DealBook: Ex-Trader Charged in $276 Million Insider Scheme

Federal prosecutors brought what they called “the most lucrative insider trading scheme ever charged,” filing a criminal case on Tuesday against a former trader at a unit of the hedge fund SAC Capital.

Mathew Martoma, a former trader at CR Intrinsic, a division of SAC Capital, was charged with making about $276 million in combined profits and avoided losses by obtaining confidential information about a drug trial for an Alzheimer’s drug developed by the pharmaceutical companies Elan and Wyeth.

The case is the latest to put the billionaire investor Steven A. Cohen and his hedge fund, SAC Capital, in the spotlight over insider trading crimes committed by former employees.

Mr. Martoma received the information from Sidney Gilman, a neurology professor at the University of Michigan, a leading expert in Alzheimer’s disease. Mr. Gilman is cooperating with the government and has entered into a nonprosecution agreement with the United States attorney’s office in Manhattan.

Mr. Gilman connected with Mr. Martoma through an expert network firm based in New York. Expert networks became popular on Wall Street in the last decade, linking Wall Street money managers to specialists in various industries to help give them an edge on their investments. Expert networks have been a focus of the government’s widespread crackdown on insider trading at hedge funds.

His consulting work at the expert network firm earned Mr. Gilman more than $100,000, according to a parallel civil complaint against Mr. Martoma and Mr. Gilman filed by the Securities and Exchange Commission on Monday.

According to the complaint, between 2006 and 2008, Mr. Martoma consulted with Mr. Gilman on dozens of occasions about the preliminary results of the drug trial and accumulated a roughly $700 million position in the stocks of Wyeth and Elan. Mr. Gilman was chairman of the safety committee overseeing the drug trial.

In June 2008, the complaint says, Mr. Martoma received secret information about negative data relating to the drug trials. After receiving that information, Mr. Martoma caused SAC Capital to sell its entire inventory of roughly 10.5 million shares in Elan and about 7 million shares of Wyeth before the public release of the data.

The day after the study was announced, Elan stock lost about 42 percent of its value and Wyeth dropped about 12 percent. The inside information allowed SAC Capital to make about $276 million in illegal gains.

Mr. Martoma left SAC Capital in 2010, according to a spokesman at the hedge fund. A lawyer for Mr. Martoma could not be reached immediately for comment.

In a statement, Preet Bharara, the United States attorney, said: “The charges unsealed today describe cheating coming and going – specifically, insider trading first on the long side, and then on the short side, on a scale that has no historical precedent. As alleged, by cultivating and corrupting a doctor with access to secret drug data, Mathew Martoma and his hedge fund benefited from what might be the most lucrative inside tip of all time.”

Mr. Martoma is the latest person to have worked at SAC to be ensnared in an insider trading investigation. Jon Horvath, a former technology industry analyst at SAC, pleaded guilty in September to participating in a conspiracy that illegally traded in the shares of Dell computer. His boss, the former portfolio manager Michael Steinberg, has been named as an unindicted co-conspirator but has not been charged in the case. Mr. Steinberg’s lawyer, Barry Berke, declined to comment.

Last year, two former SAC portfolio managers – Donald Longueuil and Noah Freeman – admitted to trading on illegal tips about publicly traded technology companies. Mr. Longueuil is serving a two-and-a-half-year term at a federal prison in Otisville, N.Y.; Mr. Freeman, who is cooperating with prosecutors, has yet to be sentenced.

SAC CAPITAL UNDER A MICROSCOPE The firm has been under a cloud since a former employee, Richard Choo-Beng Lee, pleaded guilty in 2009 to insider trading and began helping the government in its investigation. The crimes he confessed to were committed after he left SAC, but he agreed to provide information about his five years at the firm, which ended in 2004.

NAMES	THE CASES
Jonathan Hollander	The former analyst paid more than $220,000 to settle civil charges brought by the Securities and Exchange Commission accusing him of trading in his personal account on confidential information about the 2006 takeover of the Albertsons grocery store chain.
Jon Horvath and Michael Steinberg	Mr. Horvath, right, a former technology industry analyst, pleaded guilty in September to participating in a conspiracy that illegally traded in the shares of Dell computer. His boss, the former portfolio manager Mr. Steinberg, has been named as an unindicted co-conspirator but has not been charged in the case. Federal prosecutors contend they were part of a seven-person conspiracy — a “circle of friends” — that earned about $62 million in illegal gains trading on secret tips from executives at publicly traded technology companies.
Donald Longueuil and Noah Freeman	The two former portfolio managers admitted in 2011 to trading on illegal tips about publicly traded technology companies. Mr. Longueuil, right, was swept up in a crackdown on so-called expert networks. He is one of roughly a dozen implicated in the case. Mr. Longueuil is serving a two-and-a-half-year jail term at a federal prison in Otisville, N.Y.; Mr. Freeman, who is cooperating with prosecutors, has yet to be sentenced.
Mathew Martoma	The former trader at CR Intrinsic, a unit of the hedge fund, was charged with making about $276 million in combined profits and avoided losses by obtaining confidential information about a drug trial for an Alzheimer’s drug developed by the pharmaceutical companies Elan and Wyeth.

