Amgen Workers Helped U.S. in Aranesp Marketing Inquiry

“I hope no one is taping this,” the Amgen manager remarked at a company sales meeting in 2005.

The manager then boasted of how she had given a $10,000 unrestricted grant to a pet project of a doctor who was an adviser to the local Medicare contractor. In turn, she said, the doctor would help persuade the contractor to provide reimbursement for an unapproved use of Amgen’s anemia drug, Aranesp.

Someone, it turned out, was taping it. Jill Osiecki, a longtime sales representative at Amgen, was wearing a recording device under her clothes, transmitting the proceedings to agents of the Department of Health and Human Services.

The result of Ms. Osiecki’s undercover work, and information provided by other whistle-blowers, led to Amgen’s agreement this week to pay $762 million to settle federal investigations regarding the marketing of some of its top-selling drugs.

Judge Sterling Johnson Jr. of Federal District Court in Brooklyn accepted the settlement on Wednesday, clearing the way for 10 whistle-blower lawsuits to be unsealed.

Amgen, the world’s largest biotechnology company, will pay $150 million in criminal penalties after pleading guilty to one misdemeanor count of marketing Aranesp for unapproved uses and in unapproved doses.

The rest of the money — $612 million — will go to settle civil false claims lawsuits filed by the federal government, states and whistle-blowers. These contain accusations that go well beyond the off-label marketing of Aranesp.

They include off-label marketing of other drugs like Enbrel for psoriasis and Neulasta, which increases the levels of white blood cells. Amgen is also accused of offering kickbacks to doctors and clinics to induce them to use its drugs. These reportedly came as cash, rebates, free samples, educational and research grants, dinners and travel, and other inducements. The government also accused the company of knowingly misreporting the prices of some of its drugs.

Except for those in the criminal count, Amgen denied the other accusations, though it did issue a statement on Wednesday acknowledging the settlement.

“The government raised important concerns in the criminal prosecution,” Cynthia M. Patton, chief compliance officer at Amgen, said in the statement. “Amgen acknowledges that mistakes were made, and we did not live up to our standards.”

Ms. Osiecki, 52, was one of the main whistle-blowers and will be entitled to a share of the settlement. The amount each whistle-blower will receive has not been determined or is being kept confidential, their lawyers said.

Ms. Osiecki worked as a sales representative for Merck for nine years before joining Amgen in 1990, soon after the biotechnology company won regulatory approval for its first product. The company, based outside Los Angeles, had “good science, good products, strong ethics,” Ms. Osiecki said in an interview.

But, she said, the corporate culture changed starting around 2000. That was when new management came in and Aranesp was approved, setting up a fierce marketing battle with Johnson & Johnson and its rival anemia drug, Procrit.

“It was more important to make your numbers than to follow the rules,” said Ms. Osiecki, who was based in Milwaukee and sold Aranesp.

In August 2004, with her concerns mounting, Ms. Osiecki called the Office of Inspector General of the Department of Health and Human Services and left a message. Within days, she was called back, and she went to see an agent, who persuaded her to secretly record meetings. She did that 13 times over about 15 months, mainly sales meetings.

Aranesp is used mainly in a hospital, clinic or physician’s office. It is bought by the medical practice, which can make a profit if the patient and insurers pay more for the use of the drug than the practice paid.

Ms. Osiecki said Amgen “marketed the spread,” trying to make it more profitable for doctors to use Aranesp rather than Procrit.

Such financial inducements could also spur greater overall use of a drug and can violate anti-kickback laws, said Ms. Osiecki’s lawyer, Brian P. Kenney of Kenney & McCafferty in Blue Bell, Pa.

Ms. Osiecki said the first sales meeting at which she wore the recording device, wrapped around her midriff under baggy clothes, was in October 2004 in a Milwaukee hotel. She could look down from the meeting room and see the car parked across the street containing the agent with the receiving device. She said she was not particularly nervous.

The speaker was a pharmacist from an oncology practice going through the numbers on how his practice could make a million dollars more a year using Aranesp rather than Procrit.

