Beverage attorney: NYC drinks limit bad for public

NEW YORK (AP) — New York City's limit on the size of sugary drinks is an "extraordinary infringement" on consumer choice, a lawyer for the American Beverage Association and other critics said in court on Wednesday.

"New Yorkers do not want to be told what to drink," attorney James Brandt told Manhattan state Supreme Court Justice Milton Tingling.

Opponents also are raising questions of racial fairness alongside other complaints as the novel restriction faces a court test.

The NAACP's New York state branch and the Hispanic Federation have joined beverage makers and sellers in trying to stop the rule from taking effect March 12. Critics are attacking what they call an inconsistent and undemocratic regulation, while city officials and health experts defend it as a pioneering and proper move to fight obesity.

The issue is complex for the minority advocates, especially given that obesity rates are higher than average among blacks and Hispanics, according to the federal Centers for Disease Control and Prevention. The groups say in court papers they're concerned about the discrepancy, but the soda rule will unduly harm minority businesses and "freedom of choice in low-income communities."

The latest in a line of healthy-eating initiatives during Mayor Michael Bloomberg's administration, the beverage rule bars restaurants and many other eateries from selling high-sugar drinks in cups or containers bigger than 16 ounces. Violations could bring $200 fines; the city doesn't plan to start imposing those until June.

The city Board of Health approved the measure in September. Officials cited the city's rising obesity rate — about 24 percent of adults, up from 18 percent in 2002 — and pointed to studies linking sugary drinks to weight gain. Care for obesity-related illnesses costs more than $4.7 billion a year citywide, with government programs paying about 60 percent of that, according to city Health Commissioner Dr. Thomas Farley.

"It would be irresponsible for (the health board) not to act in the face of an epidemic of this proportion," the city says in court papers. The National Association of Local Boards of Health and several public health scholars have backed the city's position in filings of their own.

Opponents portray the regulation as government nagging that turns sugary drinks into a scapegoat when many factors are at play in the nation's growing girth.

The American Beverage Association and other groups, including movie theater owners and Korean grocers, sued. They argue that the first-of-its-kind restriction should have gone before the elected City Council instead of being approved by the Bloomberg-appointed health board.

Five City Council members echo that view in a court filing, saying the Council is "the proper forum for balancing the city's myriad interests in matters of public health." The Bloomberg administration counters that the health board, made up of doctors and other health professionals, has the "specialized expertise" needed to make the call on limiting cola sizes.

The lawsuit also argues the rule is too narrow to be fair. Alcohol, unsweetened juice and milk-based drinks are excluded, as are supermarkets and many convenience stores — including 7-Eleven, home of the Big Gulp — that aren't subject to city health regulations.

The NAACP and the Hispanic Federation, a network of 100 northeastern groups, say minority-owned delis and corner stores will end up at a disadvantage compared to grocery chains.

"This sweeping regulation will no doubt burden and disproportionally impact minority-owned businesses at a time when these businesses can least afford it," they said in court papers. They say the city should focus instead on increasing physical education in schools.

During Bloomberg's 11-year tenure, the city also has made chain restaurants post calorie counts on their menus and barred artificial trans fats in french fries and other restaurant food.

In general, state and local governments have considerable authority to enact laws intended to protect people's health and safety, but it remains to be seen how a court will view a portion-size restriction, said Neal Fortin, director, Institute for Food Laws and Regulations at Michigan State University.

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Wall Street flat near five-year highs, Travelers rallies

NEW YORK (Reuters) - U.S. stocks were little changed near five-year highs on Tuesday as investors held back from making large bets ahead of earnings from key tech companies.

Both the Dow and S&P 500 closed at their highest levels so far in this earnings season, with the gains largely coming on better-than-expected results. But despite bullish statements from major companies, many investors are worried economic uncertainty in the fourth quarter hurt earnings and revenues.

Weaker-than-expected economic data had little impact on stocks. Existing-home sales unexpectedly fell in December, dropping 1 percent, according to the National Association of Realtors. Analysts were looking for a rise of 1.2 percent.