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Hamas Strengthens as Palestinian Authority Weakens

RAMALLAH, West Bank — In the daily demonstrations here of solidarity with Gaza, a mix of sympathy and anguish, there is something else: growing identification with the Islamist fighters of Hamas and derision for the Palestinian Authority, which Washington considers the only partner for peace with Israel.

“Strike a blow on Tel Aviv!” proclaim the lyrics of a new hit song blasting from shops and speakers at Monday’s demonstration, in a reference to Hamas rockets that made it nearly to Israel’s economic and cultural capital. “Don’t let the Zionists sleep! We don’t want a truce or a solution! Oh Palestinians, you can be proud!”

Pop songs everywhere are filled with bravado and aggression. But this one reflects a widespread sentiment that does not augur well for President Mahmoud Abbas and his Palestinian Authority, which is rapidly losing credibility, even relevance. The Gaza truce talks in Cairo, involving Egypt, Turkey and Qatar, offer a telling tableau. The Palestinian leader seen there is not Mr. Abbas, but Khaled Meshal, the leader of the militant group Hamas, who seeks to speak for all Palestinians as his ideological brothers in the Muslim Brotherhood rise to power around the region.

Israel is also threatening Mr. Abbas, even hinting that it may give up on him, as he prepares to go to the United Nations General Assembly on Nov. 29 to try to upgrade the Palestinian status to that of a nonmember state. The Israelis consider this step an act of aggression, and even some Palestinians say it is somewhat beside the point at this stage.

“His people are being killed in Gaza, and he is sitting on his comfortable chair in Ramallah,” lamented Firas Katash, 20, a student who took part in the Ramallah demonstration.

For the United States, as for other countries hoping to promote a two-state solution to this century-old conflict, a more radicalized West Bank with a discredited Palestinian Authority would mean greater insecurity for Israel and increased opportunity for anti-Western forces to take root in a region where Islamism is on the rise.

Since Hamas, which won parliamentary elections in 2006, threw the Fatah-controlled authority out of Gaza a year later, Mr. Abbas has not set foot there. Yet he will be asking the world to recognize the two increasingly distinct entities as a unified state.

Manar Wadi, who works in an office in Ramallah, put the issue this way: “What is happening in Gaza makes the Palestinian Authority left behind and isolated. Now we see the other face of Hamas, and its popularity is rising. It makes us feel that the Palestinian Authority doesn’t offer a path to the future.”

In Cairo on Monday, Mr. Meshal seemed defiant and confident in his new role, daring the Israelis to invade Gaza as a sixth day of Israeli aerial assaults brought the death toll there to more than 100 people, many of them militants of Hamas and its affiliates. Rockets launched from Gaza hit southern Israel, causing some damage and panic, but no casualties, leaving the death toll there at three.

“Whoever started the war must end it,” he said at a news conference. “If Israel wants a cease-fire brokered through Egypt, then that is possible. Escalation is also possible.”

Officials in the authority have been holding leadership meetings, staying in close touch with the talks in Cairo and issuing statements of solidarity. They have also sent a small medical delegation to Gaza and argue that there is a new opportunity to forge unity between the two feuding movements. But they are acutely aware of their problem.

“The most dangerous thing is the fact that what we could not do in negotiations, Hamas did with one rocket,” one official said, speaking on the condition of anonymity. “The people had such excitement seeing the occupiers run in panic. It’s a very dangerous message.”

Mr. Abbas, whose popularity has been on the decline as the Palestinian Authority faces economic difficulty and growing Israeli settlements, also ran into trouble not long before the Gaza fighting began when he seemed to give up on the Palestinian demand of a right of return to what is now Israel.

Many Palestinians believe that Israel launched its latest operation in Gaza to block the Palestinian Authority’s United Nations plans by embarrassing it. Israeli officials say that is ridiculous: the operation’s purpose is to stop the growing number of rockets being fired at their communities, and Israelis interrupted their deliberations over the United Nations bid to wage the military campaign.

But Israel says anything that does not involve direct negotiations is a waste of time. The government of Prime Minister Benjamin Netanyahu has repeatedly threatened to take severe retaliatory steps against the Palestinian Authority, including cutting off badly needed tax receipts to Palestinian coffers, should Mr. Abbas go ahead at the United Nations.

In a speech here on Sunday night at a Palestinian leadership meeting, Mr. Abbas repeated his determination to go to New York and ask for a change in status to that of nonmember state. He has chosen the symbolically significant date of Nov. 29, when the General Assembly voted in 1947 to divide this land into two states, one Jewish and the other Palestinian Arab.

The United States has asked Mr. Abbas not to do so but instead to resume direct negotiations with Israel, which have essentially been frozen since 2008.

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Google should not be accused of “unfair” acts: lawmakers

WASHINGTON (Reuters) – Two lawmakers urged the Federal Trade Commission on Monday to steer clear of expanding its authority as it investigates allegations search engine company Google violated antitrust law.

The two California Democrats in the House of Representatives, who count Google as a major campaign contributor, asked the FTC not to accuse the company of “unfair” acts if it believes it broke antitrust law.