Ms. Osiecki said Amgen was careful to cover up such marketing. Spreadsheets showing doctors how much more money they could make using Aranesp were “homemade bread,” meaning they were created by each sales representative, not by the company. And representatives were told not to leave the presentations behind after showing them to doctors.

Her 107-page complaint, filed in late 2004, contains many other accusations.

Other whistle-blowers made other accusations. Kassie Westmoreland, a former sales representative, said Amgen overfilled vials of Aranesp, essentially providing free drugs to doctors. They could then bill Medicare or private insurers for the use of that drug, making an extra profit.

“Amgen was offering a kickback in the form of extra product subsidized by the taxpayers,” said Robert M. Thomas Jr., one of Ms. Westmoreland’s lawyers.

Elena Ferrante and Marc Engelman, both former sales representatives, contended that Amgen promoted Enbrel’s off-label use for mild psoriasis when the drug was approved only for moderate or severe cases of the disease.

Lydia Cotz, one of their lawyers, said the two refused to go along with the off-label marketing. They are now pursuing wrongful termination claims against Amgen in arbitration proceedings that Amgen requires be kept confidential, she said.

“It’s been a very long heroic journey for my clients,” she said.

Ms. Osiecki is now also a former Amgen sales representative. She said that she was fired in December 2005 after she let slip that she had retained a company voice mail message that she thought provided evidence of illegal activity. Leaving the pharmaceutical industry, she moved to Amelia Island, Fla. She now works for a small business.

Mosi Secret and Barry Meier contributed reporting.

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FTC unveils broader rules to protect kids' privacy online

Columnist David Lazarus talks with Mark Blafkin, spokesman for the Assn. of Competitive Technology, an organization of app developers, and Alan Simpson of Common Sense Media, an advocacy group for parents.

SAN FRANCISCO — In a major step to protect kids' online privacy, the Federal Trade Commission has unveiled new rules that require mobile apps and websites to obtain parental consent before collecting personal information from children.

The agency's chairman, Jon Leibowitz, said Wednesday that federal regulators were trying to keep pace with the growing use of mobile devices by those under age 13 — and the rapidly evolving tactics and tracking tools of marketers and data brokers that collect detailed dossiers on Americans and their online activities.

The new rules — the first major update to federal laws on children's online privacy in 14 years — require a parent's consent to collect those kinds of personal details that can be used to identify, locate or contact a child and pass that information on to third parties.

The FTC struck a balance between shielding kids from potential harm and ensuring that the marketplace for kids' mobile apps and online services would continue to flourish, Leibowitz said during a Capitol Hill news conference.

Under the broader rules, the FTC said companies must get permission from parents before collecting photographs and videos as well as deploying tracking tools, such as cookies, which use IP addresses and mobile device IDs to follow a child on the Web.

Quiz: What set the Internet on fire in 2012?

The move comes one week after the agency said it was investigating mobile app developers who might have gathered information from kids without their parents' consent. The agency did not name the companies or say how many it was investigating.

"We are at a critical moment in the growth of the children's digital marketplace as social networks, mobile phones and gaming platforms become an increasingly powerful presence in the lives of young people," said Kathryn Montgomery, a children's advocate and a professor of communications at American University. "The new rules should help ensure that companies targeting children throughout the rapidly expanding digital media landscape will be required to engage in fair marketing and data collection practices."

Federal regulators had not significantly updated online privacy rules for kids since 1998 when the Children's Online Privacy Protection Act was enacted. That law required online services geared toward kids to notify parents and get their permission before collecting or sharing basic personal information such as names, email addresses or home addresses from those under 13.

The law did not envision today's Internet in which the rapid adoption of mobile devices loaded with apps can relay a person's location and other personal details highly prized by advertisers and data brokers. The FTC began a review of the law in 2010.

James Steyer, chief executive of Common Sense Media Inc., a nonprofit group in San Francisco that studies kids' use of technology, said the new rules put parents — not corporations — back in charge as gatekeepers for kids.

"All of the companies and developers in the online and mobile space benefit from the share and use of personal information. But they also have a responsibility for providing parents with information and tools so they can make smart choices about what their young children do and share online, and so far, most of these companies have failed to live up to that responsibility," Steyer said.

