Israel and Hamas Step Up Air Attacks in Gaza Clash

Wissam Nassar for The New York Times

The Gaza City funeral on Thursday of Ahmed al-Jabari, the Hamas military commander, killed in an Israeli attack. More Photos »

KIRYAT MALACHI, Israel — Israel and Hamas brushed aside international calls for restraint on Thursday and escalated their lethal conflict over Gaza, where Palestinian militants launched hundreds of rockets into Israeli territory, targeting Tel Aviv for the first time, and Israel intensified its aerial assaults and sent armored vehicles rumbling toward the Gaza border for a possible invasion.

Defense Minister Ehud Barak of Israel, expressing outrage over a pair of long-range Palestinian rockets that whizzed toward Tel Aviv and set off the first air-raid warning in the Israeli metropolis since it was threatened by Iraqi Scuds in the Persian Gulf war of 1991, said, “There will be a price for that escalation that the other side will have to pay.”

He authorized the call-up of 30,000 army reservists if needed, another sign that Israel was preparing to invade Gaza for the second time in four years to crush what it considers an unacceptable security threat from smuggled rockets amassed by Hamas, the militant Islamist group that governs the isolated coastal enclave and does not recognize Israel’s right to exist.

It was not clear whether the show of Israeli force on the ground in fact portended an invasion or was meant as more of an intimidation tactic to further pressure Hamas leaders, who had all been forced into hiding on Wednesday after the Israelis killed the group’s military chief, Ahmed al-Jabari, in a pinpoint aerial bombing. But Prime Minister Benjamin Netanyahu of Israel said he was prepared to “take whatever action is necessary.”

Tel Aviv was not hit on Thursday. One rocket crashed into the sea off its coast and another apparently fell, the ability of militants 40 miles away to fire those weapons at the city of 400,000 underscored, in the Israeli government’s view, the justification for the intensive aerial assaults on hundreds of suspected rocket storage sites and other targets in Gaza.

Health officials in Gaza said at least 19 people, including five children and a pregnant teenager, had been killed over two days of nearly nonstop aerial attacks by Israel, and dozens had been wounded. Three Israelis were killed on Thursday in Kiryat Malachi, this small southern Israeli town, when a rocket fired from Gaza struck their apartment house.

In a sign of solidarity with Hamas as well as a diplomatic move to ease the crisis, President Mohamed Morsi of Egypt ordered his prime minister to lead a delegation to Gaza on Friday. In another diplomatic signal, Ban Ki-moon, the United Nations secretary general, also planned to visit Jerusalem, Cairo and Ramallah, the West Bank headquarters of the Palestinian Authority, in coming days.

In Washington, Obama administration officials said they had asked friendly Arab countries with ties to Hamas, which the United States and Israel regard as a terrorist group, to use their influence to seek a way to defuse the hostilities. At the same time, however, a State Department spokesman, Mark C. Toner, reiterated to reporters the American position that Israel had a right to defend itself from the rocket fire and that the “onus was on Hamas” to stop it.

The Pentagon said late Thursday that Defense Secretary Leon E. Panetta spoke to Mr. Barak this week about Israeli operations in and around Gaza and condemned the violence carried out by Hamas and other groups against Israel.

There was no sign that either side was prepared, at least not yet, to restore the uneasy truce that was forged the last time the Israelis invaded Gaza in the winter of 2008-9, a three-week war that left 1,400 Palestinians dead and drew widespread international condemnation.

Denunciations of Israel for what critics called a renewal of its aggressive and disproportionate attacks spread quickly on the second day of the aerial assaults. The biggest criticism came from the 120-nation Nonaligned Movement, the largest bloc at the United Nations. In a statement released by Iran, which holds the group’s rotating presidency and is one of Israel’s most ardent foes, the group said: “Israel, the occupying power, is, once more, escalating its military campaign against the Palestinian people, particularly in the Gaza Strip.” The group made no mention of the Palestinian rocket fire aimed at Israel but condemned “this act of aggression by the Israelis and their resort to force against the defenseless people” and demanded “decisive action by the U.N. Security Council.”