Anna Eshoo, on the Energy and Commerce Committee, and Zoe Lofgren, who is on the Judiciary Committee, said there were reports to suggest the FTC planned to use the unfair standard to avoid proving some elements required in an antitrust claim.

They said such a move could lead to over-broad authority for the FTC that could create legal uncertainties for firms and stifle economic growth.

“Such a massive expansion of FTC jurisdiction would be unwarranted, unwise, and likely have negative implications for our nation’s economy,” the lawmakers wrote in the letter, which was dated November 19 and sent to the five FTC commissioners.

The FTC is looking into a long list of complaints brought by rivals of Google, which is also accused of using its dominance to squash competitors in vertical search areas such as shopping and travel.

The FTC staff has reportedly given the commission a report urging them to file a complaint against Google for suing competitors based on standard essential patents and asking for injunctions to stop the sales of their products. Standard essential patents are supposed to be broadly licensed at a fair rate.

Google is the seventh largest contributor to Eshoo, donating $ 13,000 during the 2012 election cycle, according to data from the Center for Responsive Politics. It is the third largest contributor to Lofgren, who got $ 14,500 from Google. The donations came from a Google political action committee and employees and lobbyists associated with Google.

Complaints about Google to the FTC over standard essential patents arise from a raft of litigation between Apple Inc, Google and Microsoft Corp, which have sued each other numerous times in various countries, each alleging that their respective patents are being infringed upon by rivals in the highly competitive smartphone market.

In many cases, the companies ask that their rivals’ products be banned from stores. Many antitrust enforcers believe it is inappropriate for companies to ask for sales bans based on the infringement of essential patents.

FTC Chairman Jon Leibowitz, who is expected to leave the agency soon, said in mid-September that he expected a decision in the case by the end of the year. A decision could be in the form of a lawsuit or, more likely, a settlement.

Google has settled with U.S. law enforcement agencies in the past.

For example, it settled with the FTC following privacy gaffes during the botched roll-out of its social network, Buzz. Later, it paid $ 22.5 million to settle charges that it bypassed the privacy settings of customers using Apple’s Safari browser.

Google also paid a $ 500 million settlement in 2011 to the Justice Department for knowingly accepting illegal advertisements from Canadian pharmacies selling in the United States.

FTC spokesman Peter Kaplan confirmed that the commission had received the letter but said the agency declined comment.

(Reporting By Diane Bartz; editing by Andrew Hay)

Tech News Headlines – Yahoo! News

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Marlins salary dump to Toronto finalized

MIAMI (AP) — The Miami Marlins' latest payroll purge received final approval Monday from the commissioner's office, and as the team's top baseball executive began to discuss the deal during a conference call, a bad connection generated waves of reverberating noise that filled the phone line.

Nearly a week after the Marlins swung their widely ridiculed trade with Toronto, negative feedback keeps coming.

Commissioner Bud Selig approved the blockbuster deal, however, even though it made Marlins fans irate and made the team a nationwide punch line. The trade sends All-Star shortstop Jose Reyes to the Blue Jays along with pitchers Mark Buehrle and Josh Johnson, catcher John Buck and outfielder Emilio Bonifacio for seven players, none of whom has a big-money contract.

Miami received infielders Yunel Escobar and Adeiny Hechavarria, pitchers Henderson Alvarez, Anthony DeSclafani and Justin Nicolino, catcher Jeff Mathis and outfielder Jake Marisnick.

By swinging the deal only months after the Marlins moved into a new stadium built with taxpayer money, they pared from their books $146.5 million in payroll. That's their net savings after agreeing to send $8.5 million to the Blue Jays as part of the trade.

Marlins president of baseball operations Larry Beinfest said he understood why fans were mad, and confirmed the trade was necessary because owner Jeffrey Loria wanted to pare payroll. Beinfest also conceded the deal will make it harder for the team to recruit free agents in the future.

But Selig decided not to block it.

"This transaction, involving established major leaguers and highly regarded young players and prospects, represents the exercise of plausible baseball judgment on the part of both clubs (and) does not violate any express rule of Major League Baseball and does not otherwise warrant the exercise of any of my powers to prevent its completion," Selig said in a statement. "It is, of course, up to the clubs involved to make the case to their respective fans that this transaction makes sense and enhances the competitive position of each, now or in the future."

The players traded by the Marlins have combined guaranteed salaries of $163.75 million through 2018, including $96 million due Reyes.

"I understand the pause the fans have with the instability in our roster at a time when we were hoping to be very stable in the new stadium," Beinfest said. "It's not a lot of fun."

By contrast, the trade stamps the Blue Jays as contenders in the AL East. They haven't reached the playoffs since winning their second consecutive World Series in 1993.

Miami also finalized a deal with outfielder Juan Pierre, who agreed to a $1.6 million, one-year contract. That leaves the Marlins with an estimated opening-day payroll of $36 million for active players, which would be their lowest since 2008. In the latest figures, Oakland had the lowest payroll in the majors this year at $59.5 million.

While Beinfest said the Marlins acquired championship-caliber talent, fans believe owner Jeffrey Loria's goal was to increase his profits in the new ballpark rather than put increased revenue into the roster.

"We did receive a payroll range from ownership that we needed to achieve," Beinfest said. "With this transaction, we have achieved that payroll range."