Recently Apple Inc and Intel Corp gave weak outlooks, calling the tech sector' outlook into question. Three tech companies are due to report after the market's close: Google Inc, International Business Machines and Texas Instruments.

"Markets are quiet today with many investors taking a wait-and-see approach to tonight's tech earnings," said Douglas DePietro, managing director at Evercore Partners in New York. "There's still room for us to rise from here, but right now most of the action is in specific stocks."

Four Dow components reported early on Tuesday, and three rose on the results. Insurer Travelers Cos was the stand-out, climbing 3.4 percent to $78.90 as the S&P 500's biggest percentage gainer after it forecast higher premiums across its business.

DuPont, the largest U.S. chemical company by market capitalization, reported revenue that was ahead of Wall Street expectations, while Verizon Communications Inc also posted revenue that beat forecasts.

Shares of DuPont were up 0.6 percent at $47.24 while Verizon rose 0.3 percent to $42.67.

On the downside, Johnson & Johnson, the diversified health company, fell 0.5 percent to $72.87 after forecasting 2013 earnings below expectations.

The Dow Jones industrial average was down 6.07 points, or 0.04 percent, at 13,643.63. The Standard & Poor's 500 Index was down 1.56 points, or 0.10 percent, at 1,484.42. The Nasdaq Composite Index was down 2.52 points, or 0.08 percent, at 3,132.19.

Monday was a market holiday for Martin Luther King Jr. Day in the United States. President Barack Obama at his inauguration for a second term on Monday called for aggressive action on climate change, economic equality and the federal budget.

Markets have recently been pressured by uncertainty stemming from Washington about the federal debt limit and spending cuts that could hamper U.S. growth.

Republican leaders in the House of Representatives said they aim to pass on Wednesday a nearly four-month extension of the U.S. debt limit, allowing the government to borrow enough to meet its obligations during that period.

Overall, S&P 500 fourth-quarter earnings rose 2.5 percent, according to Thomson Reuters data.

U.S. shares of Research in Motion jumped 8.2 percent to $17.13 a day after its chief executive said the company may consider strategic alliances with other companies after the launch of devices powered by RIM's new BlackBerry 10 operating system.

(Editing by Chizu Nomiyama and Kenneth Barry)

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The Lede Blog: Prince Harry Compares War to PlayStation and Taliban Is Not Amused

A Taliban spokesman said on Tuesday that Prince Harry must have “mental problems,” following the broadcast of remarks by the royal in which he said that killing militants from an Apache helicopter was similar to playing video games.

As soon as Britain’s ministry of defense announced on Monday that Prince Harry had left Afghanistan, ending his four-month deployment there, the British news media rushed to broadcast video of the royal officer at war, which was recorded with his cooperation on the condition that it not be released until his tour was over.

Britain’s Channel 4 News broke into its bulletin on Monday night just minutes after the announcement to broadcast its edit of the footage, which was shot last month at Camp Bastion in Afghanistan’s Helmand Province by the British Press Association.

A video report from Britain’s Channel 4 News shot during Prince Harry’s recent deployment to Afghanistan.

The Channel 4 News report drew attention to how frequently the prince, whose mother was being chased by photographers when she died in a fatal car accident, mentioned his distaste for the British press.

At one stage in the interview, Prince Harry said that he was not troubled by killing militants. “Take a life to save a life,” he said. “If there’s people trying to do bad stuff to our guys, then we’ll take them out of the game.”

In another edit of the footage, posted online by The Guardian, Prince Harry, who is known as Captain Wales in the army, explained that he was glad to have been “pushed forward to the front seat,” the one reserved for the attack helicopter’s gunner. That was, he said, “a joy for me because I’m one of those people that loves playing PlayStation and Xbox, so with my thumbs I like to think I’m probably quite useful — if you ask the guys I thrash them at FIFA the whole time,” referring to a popular video game series.