Isabel Kershner reported from Kiryat Malachi, and Rick Gladstone from New York. Reporting was contributed by Fares Akram from Gaza, Mayy El Sheikh and David D. Kirkpatrick from Cairo, Alan Cowell from Paris and Elisabeth Bumiller from Bangkok.

Isabel Kershner reported from Kiryat Malachi, and Rick Gladstone from New York. Reporting was contributed by Fares Akram from Gaza, Rina Castelnuovo from Kiryat Malachi, Mayy El Sheikh and David D. Kirkpatrick from Cairo, Gabby Sobelman from Jerusalem, Alan Cowell from Paris and Elisabeth Bumiller from Bangkok.

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Ruckus Wireless prices IPO at high end of range: market source

(Reuters) – WiFi products maker Ruckus Wireless Inc priced its initial public offering at $ 15 per share, the high end of its expected price range, a market source told Reuters.

The company, which is backed by Google Inc‘s Motorola Mobility LLC and venture capital firm Sequoia Capital, raised $ 126 million by selling 8.4 million shares.

Ruckus offered 7 million shares while selling shareholders, including Telus Corp, offered 1.4 million shares.

The Sunnyvale, California-based company, which makes wireless LAN products for both indoor and outdoor use, competes with Meru Networks Inc and Aruba Networks Inc.

The company’s customers include Time Warner Cable Inc, Towerstream Corp, Tikona Digital Networks and Bright House Networks.

Goldman Sachs & Co and Morgan Stanley are the lead underwriters to the offering.

The company’s shares are expected to begin trading on the New York Stock Exchange on Friday under the ticker symbol “RKUS”.

(This story was fixed to correct description of Sequoia Capital to venture capital firm in paragraph 2)

(Reporting by Sharanya Hrishikesh and Ashutosh Pandey in Bangalore; Editing by Sriraj Kalluvila)

Wireless News Headlines – Yahoo! News

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Hope Solo Weds Jerramy Stevens Amid Assault Allegations?

By Dahvi Shira

11/14/2012 at 06:35 PM EST

Jerramy Stevens and Hope Solo

NFL/Getty; Jeff Vinnick/Getty

One day after former Seattle Seahawks tight end Jerramy Stevens was arrested on suspicion of assaulting his fiancée, U.S. women's soccer team goalkeeper Hope Solo, the pair reportedly tied the knot.

"Confirmed," Sportsradio 950 AM and 102.9 FM radio host Dave Mahler Tweeted on Tuesday. "Jerramy Stevens and Hope Solo were married tonight. Events of yesterday morning didn't change plans."

The pair, who had only been dating for about two months, applied for a marriage license last Thursday. According to court documents, the athletes were arguing over whether to wed in Florida or Washington State.

Stevens, 33, was reportedly released from custody by a Kirkland, Wash., Municipal Court judge on Tuesday after determining there wasn't enough evidence to hold the former football star.

All of the former Dancing with the Stars contestant's social media pages have gone silent since Nov. 6., and calls to her rep have not been returned.

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Booze calories nearly equal soda's for US adults

NEW YORK (AP) — Americans get too many calories from soda. But what about alcohol? It turns out adults get almost as many empty calories from booze as from soft drinks, a government study found.

Soda and other sweetened drinks — the focus of obesity-fighting public health campaigns — are the source of about 6 percent of the calories adults consume, on average. Alcoholic beverages account for about 5 percent, the new study found.

"We've been focusing on sugar-sweetened beverages. This is something new," said Cynthia Ogden, one of the study's authors. She's an epidemiologist with the Centers for Disease Control and Prevention which released its findings Thursday.

The government researchers say the findings deserve attention because, like soda, alcohol contains few nutrients but plenty of calories.

The study is based on interviews with more than 11,000 U.S. adults from 2007 through 2010. Participants were asked extensive questions about what they ate and drank over the previous 24 hours.

The study found:

—On any given day, about one-third of men and one-fifth of women consumed calories from beer, wine or liquor.

