Genetic Gamble : Drugs Aim to Make Several Types of Cancer Self-Destruct


C.J. Gunther for The New York Times


Dr. Donald Bergstrom is a cancer specialist at Sanofi, one of three companies working on a drug to restore a tendency of damaged cells to self-destruct.







For the first time ever, three pharmaceutical companies are poised to test whether new drugs can work against a wide range of cancers independently of where they originated — breast, prostate, liver, lung. The drugs go after an aberration involving a cancer gene fundamental to tumor growth. Many scientists see this as the beginning of a new genetic age in cancer research.




Great uncertainties remain, but such drugs could mean new treatments for rare, neglected cancers, as well as common ones. Merck, Roche and Sanofi are racing to develop their own versions of a drug they hope will restore a mechanism that normally makes badly damaged cells self-destruct and could potentially be used against half of all cancers.


No pharmaceutical company has ever conducted a major clinical trial of a drug in patients who have many different kinds of cancer, researchers and federal regulators say. “This is a taste of the future in cancer drug development,” said Dr. Otis Webb Brawley, the chief medical and scientific officer of the American Cancer Society. “I expect the organ from which the cancer came from will be less important in the future and the molecular target more important,” he added.


And this has major implications for cancer philanthropy, experts say. Advocacy groups should shift from fund-raising for particular cancers to pushing for research aimed at many kinds of cancer at once, Dr. Brawley said. John Walter, the chief executive officer of the Leukemia and Lymphoma Society, concurred, saying that by pooling forces “our strength can be leveraged.”


At the heart of this search for new cancer drugs are patients like Joe Bellino, who was a post office clerk until his cancer made him too sick to work. Seven years ago, he went into the hospital for hernia surgery, only to learn he had liposarcoma, a rare cancer of fat cells. A large tumor was wrapped around a cord that connects the testicle to the abdomen. “I was shocked,” he said in an interview this summer.


Companies have long ignored liposarcoma, seeing no market for drugs to treat a cancer that strikes so few. But it is ideal for testing Sanofi’s drug because the tumors nearly always have the exact genetic problem the drug was meant to attack — a fusion of two large proteins. If the drug works, it should bring these raging cancers to a halt. Then Sanofi would test the drug on a broad range of cancers with a similar genetic alteration. But if the drug fails against liposarcoma, Sanofi will reluctantly admit defeat.


“For us, this is a go/no-go situation,” said Laurent Debussche, a Sanofi scientist who leads the company’s research on the drug.


The genetic alteration the drug targets has tantalized researchers for decades. Normal healthy cells have a mechanism that tells them to die if their DNA is too badly damaged to repair. Cancer cells have grotesquely damaged DNA, so ordinarily they would self-destruct. A protein known as p53 that Dr. Gary Gilliland of Merck calls the cell’s angel of death normally sets things in motion. But cancer cells disable p53, either directly, with a mutation, or indirectly, by attaching the p53 protein to another cellular protein that blocks it. The dream of cancer researchers has long been to reanimate p53 in cancer cells so they will die on their own.


The p53 story began in earnest about 20 years ago. Excitement ran so high that, in 1993, Science magazine anointed it Molecule of the Year and put it on the cover. An editorial held out the possibility of “a cure of a terrible killer in the not too distant future.”


Companies began chasing a drug to restore p53 in cells where it was disabled by mutations. But while scientists know how to block genes, they have not figured out how to add or restore them. Researchers tried gene therapy, adding good copies of the p53 gene to cancer cells. That did not work.


Then, instead of going after mutated p53 genes, they went after half of cancers that used the alternative route to disable p53, blocking it by attaching it to a protein known as MDM2. When the two proteins stick together, the p53 protein no longer functions. Maybe, researchers thought, they could find a molecule to wedge itself between the two proteins and pry them apart.


The problem was that both proteins are huge and cling tightly to each other. Drug molecules are typically tiny. How could they find one that could separate these two bruisers, like a referee at a boxing match?


In 1996, researchers at Roche noticed a small pocket between the behemoths where a tiny molecule might slip in and pry them apart. It took six years, but Roche found such a molecule and named it Nutlin because the lab was in Nutley, N.J.


But Nutlins did not work as drugs because they were not absorbed into the body.


Roche, Merck and Sanofi persevered, testing thousands of molecules.


