s why I remain optimistic about our ability to deliver on our mission, even on our toughest days. Today is certainly one of them.”
This is a developing story. Please check back for updates.
(NEW YORK) — The holiday shopping season began with a boom but ended with a whimper.
U.S. retail sales fell in December, offering the latest sign of an economic slowdown driven by elevated prices and rising interest rates.
Year-over-year retail sales dropped by about 1% last month, extending a nearly identical fall in November. The prolonged decline followed a buying surge in October, when many Americans seized on discounts for holiday purchases.
“Consumers finally have this fatigue from inflation,” Mickey Chadha, a retail analyst at Moody’s Investors Service, told ABC News. “Rising prices are taking a chunk out of disposable income.”
Consumer spending accounts for nearly 70% of U.S. economic activity. A sustained drop off in retail sales foretells a sluggish period for the broader economy, and in return signs of a downturn drag on sales, Chadha said.
“The economy is definitely slowing down,” Chadha said. “When consumers are worried about whether there will be a recession, they always pull back.”
The sales downturn battered stores across the sector. Sales at department stores fell more than 6% compared to a year prior; while sales at furniture stores fell 2.5% and sales at auto dealers dropped 1.4%.
Sky-high prices have eased in recent months but continue to hover near a 40-year high. Consumer prices rose 6.5% last month compared to a year ago, marking a significant drop from a summer peak.
The Federal Reserve imposed a string of aggressive rate hikes last year that aimed to slow price increases by cooling the economy and choking off demand. The approach, however, risks tipping the U.S. into a recession.
Consumer spending defied the economic headwinds for much of last year, as pandemic-era savings and robust wage gains fueled purchases. But the pace of wage gains trailed the inflation rate, drawing down household savings and ultimately forcing cutbacks in spending.
“Consumers have finally started to see cracks in that resilience,” Chadha said.
The personal savings rate fell to 2.3% in November, the lowest rate in nearly two decades, according to data from the Commerce Department.
In addition, the sluggish sales in December sprang in part from the push forward of holiday spending into October, when many retailers offer significant discounts and consumers fear missing out on the cost gains, Chadha said.
“There was some pull forward on holiday buying in October, primarily because consumers were looking for bargains,” he said.
In all, the fall in retail spending offers a cautionary note as the U.S. economy begins a year in which many economists expect a recession, Chadha said.
“Consumers are definitely getting pickier and getting a lot more skeptical about prospects in 2023,” he said.
(NEW YORK) — The Occupational Safety and Health Administration cited Amazon on Wednesday for failing to furnish a place of employment that was free from recognized hazards that were causing serious physical harm to employees.
This is the second set of OSHA citations issued after referrals from federal prosecutors in New York who have been investigating workplace complaints.
The new citations said employees at three Amazon facilities were exposed to ergonomic hazards, which put them at high risk for lower back injuries and other musculoskeletal disorders.
They resulted from the high frequency with which workers are required to lift packages and other items; the heavy weight of the items; awkward postures, such as twisting, bending, and long reaches while lifting; and long hours required to complete assigned tasks, OSHA said.
“Amazon became the nation’s largest online retailer thanks, in no small part, to the hundreds of thousands of Americans who work each year in Amazon’s massive warehouses. Each of these workers has the right to a place of work free from severe safety hazards,” U.S. Attorney Damian Williams said in a statement Wednesday.
Amazon told ABC News it intends to appeal.
“We take the safety and health of our employees very seriously, and we strongly disagree with these allegations and intend to appeal. We’ve cooperated fully, and the government’s allegations don’t reflect the reality of safety at our sites,” Kelly Nantel, Amazon spokesperson, told ABC News. “Over the last several months, we’ve demonstrated the extent to which we work every day to mitigate risk and protect our people, and our publicly available data show we’ve reduced injury rates nearly 15% between 2019 and 2021. What’s more, the vast majority of our employees tell us they feel our workplace is safe.”
The cited warehouses are located in New Windsor, New York; Waukegan, Illinois, and Deltona, Florida. Additionally, at the Deltona, Florida, warehouse, OSHA also cited Amazon for exposing workers to the hazard of being struck by falling boxes with merchandise.
Amazon faces a total of $60,269 in proposed penalties for these violations, according to OSHA.
These citations arise out of workplace safety inspections at six Amazon warehouses across the country that OSHA began conducting in mid-July and early August of last year. OSHA’s investigation at three facilities — located outside of Albany, New York, Boise, Idaho, and Denver, Colorado — is ongoing.