—Averaged out to all adults, the average guy drinks 150 calories from alcohol each day, or the equivalent of a can of Budweiser.

—The average woman drinks about 50 calories, or roughly half a glass of wine.

—Men drink mostly beer. For women, there was no clear favorite among alcoholic beverages.

—There was no racial or ethnic difference in average calories consumed from alcoholic beverages. But there was an age difference, with younger adults putting more of it away.

For reference, a 12-ounce can of regular Coca-Cola has 140 calories, slightly less than a same-sized can of regular Bud. A 5-ounce glass of wine is around 100 calories.

In September, New York City approved an unprecedented measure cracking down on giant sodas, those bigger than 16 ounces, or half a liter. It will take effect in March and bans sales of drinks that large at restaurants, cafeterias and concession stands.

Should New York officials now start cracking down on tall-boy beers and monster margaritas?

There are no plans for that, city health department officials said, adding in a statement that while studies show that sugary drinks are "a key driver of the obesity epidemic," alcohol is not.

Health officials should think about enacting policies to limit alcoholic intake, but New York's focus on sodas is appropriate, said Margo Wootan, director of nutrition policy for the Center for Science in the Public Interest, a public health advocacy group.

Soda and sweetened beverages are the bigger problem, especially when it comes to kids — the No. 1 source of calories in the U.S. diet, she said.

"In New York City, it was smart to start with sugary drinks. Let's see how it goes and then think about next steps," she said.

However, she lamented that the Obama administration is planning to exempt alcoholic beverages from proposed federal regulations requiring calorie labeling on restaurant menus.

It could set up a confusing scenario in which, say, a raspberry iced tea may have a calorie count listed, while an alcohol-laden Long Island Iced Tea — with more than four times as many calories — doesn't. "It could give people the wrong idea," she said.

___

Online:

CDC report: http://www.cdc.gov/nchs/

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Wall Street drops on deficit, Middle East concerns

NEW YORK (Reuters) - Stocks slid on Wednesday with declines accelerating after President Barack Obama set up a drawn-out fight over the fiscal cliff when he stuck to his pledge to raise taxes on the wealthy, and as violence increased in the Middle East.

Obama, in his first press conference since re-election, held to his position that marginal tax rates will have to rise to tackle the nation's deficits.

With talks over solving the U.S. "fiscal cliff" in early stages, investors are reacting to the uncertainty by shedding positions.

"I think we will have a last-minute cliffhanger solution," said Michael Cheah, portfolio manager at SunAmerica Asset Management in Jersey City, New Jersey, about a deal to avoid the so-called cliff.

"In the meantime, the market is going to get punched every day."

Without a deal, a series of mandated tax hikes and spending cuts will start to take effect early next year that could push the U.S. economy into a recession.

Taxes on capital gains and dividends could rise as part of the negotiations, pushing investors to sell this year and pay lower taxes on their gains.

Adding to the selling pressure, Israel launched a major offensive against Palestinian militants in Gaza, killing the military commander of Hamas in an air strike and threatening an invasion of the enclave. Egypt said it recalled its ambassador from Israel in response.

"We know Europe's in trouble, China's slowing down ... and now you've got the Middle East flaring up again. It's all hitting at once, and obviously, the market is taking a 'sell first, ask questions later' approach," said Ryan Detrick, senior technical strategist at Schaeffer's Investment Research in Cincinnati.

Industrial shares led the decline, dragged lower in part by a 1 percent spike in crude prices after the Israeli offensive on Gaza. The S&P industrial sector index <.gspi> fell 2.5 percent.

Wall Street had opened higher after Dow component Cisco Systems Inc reported first-quarter earnings and revenue late Tuesday that beat expectations, driving its stock up 4.8 percent to $17.66. But the positive momentum was short-lived.

The Dow Jones industrial average <.dji> fell 185.23 points, or 1.45 percent, to 12,570.95 at the close. The S&P 500 <.spx> dropped 19.04 points, or 1.39 percent, to 1,355.49. The Nasdaq Composite <.ixic> lost 37.08 points, or 1.29 percent, to 2,846.81.