At Sanofi, the stubborn scientist leading the way, Dr. Debussche, maintained an obsession with p53 for two decades. Finally, in 2009, his team, together with Shaomeng Wang at the University of Michigan and a biotech company, Ascenta Therapeutics, found a promising compound.


The company tested the drug by pumping it each day into the stomachs of mice with sarcoma.


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Naomi Gleit helps keep Facebook growing









The gig: As senior director of Facebook Inc.'s growth, engagement and mobile team, Naomi Gleit helps grow the social network's 1-billion-plus user base.


Facebook employee No. 29: Few people outside Facebook have heard of Gleit, but she's the second-longest-serving Facebook employee, after Facebook founder Mark Zuckerberg. Gleit, 29, talked her way into a job at Facebook on July 18, 2005 — her birthday. She was Facebook's 29th employee, coming on board shortly after the company hit 1 million users and before anyone had an inkling of the colossus it would become.


Dogged spirit: Unlike most other early employees who eventually dispersed to seek new fortunes, Gleit says she has no intention of leaving Facebook. She gets that tenacity from her "tiger mom," a computer programmer who ferried her to ballet, piano, karate and Chinese lessons, and her Jewish father, an immigration lawyer who took her to Hebrew school, she said. "I know it sounds completely irrational, but I had no doubt in 2005 that Facebook would be something incredible in the future," she said.





Rival social networks: Her passion for Facebook began before she was hired, when she was a Stanford undergraduate studying science, technology and society, an interdisciplinary major. She wrote her senior thesis on why Facebook beat out rival college social networking site Club Nexus at Stanford. (Club Nexus was started by Stanford student and Turkish software engineer Orkut Büyükkökten, who went on to create Orkut, Google's first attempt at a social network.) Getting in on the ground floor at Facebook made her feel like she was taking part in something bigger than herself, the same feeling she got volunteering for six months in a refugee camp in Botswana, she said.


Growing with Facebook: Gleit helped Facebook push beyond colleges to high schools and eventually to everyone. In late 2007, when the torrid growth pace temporarily cooled, Zuckerberg tapped a team of five to reignite it and asked Gleit to lead product management. It fell to the growth team to identify the obstacles to the company's momentum. In a company ruled by engineers, Gleit, who never studied programming, earned respect with her analytical approach and intuitive understanding of people. "I always believed that growth was the most important thing, the most important way to impact the company," she said. There are now more than 150 people on the team. "It's been an incredible learning experience," she said. "Each year is different."


That magic moment: Those who work closely with Gleit say part of her success early on was her ability to seize on the "magic moment" that makes users fall in love with Facebook. She made it simpler to sign up, and she helped people find friends as soon as they joined. She also helped Facebook spread quickly to new countries by enlisting users to translate the service into more than 80 languages. Gleit helps her team parachute into new markets and traverse less-familiar languages and cultures. It's something that comes from her own passion to see the world and have new experiences. She has taught on a Navajo reservation and lived in a Buddhist monastery in Thailand.


One billion users: Around noon Sept. 14, Zuckerberg gathered with Gleit and dozens of employees in front of a big screen as the number of Facebook users crossed 1 billion. "The scale was insane," she said. "But that is not the goal. When Mark talks about his vision for Facebook, he talks about being able to connect everyone in the world to the people that they care about and provide some value for them every single day."


A problem solver: Zuckerberg calls on Gleit for high-profile projects. In May 2010, when Facebook was under siege because of how it was handling users' personal information, he put Gleit in charge of simplifying privacy settings. Last year she worked on a popular feature that lets users subscribe to a News Feed without having to become Facebook friends.


Betting on mobile: Now Gleit is focused on the future: mobile devices and how they can unlock emerging markets. Gleit knew back in 2011 that people would begin to log on to Facebook from mobile devices in greater numbers than from desktops, particularly in the developing world. So she traveled to Tel Aviv to buy Snaptu, which makes software that helps people on low-tech phones access Facebook, and she brought the whole team back to Silicon Valley with her. Now Facebook is surging in popularity on mobile devices in Tokyo and Nairobi, Kenya. "I have always been interested in technology and how it can be used to improve lives," Gleit said.


jessica.guynn@latimes.com





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Appeals court puts hold on California gay conversion ban









A federal appeals court Friday put a hold on a new state law intended to prevent therapists from trying to change a minor's sexual orientation, dealing a setback to gay rights groups.


