Mangoes are seen in a net during harvest on a farm, March 24, 2021, in Actopan, Veracruz state, Mexico. (Hector Quintanar/Bloomberg via Getty Images, FILE)
(NEW YORK) — The U.S. Department of Agriculture has temporarily paused any new exports of mangoes and avocados out of Michoacán, Mexico after an incident that reportedly sparked security concerns for its safety inspectors on the ground.
A spokesman for the agency said Monday that the inspection program will remain paused until it can ensure its Animal and Plant Health Inspection Service inspectors working in Mexico are safe.
The USDA did not elaborate on the nature of the specific security threats.
“The programs will remain paused until the security situation is reviewed and protocols and safeguards are in place for APHIS personnel,” the USDA spokesman added.
The USDA first alerted the Avocado Exporting Producers and Packers of Mexico of its decision to suspend new exports out of the western Mexican state earlier this month.
Any produce that has already been inspected and is in transit will not be blocked or impacted by the suspension, the agency said.
This marks the second time in just over two years that inspections have been suspended following an incident in February 2022 that dealt with USDA employee safety, which was resolved within a week of the ban and had no severe impact on the avocado supply in the U.S.
The USDA has inspectors working in Mexico to ensure the products meet U.S. standards, without whose signoff the avocados and mangos cannot be sent north.
Michoacán and Jalisco are the only two Mexican states allowed to export avocados to the U.S., an industry worth billions of dollars each year.
Michoacán is known as one of Mexico’s most dangerous states, which has been dominated by organized crime for decades. The avocado industry has been no exception, with extortion rampant in the lucrative produce industry.
If the current issue is not resolved as swiftly as the 2022 incident, and the supply chain is disrupted for a long period of time, there could be an impact on U.S. supply.
(NEW YORK) — Apple has announced it is scrapping Apple Pay Later, the company’s buy now, pay later service that launched last year.
In a statement, Apple said users instead will be able to apply for installment loans via credit cards, debit cards and lenders when checking out with Apple Pay later this year.
“With the introduction of this new global installment loan offering, we will no longer offer Apple Pay Later in the U.S.,” the company said in the statement. “Our focus continues to be on providing our users with access to easy, secure and private payment options with Apple Pay, and this solution will enable us to bring flexible payments to more users, in more places across the globe, in collaboration with Apple Pay enabled banks and lenders.”
Apple introduced Apple Pay Later last March. The service allowed users to split purchases into four interest-free installments, paid over six weeks. Users were allowed to apply for Apple Pay Later loans of up to $1,000.
The Bud Light logo is seen on a truck semitrailer, Oct. 21, 2022, in Maryland. — Jakub Porzycki/NurPhoto via Getty Images
(NEW YORK) — When conservative activists set aflame boxes of Bud Light and urged a boycott in response to an endorsement from a trans influencer last spring, they sent sales of the beer plummeting in a rare success in the long history of consumer movements.
Even more improbably, the backlash continues to hammer Bud Light and strain independent local wholesalers more than a year later, according to third-party sales data shared with ABC News as well as interviews with six Anheuser-Busch wholesalers.
Most of the wholesalers, small- and medium-sized businesses that draw a significant portion of their revenue from Bud Light, said they remain weakened by the decline in sales and uncertain about when, if ever, the brand will fully recover.
The owner of an Anheuser-Busch wholesaler in the Northeast, whose child is trans, told ABC News they have taken a 30% pay cut to make up for the losses and are considering retirement.
“It was really hurtful personally,” the owner said. “I’m trying to understand what my kid is going through and then this happens.”
“It’s still very upsetting,” the owner added, noting the company’s Bud Light sales declined by 50% in the immediate aftermath of the boycott. “It’s very difficult to come in every day and look at those sales numbers, knowing I have a responsibility for everyone here.”
Another executive at a wholesaler in the Mid-Atlantic said they have spent sleepless nights devising ways to shed costs without laying off employees; and a top official at a distributor in the Southeast said they expect sales of Bud Light will remain down for at least two more years.