But software developers — many of whom are parents themselves — said the FTC is giving their industry, which makes products including educational tools and games for kids, a bad rap.

"It's a little alarming that the FTC has chosen to paint all children's apps with the same brush," said Rick Richter, CEO of Ruckus Media Group Inc. "What this is all about is notifying parents about information we are gathering. We have been fastidious as a company about doing that."

Some app developers warned that the cost of complying with the new regulations would force many of them to stop building apps for kids.

Liability for violating the rules does not extend to Google, Apple and other technology giants that operate online stores that sell kids' apps.

The Application Developers Alliance said the kids' software industry is mostly made up of entrepreneurs who can't afford lawyers to help them navigate the complex new rules governing kids' privacy.

"Ultimately it's the kids, parents and teachers who will suffer," said Tim Sparapani, vice president of law policy and government relations at the alliance.

Josh Hartwell, who runs Mobile Deluxe, a mobile game developer and publisher in Santa Monica, has three kids and a fourth on the way. He said he and many other app developers agree that protecting children's privacy is "paramount" and supports weeding out "bad actors." But he worries that the burdensome new rules will stifle innovation.

"Some of the compliance issues are going to make it tougher for people to create apps for kids," Hartwell said.

But Samantha Lurey, CEO of Go Trexx in Mission Viejo, which makes travel apps for kids, applauded the effort to increase privacy protections for children.

"This is something our firm has wanted to see for a while now. We feel that federal regulators are going in the right direction," Lurey said. "Because our apps are designed for kids, we felt it was really important that we were not capturing any sensitive information. I think other developers will find that it's relatively easy to construct apps that are engaging, entertaining and useful without capturing sensitive information."

jessica.guynn@latimes.com

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Grand jury probes L.A. County sheriff's handling of FBI informant

When Los Angeles County jail officials learned last year that one of their inmates was a secret FBI informant, they launched a plan.

Sheriff's officials moved the inmate from the downtown lockup, where he was surreptitiously collecting information on allegedly abusive and corrupt deputies, to a cell in a patrol station in San Dimas. Jailers kept him under constant watch, sources said, and listed the informant, a convicted bank robber, under a series of aliases — including Robin Banks.

Now, a federal grand jury is investigating whether sheriff's officials moved the informant to hinder an FBI investigation into alleged jail abuses.

Several sheriff's employees have testified at recent grand jury hearings about the handling of the informant, sources said. At least one witness testified that moving the inmate and changing his name was an attempt to hide him from federal agents, and that top officials, including the department's second in command, Undersheriff Paul Tanaka, played a role in the plan, according to a source familiar with the testimony.

Sheriff's officials insist that they were not hiding the informant, Anthony Brown, from the FBI but protecting him from other deputies.

Department spokesman Steve Whitmore said Brown wrote a letter after his identity was discovered, complaining that he feared for his life and felt abandoned by the FBI.

"He was frightened not of inmates but of deputies because he was snitching on deputies," Whitmore said. "We were moving him around to protect him from any kind of retaliation."

The grand jury investigation underscores the rift that developed last year between the Sheriff's Department and federal authorities after deputies discovered the FBI had cultivated an inmate informant as part of a wide-ranging inquiry into the department's jails.

After news broke about the incident, Sheriff Lee Baca publicly accused an FBI agent of possibly committing a crime by smuggling a phone to the informant. He dispatched investigators to the agent's home before determining the case was "not worthy of pursuing."

The grand jury hearings suggest that the federal investigation extends beyond alleged jailhouse abuses by deputies to include the actions of high-ranking members of the department. So far, the U.S. attorney's office has brought charges against only one deputy, who pleaded guilty to bribery for taking money to smuggle the cellphone to the informant.

Laurie Levenson, a professor at Loyola Law School and a former federal prosecutor, said obstruction of justice cases typically involve intimidation or violence against potential witnesses. But she said prosecutors could build a criminal case against sheriff's officials if they can prove the department's goal in moving Brown was to hinder the FBI's investigation of the jails.