A three-judge panel of the U.S. 9th Circuit Court of Appeals agreed to block the law, scheduled to take effect Jan. 1, pending a decision on its constitutionality.


"This is a very good sign for our clients," said Mathew Staver, found of Liberty Counsel, a religious liberties group that sued to block the law, arguing that it violates free speech rights. "To get an injunction pending appeal is a very difficult thing to do."








A spokeswoman for state Atty. Gen. Kamala D. Harris said Harris would "vigorously defend" a law that banned what she termed an "unsound and harmful practice."


The law would subject psychologists, psychiatrists and other mental health professionals to discipline by their licensing boards for providing minors therapy to change their sexual orientation. The state and many professional groups say the therapy is ineffective and potentially dangerous.


A District Court judge initially rejected the suit by Liberty Counsel, whose clients include a 15-year-old boy undergoing the therapy. The Christian-oriented legal group appealed that decision to the 9th Circuit.


The judges who are hearing the case are Alfred T. Goodwin, appointed by President Nixon; Edward Leavy, a Reagan appointee; and Milan D. Smith Jr., named to the court by President George W. Bush.


Staver, calling the preliminary injunction "very welcome news," said it was "never routine" and granted only in extraordinary situations when the court believes an appeal has a "likelihood of success."


UC Irvine Law School Dean Erwin Chemerinsky, who believes that the law is constitutional, said its opponents "won this round."


"This doesn't determine the ultimate outcome by the 9th Circuit," the constitutional law expert said. "It still has to rule on the merits, and it could well go to the Supreme Court. But obviously this is a preliminary loss for supporters of the law."


California's ban on trying to change a minor's sexual orientation, the first of its kind in the nation, has divided the lower courts. The federal judge in Sacramento who refused to block the law was appointed by President Obama. She concluded that it did not violate the 1st Amendment. Her colleague on the same bench, appointed by President George H.W. Bush, concluded that it was likely that the law infringed on free speech protections.


Communication between professionals and their clients generally has less 1st Amendment protection than other forms of speech. For instance, a lawyer or doctor who negligently gives bad advice may be found liable for malpractice, and licensing requirements for professionals may be restrictive.


The Supreme Court upheld a law that required doctors to tell patients about potential harmful effects of an abortion, but the 9th Circuit blocked a federal law designed to prevent doctors from discussing the benefits of marijuana with patients.


Therapy to change sexual orientation may involve psychoanalysis, cognitive behavioral treatment and religious and spiritual counseling. Some therapists have practiced aversion therapy using hormone treatments and nausea-inducing drugs to combat sexual impulses.


A task force report by the American Psychological Assn. in 2009 said the therapy could trigger depression, suicide and substance abuse, but also noted that there was scant research on the issue.


The new law was supported by the California Psychological Assn., the California chapter of the National Assn. of Social Workers and the California Division of the American Assn. for Marriage and Family Therapy.


Gay rights activists Friday minimized the setback and noted that the court has agreed to review the law on a fast track.


"Every leading medical and mental health organization has warned therapists and parents that these practices do not work and put young people at risk of serious harm, including depression and suicide," said Shannon Minter, legal director of the National Center for Lesbian Rights. "No young person should be subjected to these dangerous practices, and no licensed therapist should be permitted to engage in practices that cause such serious harm."


maura.dolan@latimes.com





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Google working on “X Phone”, “X” tablet to take on rivals – WSJ






(Reuters) – Google Inc is working with recently acquired Motorola on a handset codenamed “X-phone”, aimed at grabbing market share from Apple Inc and Samsung Electronics Co Ltd, the Wall Street Journal said, citing people familiar with the matter.


Google acquired Motorola in May for $ 12.5 billion to bolster its patent portfolio as its Android mobile operating system competes with rivals such as Apple and Samsung.






The Journal quoted the people saying that Motorola is working on two fronts: devices that will be sold by carrier partner Verizon Wireless, and on the X phone.


Motorola plans to enhance the X Phone with its recent acquisition of Viewdle, an imaging and gesture-recognition software developer. The new handset is due out sometime next year, the business daily said, citing a person familiar with the plans.