Still, the wholesalers added, harassment of employees and drinkers has faded, indicating the boycott fervor has died down and the brand reputation of Bud Light has begun to mend. Many of the wholesalers said sales had improved lately and Bud Light remains their top-selling beer.
The wholesalers requested anonymity because they didn’t want to be publicly identified speaking about the financial consequences of the boycott. In all, roughly 500 independent distributors sell Anheuser-Busch products nationwide.
In response to ABC News’ request for comment, a spokesperson at Anheuser-Busch touted the success of Bud Light and the company’s relationship with wholesalers.
“Bud Light continues to be the number one selling beer brand in the country because for decades it has been synonymous with programs and activations that consumers love, including partnerships with the NFL, NHL, UFC, and College Football,” the spokesperson said.
“As we have for nearly a century, we continue to work side-by-side with our 350+ wholesaler partners to drive growth for our collective business and provide best-in-class service to our consumers and retailers across the country,” the spokesperson added.
Sales of Bud Light declined by roughly 25% over the weeks following a product endorsement from Dylan Mulvaney, a transgender influencer, which sparked backlash among many conservatives last April, according to data from Bump Williams Consulting and Nielsen NIQ obtained by ABC News.
In a video posted on Instagram, Mulvaney held a specially designed can of Bud Light featuring an illustration of her. The can, Mulvaney said, included a message congratulating her on “365 days of womanhood.”
Until April of this year, sales of the beer stayed stuck at the same level while the boycott persisted, Dave Williams, the president of Bump Williams Consulting, told ABC News.
“Sales cratered and sat there. They didn’t get any worse but they sure as heck didn’t get any better,” Williams said. “I don’t think there are a lot of examples where the king of the castle, someone in such prominence, took such a public and drastic hit in beer.”
In recent months, sales have shown signs of improvement but remain well below pre-boycott levels, Williams added, noting that some customers appear to have returned to the brand as the social stigma has waned while others remain steadfast in their opposition.
“The goal is to retain the consumers they have and hopefully try to win some back.”
An executive at a wholesaler in the Southeast said Bud Light sales plummeted by at least 20% in the aftermath of the boycott and remained at that level for the rest of 2023. The blow to the balance sheet hurt company morale and raised questions about the firm’s future, the executive said.
“We’ve got employees who expected a career helping to build this brand and this business,” the executive added. “To have that undone was a bit of a shock, to say the least.”
In recent months, hostility toward the brand has faded, sales have stabilized and morale has improved, the executive added, acknowledging that sales still stand well below pre-boycott levels.
“Once a consumer drops off a product — where there is a readily available and similarly priced substitute — a habit has formed and it’s difficult to shake that habit,” the executive said. “We have to give them a reason to come back.”
Williams said Bud Light has returned to its spot as the top-selling U.S. beer by volume, even if revenue has lagged. Meanwhile, other Anheuser-Busch beer brands are performing better than they did before the boycott.
Some wholesalers expressed optimism about Bud Light’s outlook and praised Anheuser-Busch for providing financial support in response to the sales slump. They also downplayed the boycott’s impact, attributing much of the sales decline to a wider shift away from beer to other alcoholic drinks.
“The beer industry — no matter what product you’re selling — is down in sales,” Tom Davis, director of operations at Maryland-based Katcef Brothers, Inc., an Anheuser-Busch wholesaler, told ABC News. “That has a bigger impact on beer sales than anything.”
An Anheuser-Busch spokesperson shared a statement from a wholesaler with ABC News.
“Anheuser-Busch recognizes the vital role their wholesaler partners play in the business, and last year they stepped in to provide critical resources to ensure we were positioned to continue serving our consumers and communities across the country,” Sarah Matesich Schwab, President of Ohio-based Matesich Distributing, said in the statement.
“There’s lots of positive momentum in the system, and we are focused on strengthening our partnership so that we can continue to grow and succeed together,” Matesich Schwab added.