"The biggest challenge is probably to show... the purpose of that was to interfere with the investigation as opposed to other legitimate purposes," she said. "If they can show that there was a conspiracy to hide the informant, they'll find a statute that fits."

Sheriff's officials discovered the informant's identity after jail deputies found his phone during a cell search in August 2011. The phone included calls to the FBI. In an interview with The Times earlier this year, the informant said he had been using his phone to take photos and document excessive force inside Men's Central Jail. Brown said FBI agents regularly visited him in court and at jail, where he supplied them with the names of corrupt and abusive deputies.

Brown said FBI agents rushed into the jail to visit him soon after they learned his cover had been blown. But as the meeting began, Brown said, a sheriff's investigator came in and ended it. "This…visit is over," the official said, according to Brown.

Brown said sheriff's officials moved him, changed his name several times and grilled him about what he knew and whether he would testify in the federal investigation.

"I didn't know it then, but they were hiding me from the feds," said Brown, who is serving 423 years to life in prison for armed robbery.

Whitmore, the sheriff's spokesman, disputed Brown's account of the FBI visit, saying it never happened. Federal agents, he said, never asked to visit Brown and would have been given access to the inmate had they requested it.

Sources who were briefed on the department's handling of the informant said the decision to move Brown was made at a meeting attended by Tanaka. One sheriff's employee testified that supervisors made it clear after the meeting that the intent of moving Brown was to hide him from the FBI, according to a source.

Whitmore said Tanaka played no role in Brown's move.

"That is an absurd allegation," he said. "Were the higher-ups briefed about this? Absolutely. But he had nothing to do with this decision other than the fact that he was aware of it."

In the year since the jail abuse scandal erupted, Tanaka has come under heavy criticism. A county commission created to examine the jails accused Tanaka of exacerbating problems in the lockups by encouraging deputies to push legal boundaries and discouraging supervisors from disciplining deputies involved in misconduct.

The undersheriff admitted some fault, but denied that he turned a blind eye to abuse. In testimony before the commission, he accused his detractors of having personal agendas and trying to discredit him by misinterpreting his actions.

At least one witness has told the grand jury that another top sheriff's official — Lt. Greg Thompson, formerly in charge of the jailhouse intelligence team — was also involved in hiding Brown, according to the source.

Thompson was placed on leave last month. Sheriff's officials are investigating whether Thompson had his son, who is also a deputy, confront another jailer to find out what he had told the grand jury about the elder Thompson, according to several sources who asked to remain anonymous because the investigation is ongoing.

Representatives for the FBI and the U.S. attorney's office declined to comment. Whitmore said that Tanaka and Thompson also declined to comment.

jack.leonard@latimes.com

robert.faturechi@latimes.com

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Samsung Galaxy Muse is like an iPod Shuffle that Syncs with Your Phone

In perhaps the most awkwardly titled tech press release ever, Samsung Mobile announced the launch of the new Samsung Galaxy Muse, a device which appears to have nothing to do with “CORRECTING and REPLACING and ADDING MULTIMEDIA” but everything to do with being a music player crossed with a smartphone accessory.

​Say goodbye to iTunes?

While most handheld music players (and smartphone or tablets with music apps) sync with a PC or Mac music app, like iTunes or Banshee, the Samsung Galaxy Muse syncs with your Android phone itself. It uses the Muse Sync app, which Google Play says will install on devices like the Nexus 7 tablet but which Samsung says will only work with the Galaxy S II, Galaxy S III, Galaxy Note and Galaxy Note II smartphones.

​Plug it in, turn it on

The pebble-shaped Muse connects to your Samsung phone via its headset jack. It doesn’t have a screen, so you have to control it iPod Shuffle style, and use the Muse Sync app to see how much of its 4 GB of space are free and decide which playlists to sync. Since it only has those 4 GB, it can only hold a fraction of the music that can be put on the much more powerful smartphones.

​Who is Samsung selling the Galaxy Muse to?