The Marlins flopped as big spenders. They began the year with a franchise-record payroll of $112 million, then went 69-93, their worst record since 1999.

After sinking to last place by midseason, the Marlins traded former NL batting champion Hanley Ramirez, second baseman Omar Infante, right-hander Anibal Sanchez and closer Heath Bell. Reyes, Buehrle and Bell signed multiyear deals as newcomers a year ago during an unprecedented Marlins spending spree, and Beinfest acknowledged other free agents might be now reluctant to sign with Miami.

"It'll be a factor," he said. "I don't think we're happy about this at all. I understand there may be some disdain in the marketplace. We won't know until we get into those negotiations with free agents. It's definitely not great for the club, and we're going to have to deal with it."

Miami's biggest remaining star, slugger Giancarlo Stanton, has been among those expressing anger about the trade. Beinfest said he hadn't talked with Stanton about the deal.

"I know this is an emotional time," Beinfest said. "I'm sure it has been tough for him. Our feeling was to maybe let the dust settle a little bit and then talk to Giancarlo. I hear the frustration. It's not unexpected. This has been a tough go, but we think it's best for us moving forward."

Players' union head Michael Weiner withheld comment, saying he was awaiting more input from Major League Baseball.

In January 2009, the union reached an agreement with MLB and the Marlins covering 2010-12 which Weiner said was a "response to our concerns that revenue sharing proceeds have not been used as required. As part of the deal, Weiner said the team planned to "use such proceeds to increase player payroll annually as they move toward the opening of their new ballpark."

Selig said he was sensitive to how Marlins fans reacted to the trade.

"Baseball is a social institution with important social responsibilities, and I fully understand that the Miami community has done its part to put the Marlins into a position to succeed with beautiful new Marlins Park," Selig said. "Going forward, I will continue to monitor this situation with the expectation that the Marlins will take into account the sentiments of their fans, who deserve the best efforts and considered judgment of their club. I have received assurances from the ownership of the Marlins that they share these beliefs and are fully committed to build a long-term winning team that their fans can be proud of."

NOTES: Pierre would earn a $25,000 bonus if he's an All-Star, $25,000 each for winning a Gold Glove or Silver Slugger, $50,000 if he's an LCS MVP, $100,000 if he's the World Series MVP and $100,000 if he's the league MVP.

___

AP Sports Writer Ronald Blum in New York contributed to this report.

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Really?: The Claim: Eye Problems Can Cause Headaches in Children

Really?

Anahad O’Connor tackles health myths.

THE FACTS When a child complains of frequent headaches, many pediatricians order an eye exam. “In some pediatric ophthalmology practices, it’s a daily occurrence,” said Dr. Zachary Roth, a resident in ophthalmology at Albany Medical Center in New York.

Often, a child may experience headaches while reading or doing schoolwork, leading parents to think the child needs glasses. But are eye problems really a cause of childhood headaches?

In a recent study, Dr. Roth and his colleagues examined 158 children under age 18 who were referred to ophthalmologists for frequent headaches. Then, they evaluated the children’s medical records and looked at the results of earlier vision exams.

Ultimately, the researchers could not find any significant link between headaches and diagnoses of vision problems. In three-quarters of the subjects, the headaches went away over time, both in those who received new glasses and those who did not.

The study, which was presented at a recent American Academy of Ophthalmology conference, was not designed to look for causes of the headaches. But there were “quite a few” children with family histories of migraine, Dr. Roth said. Sinus problems and stress headaches also appeared to be common issues, he added.

“I think the take-away message is that it’s very unlikely for headaches to be caused by an eye problem,” he said. “The experience of all the ophthalmologists we talked to is that it almost never seems to be related to the eyes, so it’s probably more fruitful to investigate other causes.”

THE BOTTOM LINE Vision problems are often blamed for childhood headaches, but in reality, the two are rarely related.

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News Corporation Looks at Potential Acquisitions

Kevork Djansezian/Getty Images

Rupert Murdoch, second from left, with his sons, Lachlan, left, and James, second from right, and Chase Carey, News Corporation’s president and chief operating officer, in July in Sun Valley, Idaho.

The media conglomerate, which had been on its heels for more than a year because of the phone hacking scandal in Britain, is looking to make acquisitions again. First on the list could be a 49 percent stake in the Yes Network in New York, a purchase that could become the foundation for a new nationwide sports network to compete with ESPN.

News Corporation’s stock has reached highs as the company prepares to transfer its underperforming publishing assets, including newspapers like The Wall Street Journal and The New York Post, into a separate publicly traded entity.

One of the crucial factors in the decision was that the split would allow Rupert Murdoch, the company’s chairman and chief executive, to buy into the businesses he loves without upsetting investors who are more interested in cable and broadcast. Potential targets include The Los Angeles Times, The Chicago Tribune and more education companies.

“Rupert has his mojo back,” said Todd Juenger, a media analyst at Sanford C. Bernstein. “The stock is up, investors are happy with the company’s recent decisions.”

“He is definitely rubbing his hands together,” a person with knowledge of News Corporation’s deal-making discussions said of Mr. Murdoch.