Both the Dow industrials and the Nasdaq ended at their lowest levels since late June.

The S&P 500 has fallen 5.1 percent in the six sessions since election night. Wednesday marked the benchmark index's lowest close since July 25.

The Russell 2000 <.rut> tumbled 2 percent. The Dow Jones Transportation average <.djt> slid 2.6 percent. FedEx Corp shares dropped 3.7 percent to $87.12. Bank of America shares lost 3.6 percent to $8.99.

In contrast, Facebook shares jumped 12.6 percent to $22.36 as investors were relieved that expiring trading restrictions on a huge block of shares did not trigger an immediate wave of insider selling.

Teen clothing retailer Abercrombie & Fitch Co jumped 34.4 percent to $41.92 after the company reported unexpectedly improved third-quarter results and a full-year outlook that exceeded Wall Street's forecasts.

About 7.53 billion shares changed hands on the New York Stock Exchange, the Nasdaq and NYSE MKT, more than the daily average so far this year of about 6.51 billion shares.

On the NYSE, decliners outnumbered advancers by a ratio of almost 9 to 1. On the Nasdaq, about four stocks fell for every one that rose.

(Reporting by Rodrigo Campos; Additional reporting by Steven C. Johnson and Leah Schnurr; Editing by Jan Paschal)

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BBC Failures Show Limits of Guidelines

LONDON — It was 2004, and the British Broadcasting Corporation was gripped by a crisis over journalistic standards that had led to Parliamentary hearings, public recrimination and the resignations of its two top officials. Vowing change, the corporation established elaborate bureaucratic procedures that placed more formal responsibility for delicate decisions in the hands not of individual managers, but of rigid hierarchies.

The corporation also appointed a deputy director general in charge of news operations; established a “journalism board” to monitor editorial policy; issued numerous new guidelines on journalistic procedures; and put an increasing emphasis on “compliance” — a system in which managers are required to file cumbersome forms flagging dozens of potential trouble spots, from bad language to “disturbing content” like exorcism or beheadings, in every program taped for broadcast.

More crises would follow — the history of the BBC can be measured out in crises — and with each new one, the management team under Mark Thompson, director general from 2004 through mid-September 2012, added more guidelines and put more emphasis on form-filling and safety checks in news and entertainment programs. An organization already known for its bureaucracy became even more unwieldy (the editorial guidelines are now 215 pages long).

But it is these very structures that seem to have failed the BBC in the most recent scandal, in which its news division first canceled a child abuse segment it should have broadcast, and later broadcast one it should have canceled. In the first instance, it appears that people overseeing the program were too cautious, so that top managers were left unaware of its existence; in the second, managers may have relied too much on rigid procedures at the expense of basic journalistic principles.

“They burned their fingers,” said Tim Luckhurst, a journalism professor at the University of Kent who worked at the BBC for 10 years. “They wanted systems that could take responsibility instead of people.”

The recent scandal has had a number of immediate results. Mr. Thompson’s successor as director general, George Entwistle, resigned after just 54 days on the job. (Mr. Thompson is now president and chief executive of The New York Times Company.) Outside investigators were appointed to interrogate BBC employees in at least three different inquiries. A number of lower- and midlevel managers had to withdraw temporarily from their jobs and, facing possible disciplinary action, hired lawyers. And, once again, the BBC is talking about reorganizing structures.

Through a spokesman, Mr. Entwistle declined to comment on the scandal or the BBC’s management practices, saying he was “not doing any media interviews at present.” Mr. Thompson also declined to comment.

But Mr. Entwistle’s temporary successor, Tim Davie, who had previously been director of BBC Audio & Music, acknowledged that changes had to be made. “If the public are going to get journalism they trust from the BBC I have to be, as director general, very clear on who’s running the news operation and ensuring that journalism that we put out passes muster,” Mr. Davie said in his first week on the job. The first thing to do, he said, was to “take action and build trust by putting a clear line of command in.”