Samsung says “users can sync the songs they want and leave their phone behind,” the usefulness of which may depend on whether or not you feel limited by having to bring your smartphone with you. The press release mentions its “wearable design and small form factor,” and suggests taking it “in place of [your] smartphone … at the gym or on the go.”

​What other gadgets are like the Galaxy Muse?

The most obvious comparison is to the iPod Shuffle, Apple’s similarly tiny and screen-less portable music player. At $ 49, it costs the same as the Galaxy Muse (although a Droid-Life tipster found a $ 25 off coupon code for the Muse), but comes in seven different colors and has an embossed click-wheel controller instead of a flat and featureless surface. It requires you to use iTunes on a desktop PC or Mac, though.

​On the upside

The Galaxy Muse’s six hours of battery life may not be suitable for all-day listening, but may at least take the pressure off of a battery-hungry smartphone (so long as it’s one of Samsung’s flagship models). And as PCMag’s Chloe Albanesius notes, “it’s not very convenient to strap a 5.5-inch Galaxy Note II to your arm when you hit the gym.”

Jared Spurbeck is an open-source software enthusiast, who uses an Android phone and an Ubuntu laptop PC. He has been writing about technology and electronics since 2008.
Linux/Open Source News Headlines – Yahoo! News

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Newsman's disappearance largely kept secret

NEW YORK (AP) — NBC was able to keep the abduction of chief Middle East correspondent Richard Engel in Syria largely a secret until he escaped late Monday because it persuaded some of this country's most prominent news organizations to hold back on the story.

Otherwise, the disappearance of Engel — probably the most high-profile international television reporter on a U.S. network — would have been big news.

Engel and three colleagues, producers Ghazi Balkiz and Aziz Akyavas and photographer John Kooistra, escaped during a firefight between rebels and their captors, forces sympathetic to the Syrian government. The journalists were dragged from their cars, kept bound and blindfolded and threatened with death.

NBC said it did not know what had happened to the men until after their escape. The first sign of trouble came last Thursday, when Engel did not check back with his office at an agreed-upon time.

The Associated Press learned of Engel's disappearance independently and was asked to keep the news quiet upon contacting NBC, said John Daniszewski, the AP's vice president and senior managing editor.

"A general principle of our reporting is that we don't want to write stories that are going to endanger the lives of the people that we are writing about," Daniszewski said. The first few days after an abduction are often crucial to securing the captive's release.

In any case, he said, the AP never had enough information to report to its standards. "The fragmentary information we did receive was not solid or sourced in a way we could use. We had no actual news to report until they got out on Tuesday and NBC went public with the story," he said.

CBS News also said that it had honored NBC's request, but a spokeswoman declined to discuss it. ABC, Fox News and CNN were also contacted by NBC.

CNN, in an editor's note affixed to a website story on Engel's escape, noted NBC's request. CNN said it complied to allow fact-finding and negotiations to free the captors before it became a worldwide story.

"Hostage negotiators say that once the global spotlight is on the missing, the hostages' value soars, making it much harder to negotiate their freedom," CNN said.

For similar reasons, the AP did not report its own news several years ago when a photographer was kidnapped in the Gaza Strip, securing his release within a day. In one celebrated case of secrecy, The New York Times withheld news that reporter David Rohde was kidnapped while trying to make contact with a Taliban commander in Afghanistan. Rohde escaped after seven months in captivity.

It wasn't clear whether Engel's abductors knew what they had at the time. That knowledge, CNN argued, could have greatly complicated any negotiations. In this case, the captors did not make any ransom demands during the time he was missing.

This isn't simply a professional courtesy; the AP has withheld news involving overseas contractors in the past, Daniszewski said. For similar reasons, the organization does not reveal details of military or police actions it learns about beforehand if the news will put people at risk, and doesn't write about leaders heading into war zones until they are safely there.

Still, it's not a decision lightly taken by news organizations. "The obligation of journalists is to report information, not withhold it, except in exceptional circumstances," said Robert Steele, a journalism ethics professor at DePauw University.