The enduring impact of the Bud Light boycott defies a decadeslong history of largely ineffective consumer boycotts, Maurice Schweitzer, a professor at the University of Pennsylvania’s Wharton School of Business who studies consumer movements, told ABC News.
The continued struggle of Bud Light owes to the easy availability of similar products as well as the highly polarized political environment nationwide, Schweitzer said.
“Given the history of boycotts and its history of ineffectiveness, it is really surprising that this one has had the staying power that it has,” Schweitzer told ABC News.
“In this moment, we’re so politicized,” Schweitzer added. “The weather is political, the employment rate is political and now beer is political.”
(WASHINGTON) — The Federal Reserve decided to hold its benchmark interest rate steady on Wednesday, prolonging an aggressive fight against inflation despite fresh data hours earlier that showed a slight cooldown of price increases.
At seven consecutive meetings spanning nearly a year, the Fed has opted to hold rates steady in response to elevated inflation and robust economic performance.
In theory, the prolonged stretch of high interest rates should weigh on economic activity, reduce consumer demand and cut prices. Instead, a resilient economy and stubborn inflation have largely defied the Fed’s efforts.
Inflation has fallen significantly from a peak of 9.1%, but price increases have barely budged in recent months and remain more than a percentage point higher than the Fed’s target rate of 2%.
The Fed has all but abandoned a previous forecast of three interest rate cuts by the end of the year.
The Federal Open Market Committee, the Fed’s decision-making body on interest rates, said last month that it does not anticipate cutting interest rates until it regains confidence that inflation is moving sustainably downward.
“So far, the data has not given us that greater confidence,” Fed Chair Jerome Powell said at a press conference in Washington, D.C., last month. “It is likely that gaining such greater confidence will take longer than previously expected.”
Some observers expect the Fed to forgo interest rate cuts for the remainder of 2024.
Roger Aliaga-Diaz, chief economist at the investment giant Vanguard, said in a statement to ABC News before the rate announcement that he believed the Fed would keep interest rates at current levels for at least the next six months.
The forecast, Aliaga-Diaz added, owes to “inadequate progress in the inflation fight and continued growth and labor momentum.”
In a note to clients, Deutsche Bank echoed skepticism about rate cuts anytime soon. “Fed officials have clearly signaled that they are in a wait-and-see mode with respect to the timing and magnitude of rate cuts,” the note said.
The Fed risks a rebound of inflation if it cuts interest rates too quickly, since stronger consumer demand on top of solid economic activity could lead to an acceleration of price increases.
A prolonged period of high interest rates, however, threatens to place downward pressure on economic growth and plunge the U.S. into a recession.
A jobs report released on Friday blew past economist expectations, demonstrating the resilient strength of the economy. Blockbuster hiring in May exceeded the average number of jobs added each month over the previous year, the U.S. Bureau of Labor Statistics said.
Average hourly wages surged 4.1% over the year ending in May, the report found. That rate of pay increase exceeds the pace of inflation, indicating that the spending power of workers has grown even as prices jump.
The data marks a boon for workers but could give pause to policymakers, since they fear that a rise in pay could prompt businesses to raise prices in order to cover the added labor cost.
Economic output slowed markedly at the outset of 2024, though it continued to grow at a solid pace.
While the Fed has resisted lowering interest rates, consumers have faced high borrowing costs for everything from mortgages to credit cards.
The average rate for a 30-year fixed mortgage stands at 6.99%, according to Freddie Mac data released last week.
When the Fed imposed its first rate hike of the current series in March 2022, the average 30-year fixed mortgage stood at just 3.85%, Freddie Mac data showed.
(WASHINGTON) — Consumer prices rose 3.3% in May compared to a year ago, easing slightly from the previous month and outperforming economists’ expectations.
The data arrived hours before the Federal Reserve is set to announce a decision about whether to move its benchmark interest rate.
Price increases have slowed significantly from a peak of about 9%, but inflation still stands more than a percentage point higher than the Federal Reserve’s target rate of 2%.