Motorola is also expected to work on an “X” tablet after the phone. Google Chief Executive Larry Page is said to have promised a significant marketing budget for the unit, the newspaper said quoting the persons.


Google was not immediately reachable for comments outside regular U.S. business hours.


(Reporting by Balaji Sridharan in Bangalore; Editing by Richard Chang)


Tech News Headlines – Yahoo! News





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Ashton Kutcher files for divorce from Demi Moore


LOS ANGELES (AP) — Ashton Kutcher filed court papers Friday to end his seven-year marriage to actress Demi Moore.


The actor's divorce petition cites irreconcilable differences and does not list a date that the couple separated. Moore announced last year that she was ending her marriage to the actor 15 years her junior, but she never filed a petition.


Kutcher's filing does not indicate that the couple has a prenuptial agreement. The filing states Kutcher signed the document Friday, hours before it was filed in Los Angeles Superior Court.


Kutcher and Moore married in September 2005 and until recently kept their relationship very public, communicating with each other and fans on the social networking site Twitter. After their breakup, Moore changed her name on the site from (at)mrskutcher to (at)justdemi.


Kutcher currently stars on CBS' "Two and a Half Men."


Messages sent to Kutcher's and Moore's publicists were not immediately returned Friday.


Moore, 50, and Kutcher, 34, created the DNA Foundation, also known as the Demi and Ashton Foundation, in 2010 to combat the organized sexual exploitation of girls around the globe. They later lent their support to the United Nations' efforts to fight human trafficking, a scourge the international organization estimates affects about 2.5 million people worldwide.


Moore was previously married to actor Bruce Willis for 13 years. They had three daughters together — Rumer, Scout and Tallulah Belle — before divorcing in 2000. Willis later married model-actress Emma Heming in an intimate 2009 ceremony at his home in Parrot Cay in the Turks and Caicos Islands that attended by their children, as well as Moore and Kutcher.


Kutcher has been dating former "That '70s Show" co-star Mila Kunis.


The divorce filing was first reported Friday by People magazine.


___


Anthony McCartney can be reached at http://twitter.com/mccartneyAP.


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Vernice D. Ferguson, Leader and Advocate of Nurses, Dies at 84





Vernice D. Ferguson, who fought for greater opportunities, higher wages and more respect for nurses as a longtime chief nursing officer for the Veterans Administration, died on Dec. 8 at her home in Washington. She was 84.







NYU Photobureau

Vernice D. Ferguson served at the Veterans Administration.







Her niece Hope Ferguson confirmed her death.


America faced a nursing shortage when Ms. Ferguson began overseeing the agency’s more than 60,000 nurses nationwide in 1980. Historically, the nursing ranks were overwhelmingly female, but as job opportunities began to expand for young women in the late 1970s, nursing, with its prospect of strenuous work, irregular hours and relatively low pay, was losing its appeal.


Doctors, most of whom were men, were paid far more and rarely discussed medical treatments with nurses, despite nurses’ hands-on knowledge of patients.


“What is good enough for the doctor is good enough for me and the nursing staff,” Ms. Ferguson was quoted as saying in the book “Pivotal Moments in Nursing: Leaders Who Changed the Path of a Profession,” by Beth Houser and Kathy Player. “Whatever the boys have, I am going to get the same thing for the girls.”


In 1981, Ms. Ferguson told National Journal, “Hospitals are going to have to rethink and restructure their policies to let nurses perform nursing services and let others attend to ‘hotel’ services,” like making beds and handling phone calls.


Ms. Ferguson helped establish an agency scholarship program to recruit and retain nurses and made educational programs that had been restricted to doctors open to nurses as well.


By 1992, when she left the agency — then the Department of Veterans Affairs — the number of registered nurses there with bachelor’s degrees or higher had more than doubled. Nurses’ salaries also increased throughout the field. In 1980, their average annual pay was $26,826 in 2008 dollars; in 2008, it was $66,973, according to the most recent survey of registered nurses.


Vernice Doris Ferguson was born on June 13, 1928, in Fayetteville, N.C. Her father was a minister in Baltimore, where she grew up, and her mother was a teacher. At a time when few black women attended college, Ms. Ferguson graduated from New York University with a nursing degree in 1950 and was awarded the Lavinia L. Dock prize for high scholastic standing. At the awards ceremony, the director of nursing refused to shake her hand, Ms. Houser and Ms. Player wrote.