The news that Engel was missing was first reported Monday by Turkish journalists who had heard about Akyavas' involvement, and was picked up by the U.S. website Gawker.com. In explaining why the news was reported, Gawker's John Cook wrote that no one had told him of a specific or even general threat to Engel's safety.

"I would not have written a post if someone had told me that there was a reasonable or even remote suspicion that anything specific would happen if I wrote the post," Cook wrote.

He also noted that China's Xinhua News Agency and the Breitbart website had also reported on Engel's disappearance. Breitbart's John Nolte attached a note to his report saying that he wasn't even aware of any news embargo until after hearing that Engel had been released.

The news was also tweeted by a small number of journalists, apparently unaware of the embargo request.

Whether a disappearance has become widely known could influence a decision by AP on whether to withhold the news, Daniszewski said. In this case, it wasn't clear that it had been widely circulated, he said.

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Attackers in Pakistan Kill Anti-Polio Workers

Rizwan Tabassum/Agence France-Presse — Getty Images

A Pakistani mother mourned her daughter, who was killed on Tuesday in an attack on health workers participating in a drive to eradicate polio from Pakistan.

ISLAMABAD, Pakistan — Gunmen shot dead five female health workers who were immunizing children against polio on Tuesday, causing the Pakistani government to suspend vaccinations in two cities and dealing a fresh setback to an eradication campaign dogged by Taliban resistance in a country that is one of the disease’s last global strongholds.

“It is a blow, no doubt,” said Shahnaz Wazir Ali, an adviser on polio to Prime Minister Raja Pervez Ashraf. “Never before have female health workers been targeted like this in Pakistan. Clearly there will have to be more and better arrangements for security.”

No group claimed responsibility for the attacks, but most suspicion focused on the Pakistani Taliban, which has previously blocked polio vaccinators and complained that the United States is using the program as a cover for espionage.

The killings were a serious reversal for the multibillion-dollar global polio immunization effort, which over the past quarter century has reduced the number of endemic countries from 120 to just three: Pakistan, Afghanistan and Nigeria.

Nonetheless, United Nations officials insisted that the drive would be revived after a period for investigation and regrouping, as it had been after previous attacks on vaccinators here, in Afghanistan and elsewhere.

Pakistan has made solid gains against polio, with 56 new recorded cases of the diseases in 2012, compared with 192 at the same point last year, according to the government. Worldwide, cases of death and paralysis from polio have been reduced to less than 1,000 last year, from 350,000 worldwide in 1988.

But the campaign here has been deeply shaken by Taliban threats and intimidation, though several officials said Tuesday that they had never seen such a focused and deadly attack before.

Insurgents have long been suspicious of polio vaccinators, seeing them as potential spies. But that greatly intensified after the C.I.A. used a vaccination team headed by a local doctor, Shakil Afridi, to visit Osama bin Laden’s compound in Abbottabad, reportedly in an attempt to obtain DNA proof that the Bin Laden family was there before an American commando raid on it in May 2011.

In North Waziristan, one prominent warlord has banned polio vaccinations until the United States ceases drone strikes in the area.

Most new infections in Pakistan occur in the tribal belt and adjoining Khyber-Pakhtunkhwa Province — some of the most remote areas of the country, and also those with the strongest militant presence. People fleeing fighting in those areas have also spread the disease to Karachi, the country’s largest city, where the disease has been making a worrisome comeback in recent years.

After Tuesday’s attacks, witnesses described violence that was both disciplined and well coordinated. Five attacks occurred within an hour in different Karachi neighborhoods. In several cases, the killers traveled in pairs on motorcycle, opening fire on female health workers as they administered polio drops or moved between houses in crowded neighborhoods.

Of the five victims, three were teenagers, and some had been shot in the head, a senior government official said. Two male health workers were also wounded by gunfire; early reports incorrectly stated that one of them had died, the official said.

In Peshawar, the capital of Khyber-Pakhtunkhwa Province, gunmen opened fire on two sisters participating in the polio vaccination program, killing one of them. It was unclear whether that shooting was directly linked to the Karachi attacks.