This is a complicated scandal in two parts. The first part was over the BBC’s decision last December not to broadcast a report saying that Jimmy Savile, a longtime BBC television host, had been a serial child molester, and instead to broadcast several glowing tributes to his career. The second part was its decision on Nov. 2 to accuse a member of Margaret Thatcher’s government of being a pedophile, an accusation that turned out to be patently false.

But both exposed the problems in a system that seems to insulate the BBC’s director general — who is also the editor in chief — from knowledge of basic issues like what potentially contentious programs are scheduled for broadcast. And both decisions were the result, it seems, of a system that failed in practice, even as it was correctly followed in theory.

Ben Bradshaw, a former BBC correspondent and now a Labour member of Parliament, said the 2004 scandal, touched off by reporting about British intelligence on Iraqi weapons of mass destruction, had created a system based on “fear and anxiety.” The BBC, he added, became “even more bureaucratic and had even more layers, which exacerbated the problem of buck passing and no one being able to take a decision.”

Speaking of the Nov. 2 broadcast, the chairman of the BBC Trust, Chris Patten, said in a television interview that the piece went through “every damned layer of BBC management bureaucracy, legal checks” without anyone raising any serious objections.

Matthew Purdy contributed reporting from New York, and Lark Turner from London.

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RIM CEO sees new BlackBerry powering growth

WATERLOO, Ontario (Reuters) – A new line of BlackBerry 10 devices will provide Research In Motion with a framework for growth over the next decade, offering long-term value for unhappy shareholders, Chief Executive Thorsten Heins said on Wednesday.

In an interview with Reuters, Heins said RIM had identified $ 800 million of the $ 1 billion of savings it promised for the financial year ending in early March, and was confident of finding the rest as it gets ready to launch the new phones.

RIM is betting that the new smartphones will help it claw back the market share it has lost to the likes of Apple Inc’s iPhone and devices powered by Google’s Android operating system.

Both consumers and corporate customers have abandoned the BlackBerry in droves, even though the devices offer security features that rivals have been unable to match.

“There’s this high-level security that you cannot walk away from, and then there’s ‘good enough’ security,” Heins said in an interview at RIM’s Waterloo, Ontario, campus, a sprawl of low-rise buildings.

But analysts remain skeptical, especially after the botched 2011 launch of RIM’s PlayBook tablet computer, which the company had hoped would compete with Apple’s wildly popular iPad. The PlayBook had top-of-the-line hardware, but its software was far from complete at the launch and needed multiple updates.

RIM delayed the roll-out of the BlackBerry 10 phones to the first quarter of 2013 so as not to repeat the errors that surrounded the PlayBook launch.

Heins said the delay was the correct decision – the way to ensure the BB10 phones are a high-quality product rather than a rushed one that would not meet customer expectations.

“I think it’s all lining up. Sometimes you get the feeling that the universe is in disarray, and with BlackBerry 10 coming, I see the stars lining up,” Heins said.

SLEEK DEMO MODELS

Sleek demo models of the new phones look much like the high-end smartphones in the market today, and company executives proudly showed off a touch-screen version and a version with the miniature QWERTY keyboard popular with many BlackBerry users.

Users flick a thumb or finger to maneuver from one program to another and can sneak a look at an incoming email while browsing the Internet or using other applications, a multi-tasking ability that RIM says rival devices lack.

Personal and business profiles can be kept separately, something RIM calls BlackBerry Balance. Corporations can erase only their share of the data on a device if they need to do so for security reasons, leaving personal photos, contacts and emails untouched.

The app library available at launch will not match the vast number available on other devices. Heins said RIM had chosen to focus on providing those apps needed in different regional markets. It expects some 100,000 apps to be ready at launch.

The developer community has been broadly enthusiastic about the devices. But financial analysts have mixed views on their likely reception in an ultra-competitive market.

Pacific Crest analyst James Faucette warned last week that BlackBerry 10 is likely to be dead on arrival – with an operating system that gets “a lukewarm response at best,” due to the unfamiliar user interface and a shortage of apps.

SHAREHOLDER VALUE

Heins insisted morale was high at the company, despite 5,000 job cuts and a rapidly sliding market share ahead of the launch of the new phones.