Ms. Ferguson’s first job out of college was in a research unit financed by the National Institutes of Health at Montefiore Medical Center in the Bronx. She went on to be a co-author of papers in The American Journal of Nursing, The Journal of Clinical Nutrition and The Journal of Clinical Investigation.


She worked in several hospitals around the country, and from 1972 to 1980 was the chief of the nursing department of the Clinical Center at the National Institutes of Health. A brief marriage ended in divorce. Her survivors include a sister, Velma O. Ferguson, and several nieces and nephews.


After retiring in 1992, Ms. Ferguson was appointed senior fellow at the University of Pennsylvania School of Nursing.


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E-book restrictions leave 'buyers' with few rights








There's a crass old joke about how you can never buy beer, just rent it. Who would think that the same joke applies to book buying in the digital age?


But that's the case. Many people who'll be unwrapping iPads, Amazon Kindles or Barnes & Noble Nooks on Tuesday morning and loading them with bestsellers or classics won't have any idea how limited their rights are as their books' "owners."


In fact, they won't be owners at all. They'll be licensees. Unlike the owners of a physical tome, they won't have the unlimited right to lend an e-book, give it away, resell it or leave it to their heirs. If it's bought for their iPad, they won't be able to read it on their Kindle. And if Amazon or the other sellers don't like what they've done with it, they can take it back, without warning.






All these restrictions "raise obvious questions about what 'ownership' is," observes Dan Gillmor, an expert on digital media at Arizona State University. "The companies that license stuff digitally have made it clear that you own nothing."


Typically, e-book buyers have no idea about these complexities. How could they? The rules and limitations are embodied in "terms of service" documents that Amazon, Apple, B&N and other sellers shroud in legalese and bury deep in their websites. That tells you how little they want you to know.


The rules are based, in turn, on the 1998 Digital Millennium Copyright Act, with which Congress hoped to balance the rights of copyright holders and content users. "In the digital environment, that's always been the trickiest balance to strike," Annemarie Bridy, a specialist in intellectual property law at the University of Idaho, told me. In those terms, the DMCA looks like a failure.


Both camps have important rights to protect. Let's start with copyright owners.


In the non-digital world, copyright ends with the first sale of each copyrighted object. Under the "first sale" doctrine, once you buy a book, that physical book is yours to lend, give away, or resell. Copyright is safeguarded by the limitations of physical transfer — once the book is given or loaned, the original buyer no longer has access to it. If a library owns five copies of a book, only five borrowers can read it at the same time. Theoretically a book can be photocopied, but only at great effort and with a perceptible loss of quality.


In digital-dom, however, technology allows infinite copies to be made, with no loss of quality. Absent the usual restrictions, one could give away an e-book and still have it to read. Unrestricted transferability becomes a genuine threat to the livelihood of authors, artists, filmmakers, musicians.


So some limitation is sensible. That's usually done through digital rights management, or DRM, which encodes copy or usage limitations into the digital file. The DMCA protected DRM by outlawing efforts to circumvent it (with a few exceptions).


The question is whether the balance has tipped too far in favor of the booksellers, at the consumers' expense. The answer is yes.


For one thing, DRM has put far too much power in the hands of digital booksellers. Amazon, in particular, has shown it can't be trusted with that power. In 2009, having learned that it inadvertently had sold unauthorized e-book versions of George Orwell's "1984" and "Animal Farm" through its website, the company simply deleted those e-books from buyers' Kindles stealthily, without warning.


An uproar followed, not least because Amazon's Orwellian behavior involved those Orwellian masterpieces. Amazon settled a subsequent lawsuit by promising never to steal a book back from a Kindle without the device owner's permission.


But earlier this year, the company was revealed to have unilaterally shut down the access of Linn Jordet Nygaard, a Norwegian Kindle owner, to her library of 43 e-books, for reasons it refused to divulge. Another uproar, and Amazon backed down again, restoring Nygaard's account — again without explanation. Amazon refused my request for comment.


Another downside of e-book DRM is that most e-books are tied to the seller's reading device or apps. Buy a book from Amazon, and you can read it only on a Kindle or Amazon app. Buy it from Apple, and it can be read only on an Apple device.