In remote parts of the northwest, the Taliban threat is exacerbated by the government’s crumbling writ. In Bannu, on the edge of the tribal belt, one polio worker, Noor Khan, said he quit work on Tuesday once news of the attacks in Karachi and Peshawar filtered in.

“We were told to stop immediately,” he said by phone.

Still, the Pakistani government has engaged considerable political and financial capital in fighting polio. President Asif Ali Zardari and his daughter Aseefa have been at the forefront of immunization drives. With the help of international donors, including the Bill and Melinda Gates Foundation, they have mounted a huge vaccination campaign aimed at up to 35 million children younger than 5, usually in three-day bursts that can involve 225,000 health workers.

The plan seeks to have every child in Pakistan immunized at least four times per year, although in the hardest-hit areas one child could be reached as many as 12 times in a year.

Declan Walsh reported from Islamabad, and Donald G. McNeil Jr. from New York. Salman Masood contributed reporting from Islamabad, and Zia ur-Rehman from Karachi, Pakistan.

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U.S. settles with Penguin Group in e-book price-fixing lawsuit

The Justice Department announced Tuesday that it has reached a settlement with Penguin Group (USA) Inc. in its lawsuit accusing the nation's largest book publishers of colluding with Apple Inc. to raise e-book prices on customers.

The settlement, if approved by a federal judge, leaves Apple Inc. and Holtzbrinck Publishers, which does business as Macmillan, as the only defendants in the federal government's lawsuit accusing Apple, the multimedia and computer giant, of conspiring with several publishers in 2009 to force e-book prices several dollars above the $9.99 charged by Amazon.com Inc. on its Kindle device.

The Justice Department, which sued in April, settled with Hachette Book Group Inc., HarperCollins Publishers and Simon & Schuster Inc. earlier this year. The trial is scheduled to begin in June.

"The proposed settlement with Penguin will be an important step toward undoing the harm caused by the publishers' anti-competitive conduct and restoring retail price competition so consumers can pay lower prices for Penguin's e-books," said Jamillia Ferris, chief of staff and counsel at the Justice Department's antitrust division.

Apple has said the government's accusation that it conspired with major book publishers to raise the price of e-books is untrue.

The proposed settlement was filed in federal court in New York.

The settlement had been expected by some industry observers as a means to simplify Penguin's impending merger with Random House, which is not a defendant in the case. That deal would create the world's largest publisher of consumer books.

Under the settlement, Penguin "will be prohibited for two years from entering into new agreements that constrain retailers' ability to offer discounts or other promotions to consumers to encourage the sale of the Penguin's e-books," and must submit to "a strong antitrust compliance program" that includes telling federal officials about any joint e-book ventures or any communications with other publishers, Justice Department officials said.

The Justice Department's lawsuit stems from agreements reached between major publishers and Apple in 2010 that allowed publishers to set their own prices for e-books, an effort to counter Amazon's deep discounts of bestsellers. The department and 15 states said Apple and the publishers cost consumers more than $100 million in the last two years by adding $2 or $3, and sometimes as much as $5, to the price of each e-book.

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Girl, 13, gets Hasbro to make gender-neutral Easy-Bake oven

McKenna Pope, the 13-year-old girl who petitioned toy maker Hasbro for an Easy-Bake oven suitable for both girls and boys, will get what she’s been asking for.

After meeting with the New Jersey girl at its Rhode Island headquarters Monday, Hasbro said it will offer a new black-and-silver oven design in fall 2013. The company said the prototype, which it showed to Pope, has been in development for 18 months and will debut at the New York Toy Fair in February.

Since 1963, a dozen different Easy-Bake models have been introduced in colors including teal, green, yellow, silver, blue and purple, Hasbro said.

The packaging for the new oven will feature boys and girls, according to Change.org, where Pope launched her petition recently. More than 44,000 people have since signed the petition.

Pope’s effort also scored support from some major male bakers and chefs, including “Top Chef” star Manuel Trevino, who was featured in a YouTube video backing her cause.