“This is a serious war, a historic war, resistance for us, for our people,” a Taliban spokesman, Zabiullah Mujahid, told Agence France-Presse in response, “and now this prince comes and compares this war with his games, PlayStation or whatever he calls it.”

But the spokesman added, “we don’t take his comments very seriously, as we have all seen and heard that many foreign soldiers, occupiers who come to Afghanistan, develop some kind of mental problems on their way out.”

In another part of the interview, posted online by The Telegraph, Prince Harry said that his brother, Prince William, was jealous of him. “He’d love to be out here and, to be honest with you, I don’t see why he couldn’t,” Harry said. “No one knows who’s in the cockpit. Yes you get shot at, but, you know, if the guys who are doing the same job as us are being shot at on the ground, then I don’t think there’s anything wrong with us being shot at as well. Yeah, people back home might have issues with that, but we’re not special.”

Video of remarks by Prince Harry about how much his brother would like to serve in Afghanistan.

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Canada wants RIM organic growth, may have to review handset sale

OTTAWA (Reuters) – The Canadian government wants BlackBerry maker Research in Motion to continue to be a global leader and grow organically, and Ottawa may have to review a future sale of its handset business, Industry Minister Christian Paradis said on Tuesday.

“We hope to see RIM remain a global leader and player, and make sure it grows organically,” Paradis told Reuters by phone from Germany, where he is meeting with industrial leaders.

He also said the government did not intend at present to open up Canada’s telecommunications sector further to foreign investment.

(Reporting by Randall Palmer Editing by W Simon)

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Kelly Clarkson & Fiancé Brandon Blackstock Attend Inaugural Ball

By Maggie Coughlan

01/22/2013 at 11:35 AM EST

Kelly Clarkson and Brandon Blackstock

Courtesy Kelly Clarkson

After helping President Barack Obama begin his second term with a powerful rendition of "My Country, 'Tis of Thee," Kelly Clarkson celebrated in style.

The singer – who is engaged to Nashville-based talent manager Brandon Blackstock – attended the inaugural ball with her fiancé on Monday.

Sharing her political partying experience with her 2.6 million followers, Clarkson, 30, chronicled her evening on Twitter.

"My dress barely fit in the car for tonight's festivities. I feel like Cinderella! Thank you Oscar De La Renta!" she Tweeted, revealing a photo of herself wearing a floral patterned gown.

Then it was time to pose for photos with Blackstock. "Me and Brandon in our 'fancy' attire :) Fun night!" she later Tweeted.

Though Clarkson assured followers she was having a ball, she credited the First Lady with getting the festivities going.

"Just partied at the White House ....I kid you not, Michelle Obama stood up and got the party started ....seriously cool First Lady :)," she Tweeted.

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Flu season fuels debate over paid sick time laws

NEW YORK (AP) — Sniffling, groggy and afraid she had caught the flu, Diana Zavala dragged herself in to work anyway for a day she felt she couldn't afford to miss.

A school speech therapist who works as an independent contractor, she doesn't have paid sick days. So the mother of two reported to work and hoped for the best — and was aching, shivering and coughing by the end of the day. She stayed home the next day, then loaded up on medicine and returned to work.

"It's a balancing act" between physical health and financial well-being, she said.

An unusually early and vigorous flu season is drawing attention to a cause that has scored victories but also hit roadblocks in recent years: mandatory paid sick leave for a third of civilian workers — more than 40 million people — who don't have it.

Supporters and opponents are particularly watching New York City, where lawmakers are weighing a sick leave proposal amid a competitive mayoral race.

Pointing to a flu outbreak that the governor has called a public health emergency, dozens of doctors, nurses, lawmakers and activists — some in surgical masks — rallied Friday on the City Hall steps to call for passage of the measure, which has awaited a City Council vote for nearly three years. Two likely mayoral contenders have also pressed the point.