For nearly a year, the Fed has held interest rates steady at their highest level since 2001, hoping that elevated borrowing costs would slow economic activity, reduce consumer demand and lower prices.
Instead, the economy has hummed along and price increases have largely stalled.
A jobs report released on Friday blew past economist expectations, demonstrating the resilient strength of the economy. Blockbuster hiring in May exceeded the average number of jobs added each month over the previous year, the U.S. Bureau of Labor Statistics said.
Average hourly wages surged 4.1% over the year ending in May, the report found. That rate of pay increase exceeds the pace of inflation, indicating that the spending power of workers has grown even as prices jump.
The data marks a boon for workers but could give pause to policymakers, since they fear that a rise in pay could prompt businesses to raise prices in order to cover the added labor cost.
Economic output slowed markedly at the outset of 2024, though it continued to grow at a solid pace.
The Fed, in turn, has all but abandoned a previous forecast of three interest rate cuts by the end of the year.
The Federal Open Market Committee, the Fed’s decision-making body on interest rates, said last month that it does not anticipate cutting interest rates until it retains confidence that inflation is moving sustainably downward.
“So far the data has not given us that greater confidence,” Fed Chair Jerome Powell said at a press conference in Washington, D.C., last month. “It is likely that gaining such greater confidence will take longer than previously expected.”
Economists expect the Fed to hold interest rates steady for the seventh consecutive time at the close of its meeting on Wednesday.
The Fed risks a rebound of inflation if it cuts interest rates too quickly, since stronger consumer demand on top of solid economic activity could lead to an acceleration of price increases.
A prolonged period of high interest rates, however, threatens to place downward pressure on economic growth and plunge the U.S. into a recession.
Price increases have drawn attention from voters as the U.S. hurtles toward what appears to be a closely contested presidential election in the fall.
Eighty-five percent of U.S. adults surveyed by ABC News/Ipsos last month said inflation is an important issue, making it the second-highest priority among adults surveyed. The top priority, the economy, also relates to individuals’ perceptions of price increases.
On each of those issues, the economy and inflation, those surveyed by ABC News/Ipsos said they trusted former President Donald Trump over President Joe Biden by a margin of 14 percentage points.
“Inflation is something that affects absolutely everybody,” Elaine Kamarck, a senior fellow in the Governance Studies program at the Brookings Institution, previously told ABC News. “People notice it, whether they’re rich or poor.”
(WASHINGTON) — The release of inflation data on Wednesday will reveal the latest movement for consumer prices, which continue to strain households and top surveys of voter priorities less than five months before the November election.
The data will arrive hours before the Federal Reserve announces a decision about whether to move its benchmark interest rate.
Economists expect prices to have risen 3.4% over the year ending in May, which would leave the inflation rate unchanged from the previous month. Such a reading would extend a bout of stubborn inflation that stretches back to last year.
Price increases have slowed significantly from a peak of about 9%, but inflation still stands more than a percentage point higher than the Federal Reserve’s target rate of 2%.
For nearly a year, the Fed has held interest rates steady at their highest level since 2001, hoping that elevated borrowing costs would slow economic activity, reduce consumer demand and lower prices.
Instead, the economy has hummed and price increases have stalled.
A jobs report released on Friday blew past economist expectations, demonstrating the resilient strength of the economy. Blockbuster hiring in May exceeded the average number of jobs added each month over the previous year, the U.S. Bureau of Labor Statistics said.
Average hourly wages surged 4.1% over the year ending in May, the report found. That rate of pay increase exceeds the pace of inflation, indicating that the spending power of workers has grown even as prices jump.
The data marks a boon for workers but could give pause to policymakers, since they fear that a rise in pay could prompt businesses to raise prices in order to cover the added labor cost.
Economic output slowed markedly at the outset of 2024, though it continued to grow at a solid pace.
The Fed, in turn, has all but abandoned a previous forecast of three interest rate cuts by the end of the year.
The Federal Open Market Committee, the Fed’s decision-making body on interest rates, said last month that it does not anticipate cutting interest rates until it retains confidence that inflation is moving sustainably downward.