In the last several weeks, Mr. Murdoch has exuded a satisfaction and sure-footedness that people close to the company said they had not seen since before Mr. Murdoch’s British newspaper unit became embroiled in a phone hacking scandal. That is in part because hacking has been overtaken in the press by an unfolding scandal at the British Broadcasting Corporation.

The BBC, which Mr. Murdoch and his son James have frequently criticized, is accused of canceling a news program’s segment about serial child molesting committed by longtime host Jimmy Savile, and broadcasting false reports of pedophilia about a member of Margaret Thatcher’s administration.

People close to Mr. Murdoch said he considered the BBC scandal karmic justice for months of negative coverage of News Corporation, and he has provided almost daily commentary via Twitter. “BBC getting into deeper mess,” he wrote on Nov. 10. “After Savile scandal, now prominent news program falsely names senior pol as pedophile.”

And the BBC scandal touches another Murdoch rival — The New York Times, whose parent company’s new chief executive, Mark Thompson, served as director general at the BBC. Mr. Thompson’s replacement at the BBC, George Entwistle, resigned on Nov. 11 after just 54 days on the job. “Look to new CEO to shape up NYT unless recalled to BBC to explain latest scandal,” Mr. Murdoch wrote on Twitter last month.

As News Corporation sank into its hacking scandal last year, it delayed new acquisitions. In September, Britain’s Office of Communications, known as Ofcom, said that British Sky Broadcasting, 39.1 percent owned by News Corporation, was “fit and proper” to hold a broadcast license. The decision removed a cloud of uncertainty at News Corporation’s Manhattan headquarters and cleared the company to revisit deals, analysts said.

“The internal narrative at the company is that the boss is in shopping mode,” said one person close to News Corporation who could not discuss Mr. Murdoch’s thinking publicly.

Dropping its $12 billion bid for the portion of BSkyB that it did not already own gave News Corporation ample cash to complete share buybacks and consider other acquisitions. The company had $9.6 billion in cash at the end of its 2012 fiscal year and in September borrowed another $1 billion.

On a recent earnings call, Chase Carey, News Corporation’s president and chief operating officer, said: “We always seem to be the topic of the day when it comes to a rumor of some transaction.” Still, he added: “There are places where we think we should kick the tires on things.”

Last week News Corporation neared a deal with Yankees Global Enterprises to buy a 49 percent stake in the Yes Network, a regional New York sports network, with a valuation of about $3 billion. A stake in Yes would add to News Corporation’s lineup of regional sports channels and contribute to its reported plans to introduce a national cable sports channel that could take on the Walt Disney Company’s ESPN.

“It’s one of the only businesses where there’s no No. 2,” said Michael Nathanson, a media analyst at Nomura Securities. “In our view, sports is the safest asset in media.”

This month the company paid an estimated $250 million for the portion of ESPN Star Sports that it did not already own. ESPN Star Sports, based in Singapore, operates 17 sports networks in five languages around Asia.

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Gaza Violence Is Unabating as Outsiders Push for a Truce

GAZA CITY — Israeli forces killed at least 11 people, including several children, in a single airstrike that destroyed a home here on Sunday, as Israel pressed its bombardment of the Gaza Strip for a fifth day, deploying warplanes and naval vessels to pummel the coastal enclave.

The airstrike, which the Israeli military said was meant to kill a Palestinian militant involved in the recent rocket attacks, was the deadliest operation to date and would no doubt weigh on negotiations for a possible cease-fire. Among the dead were five women and four small children, The Associated Press reported, citing a Palestinian health official.

Two media offices were also hit on Sunday, and Prime Minister Benjamin Netanyahu of Israel warned of a “significant” expansion in the onslaught, which has already killed over 50 people, many of them civilians.

Speaking on Sunday from Bangkok, President Obama condemned missile attacks by Palestinian fighters in Gaza and defended Israel’s right to protect itself.

“There’s no country on earth that would tolerate missiles raining down on its citizens from outside its borders,” Mr. Obama said in his first public comments since the violence broke out. “We are fully supportive of Israel’s right to defend itself.”

The president also said that efforts were under way to address Israel’s security concerns and end the violence. “We’re going to have to see what kind of progress we can make in the next 24, 36, 48 hours,” Mr. Obama said.

Even as the diplomacy intensified on Sunday, the attacks continued in Gaza and Israel.

Mr. Netanyahu made his warning as militants in Gaza aimed at least one rocket at Tel Aviv, a day after Israeli forces broadened the attack beyond military targets, bombing centers of government infrastructure in Gaza, including the four-story headquarters of the Hamas prime minister.

“We are exacting a heavy price from Hamas and the terrorist organizations, and the Israel Defense Forces are prepared for a significant expansion of the operation,” Mr. Netanyahu told his cabinet at its routine Sunday meeting, referring directly to the of thousands of reservists who have been called up and the massing of armor on the Gaza border that many analysts have interpreted as preparations for a possible invasion.

“I appreciate the rapid and impressive mobilization of the reservists who have come from all over the country and turned out for the mission at hand,” Mr. Netanyahu said. “Reservist and conscript soldiers are ready for any order they might receive.”