The flu spike is making people more aware of the argument for sick pay, said Ellen Bravo, executive director of Family Values at Work, which promotes paid sick time initiatives around the country. "There's people who say, 'OK, I get it — you don't want your server coughing on your food,'" she said.

Advocates have cast paid sick time as both a workforce issue akin to parental leave and "living wage" laws, and a public health priority.

But to some business owners, paid sick leave is an impractical and unfair burden for small operations. Critics also say the timing is bad, given the choppy economy and the hardships inflicted by Superstorm Sandy.

Michael Sinensky, an owner of seven bars and restaurants around the city, was against the sick time proposal before Sandy. And after the storm shut down four of his restaurants for days or weeks, costing hundreds of thousands of dollars that his insurers have yet to pay, "we're in survival mode."

"We're at the point, right now, where we cannot afford additional social initiatives," said Sinensky, whose roughly 500 employees switch shifts if they can't work, an arrangement that some restaurateurs say benefits workers because paid sick time wouldn't include tips.

Employees without sick days are more likely to go to work with a contagious illness, send an ill child to school or day care and use hospital emergency rooms for care, according to a 2010 survey by the University of Chicago's National Opinion Research Center. A 2011 study in the American Journal of Public Health estimated that a lack of sick time helped spread 5 million cases of flu-like illness during the 2009 swine flu outbreak.

To be sure, many employees entitled to sick time go to work ill anyway, out of dedication or at least a desire to project it. But the work-through-it ethic is shifting somewhat amid growing awareness about spreading sickness.

"Right now, where companies' incentives lie is butting right up against this concern over people coming into the workplace, infecting others and bringing productivity of a whole company down," said John A. Challenger, CEO of employer consulting firm Challenger, Gray & Christmas.

Paid sick day requirements are often popular in polls, but only four places have them: San Francisco, Seattle, Washington, D.C., and the state of Connecticut. The specific provisions vary.

Milwaukee voters approved a sick time requirement in 2008, but the state Legislature passed a law blocking it. Philadelphia's mayor vetoed a sick leave measure in 2011; lawmakers have since instituted a sick time requirement for businesses with city contracts. Voters rejected a paid sick day measure in Denver in 2011.

In New York, City Councilwoman Gale Brewer's proposal would require up to five paid sick days a year at businesses with at least five employees. It wouldn't include independent contractors, such as Zavala, who supports the idea nonetheless.

The idea boasts such supporters as feminist Gloria Steinem and "Sex and the City" actress Cynthia Nixon, as well as a majority of City Council members and a coalition of unions, women's groups and public health advocates. But it also faces influential opponents, including business groups, Mayor Michael Bloomberg and City Council Speaker Christine Quinn, who has virtually complete control over what matters come to a vote.

Quinn, who is expected to run for mayor, said she considers paid sick leave a worthy goal but doesn't think it would be wise to implement it in a sluggish economy. Two of her likely opponents, Public Advocate Bill de Blasio and Comptroller John Liu, have reiterated calls for paid sick leave in light of the flu season.

While the debate plays out, Emilio Palaguachi is recovering from the flu and looking for a job. The father of four was abruptly fired without explanation earlier this month from his job at a deli after taking a day off to go to a doctor, he said. His former employer couldn't be reached by telephone.

"I needed work," Palaguachi said after Friday's City Hall rally, but "I needed to see the doctor because I'm sick."

___

Associated Press writer Susan Haigh in Hartford, Conn., contributed to this report.

___

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European shares test two-year highs, yen volatile before BOJ

LONDON (Reuters) - European shares inched towards two-year highs on Monday, as a political attempt to break a budget impasse in the United States and expectations of aggressive Japanese stimulus bolstered the appetite for shares.

U.S. House Republican leaders said on Friday they would seek to pass a three-month extension of federal borrowing authority in the coming days to buy time for the Democrat-controlled Senate to pass a plan to shrink budget deficits.

European shares <.fteu3> were supported by the news <.eu>, but with no clear response from the Democrats and a thin session expected due to a market holiday in the United States, the impact on assets such as bonds and commodities was limited.