“So far the data has not given us that greater confidence,” Fed Chair Jerome Powell said at a press conference in Washington, D.C., last month. “It is likely that gaining such greater confidence will take longer than previously expected.”
Economists expect the Fed to hold interest rates steady for the seventh consecutive time at the close of its meeting on Wednesday.
The Fed risks a rebound of inflation if it cuts interest rates too quickly, since stronger consumer demand on top of solid economic activity could lead to an acceleration of price increases.
A prolonged period of high interest rates, however, risks placing downward pressure on economic growth and plunging the U.S. into a recession.
Price increases have drawn attention from voters as the U.S. hurtles toward what appears to be a closely contested presidential election in the fall.
Eighty-five percent of U.S. adults surveyed by ABC News/Ipsos last month said inflation is an important issue, making it the second-highest priority among adults surveyed. The top priority, the economy, also relates to individuals’ perceptions of price increases.
On each of those issues, the economy and inflation, those surveyed by ABC News/Ipsos said they trusted former President Donald Trump over President Joe Biden by a margin of 14 percentage points.
“Inflation is something that affects absolutely everybody,” Elaine Kamarck, a senior fellow in the Governance Studies program at the Brookings Institution, previously told ABC News. “People notice it, whether they’re rich or poor.”
(WASHINGTON) — The Federal Reserve on Wednesday will announce its latest decision on interest rates, just hours after fresh inflation data is set to reveal the status of the central bank’s fight to slow price increases.
At six consecutive meetings spanning nearly a year, the Fed has opted to hold rates steady in response to elevated inflation and robust economic performance. Economists expect the Fed to continue that approach on Wednesday.
In theory, the prolonged stretch of high interest rates should weigh on economic activity, reduce consumer demand and cut prices. Instead, a resilient economy and stubborn inflation have defied the Fed’s efforts.
Inflation has fallen significantly from a peak of 9.1%, but price increases have held steady in recent months and remain more than a percentage point higher than the Fed’s target rate of 2%.
The Fed has all but abandoned a previous forecast of three interest rate cuts by the end of the year.
The Federal Open Market Committee, the Fed’s decision-making body on interest rates, said last month that it does not anticipate cutting interest rates until it retains confidence that inflation is moving sustainably downward.
“So far the data has not given us that greater confidence,” Fed Chair Jerome Powell said at a press conference in Washington, D.C., last month. “It is likely that gaining such greater confidence will take longer than previously expected.”
Some observers expect the Fed to forgo interest rate cuts for the remainder of 2024.
Roger Aliaga-Diaz, chief economist at the investment giant Vanguard, said in a statement to ABC News that the Fed would keep interest rates at current levels for at least the next six months.
The forecast, Aliaga-Diaz added, owes to “inadequate progress in the inflation fight and continued growth and labor momentum.”
In a note to clients, Deutsche Bank echoed skepticism about rate cuts anytime soon.
“Fed officials have clearly signaled that they are in a wait-and-see mode with respect to the timing and magnitude of rate cuts,” the note said.
The Fed risks a rebound of inflation if it cuts interest rates too quickly, since stronger consumer demand on top of solid economic activity could lead to an acceleration of price increases.
A prolonged period of high interest rates, however, threatens to place downward pressure on economic growth and plunge the U.S. into a recession.
A jobs report released on Friday blew past economist expectations, demonstrating the resilient strength of the economy. Blockbuster hiring in May exceeded the average number of jobs added each month over the previous year, the U.S. Bureau of Labor Statistics said.
Average hourly wages surged 4.1% over the year ending in May, the report found. That rate of pay increase exceeds the pace of inflation, indicating that the spending power of workers has grown even as prices jump.
The data marks a boon for workers but could give pause to policymakers, since they fear that a rise in pay could prompt businesses to raise prices in order to cover the added labor cost.
Economic output slowed markedly at the outset of 2024, though it continued to grow at a solid pace.
While the Fed has resisted lowering interest rates, consumers have faced high borrowing costs for everything from mortgages to credit cards.