His remarks were reported shortly after a battery of Israel’s Iron Dome defense shield, hastily deployed near Tel Aviv on Saturday in response to the threat of longer-range rockets, intercepted at least one aimed at the city on Sunday, Israeli officials said. It was the latest of several salvos that have illustrated Hamas’s ability to extend the reach of its rocket attacks.

Since Wednesday, when the escalation of the conflict began, Iron Dome has knocked 245 rockets out of the sky, the military said Saturday, while 500 have struck Israel.

The American-financed system is designed to intercept only rockets streaking toward towns and cities and to ignore those likely to strike open ground. But on Sunday a rocket fired from Gaza plowed through the roof of an apartment building in the southern Israeli city of Ashkelon. There were no immediate reports of casualties there.

In Gaza City, the crash of explosions pierced the quiet several times throughout the early morning.

Before the latest deadly strike involving civilians on Sunday, Hamas health officials had said the Palestinian death toll had risen to 53. One of the latest victims was a 52-year-old woman whose house in the eastern part of Gaza City was bombed around lunchtime.

A few hours earlier, a Hamas militant was killed and seven people were wounded in an attack on the Beach Refugee Camp, where Ismail Haniya, the Hamas prime minister, has a home. Those killed on Sunday included three children ages 1 through 5, the health officials said.

In Israel, 3 civilians have died and 63 have been injured. Four soldiers were wounded on Saturday.

The onslaught continued despite talks in Cairo that President Mohamed Morsi of Egypt said Saturday night could soon result in a cease-fire. Mr. Netanyahu said he would consider a comprehensive cease-fire if the launchings from Gaza stopped.

The attack on Mr. Haniya’s office, one of several on government installations, came a day after he hosted his Egyptian counterpart in the same building, a sign of Hamas’s new legitimacy in a radically redrawn Arab world.

Jodi Rudoren and Fares Akram reported from Gaza City. Reporting was contributed by Isabel Kershner, Carol Sutherland and Iritz Pazner Garshowitz from Jerusalem; Tyler Hicks from Gaza, Peter Baker from Bangkok, Alan Cowell from London, Michael Schwirtz from New York and David D. Kirkpatrick and Mayy El Sheikh from Cairo.

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Keselowski wins Sprint Cup title

HOMESTEAD, Fla. (AP) — Here's a tweet for Brad Keselowski: NASCAR champion.

Roger Penske must like the sound of that, too.

The kid who stole the show at the season-opening Daytona 500 ended the year under the biggest spotlight of them all Sunday, beating five-time champion Jimmie Johnson to deliver the first Sprint Cup championship to Penske Racing.

It's a trophy that had eluded Penske since he first entered NASCAR in 1972. Although his motorsports organization is considered the gold standard of IndyCar racing — 15 Indianapolis 500 wins — and his empire has made Penske one of the most successful businessmen in America, his NASCAR team operation was always just average.

Then came Keselowski, the blue collar, Twitter-loving, Michigan native who convinced "The Captain" his NASCAR team could be a winner, too.

Three years later, they hoisted the Sprint Cup trophy together at Homestead-Miami Speedway following Keselowski's 15th-place finish Sunday night.

He started the race up 20 points on Johnson, who blew a tire and crashed last week at Phoenix to give Keselowski a nice cushion and needing only to finish 15th or higher in the finale to wrap up his first championship. But the Penske team took nothing for granted — not after Will Power crashed in the IndyCar finale to blow a 17-point lead and lose the championship.

And this one got tight, too, especially when Keselowski ran out of gas on pit road during green flag pit stops. It put him a lap down with Johnson leading, and Keselowski and crew chief Paul Wolfe frantically trying to figure out how dire the situation had become.

Wolfe crunched the numbers, figuring the No. 2 Dodge would cycle out in the mid-20s, a lap down from the leaders.

"I know the scenario, and it's not good," Keselowski said.

But minutes later, Johnson went to pit road for his own stop and pulled away with a missing lug nut. NASCAR flagged the Hendrick Motorsports team and Johnson was forced back to pit road for another stop.

The Penske team was unsure if Keselowski wanted to know what was going on with Johnson.

"I've got a big picture story if you want to hear it," a team member radioed, then informed Keselowski that Johnson had to pit again.

"Ten-four. Thank you for telling me. We're back in the game. I got it," he said.

It got worse for Johnson from there. He broke a rear end gear in his Chevrolet and went to the garage with 40 laps to go, essentially clinching the championship for Keselowski.

"It all unraveled pretty quick," Johnson conceded.

No longer needing to save fuel, and no longer needing to play it conservatively, he waived off Wolfe's playbook.

"If he's in the garage, let's race," Keselowski said.

That's been Keselowski's attitude since he burst onto the NASCAR scene. He first caught attention as a brash driver for Dale Earnhardt Jr.'s Nationwide Series team, and he was unapologetic for his aggressive driving and his refusal to back down in long-running feuds with established stars Denny Hamlin and Carl Edwards.

But he's been calmer and focused since teaming with Penske in 2009, and his mission has been to give Penske a title. Still, his fame has been for the tweeting, which drew him worldwide attention when he took to Twitter from the cockpit of his car during the red flag in the season-opening Daytona 500.