By 1500 GMT London's FTSE 100 <.ftse>, Paris's CAC-40 <.fchi> and Frankfurt's DAX <.gdaxi> were up 0.4 to 0.6 percent, leaving the pan-European FTSEurofirst 300 within touching distance of a two-year high and MSCI's world index <.miwd00000pus> steady at a 20-month high. <.l><.eu/>

Expectations that the Bank of Japan will deliver a bold monetary easing plan at the end of its two-day meeting on Tuesday also supported shares and created choppy conditions in the currency market.

According to sources familiar with the BoJ's thinking, the government of new Prime Minister Shinzo Abe and the central bank have agreed to set 2 percent inflation as a new target, supplanting a softer 1 percent 'goal'.

The yen, which has fallen 13 percent against the dollar over the last two months as the shift in Japanese policy has taken shape, touched a new 2-1/2 year low in early trading but then firmed as traders cut short positions given the BOJ has often fallen short of market expectations.

"Investors are being mindful that the moves we have seen over the course of the last month or two are just worth locking in at least until we understand how the BOJ are really going to play in the future," said Jeremy Stretch, head of currency strategy at CIBC World Markets.

CURRENCY WARS

Japanese equities have surged in recent weeks in anticipation of a more aggressive monetary policy stance, but not everyone is happy.

The slump in the yen has prompted Russia's deputy central bank governor to warn of a new round of 'currency wars' and the medium-term risk of running ultra-loose monetary policies is likely to be a theme of the World Economic Forum in Davos, which opens on Wednesday.

With little in the way of economic data or debt issuance and U.S. markets shut for the Martin Luther King public holiday, the rest of the day was expected to be a fairly quiet for investors.

As the first European finance ministers' meeting of the year got under way, most euro zone government bonds were trading virtually flat and the euro was steady at $1.3316.

Market pressure on Europe is now less intense thanks to the European Central Bank's promise to prevent a collapse of the euro. Policymakers are set to discuss Cyprus's plight and plans for the euro zone's bailout fund to directly recapitalize banks.

French Finance Minister Pierre Moscovici said as he arrived at the Brussels meeting that a proper recapitalization strategy was very important.

"Negotiations will be complex, and a final decision is unlikely to emerge soon. Risks for sovereign spreads in the periphery should be limited, but we have some concerns that the long-term solution may fall short of what a real banking union needs," said UniCredit economist Marco Valli.

POLITICAL GAME

The efforts by Republican lawmakers to give the U.S. government leeway to pay its bills for another three months dented demand for safe haven assets and pushed German government bond yields near the top of this year's range.

The U.S. Treasury needs congressional authorization to raise the current $16.4 trillion limit on U.S. debt sometime between mid-February and early March. A failure to achieve that could lead to a debt default.

"This is part of the political game, it remains to be seen whether the Democrats will accept it," KBC strategist Piet Lammens said, adding that investors' working scenario was that a solution to raise the ceiling would be eventually found anyway.

One of the key factors that drove 2-year German yields higher last week was also the prospect of sizeable early repayments of the 1 trillion euros euro zone banks took from the ECB roughly a year ago.

The central bank will publish on Friday how much banks plan to return at the optional first repayment date on January 30. A Reuters poll on Monday showed around 100 billion euros are expected to be repaid although some predict it could be as high as 250 billion.

OIL OVERSUPPLY

German markets showed no reaction after the country's center-left opposition party edged Chancellor Angela Merkel's conservatives from power in a regional election on Sunday, reviving its flagging hopes for September's national election.

The Bundesbank's latest report delivered an upbeat message on the country's economy, saying a recent slump should be short-lived and may have already bottomed out.

Oil prices took their cues from a report in the United States at the end of last week that showed consumer sentiment at its weakest in a year as a result of the uncertainty surrounding the country's debt crisis.

Concerns about demand overshadowed supply disruption fears reinforced by the Islamist militant attack and hostage-taking at a gas plant in Algeria, a member of the Organization of Petroleum Exporting Countries.