The average rate for a 30-year fixed mortgage stands at 6.99%, according to Freddie Mac data released last week.
When the Fed imposed its first rate hike of the current series in March 2022, the average 30-year fixed mortgage stood at just 3.85%, Freddie Mac data showed.
(WASHINGTON) — In a sweeping change that could improve millions of Americans’ ability to own a home or buy a car, the Biden administration will propose a rule Tuesday to ban medical debt from credit reports.
The rule, which will be announced by Vice President Kamala Harris and Consumer Financial Protection Bureau Director Rohit Chopra, comes as President Joe Biden beefs up his efforts to convince Americans his administration is lowering costs, a chief concern for voters in the upcoming election.
The rule, which has been in the works since September, could go into effect sometime next year, Chopra told ABC News in an exclusive interview ahead of the policy announcement.
“Our research shows that medical bills on your credit report aren’t even predictive of whether you’ll repay another type of loan. That means people’s credit scores are being unjustly and inappropriately harmed by this practice,” Chopra said.
CFPB’s research estimates that the new rule would allow 22,000 more people to get approved for safe mortgages each year — meaning lenders could also benefit from the positive impact on peoples’ credit scores, by being able to approve more borrowers.
Some major credit report companies have already stopped using medical debt to calculate peoples’ credit worthiness, including Equifax, TransUnion and Experian. FICO and VantageScore also recently started factoring medical debt less heavily into their scores.
But 15 million Americans still have $49 billion of medical debt that is hampering their scores, the CFPB found. This rule would extend the practice to all credit reporting in the U.S.
Medical debt is extensive in the U.S. It affects two in every five Americans, according to the health policy research organization KFF, and a vast majority have debt in the thousands.
Once those debts go to collections, credit scores take a hit, which means car and home loans are harder to come by or are only offered with high interest rates — leading to a slippery slope for people who are already struggling with their bills.
Lexi Coburn, 33, first ran into that issue nearly a decade ago. She took on medical debt in 2013, when she was 23 years old and uninsured.
Her feet were too swollen to walk, so she went to the emergency room, unsure where else she could go to get medical care without insurance. She was told she had early onset arthritis.
The $425 bill from that visit was not in Coburn’s budget, so she left it unpaid. Growing up, her family frequently didn’t have the income to cover medical expenses, she said, and she felt ill-equipped to handle the medical system any differently as a young adult.
Though she was later able to enroll in health insurance through the Affordable Care Act, Coburn’s medical debt still grew to over $2,300 — including another $1,532 from dental work and a separate ER visit, both in 2019.
The consequences became clear when she tried to get a car.
“Immediately my medical debt was in the way of qualifying for a good loan that didn’t have an outrageous payment per month,” Coburn said.
“The most frustrating aspect for me was in my mid 20s, when I wasn’t making a lot of money, I needed to be able to get transportation to get to my job,” Coburn said.
She saw a perilous financial cycle mounting. Coburn’s bills and subsequently low credit score got in the way of “being able to thrive enough to pay off the debt,” she said. “So it just felt like a domino effect.”
The new CFPB rule also seeks to address the issue of incorrect, confusing and complicated medical bills, which often lead to long, drawn-out disputes between patients and billing departments — a complaint that the CFPB, as the agency tasked with consumer empowerment, receives in droves, Chopra said.
“Too often, we see that people are receiving bills that are inaccurate. Many patients are fighting over these bills for months, only to find that it then appears on their credit report,” he said.
Experts who support the CFPB’s proposed rule also point to the already-low success rate for collecting on medical bills.
“We know empirically that the repayment rates are incredibly low for medical debt, and so it’s already the case that people aren’t really paying it down. So I don’t think this policy change is going to change the behavior that dramatically,” said Matt Notowidigdo, a professor at University of Chicago’s Booth School of Business who studies health economics.
Linda Davis, a 61-year-old resident of Grand Rapids, Michigan, has chronic obstructive pulmonary disease, a type of lung disease, and uses a power wheelchair because of a lower back injury. She said she doesn’t think she’ll ever pay off her medical bills, which she estimates to be between $45,000 and $50,000.