“Each of these inspections found work processes that were designed for speed but not safety, and they resulted in serious worker injuries. While Amazon has developed impressive systems to make sure its customers’ orders are shipped efficiently and quickly, the company has failed to show the same level of commitment to protecting the safety and well-being of its workers,” OSHA Assistant Secretary of Labor Douglas L. Parker said.
OSHA cited Amazon in December 2022 for 14 recordkeeping violations as part of the same investigation.
(NEW YORK) — Microsoft said it will lay off 10,000 employees this year, the latest tech firm to slash jobs as the sector contracts after a pandemic-era boom.
The layoffs will affect nearly 5% of Microsoft’s global workforce, the company said.
“As we saw customers accelerate their digital spend during the pandemic, we’re now seeing them optimize their digital spend to do more with less,” Microsoft CEO Satya Nadella said in a memo to employees on Wednesday.
“We’re also seeing organizations in every industry and geography exercise caution as some parts of the world are in a recession and other parts are anticipating one,” he added.
The company said the job cuts, changes to its hardware portfolio and consolidation of its real estate holdings would result in a $1.2 billion charge.
A tech industry downturn – marked by a 33% drop in the Nasdaq last year – has brought job cuts across the sector, including at large firms like Amazon and Facebook-parent Meta.
The layoffs at Microsoft arrive in response to “macroeconomic conditions and changing customer priorities,” the company said in a filing with the Securities and Exchange Commission.
The move follows a wave of job cuts in October that eliminated nearly 1,000 positions.
Shares of Microsoft fell roughly 1% in early trading on Wednesday morning in response to the news.
The company did not immediately respond to a request for comment. Microsoft employs about 221,000 workers worldwide.
Sales at top tech firms have retreated from the blistering pace attained during the pandemic, when billions across the world were forced into isolation. Customers stuck at home came to rely on delivery services like e-commerce and virtual connections formed through social media and videoconferencing.
Persistent recession fears, rising interest rates and a shift back toward a pre-pandemic lifestyle have bludgeoned the industry, experts say.
Microsoft announced the layoffs on the same day that Amazon began cutting 18,000 workers. Amazon CEO Andy Jassy said the company was set for layoffs in a memo to employees earlier this month.
In the memo, Jassy cited an “uncertain economy” as the primary reason behind the job cuts.
Amazon officials are “deeply aware that these role eliminations are difficult for people, and we don’t take these decisions lightly or underestimate how much they might affect the lives of those who are impacted,” Jassy said.
Over the past year, major tech companies have cut hundreds of thousands of jobs. The list of companies that have undertaken layoffs includes Twitter, Lyft, Stripe, Salesforce, Coinbase and Robinhood.
“When I think about this moment in time, the start of 2023, it’s showtime – for our industry and for Microsoft,” Nadella said. “As a company, our success must be aligned to the world’s success.”
(NEW YORK) — Former President Donald Trump is looking to get back on Facebook.
Attorneys for Trump, who was banned from Facebook after the Jan. 6 insurrection, have written to executives of Meta requesting a meeting to discuss “prompt reinstatement to the platform,” according to a copy of the letter reviewed by ABC News.
The letter, which is addressed to Meta CEO Mark Zuckerberg and two other executives, claims the ban on Trump’s account “has dramatically distorted and inhibited the public discourse,” and represents “a deliberate effort by a private company to silence Mr. Trump’s political voice.”
“Moreover, every day that President Trump’s political voice remains silenced furthers an inappropriate interference in the American political and election process,” the letter states.
The letter does not address the reason Trump was kicked off the platform in the first place — it does, however, note that Trump was allowed back on Twitter. Twitter CEO Elon Musk lifted Trump’s ban on the platform in November after putting the decision up to a poll.
He has not used the account despite being unbanned, and has said he plans to stick with TRUTH Social, the platform he founded after being banned from most social media sites.
Trump was removed from Facebook in January 2021, in the wake of the insurrection, over concerns his posts were inciting violence.
The company later said the removal was set to last for two years, at which point it would come under reassessment.
“We therefore write to request a meeting to discuss President Trump’s prompt reinstatement to the platform,” the letter says.
However, even as Trump announced his run for president in 2024, Facebook said in November it did not plan to reinstate him.
(NEW YORK) — Even as U.S. households begin to enjoy relief from inflation woes, a spike in heating bills could crunch budgets this winter due to a rise in natural gas prices.
Nearly half of the nation’s households rely on natural gas for warmth. The price of the fuel surged last year following a jump in demand after extreme weather forced consumers to run heat and air conditioning more than usual, analysts told ABC News.