NASCAR loved the attention it received, but quietly admonished him later for having a phone in his car, which is banned because it can manipulate electronic fuel injection systems. So when he tweeted again last week under red at Phoenix, NASCAR fined him $25,000 — which angered fans who felt a mixed message had been sent.

But Keselowski, who was tweeting into the early morning hours Sunday, handed his phone over with no resistance right before he climbed into the car at Homestead.

The win is the first for Dodge since Richard Petty's Cup title in 1975, and comes as the manufacturer is leaving NASCAR. Penske announced days after the Daytona 500 it will move to Ford next year, and it led to Dodge's decision to pull out of NASCAR.

"Not one failure all year long in that Dodge engine, so I want to thank Dodge for what they've done for us," Penske said after Keselowski secured the title.

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News Analysis: Steroids and Back Pain: An Uneasy Match

RANDALL KINNAIRD’S legal clients had steroids injected into their backs last summer for a wide range of reasons. Of the 25, one got three shots in a two-month period when pain never totally disappeared. Another got one as a preventive measure because she was going on a trip to Europe and was worried that cobblestones would aggravate an old injury.

Now the 25 — or their survivors — have engaged Mr. Kinnaird, one of Nashville’s leading lawyers, to sue the New England Compounding Center. Three have died, one is paralyzed, several more are still hospitalized and all suffer blinding headaches — victims of the meningitis that resulted from vials of steroid medicine contaminated by fungus.

The New England Compounding Center certainly seems deserving of its current status as the prime culprit in a tragic outbreak that has killed 32 and sickened 438. The bottles of supposedly sterile steroid medication it shipped were reportedly so tainted that white fuzz could be seen floating in some vials.

But, experts say, the now notorious Compounding Center has a nationwide network of unwitting enablers and accomplices: There are the doctors who overprescribe an invasive back-pain therapy that, in studies, has not proved useful for many of the patients who get it. And there are the patients, living in an increasingly medicalized society, who want a quick fix for life’s aches and pains.

The use of steroid injections to treat back pain has skyrocketed in the past 15 years — out of proportion to growth in the number of patients with back pain, or the aging of the population. The frequency of steroid injections dispensed to Medicare patients rose 121 percent from 1997 to 2006. Washington State found that the use of back injections grew 12.6 percent between 2006 and 2009, at a cost to the state of $56 million. Some people received more than 10 shots a year.

The increase in treatment has not led to less pain over all, researchers say, and is a huge expense at a time of runaway health costs. “There are lots of places doing lots of injections for conditions that haven’t been shown to benefit,” says Dr. Janna Friedly, a researcher at the University of Washington, who added, “Sadly, some of the patients who got meningitis were probably in that category — they did not have conditions where steroid injections were indicated.”

Studies are at best inconclusive about exactly which groups of back-pain patients are likely to benefit from steroid shots. Though some patients clearly get much-needed relief, health researchers are nearly unanimous that the treatment is vastly overused in the United States.

But Dr. Laxmaiah Manchikanti, head of the American Society of Interventional Pain Physicians, said the increasing number of spine injections was just part of “an exponential increase in all interventional techniques” and is a good thing, reflecting a better understanding of chronic pain and patients’ demands for improved pain relief.

Though doctors are still arguing, most academic researchers say there is no evidence that steroid injections are useful in easing straightforward chronic low back pain. Professional guidelines say such shots should generally not be used for back pain that is less than four to six weeks old, which studies show almost always gets better with noninvasive treatments. Although many Medicare patients get spinal injections to treat a condition called spinal stenosis, a narrowing of spaces between bones of the spine, Dr. Friedly said, shots are not used for that condition in many European countries.

Spinal injections, which can cost between $600 and $2,500, including the fees for treatment rooms, have been fostered and promoted by the rising number of pain clinics and pain specialists — mostly anesthesiologists and rehab doctors — who invest in extra training to learn procedures like spinal injections.

“There used to be only a small number of people who did this, but that’s gone way up, and reimbursement has gone up, too,” says Scott Forseen, a doctor who studies the treatment of back pain at the Georgia Health Sciences University. The number of spinal injections given in any geographical area correlates better with the number of local specialists trained in the procedure rather than the amount of back pain, Dr. Friedly says. There is an old saying in medicine: “When you go to Midas, you get a muffler.”

The shots — which may include a steroid and an anesthetic — are often dispensed at for-profit pain clinics owned by the physicians holding the needle. “There’s a lot of concern about perverse financial incentive,” Dr. Friedly added.

Mr. Kinnaird’s clients got their injections at the St. Thomas Outpatient Neurosurgery Clinic, a limited-liability corporation half owned by doctors, which occupied a floor of one of Nashville’s major hospitals. It gave 5,000 injections a year, or about 20 each business day, and epidural steroid injections are listed on its Web site as its “top procedure.”

Since guidelines for injections are being disputed among doctors’ groups, it is hard in most cases to say if a particular patient should or should not have been offered an injection, says Marc Lipton, a Michigan attorney who is representing more that 20 patients with fungal meningitis. Though he believes that steroid shots are overused, he says many of the patients he represents were treated appropriately, for example, receiving an injection for pain from a herniated disc in an attempt to stave off back surgery. He and other lawyers are, for now, targeting the Compounding Center in product liability lawsuits.