“People might be mistaken and think, oh, well, she’s got Medicare, she’s all set. That’s not the case at all, and it can screw your whole life up. It takes control of your whole life,” Davis said.
She said her monthly income covers rent, electricity, her cell phone bill and groceries, but that she doesn’t have room in her budget for her medical bills.
“You find out [after the procedure], you’ve got all these medical bills, and what are you supposed to do with them all? You know, there’s no way on God’s green earth I could pay all those medical bills. Even if I paid a small amount every month, I wouldn’t live long enough to pay them all,” Davis said.
To Notowidigdo and many other health economists, addressing the root cause of America’s medical debt issue would mean enrolling more people in adequate health care coverage on the front end, “rather than dealing with unpaid medical bills from lack of insurance or not generous enough insurance on the back end,” he said.
Of course, for now, those large bills and low repayment rates are already a challenge for hospitals and health care systems.
If the CFPB rule leads to fewer people paying the bills, it could be the patients who suffer, some experts warned.
Ge Bai, a professor who studies accounting health policy at Johns Hopkins University, predicted that hospitals will have to make up for that loss in other ways. More stringent payment efforts, like requiring payment before patients receive medical care, could leave low-income patients worse off.
“I think in the short run, it will be great news for patients, and probably we’ll see patient advocacy groups pushing it. However, I think in the long-run, when the long-term negative effects emerge, probably we’re going to see more pushback,” Bai said.
Industry groups, like the Association of Credit and Collection Professionals, have echoed Bai’s concerns.
“There’s too much at stake for Americans’ access to quality health care by taking actions that only negatively affect the cash flow to the health care community without finding ways to replace those funds,” ACA CEO Scott Purcell said when CFPB first announced it was looking into the policy change.
Chopra rejected the notion that more people will default on their health care debts as a result of the rule, saying they’ll still have to face other penalties that come with debt.
“Those individuals will still be subject to collection actions, lawsuits and more. There are plenty of ways that people get penalized for not paying their bills. I just don’t want to see the credit reporting system be weaponized against people who already paid them,” Chopra said.
Former Theranos CEO Elizabeth Holmes alongside her boyfriend Billy Evans, walks back to her hotel following a hearing at the Robert E. Peckham U.S. Courthouse on March 17, 2023 in San Jose, California. (Philip Pacheco/Getty Images)
(SAN FRANCISCO) — Disgraced Theranos founder Elizabeth Holmes’ appeal will be heard at a federal courthouse in San Francisco on Tuesday.
The hearing arrives one year after Holmes began a more than 11-year sentence at a Texas prison for defrauding investors with false claims about her company’s blood-testing technology.
In a 47-page court filing in November, Holmes’ attorneys said the prosecution failed to prove a cornerstone of its case: that Holmes hoodwinked investors while knowing full well the deficiencies of her product.
“The public narrative regarding the spectacle of Theranos’ downfall is that the company’s technology simply did not work and Holmes knew it,” Holmes’ attorneys wrote. “But Holmes’ intent and knowledge on this central question were intensely contested at trial.”
“Substantial evidence showed that Holmes and Theranos’ scientists believed in good faith that Theranos had developed technology that could accurately run virtually any blood test,” the attorneys added.
Holmes’ attorneys focused their appeal on the judge’s decision to permit testimony from ex-Theranos clinical lab director Kingshuk Das as a source of information about key events rather than as an expert witness.
The defense also took issue with limits placed on cross-examination of another key witness and the case’s treatment of voided blood test results.
In a previous filing, the prosecution strongly rebuked the alleged grounds for appeal. Prosecution attorneys challenged allegations of missteps in the case and cited evidence of misrepresentations about the product made by Holmes.
“Her claims are meritless, but, regardless, unavailing given the overwhelming evidence and independent categories of fraudulent statements Holmes made,” prosecutors said in a court filing last August.