Exacerbating the greater need for natural gas, the U.S. suffered a dearth of supply as gas exports soared, analysts told ABC News.
Last year, the average price of natural gas reached its highest point since 2008, according to the U.S. Energy Information Administration, or EIA, a federal agency that tracks gas data.
The price was expected to climb even further this winter, increasing nearly 30% above where it stood a year prior, according to an EIA projection released in October.
“The prices people are paying for their heating bills right now are up enormously,” Eli Rubin, an analyst with EBW Analytics Group, told ABC News.
The sky-high prices are primarily due to a jump in U.S. gas exports in response to heightened demand from European countries that previously relied on natural gas from Russia, analysts told ABC News.
After Russia invaded Ukraine last February, those nations sought alternative sources of natural gas, including the U.S, they added.
“There was a huge shortage in Europe,” Rubin said.
In turn, the U.S. sent more natural gas for sale on the international market, leaving less available for U.S. consumption. When domestic demand outpaced supply, it sent prices soaring.
“There was a supply crunch,” Clark Williams-Derry, an energy analyst at the Institute for Energy Economics and Financial Analysis, told ABC News. “Essentially, we were exporting more and more natural gas and importing high prices as a result.”
As U.S. supply faltered, a bout of extreme weather increased the need for indoor air conditioning and heat, causing a jump in demand, analysts said.
Winter storm Uri, for instance, battered Texas with snow and sleet last February, besetting the Southwest with unusually frigid weather. The summer months, meanwhile, brought a string of dangerous heat waves across the U.S.
“We had a cold winter that flipped into a record-hot summer,” said Rubin, of EBW Analytics Group. “We used natural gas to fuel power generation to run everybody’s heat and air conditioners.”
That upward pressure on prices endured through the end of last year. The average price of wholesale gas rose 47% in December compared with the same month a year prior, said Williams-Derry, of the Institute for Energy Economics and Financial Analysis.
The price of wholesale gas has fallen over the last couple of weeks, however, as a warm spell assuaged fears of a persistent gas shortage, Rubin said.
Still, the recent decline in prices likely won’t offer relief for consumers this winter, since there’s typically a lag between a change in the wholesale price and the amount paid by the end consumer in his or her heating bill, he added.
Looking ahead, however, the outlook for U.S. prices appears bright, since the country is unlikely to experience the massive increase in gas exports that it endured last year, analysts said.
Over the course of this year, the price of natural gas is expected to moderate, offering relief for heat bills by the time next winter arrives, they added.
That rosy prediction requires caveats, of course, Williams-Derry said. A period of erratic weather or another supply crisis akin to the Russia-Ukraine war could send prices rising again, he added.
“All sorts of things can make the price do funny things, but all else being equal, we can expect an easing of last year’s record prices,” he said.
(NEW YORK) — A customer-service center uses artificial intelligence to identify a caller’s agitation, an insurance company scans voice data to flag illness and raise rates, a five-star restaurant denies a reservation over personal details revealed by the tone on the other end of the line.
Far from science fiction, such scenarios have leapt into the realm of possibility, said Joseph Turow, a professor at University of Pennsylvania’s Annenberg School for Communication and author of The Voice Catchers: How Marketers Listen In to Exploit Your Emotions, Your Privacy and Your Wallet.
The rise of voice-assisted products in homes and workplaces has driven a wave of private sector innovation, honing the intake of fast food drive-thru orders, replacing handheld tech typically used by warehouse employees, and refining smart home devices that adapt to a user’s vocal tics, according to privacy experts and advocates who spoke with ABC News.
But voice data collection also fuels targeted marketing based on personal information gleaned from recordings and risks data breaches that could place one’s voice in the hands of cyber criminals aiming to imitate it, they added.
“This has become a real issue as more and more people are using voice-activated devices like Alexa and Siri,” Marc Rotenberg, founder and executive director for the nonprofit Center for AI and Digital Policy, told ABC News. “There’s a ticking time bomb with the collection of voice recordings.”
“These companies gather voice recordings to improve a service,” Rotenberg added. “But their retention of these voice recordings is a real concern for privacy.”
While voice assistants recently arrived in consumers’ pockets and living rooms, the technology goes back more than a half-century.
In the early 1960s, IBM released the Shoebox, a calculator that could do basic arithmetic in response to voice commands. Roughly a decade later, the “Harpy” speech recognition system launched by Carnegie Mellon could identify more than 1,000 words in a user’s voice.