RIM’s share price is down more than 90 percent from a 2008 peak of about $ 148. It has fallen even after Heins, a former Siemens AG executive, took over in January. The shares on Wednesday closed at $ 8.49 on Nasdaq.

“The message to our shareholders is that we understand this is and has been a difficult time for them and for us,” the tall, bespectacled CEO said. “But with the development of the BlackBerry 10 platform we are truly convinced that we will create long-term value for RIM’s shareholders and investors.”

RIM has already given the demo phones to developers and to carriers, and its new BlackBerry Enterprise Server 10, which runs the devices on corporate networks, is in beta testing with 20 key customers — both government agencies and corporates.

Next month, the company will give more than 50 top enterprise customers technical previews of both BES 10 and the devices.

Heins said the feedback he is getting from the customer base “is very encouraging.”

With the erosion of RIM’s base particularly strong in North America, there has been speculation the company could choose to launch the new phones in a region where the phones remain popular. Heins said that would not be the case.

“We cannot launch every carrier and every country on the same day, but what we have defined is a set of waves in the various regions,” he said. “It is going to be a global launch. There isn’t one preferred region. We are managing and planning it as we speak.”

(Reporting by Euan Rocha and Janet Guttsman; Editing by Frank McGurty and Leslie Adler)

Wireless News Headlines – Yahoo! News

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The Voice Sends Two Contestants Home

TV Watch

The Voice

By Julia Haskins

11/13/2012 at 10:20 PM EST

Adam Levine and Christina Aguilera

Christopher Polk/Getty

It was a great night for Teams Cee Lo and Adam on The Voice Tuesday. And though not everyone got good news on elimination night, there were plenty of entertaining performances from the coaches and contestants alike.

To open the night, Christina Aguilera and Green performed the world premiere of "Make the World Move," from her new album Lotus. Guest Jason Aldean also took the stage, and Blake Shelton rocked out with his team to Tom Cochrane's "Life is a Highway."

Green's Trevin Hunte, Nicholas David and Cody Belew came together for a '70s inspired – bell bottoms and all! – performance of the Bee Gee's "Stayin' Alive." But was it a sign of things to come? Keep reading for all the results ...

All of Green's singers as well as Levine's Bryan Keith, Melanie Martinez and Amanda Brown felt the love from viewers at home, and will have another shot at next week's show.

America also saved Aguilera's Sylvia Yacoub and Dez Duron, and Shelton's Cassadee Pope and Terry McDermott.

But without enough votes to keep them in the competition, Team Aguilera's Adriana Louise and Team Blake's Michaela Paige said goodbye.

Aguilera consoled Louise by reminding her that even she didn't win Star Search, but still made it to superstardom. Louise was grateful for all her coach's support. "You believed in me more than I believed in myself," she told Aguilera through tears.

Paige also enjoyed an uplifting experience on The Voice. "If I inspired anyone, that's all I wanted to do," Paige said. "Follow your dreams and believe in your heart." But her coach Shelton isn't too concerned about the aspiring singer's future.

"Her big old mohawk is going to be walking across the stage at the Grammys," he said, "and I can't wait."

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Report: FDA wanted to close Mass pharmacy in 2003

WASHINGTON (AP) — Nearly a decade ago, federal health inspectors wanted to shut down the pharmacy linked to a recent deadly meningitis outbreak until it cleaned up its operations, according to congressional investigators.

About 440 people have been sickened by contaminated steroid shots distributed by New England Compounding Center, and more than 32 deaths have been reported since the outbreak began in September, according to the Centers for Disease Control and Prevention. That has put the Framingham, Mass.-based pharmacy at the center of congressional scrutiny and calls for greater regulation of compounding pharmacies, which make individualized medications for patients and have long operated in a legal gray area between state and federal laws.

The House Energy and Commerce Committee released a detailed history of NECC's regulatory troubles on Monday, ahead of a meeting Wednesday meeting to examine how the outbreak could have been prevented. The 25-page report summarizes and quotes from FDA and state inspection memos, though the committee declined to release the original documents.