Brent futures were down by 40 cents to $111.47 per barrel by mid-afternoon. U.S. crude shed 43 cents to $95.13 per barrel after touching a four-month high last week.

"The over-riding fundamental feeling in the market is that crude oil is over-supplied in 2013," said Tony Nunan, an oil risk manager at Mitsubishi.

Last week's data showing a pick-up in the Chinese economy helped keep growth-sensitive copper prices steady at roughly $8,056 an ounce. Gold, meanwhile, reversed Friday's losses to stand at $1,688 an ounce.

(Additional reporting by Sudip Kar-Gupta, Marious Zaharia and Anooja Debnath; Editing by Peter Graff)

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Algerian Prime Minister Says at Least 37 Foreigners Dead in Siege

Anis Belghoul/Associated Press

Algerian Army vehicles on Sunday near a remote town in southeastern Algeria where hostages were taken in a four-day ordeal.

ALGIERS — In his first official tally of the deadly scope of Algerian hostage crisis, Prime Minister Abdelmalek Sellal said Monday that the known death toll among the foreign captives had risen steeply from 23 to 37, and that five additional foreigners remained unaccounted for.

In a televised news conference, Mr. Sellal also said that 29 militants were killed and that three were captured alive during the four-day ordeal that terrorized a remote Algerian gas field refining site. Two of the attackers were Canadian, he contended.

Algerian officials had been forecasting that the tally of foreign dead would rise from a preliminary estimate of 23, a concern that was reinforced by reports that a significant number of hostages from Japan and the Philippines had been killed at the site. On Monday, the Algerian prime minister said the dead came from eight different nations, without specifying which ones. He also said that one Algerian hostage had been killed as well.

Mr. Sellal was more specific about the attackers, telling the news conference that they had come from Egypt, Canada, Mali, Niger, Mauritania and Tunisia, although it was unclear how he knew for sure. Algerian officials have been saying that few if any of the attackers were believed to have been Algerian.

The prime minister asserted that the attackers had started out in northern Mali — a claim made by the attackers themselves, which had initially been dismissed by the Algerian authorities as far-fetched because the Mali border is hundreds of miles away.

But the prime minister added that the attackers had ultimately crossed into Algeria through its eastern border with Libya, which is much closer to the refining site. If true, it would serve as a powerful a reminder of Libya’s instability since the overthrow of Col. Muammar el-Qaddafi more than a year ago, and of the enormous distances that complicate the monitoring of national boundaries in the vast Sahara.

“We would need two NATOs to monitor our borders,” Mr. Sellal said.

He corroborated assertions made by other Algerian officials and accounts from freed hostages that the militants had intended to destroy the gas complex and had booby-trapped some hostages with explosives.

In all, the prime minister said, 790 workers were on the site, including 134 foreigners of 26 nationalities, when it was first seized by a heavily armed militant band in one of the most brazen assaults in years.

The prime minister’s news conference represented the most detailed Algerian tally of casualties in the days of alternating standoff and confrontation that began early on Wednesday as the raiders swept in from the desert to take over the internationally managed gas plant, hundreds of miles from Algiers.

Earlier Monday, the Philippines Foreign Affairs Department announced casualties among its citizens for the first time, saying 6 Filipino hostages had been killed and four were still missing.

Additionally, citing an unidentified government source, Reuters said Algeria had informed Japan that 9 of its citizens had died — if corroborated, the highest death toll by a nation reported so far — while previous Japanese accounts had spoken of 10 unaccounted for. Officials in Tokyo declined to confirm those figures but news reports quoted Prime Minister Shinzo Abe as saying that 7 Japanese captives died and that three were still unaccounted for.

Japan’s NHK television interviewed an unnamed Algerian worker who escaped the gas plant. He said that not long after sporadic firing started, militants appeared, armed with machine guns, antitank rockets and antiaircraft missiles. He said the attackers were kind to Algerian staff members, who were given food and blankets. Their targets were the foreign workers, who were rounded up.