This lock-in gives the booksellers power over not only consumers but publishers. In fact, it led several publishers to make a price-fixing deal with Apple that aimed to undermine Amazon's market power, but ended with their getting whacked with a big federal antitrust fine instead.


Moreover, notwithstanding the public impression that digital is forever, nothing is permanent in the digital world. In fact, digital content can be less permanent than physical books. In libraries you can find volumes that date back hundreds of years and can still be read (if carefully); but there are digital files that date back only a decade yet are completely unintelligible today.


Nowhere does Amazon, Apple or any other distributor pledge to support its digital formats in perpetuity. Quite the contrary: They typically warn that they can cancel their service at any time, without warning, in a way that could end your access to a lifetime of e-book purchases in the flash of an electron. They could also go out of business, leaving millions of dependent customers in the lurch.


Amazon keeps your purchased content for free on its own servers — the term is "in the cloud" — for downloading to your Kindles as needed. You pay once for an e-book and can use it on all the Kindles you own. I can't find any written promise by Amazon that this storage will always be free. If it announces a few years from now that henceforth there will be a monthly fee to store books purchased, say, more than 10 years ago, what rights will you have to resist? None.


There are ways to protect your e-books from grasping e-booksellers or the future. Programs available on the Web can strip the DRM code from your purchased items — for books, one possible method involves an e-library management program called Calibre. The program easily can be augmented with a DRM-stripping application so you can convert e-books sold in any proprietary format into a different format or even as plain text.


But is it legal? No one is quite sure, and that's a problem. The DMCA makes it unlawful to circumvent certain DRM protection, but doing so on an item you've bought and want to keep in a different format for your own use — not to make multiple copies for sale — may not break the law. On the other hand, distributing software that enables that is illegal under the DMCA even if the goal is legitimate, which is absurd.


Even if reformatting a file you own is legal, what if you don't own it? The hard-to-find terms of service of e-book sellers specify that you're only licensing a book, not buying it (although the Amazon order page does say you're "buying" it). "In the digital context, it's not clear that the 'first sale' has ever occurred," says Bridy.


It should be a top priority for Congress to clear out the murk. Buyers of e-books must have the explicit right to reformat their purchases and save backup copies for their own use, permanently. The sale of an e-book must be irrevocable. On the other side, it must remain strictly illegal to make multiple unauthorized copies of any copyrighted work for distribution. Lending by libraries, one digital copy at a time, should be facilitated — it tends to widen the audience for books.


The guiding principle must be that an e-book owner's rights and responsibilities parallel those of a book owner, and the same must go for authors, publishers and booksellers. "Someone once observed to me that if libraries were being invented today, publishers would try to make them illegal," Gillmor says.


Clarify these rules of e-book commerce, and the book market will reap the benefit. The power of electronic booksellers over publishers might be reduced, and consumers would know what they were buying — and would own what they bought. Leave the rules as vague as they are, and the victims will be authors, consumers and publishers.


Michael Hiltzik's column appears Sundays and Wednesdays. Reach him at mhiltzik@latimes.com, read past columns at latimes.com/hiltzik, check out facebook.com/hiltzik and follow @latimeshiltzik on Twitter.






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Hedge fund manager alleges Herbalife is 'pyramid scheme'









Herbalife Ltd. is girding for a fight against a Wall Street money man who's betting $1 billion that the company is nothing more than what he called a "pyramid scheme."


The Los Angeles maker of nutritional products rushed to defend itself Thursday against a hedge fund manager's accusation.


Hedge fund titan Bill Ackman accused Herbalife of paying its sales staff far more money to recruit new distributors than to actually sell its products.





That results in the roughly 2.6 million distributors at the bottom of the sales pyramid making little or no income, while a handful at the top hauls in millions, he said.


"This is the best-managed pyramid scheme in the history of the world," Ackman said.


The company denied the allegation and accused Ackman of trying to manipulate the stock. Herbalife shares slumped 10% on Thursday and are off 21% in the two days since Ackman announced that the company is in his sights.


"Today's presentation was a malicious attack on our business model based largely on outdated, distorted and inaccurate information," Herbalife said in a statement. "We are not an illegal pyramid scheme."


Herbalife, which bills itself as a so-called multilevel marketer, has beaten back similar accusations in the past. But the company has rarely faced a nemesis such as Ackman.


The 46-year-old billionaire has fashioned a career on high-stakes gambits in controversial companies. His fund firm, Pershing Square Capital Management, manages $12 billion.