The report shows that after several problematic incidents, Food and Drug Administration officials in 2003 suggested that the compounding pharmacy be "prohibited from manufacturing" until it improved its operations. But FDA regulators deferred to their counterparts in Massachusetts, who ultimately reached an agreement with the pharmacy to settle concerns about the quality of its prescription injections.

The congressional report also shows that in 2003 the FDA considered the company a pharmacy. That's significant because in recent weeks public health officials have charged that NECC was operating more as a manufacturer than a pharmacy, shipping thousands of doses of drugs to all 50 states instead of small batches of drugs to individual patients. Manufacturers are regulated by the FDA and are subject to stricter quality standards than pharmacies.

The report offers the most detailed account yet of the numerous regulatory complaints against the pharmacy, which nearly date back to its founding in 1998. Less than a year later, the company was cited by the state pharmacy board for providing doctors with blank prescription pads with NECC's information. Such promotional items are illegal in Massachusetts and the pharmacy's owner and director, Barry Cadden, received an informal reprimand, according to documents summarized by the committee.

Cadden was subject to several other complaints involving unprofessional conduct in coming years, but first came to the FDA's attention in 2002. Here are some key events from the report highlighting the company's early troubles with state and federal authorities:

__ In March of 2002 the FDA began investigating reports that five patients had become dizzy and short of breath after receiving NECC's compounded betamethasone repository injection, a steroid used to treat joint pain and arthritis that's different from the one linked to the current meningitis outbreak.

FDA inspectors visited NECC on April 9 and said Cadden was initially cooperative in turning over records about production of the drug. But during a second day of inspections, Cadden told officials "that he was no longer willing to provide us with any additional records," according to an FDA report cited by congressional investigators. The inspectors ultimately issued a report citing NECC for poor sterility and record-keeping practices but said that "this FDA investigation could not proceed to any definitive resolution," because of "problems/barriers that were encountered throughout the inspection."

__ In October of 2002, the FDA received new reports that two patients at a Rochester, N.Y., hospital came down with symptoms of bacterial meningitis after receiving a different NECC injection. The steroid, methylprednisolone acetate, is the same injectable linked to the current outbreak and is typically is used to treat back pain. Both patients were treated with antibiotics and eventually recovered, according to FDA documents cited by the committee.

When officials from the FDA and Massachusetts Board of Pharmacy visited NECC later in the month, Cadden said vials of the steroid returned by the hospital had tested negative for bacterial contamination. But when FDA scientists tested samples of the drug collected in New York they found bacterial contamination in four out of 14 vials sampled. It is not entirely clear whether FDA tested the same lot shipped to the Rochester hospital.

__ At a February 2003 meeting between state and federal officials, FDA staff emphasized "the potential for serious public consequences if NECC's compounding practices, in particular those relating to sterile products, are not improved." The agency issued a list of problems uncovered in its inspection to NECC, including a failure to verify if sterile drugs met safety standards.

But the agency decided to let Massachusetts officials take the lead in regulating the company, since pharmacies are typically regulated at the state level. It was decided that "the state would be in a better position to gain compliance or take regulatory action against NECC as necessary," according to a summary of the meeting quoted by investigators.

The FDA recommended the state subject NECC to a consent agreement, which would require the company to pass certain quality tests to continue operating. But congressional investigators say Massachusetts Board of Pharmacy did not take any action until "well over a year later."

__ In October 2004, the board sent a proposed consent agreement to Cadden, which would have included a formal reprimand and a three-year probationary period for the company's registration. The case ended without disciplinary action in 2006, when NECC agreed to a less severe consent decree with the state.

Massachusetts officials indicated Tuesday they are still investigating why NECC escaped the more severe penalty.

"I will not be satisfied until we know the full story behind this decision," the state's interim health commissioner Lauren Smith said in a transcript of her prepared testimony released a day ahead of delivery. Smith is one of several witnesses scheduled to testify Wednesday, including FDA Commissioner Margaret Hamburg.