The first ones he saw killed were two Japanese and a Filipino, gunned down before his eyes. He said the militants made the foreign hostages wear bombs strapped onto their bodies. He fled during the army attack, and did not know if those foreigners had survived.

The standoff between several dozen radical Islamists and Algerian security services came to a bloody conclusion on Saturday when the Algerians assaulted the kidnappers’ last redoubt at the facility, where hundreds of Algerian and scores of expatriate workers were employed.

The victims — from the United States, Britain, France, Japan and other countries — were killed after hours of harrowing captivity. An unknown number of the hostages died in the assault on Saturday; Algerian officials said they also killed most of the remaining hostage takers, who they said were followers of Mokhtar Belmokhtar, a warlord linked to Al Qaeda based in northern Mali. A regional Web site reported that he had issued a video claiming responsibility for the attack.

Adam Nossiter reported from Algiers, and Alan Cowell from London. Reporting was contributed by Steven Erlanger and Scott Sayare from Paris, Alan Cowell and Stanley Reed from London, Floyd Whaley from Manila, Martin Fackler from Tokyo, Eric Schmitt and Michael R. Gordon from Washington, and Michael Schwirtz from New York.

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An Appointment With Kim Dotcom

Paul Spain is the host of the weekly NZ Tech Podcast, one of New Zealand’s leading locally produced podcasts and often appears on TV and video as a commentator on consumer and business technology topics.

AUCKLAND, NEW ZEALAND — It’s been said that Kim Dotcom is a villain. Many, particularly those in the film industry and law enforcement, believe it. To others, he is a hero standing up for the rights of Internet users everywhere.

[More from Mashable: Kim Dotcom’s Mega Begins Early Rollout]

I wanted to find out for myself where he stood.

I arrived at the Dotcom Mansion early Sunday afternoon New Zealand time. It was just a few hours after the launch of Kim Dotcom’s new website Mega.co.nz and one year since his mansion was raided and he was arrested by New Zealand police in conjunction with a U.S. request to extradite him.

[More from Mashable: Kim Dotcom’s Mega Loses Web Domain Before Debut]

A friendly Kim Dotcom greeted each of us in a small media gathering, before sitting at the head of the table flanked by Ira Rothken, his California-based attorney.

I expected a prepared statement. That wasn’t the case. Dotcom shared his excitement about the 250,000 Mega signups in the first two hours and soon led into Q&A session for the remaining 45-minutes. He proved to be extremely adept in the way he responded to questions, working effortlessly to position Mega as an innovator. He indicated a desire to help the film industry succeed in the world of digital downloads and streaming — rather than being just a company out to line its own pockets.

Dotcom’s opinions and arguments for his cause were strong and generally well thought out, though on occasion seemed less robust. For instance he suggested he’d found a great way films could be funded in the future. His concept involves studios signing up digital streaming distributors around the world to fund a movie ahead of its production.

He felt distributors might pay for streaming rights before production, thereby funding the production. Unfortunately, I feel revenues from streaming (now and for the foreseeable future) are typically so low this would only provide a small fraction of the funds needed to produce a movie. And who wants to risk paying up front for a movie that might be a flop?

When asked about whether he would stay in New Zealand if he succeeds in stopping his extradition to the U.S. later this year, he was non-committal. On one hand he said he loved the country but on another he was worried he’d be persecuted by authorities, and in that case he’d leave. He spoke of journalists, music and movie producers on their way to visit him being harassed by customs officials upon arrival in the country –- including strip searches and even a request to view the content of one visitor’s laptop. I’ve not been able to verify these rather extreme occurrences.

Dotcom has positioned Mega as a service that sits between Dropbox and his previous site Megaupload -– with the added benefits of end-to-end encryption. He and Rothken went to great lengths to highlight that Mega would operate entirely within the law.