Showdowns between companies and skeptical investors historically play out behind closed doors, especially in the normally sleepy pre-holiday period.


But in a measure of the aggressive tactics favored by an emerging breed of activist investors, Ackman launched a public blitzkrieg Thursday. He gave a flashy multimedia presentation to a packed conference room in New York that was streamed live on the Internet.


"I've never seen anything quite like it," said Timothy Ramey, an analyst at D.A. Davidson & Co. "I've never seen an investor spend 31/2 hours of time at a major venue being webcast and then make TV appearances to make his point. It's the largest orchestrated bull or bear case that I've ever seen."


The brawl has potential repercussions for both sides.


Ackman claimed to have spent one year doing intensive research on Herbalife's operations, an unusually extended period given Wall Street's thirst for immediate results.


Earlier this year, Ackman began betting that Herbalife's stock would fall sharply.


His fund is "shorting" more than 20 million shares of the company. In a short sale, an investor borrows stock and sells it immediately, hoping to later buy the shares at a reduced price and return them to their actual owner.


Ackman promised to donate all profit from his Herbalife bet to charity, and portrayed his public diatribe as intended for the public good.


"I'm very fortunate to have the means to pursue this," he said. "I am independently wealthy. When I believe in something, I can say what I want and do what is right."


For Herbalife, the fight threatens to damage its credibility among investors who have always been sensitive to claims that its business is illegitimate.


Herbalife, which was founded in 1980, sells a line of diet powders, bars, drinks and vitamins through a network of independent distributors in more than 80 countries. The company reported sales of $3.5 billion in 2011.


Its chief executive, Michael O. Johnson, was the highest paid executive in the United States last year, hauling in more than $89 million in salary, exercised stock options and other compensation, according to GMI Ratings, a corporate governance firm.


The company has fought criticism of its business model throughout its existence.


In 2008, for example, self-proclaimed fraud buster Barry Minkow shorted Herbalife's stock and then accused the company of a host of misdeeds. The company survived those accusations and Minkow ultimately went to prison on unrelated charges.


This was the second time this year that investors punished Herbalife because of questions about its business practices. Herbalife shares fell 20% in May after hedge fund operator David Einhorn asked pointed questions during an earnings call.


"We operate at the highest ethical and quality standards, and our management and our board are constantly reviewing our business practices and products," Herbalife said. "We also hire independent, outside experts to ensure our operations are in full compliance with laws and regulations."


Ackman and Herbalife engaged in a bitter and bizarre war of words, with Johnson saying the United States will "be better when Bill Ackman is gone."


Ackman interpreted the statement as a threat and said he has hired a security firm to protect him.


stuart.pfeifer@latimes.com


walter.hamilton@latimes.com





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Reacting to users’ outcry, Facebook’s Instagram reverts to prior policy on advertising






SAN FRANCISCO – Instagram has abandoned wording in its new terms-of-service agreement that sparked outcry from users concerned it meant their photos could appear in advertisements.


In a blog post late Thursday, the popular mobile photo-sharing service says it has reverted to language in the advertising section of its terms of service that appeared when it was launched in October 2010.






Instagram is now owned by Facebook Inc. and maintains that it would like to experiment with different forms of advertising to make money.


Its blog post says that it will now ask users’ permission to introduce possible ad products only after they are fully developed.


The outcry to the changes announced earlier this week led the company to clarify that it has no plans to put users’ photos in ads.


Social Media News Headlines – Yahoo! News





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Marilyn Monroe subway grate photo on view in NYC


NEW YORK (AP) — A famous image of Marilyn Monroe with her skirt billowing atop a New York City subway grate is on display in a picture-perfect spot: outside the Times Square subway station.


The supersized version of Sam Shaw's well-known picture is part of an exhibit. The exhibit also features eight of Shaw's other Monroe pictures, on view inside the 42nd Street-Bryant Park station on the B, D, F, M and 7 lines.


The show opened Thursday. It'll be up for a year.


Shaw shot the subway grate photo for the 1955 film "The Seven Year Itch." He took the other pictures in 1957.


The exhibit is part of the Metropolitan Transportation Authority's Arts for Transit program. Manager Lester Burg says matching a mass transit setting with a popular figure from mass culture seemed a good fit.


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