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The Morning Risk Report: U.S. Policy on Cuba Sanctions Threatens EU Ties
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U.S. Secretary of State Mike Pompeo has repeatedly shortened a waiver to warn companies off further investments in Cuba. PHOTO: STEFANI REYNOLDS/CNP/ZUMA PRESS
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Good morning. The Trump administration plans to intensify pressure against Cuba by allowing U.S. nationals to lodge claims against foreign companies that do business there, a senior U.S. official said, setting up a fresh front in the U.S.’s widening economic rift with Europe.
The U.S. decision to end a two-decade-old waiver on a key part of the 1996 Helms-Burton Act comes after top European Union officials privately warned last week that doing so could lead the bloc to sue the U.S. at the World Trade Organization and may result in European courts imposing economic penalties against U.S. companies, according to a letter seen by The Wall Street Journal.
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The decision, expected to be announced Wednesday, is the latest measure the Trump administration is taking to pressure the governments of Cuba, Venezuela and Nicaragua, which the administration has dubbed Latin America’s “Troika of Tyranny.” U.S. officials have framed the move as a way of targeting Cuba over its human-rights record and over its support for the Maduro government in Venezuela.
The Trump administration also intends to impose additional sanctions on Cuba, Nicaragua and Venezuela as part of the crackdown, the U.S. official said.
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Tesla CEO Elon Musk arrived for a hearing earlier this month in New York; his team is negotiating with the SEC over an unusual settlement that affected his use of Twitter. PHOTO: NATAN DVIR/BLOOMBERG NEWS
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Elon Musk agreed with the government last year to have Tesla Inc. lawyers preapprove tweets that “reasonably could contain” material information about the electric car maker’s business. Those words are now at the center of court-ordered talks between the two parties over his 2018 civil-fraud settlement.
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Justice Department staffers have told T-Mobile US Inc. and Sprint Corp. that their planned merger is unlikely to be approved as currently structured, according to people familiar with the matter, casting doubt on the fate of the $26 billion deal. Their most immediate hurdle comes from the Justice Department’s antitrust division, which is considering whether the deal would present an unacceptable threat to competition.
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Apple Inc. and Qualcomm Inc. agreed to dismiss all litigation between the two companies world-wide, ending a long-brewing legal battle over how royalties are collected on innovations in smartphone technology. The settlement includes an undisclosed payment from Apple to Qualcomm and resolves all patent litigation involving the contract manufacturers Apple enlists to make iPhones and iPads.
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Progressive Corp. said it believes the sponsor of three federal renewable-energy tax-credit funds the company invested in committed fraud, and the insurer has reversed previous tax credits and other benefits it recorded related to the investments. The Mayfield Village, Ohio, insurance provider, which said it invested in the funds sponsored by DC Solar Solutions Inc. between 2016 and 2018, said it learned of allegations of potential fraudulent conduct and federal investigations in late December and the first two months of 2019.
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The U.S. Food and Drug Administration ordered two makers of surgical mesh for women’s pelvic repair to take their products off the market, responding to years of complaints about pain, bleeding and scarring from the devices. The federal agency said that Boston Scientific Corp. and Coloplast Corp. hadn’t demonstrated reasonable evidence that the mesh products worked better than surgery without the products.
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The Justice Department wants to bring to an end its breakup of Standard Oil Co., which started in 1911, along with its efforts to ensure competition in the markets for horseshoes and player-piano rolls.
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A worker places vinyl records in sleeves at the United Record Pressing facility in Nashville, Tenn., in March. PHOTO: EILON PAZ/BLOOMBERG NEWS
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American manufacturing production failed to bounce back last month after slumping earlier in the year, showing the global slowdown is squeezing a key sector of the U.S. economy. The manufacturing sector has sent mixed signals in recent weeks, but Federal Reserve data reinforces the view that manufacturing has hit a soft patch.
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Canola producers and shippers estimate Canada’s canola production could drop about 10% this year, reversing a decade of booming growth for the world’s largest producer and exporter of canola, which is primarily used to make vegetable oil. The reason is the abrupt retreat of the country’s largest canola customer, China, which last month banned imports of the seed from Canada amid a diplomatic row over the arrest of a Huawei Technologies Co. executive.
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Rajeev Suri, Nokia chief executive, during an event in Barcelona. PHOTO: ANGEL GARCIA/BLOOMBERG NEWS
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Nokia Corp., the onetime cellphone pioneer, is looking to capitalize on the U.S.’s efforts. The Finnish company, which had nearly disappeared, has transformed itself into a global manufacturer of telecommunications equipment and is now the world’s No. 2 player behind Huawei. Nokia’s sales staff has cold-called wireless carriers in countries where the U.S. has stepped up its anti-China rhetoric, pushing its gear as an alternative.
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Boeing 737 Max airplanes are seen at the company's manufacturing facility in Renton, Wash., on March 27. PHOTO: DAVID RYDER/BLOOMBERG NEWS
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Fixing the grounded 737 MAX plane is only one of Boeing Co.’s daunting tasks in recovering from two fatal crashes of the jet. Another is trying to repair its reputation with airlines, pilots and passengers world-wide. Boeing is in an unfamiliar position because, unlike other airliner crashes since the early 1990s, investigators are questioning elements of the plane’s design and Boeing’s actions. Meanwhile, two proxy advisory firms say that Boeing Co. shareholders would benefit from seeing the chairman and chief executive roles separated following two fatal
crashes of its 737 Max plane.
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Sony Corp. is cracking down on sexual content in PlayStation 4 videogames, reflecting concerns in the U.S. about the depiction of women in games but also irritating some software developers. New in-house standards that limit sexually explicit content distinguish Sony from other game-hardware makers that allow more leeway. Sony officials say the company has grown concerned that its global reputation could take a hit from sexually explicit content sold in some markets.
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Artrendex CEO Ahmed Elgammal, right, works with his team inside a Spaces office. PHOTO: ANDREW MITCHELL FOR THE WALL STREET JOURNAL
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The world’s largest flexible-office company, trying to fend off a challenge from upstart WeWork Cos., is harking back to a business model popularized decades ago by fast-food chain McDonald’s Corp. IWG PLC, which manages office brands such as Regus, Spaces and No. 18, is looking to accelerate growth through franchising.
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A pair of technology unicorns will launch themselves into the public markets Thursday, hoping the messy recent debut of Lyft Inc. is in the rearview mirror. Online image board Pinterest Inc. will price its shares Wednesday evening. People familiar with the matter say it is likely to price above its proposed range. It may be eclipsed in valuation by Zoom Video Communications Inc.
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