Dotcom made little effort to suggest Mega would be less prone to being a haven to copyright materials than Megaupload was. It seems there will continue to be a game of cat and mouse afoot as Dotcom and authorities try to outwit each other.

(A full audio recording of the discussion will be available later today at NZ Tech Podcast.)

In a one-on-one setting with Dotcom, I tried to gain more understanding about the open source elements of the Mega service and his commitment to New Zealand. Interestingly he was reticent to provide solid answers to either question and provided what I felt were just pat answers aimed at fobbing me off.

As we left the compound mid-afternoon, we saw Kim on stage rehearsing for the evening performance he would lead, with the support of musicians, his co-accused and investors in the new Mega. That performance included a dramatization of the raid on his home one year before. It was a gathering filled with media from around the country and a few from abroad. In the public context he continued to sell Mega extremely well –- to the point where someone commented to me that the event at times felt like a religious or marketing conference.

Dotcom currently remains on bail until his extradition hearing due in September. Amongst those in attendance, it appeared widely accepted that the bid to extradite him from New Zealand to the U.S. is likely to fail because of mistakes made by law enforcement and New Zealand spy agency GCSB.

After my visit, I’m left with a number of fairly clear impressions about Kim Dotcom and Mega. How you take these will depend on which side of the fence you stand:

1. Mega’s management team is making every effort to operate in a manner that does not fall afoul of the law (though it could be argued they did the same with Megaupload).


2. Mega will be used to distribute copyrighted materials such as movies, TV shows and music -– though likely to a lesser extent than Megaupload did.


3. Kim Dotcom will continue to draw controversy and be outspoken about the rights of Internet users everywhere. He is not backing down.

Love him or hate him, Kim Dotcom is back in business and, if he’s to be believed, no fair court will be able to stop him.

Dotcom raid being re-enacted at the mansion.

Click here to view this gallery.

Photos by Paul Spain

This story originally published on Mashable here.

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James Franco Is 'Hit of the Party' at Sundance

01/21/2013 at 11:15 AM EST

James Franco and Mario Lopez and Courtney Mazza

Neilson Barnard/Getty; Jeffrey Mayer/WireImage

The stars arrived by the dozens to Park City, Utah, for the 2013 Sundance Film Festival and PEOPLE has the details of their busy weekend.

James Franco was one of the last to arrive to the Stella Artois-hosted dinner for his documentary Kink on Saturday evening. Later, the Lovelace star hosted a large 1 a.m. "after, after party" at The Everest Mansion high up in the nearby mountains. The actor still managed to be up in time to surprise the guests at the Outfest Queer Brunch at Grub Steak Restaurant in Prospector Square Sunday morning with his Interior. Leather Bar. co-director Travis Mathews.

"James was the hit of the party," one brunch attendee tells PEOPLE. "Everyone wanted their picture with him."

Daniel Radcliffe may have been seen snuggling with Kill Your Darlings costar Erin Darke Friday night, but he went solo to the Next Generation Filmmaker dinner Saturday, where costar Michael C. Hall and his novelist girlfriend, Morgan Macgregor, were the last to leave while the most of the diners danced the night away at The Westway.

Glee star Jane Lynch turned the Festival into a family affair by taking her wife Lara Embry and daughters Haden and Chase to the New Era Chalet at the Lift in Park City.

Lynch was overheard stating she had "a peanut head" as she and her family picked out New Era Chicago caps – which lead to a lighthearted debate about the White Sox and the Chicago Cubs. While Lynch lobbied hard for the Cubs, her daughters were more interested in checking out the Nintendo Lounge nearby.

Newlyweds Mario Lopez and Courtney Mazza enjoyed a mini-honeymoon in Park City, or possibly a baby-moon?

The couple stopped by the TR Suites and enjoyed Lipton teas while perusing the Sears Lounge, where Mazza was overheard saying she and Lopez are "trying and hoping" for a second child. The couple later hit the Miami Lounge where, once again, they drank Hint Water rather than cocktails.

– Patrick Gomez

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