The committee will also hear from the widow of 78-year-old Eddie C. Lovelace, a longtime circuit court judge in southern Kentucky. Autopsy results confirmed Lovelace received fungus-contaminated steroid injections that led to his death Sept. 17.

Joyce Lovelace will urge lawmakers to work together on legislation to stop future outbreaks caused by compounded drugs, according to a draft of her testimony.

"We now know that New England Compounding Pharmacy, Inc. killed Eddie. I have lost my soulmate and life's partner with whom I worked side by side, day after day for more than fifty years," Lovelace states.

Barry Cadden is also scheduled to appear at the hearing, after lawmakers issued a subpoena to compel him to attend.

The NECC has been closed since early last month, and Massachusetts officials have taken steps to permanently revoke its license. The pharmacy has recalled all the products it makes, including 17,700 single-dose vials of a steroid that tested positive for the fungus tied to the outbreak.

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Microsoft leads Wall Street lower, but retailers gain

NEW YORK (Reuters) - Stocks sold off late in the session on Tuesday, led by a slide in Microsoft shares, though retailers were a notable bright spot after Home Depot raised its outlook.

Microsoft Corp was the most actively traded on Nasdaq, weighing on the tech-heavy Nasdaq Composite after the surprising departure of a key executive. The stock fell 3.2 percent to $27.09.

After the closing bell, Cisco Systems shares rose 6.8 percent to $18 after it reported quarterly revenue and earnings that beat analysts' estimates.

Home Depot shares hit during the regular session levels not seen since April 2000 and the company's raised outlook suggested a revival in the long-dormant U.S. housing market. The S&P retail sector index <.spxrt> advanced 1 percent.

"Home Depot did say something about housing, which was perceived as positive and was behind the earlier rally," said Richard Sichel, chief investment officer at Philadelphia Trust Co.

"That was tempered by Microsoft, to some extent, and probably more so by the 'fiscal cliff,'" he said.

The S&P 500 is down 2.7 percent so far this month and closed below its 200-day moving average for a fourth day in a row, a technical indicator that suggests the recent declines could gain momentum. The moving average is currently at 1,381.58, and failure to rise above that level suggests market weakness.

Concerns about the looming "fiscal cliff" kept investor activity subdued as lawmakers returned to Washington after the November 6 election, when President Barack Obama won a second term while Democrats added to their margin in the U.S. Senate and picked up seats in the House of Representatives.

The market is grappling with how a divided U.S. Congress will deal with the series of mandated tax hikes and spending cuts that start to take effect next year and could take the world's largest economy back into recession. However, serious negotiations are still weeks away, analysts said.

The Dow Jones industrial average <.dji> fell 58.90 points, or 0.46 percent, to 12,756.18 at the close. The S&P 500 <.spx> dropped 5.50 points, or 0.40 percent, to 1,374.53. The Nasdaq Composite <.ixic> lost 20.37 points, or 0.70 percent, to 2,883.89.

Dow component Home Depot Inc raised its full-year outlook even before accounting for any future lift in sales in the aftermath of super storm Sandy, as the retailer benefited from a recent uptick in the U.S. housing market. Home Depot's stock rose 3.6 percent to $63.38, its highest close in more than 12 years.

TJX Cos , which owns the Marshalls and T.J. Maxx retail chains, reported results that beat analysts' forecasts and its shares added 2.7 percent to $42.06.

Microsoft shares fell after Steve Sinofsky, head of the Windows unit, left the company. Sinofsky was considered the driving force behind Windows, the company's biggest product.

Technology shares led the market's decline, with an S&P technology index <.gspt> down 0.8 percent.

AK Steel Holding shares fell 17.6 percent to $4.50 after the company forecast a fourth-quarter loss.

Just over 6.2 billion shares changed hands on the New York Stock Exchange, the Nasdaq and NYSE MKT, below the daily average during November last year of 7.33 billion shares.

More than two issues fell for every one that rose on both the NYSE and the Nasdaq.

(Reporting by Rodrigo Campos; Editing by Jan Paschal)

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