Stewart continues to deny insider trading as stock falls

As her company’s stock price continues to fall, Martha Stewart (above) again denied Tuesday that she was involved in an insider trading scheme involving ImClone Systems Inc.

Stewart sold 4,000 shares of ImClone a day before the Food and Drug Administration announced a denial of the company’s major cancer drug.

In a statement Tuesday, Stewart called the trade “entirely proper and lawful,” but congressional investigators said they are troubled as they probe whether she received inside information from former ImClone CEO Sam Waksal, a personal friend of Stewart.

Shares of Martha Stewart Living Omnimedia Inc. have lost about 21 percent of their value since June 6, when insider trading allegations arose regarding Stewart.

Regulation: Upstart telephone firms win victory in court case

In a victory for upstart local telephone companies, the U.S. Court of Appeals on Tuesday rejected a challenge of federal rules that allow the companies to compete by locating critical network equipment in the dominant local telephone company’s central switching office.

The appeals court rejected arguments by the nation’s largest local telephone company, Verizon Communications, that the rules were overly broad and compromised security of the Baby Bell’s switching offices.

The Federal Communications Commission “did not ignore security concerns,” the court concluded. Rather, the agency found insufficient evidence to require that the competitor companies be required in every instance to build expensive separate entrances and segregate their equipment inside the Bell central offices.

Joining Verizon were SBC Communications Inc. and BellSouth Corp. Siding with the FCC in support of the rules were WorldCom Inc. and AT&T Corp., Covad Communications Group Inc. and others.

Antitrust case: Microsoft to shut out Sun

Just before closing arguments in its antitrust case, Microsoft delivered a broadside to one of its bitter software rivals, declaring Tuesday it will stop supporting Sun Microsystems’ flagship product by 2004.

Microsoft cited Sun’s opposition in the case as the reason for the decision to remove support for Sun’s Java programming language from future versions of Microsoft’s Windows operating system.

Microsoft was found by a federal appeals court to have used illegal means to stamp out competition. The Justice Department reached a settlement with Microsoft last year, but nine states, including Kansas, still are seeking stronger antitrust penalties.

Outlook: Technology sales slumping

Several technology companies said Tuesday that they do not expect spending in the tech sector to bounce back anytime soon.

Advanced Micro Devices Inc., a leading manufacturer of personal computers, said it expects “substantial” operating losses in the second quarter because of a “broad weakness” in the computer market.

Apple Computer Inc. also lowered its earnings estimates, and analysts following IBM continued to cut their estimates for the world’s largest computer maker.

Oracle Corp., a major computer software firm, also warned investors its sales for the current quarter could fall by as much as 25 percent and said the sales outlook for future quarters remains “very limited.”