But, says Dr. Forseen: “You have to use injections selectively, and selectivity has gone way down. In some places, people get injections because they’ve walked in the door.”

Patients have proved eager consumers of the new medical offering, desirous of a quick cure rather than waiting the weeks or months for the normal healing process to occur.

Mr. Kinnaird, the lawyer, says: “If I hurt my back in the ’70s, my doctor would say, go to the beach, get a few beers, relax, you’ll be fine. Now if you hurt your back, you go to the doctor and right away there’s an M.R.I., and they need to fix something. Maybe you should take an injection.”

And steroid shots are not a cure-all, even for the conditions for which doctors agree an attempt is worthwhile: low back pain accompanied by signs of nerve injury like tingling or weakness in a leg. One-third of such patients will get better, one-third will show some improvement and some will show no improvement at all, Dr. Forseen said.

When Oregon’s Health Evidence Review Commission earlier this year explored narrowing reimbursement for injections to certain conditions, it got an earful of public comment from groups like the International Spine Intervention Society.

“Obviously they are not utilizing the literature correctly,” said Dr. Manchikanti, adding that attempts to limit the shots were motivated in part by an effort to control costs and by competition from other medical specialties.

Private insurers vary considerably in coverage for the procedure, though some will pay after two weeks of back pain.

Back pain is, of course, a debilitating condition. And modern medicine has produced some miraculous cures. But from now on when doctors and patients are tempted to say “what’s the harm in trying an injection” to dispense with a nagging back — they will be more aware of just how big the risk can be.

A physician and a reporter for The New York Times.

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The iEconomy: As Boom Lures App Creators, Tough Part Is Making a Living

Daniel Rosenbaum for The New York Times

Shawn and Stephanie Grimes’s efforts have cost $200,000 in lost income and savings, but their apps have earned less than $5,000 this year.

ROSEDALE, Md. — Shawn and Stephanie Grimes spent much of the last two years pursuing their dream of doing research and development for Apple, the world’s most successful corporation.

But they did not actually have jobs at Apple. It was freelance work that came with nothing in the way of a regular income, health insurance or retirement plan. Instead, the Grimeses tried to prepare by willingly, even eagerly, throwing overboard just about everything they could.

They sold one of their cars, gave some possessions to relatives and sold others in a yard sale, rented out their six-bedroom house and stayed with family for a while. They even cashed in Mr. Grimes’s 401(k).

“We didn’t lose any sleep over it,” said Mr. Grimes, 32. “I’ll retire when I die.”

The couple’s chosen field is so new it did not even exist a few years ago: writing software applications for mobile devices like the iPhone or iPad. Even as unemployment remained stubbornly high and the economy struggled to emerge from the recession’s shadow, the ranks of computer software engineers, including app writers, increased nearly 8 percent in 2010 to more than a million, according to the latest available government data for that category. These software engineers now outnumber farmers and have almost caught up with lawyers.

Much as the Web set off the dot-com boom 15 years ago, apps have inspired a new class of entrepreneurs. These innovators have turned cellphones and tablets into tools for discovering, organizing and controlling the world, spawning a multibillion-dollar industry virtually overnight. The iPhone and iPad have about 700,000 apps, from Instagram to Angry Birds.

Yet with the American economy yielding few good opportunities in recent years, there is debate about how real, and lasting, the rise in app employment might be.

Despite the rumors of hordes of hip programmers starting million-dollar businesses from their kitchen tables, only a small minority of developers actually make a living by creating their own apps, according to surveys and experts. The Grimeses began their venture with high hopes, but their apps, most of them for toddlers, did not come quickly enough or sell fast enough.

And programming is not a skill that just anyone can learn. While people already employed in tech jobs have added app writing to their résumés, the profession offers few options to most unemployed, underemployed and discouraged workers.

One success story is Ethan Nicholas, who earned more than $1 million in 2009 after writing a game for the iPhone. But he says the app writing world has experienced tectonic shifts since then.

“Can someone drop everything and start writing apps? Sure,” said Mr. Nicholas, 34, who quit his job to write apps after iShoot, an artillery game, became a sensation. “Can they start writing good apps? Not often, no. I got lucky with iShoot, because back then a decent app could still be successful. But competition is fierce nowadays, and decent isn’t good enough.”

The boom in apps comes as economists are debating the changing nature of work, which technology is reshaping at an accelerating speed. The upheaval, in some ways echoing the mechanization of agriculture a century ago, began its latest turbulent phase with the migration of tech manufacturing to places like China. Now service and even white-collar jobs, like file clerks and data entry specialists or office support staff and mechanical drafters, are disappearing.

“Technology is always destroying jobs and always creating jobs, but in recent years the destruction has been happening faster than the creation,” said Erik Brynjolfsson, an economist and director of the M.I.T. Center for Digital Business.

Still, the digital transition is creating enormous wealth and opportunity. Four of the most valuable American companies — Apple, Google, Microsoft and I.B.M. — are rooted in technology. And it was Apple, more than any other company, that set off the app revolution with the iPhone and iPad. Since Apple unleashed the world’s freelance coders to build applications four years ago, it has paid them more than $6.5 billion in royalties.

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