ALSO:

Hasbro to meet with girl, 13, on gender-neutral Easy-Bake ovens

Eighth-grader petitions Hasbro to market Easy-Bake Ovens to boys

Women a century away from breaking California glass ceiling, study says

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Amazon smartphone reportedly set for 2013 launch

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'The Hobbit' tops box office with record $84.6M

NEW YORK (AP) — Peter Jackson's "The Hobbit" led the box office over the weekend with $84.6 million, a record-setting opening better than the three previous "Lord of the Rings" films.

The 3-D Middle Earth epic, the first of three planned films adapted from J.R.R. Tolkien's novel, was the biggest December opening ever, surpassing Will Smith's "I Am Legend," which opened with $77.2 million in 2007.

The top 20 movies at U.S. and Canadian theaters Friday through Sunday, followed by distribution studio, gross, number of theater locations, average receipts per location, total gross and number of weeks in release, as compiled Monday by Hollywood.com are:

1. "The Hobbit: an Unexpected Journey," Warner Bros., $84,617,303, 4,045 locations, $20,919 average, $84,617,303, one week.

2. "Rise of the Guardians," Paramount, $7,143,445, 3,387 locations, $2,109 average, $71,085,268, four weeks.

3. "Lincoln," Disney, $7,033,132, 2,285 locations, $3,078 average, $107,687,319, six weeks.

4. "Skyfall," Sony, $6,555,732, 2,924 locations, $2,242 average, $271,921,795, six weeks.

5. "Life of Pi," Fox, $5,413,066, 2,548 locations, $2,124 average, $69,572,472, four weeks.

6. "The Twilight Saga: Breaking Dawn, Part 2," Summit, $5,136,074, 3,042 locations, $1,688 average, $276,826,143, five weeks.

7. "Wreck-It Ralph," Disney, $3,216,043, 2,249 locations, $1,430 average, $168,721,592, seven weeks.

8. "Playing For Keeps," FilmDistrict, $3,146,443, 2,840 locations, $1,108 average, $10,737,535, two weeks.

9. "Red Dawn," FilmDistrict, $2,408,882, 2,250 locations, $1,071 average, $40,904,305, four weeks.

10. "Silver Linings Playbook," Weinstein Co., $2,109,274, 371 locations, $5,685 average, $16,979,323, five weeks.

11. "Flight," Paramount, $1,910,666, 1,823 locations, $1,048 average, $89,418,704, seven weeks.

12. "Argo," Warner Bros., $1,170,175, 667 locations, $1,754 average, $104,955,079, 10 weeks.

13. "Hitchcock," Fox Searchlight, $1,107,659, 561 locations, $1,974 average, $3,071,871, four weeks.

14. "Anna Karenina," Focus, $1,022,214, 409 locations, $2,499 average, $8,380,517, five weeks.

15. "Killing Them Softly," Weinstein Co., $1,008,127, 1,427 locations, $706 average, $14,140,432, three weeks.

16. "The Collection," LD Entertainment, $529,158, 621 locations, $852 average, $6,520,794, three weeks.

17. "Hyde Park On Hudson," Focus, $292,796, 36 locations, $8,133 average, $404,816, two weeks.

18. "Taken 2," Fox, $288,772, 339 locations, $852 average, $138,132,493, 11 weeks.

19. "Pitch Perfect," Universal, $245,680, 332 locations, $740 average, $63,869,423, 12 weeks.

20. "Talaash," Reliance Big Pictures, $168,828, 113 locations, $1,494 average, $2,706,375, three weeks.

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Universal and Focus are owned by NBC Universal, a unit of Comcast Corp.; Sony, Columbia, Sony Screen Gems and Sony Pictures Classics are units of Sony Corp.; Paramount is owned by Viacom Inc.; Disney, Pixar and Marvel are owned by The Walt Disney Co.; Miramax is owned by Filmyard Holdings LLC; 20th Century Fox and Fox Searchlight are owned by News Corp.; Warner Bros. and New Line are units of Time Warner Inc.; MGM is owned by a group of former creditors including Highland Capital, Anchorage Advisors and Carl Icahn; Lionsgate is owned by Lions Gate Entertainment Corp.; IFC is owned by AMC Networks Inc.; Rogue is owned by Relativity Media LLC.

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