Ultimately, the technology reached an inflection point more than a decade ago, when Apple released Siri as a feature of the iPhone, equipping tens of millions with voice command. Three years later, Amazon came out with Alexa, a voice assistant that could play songs or look up facts in response to a simple utterance. Soon after, Google launched Google Assistant, a voice-recognition feature available on its Android and Google Home devices.
Meanwhile, the technology has grown well beyond a consumer curiosity, as businesses have sought it out to improve operations and marketers have explored secondary uses of voice data. In all, the worldwide voice recognition market surpassed $3.5 billion in 2021 and is expected to reach $10 billion by 2028, according to research firm Global Market Insights.
In many cases, businesses deploy voice data because it bolsters productivity or betters the service encountered by a customer, Kristin Bryan, an attorney at Squire Patton Boggs who has worked on litigation involving the collection of voice data, told ABC News.
“Companies are increasingly finding novel ways to use voice technology to reduce human error and streamline operations,” she said.
For instance, a growing number of warehouses in the nation’s vast e-commerce network have replaced handheld tablets with wearable technology that allows employees to record their work through voice commands, freeing up both hands for lifting and sorting products, said Roberto Michel, a senior editor for Modern Materials Handling, a trade publication covering the manufacturing industry.
A survey conducted by the trade outlet last year found that 39% of warehouse companies use voice-assisted technology, an increase from 21% of such businesses who reported adoption of the devices a year prior, Michel said.
The technology “speeds up the order-selection process versus fumbling with a handheld,” Michel said.
However, even ostensibly innocuous uses of voice-assisted technology can trigger privacy concerns, said Turow, of the University of Pennsylvania.
Last week, Amazon-owned grocery chain Whole Foods agreed to pay almost $300,000 to workers in a settlement over allegations that a voice-assisted product used to track worker productivity at a Chicago warehouse had recorded employees’ voices without their consent.
Critics fear that voice-assisted products glean more revealing data than many users realize, allowing companies to profit off of utterances made at home or work through carefully honed advertising or the sale of intimate information.
A consumer’s voice could be used to reveal a wealth of knowledge about him or her, including height, weight, ethnicity, personality traits and possible health issues, said Turow, who spoke to scientists about audio sleuthing for his book on the collection of voice data.
In 2019, Amazon announced the development of “a deep learning model to detect when customers are frustrated” with its voice assistant.
“Alexa can now try to adjust, just like you or I would do,” the company said.
“With Frustration Detection, Alexa will recognize positive, negative, and neutral tone for a request. Alexa is not designed to detect distinct emotions like happiness, sadness, anger or surprise,” Amazon Spokesperson Lauren Raemhild told ABC News.
“Customers have several options to manage their Alexa voice recordings, including the option not to save their recordings at all,” she added.
Last June, TikTok updated its privacy policy, expanding data collected by the company to include voice recordings.
Companies that collect voice data could use information to sell products directly to consumers, or pass the data along to advertisers, Turow said.
“As we move into a world where people use voice over typing in their everyday lives, marketers want to know: What can I get out of the voice of this person?” he said.
Rotenberg, of the Center for AI and Digital Policy, warned that the collection of audio data could also result in nefarious actors accessing one’s voice, allowing them to commit fraud or other crimes through impersonation.
A thief deploying the tactic, known as deepfake audio, tricked a Hong Kong-based bank into sending $35 million to a criminal the bank thought was a corporate attorney, Forbes reported last October.
In a statement, Amazon spokesperson Lauren Raemhild said the company takes extensive measures to ensure the security of its data.
“Amazon has hundreds of employees dedicated to designing secure products, innovating on security, and finding and fixing vulnerabilities in Amazon services and devices,” Raemhild said. “We employ numerous tactics and features that help keep our devices and customer data secure, for example, rigorous security reviews during development, encryption to protect data, and regular software security updates.”
Apple and Google did not immediately respond to a request for comment about potential theft and abuse of voice data.
Despite the growing use of voice-assisted technology, laws protecting audio data collection remain limited, according to attorneys and advocates who spoke with ABC News.
The U.S. lacks a federal law governing such data, leaving regulation primarily at the state level. So far, four states have enacted laws pertaining to the collection of voice data: California, Texas, Washington and Illinois, said Bryan, of Squire Patton Boggs.
The strongest law, in Illinois, requires that companies obtain written consent from individuals before collecting such data, and afterward firms are prohibited from selling or profiting off of the information. Companies that violate the law face potential financial penalties.
The effort to limit voice data collection requires urgency, before voice-assisted products become more widely adopted, Turow said.
“Once this has congealed, we can’t do much about it,” he said.