Judge Edward Davila, who oversaw the trial of Holmes, ordered her to report to prison last year after the U.S. Court of Appeals for the Ninth Circuit denied her request to remain free pending an appeal.
In denying a previous attempt to delay Holmes’ prison sentence, Davila said she had failed to raise a “‘substantial question of law or fact’ that is ‘likely to result in a reversal or an order for a new trial on all counts.'”
The appeal hearing on Tuesday marks the latest development in a legal saga that turned the former billionaire entrepreneur, who swore her startup could run hundreds of tests on a single drop of blood, into a symbol of excess and deception in Silicon Valley.
Ramesh “Sunny” Balwani, the former romantic partner of Holmes and president of the now defunct blood testing company, began serving his nearly 13-year sentence at a prison in San Pedro, California, last April. Balwani, who was second in command to Holmes at Theranos, was convicted of fraud and conspiracy.
In November 2022, Holmes was sentenced to 135 months, or 11 1/4 years, in prison.
Holmes was convicted the following January on four counts of investor fraud and conspiracy while at the helm of Theranos.
The verdict followed a four-month trial that detailed Holmes’ trajectory from a Stanford University dropout in 2003 to a star business leader on the cover of Fortune magazine a little more than a decade later.
But in October 2015, a bombshell Wall Street Journal report came out, detailing the turmoil within Theranos. As Holmes and her company were hit with official scrutiny, her fortune quickly dwindled. Less than a year later, Forbes downgraded its assessment of Holmes’ net worth from $4.5 billion to $0.
(CUPERTINO, Calif.) — Apple unveiled artificial intelligence-fueled features across several key products on Monday, heralding the long-awaited entry of the tech giant into the high-stakes AI race.
The latest version of Apple’s operating system will deliver customizable tools using generative AI for iPhones, Mac and iPad, Apple said at the Worldwide Developers Conference hosted at the company’s headquarters in Cupertino, California. Language tools will be able to improve or summarize text, and image generators will supplement photos with extra adornment.
The AI capability, called Apple Intelligence, amounts to the “next big step for Apple,” CEO Tim Cook said on Monday. The advance results from an agreement between Apple and OpenAI, the firm behind popular text bot ChatGPT, Cook added.
A revamped Siri, for instance, will draw on generative chat technology to improve its language comprehension and retain context from previous requests, the company said.
Since its launch in 2011, Siri has functioned primarily as a hands-free tool for responses to specific prompts, such as queries about the weather or a user’s upcoming calendar. The new version, Apple said, will carry out extended conversations and aid in intricate tasks.
Further, Siri will be able to take actions within a user’s product, pulling up photos or adding text to the Notes app, the company said.
Apple, the world’s second largest company in terms of market capitalization, has lagged behind its behemoth competitors in the battle to develop and offer AI products.
OpenAI retains a longstanding partnership with Microsoft, which holds a minority stake in the firm and integrates ChatGPT into its Bing search engine. Last year, Google announced its own AI model called Bard, which provides brief summaries in response to some search queries.
The announcement on Monday amounts to the most important decision for Apple — and Cook — over the last decade, Dan Ives, a managing director of equity research at the investment firm Wedbush, told clients in a research note ahead of the conference.
“The pressure to bring a generative AI stack of technology for developers and consumers is front and center,” Ives said.
The fresh product arrives at a moment of relatively sluggish performance for Apple.
In its latest earnings report, Apple last month revealed a sales slump for some of its mainstay products. Smartphone sales dropped 10% over the three months ending in March, when compared with the same period a year earlier. iPad sales fell 17% over that period, the earnings report said.
In recent years, the company has relied on new models of its signature items, instead of transitioning to the next big product, analysts previously told ABC News.
The approach allows Apple to capitalize upon its loyal customer base and popular devices while it develops new products like Apple Vision Pro, the company’s mixed reality headset, analysts said.
With a starting cost of $3,499 and a higher-powered version at around $4,000, Apple Vision Pro remains far from a price point that would make it affordable for a wide audience.
