World and Nation

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Palestinians resist appeals to halt UN statehood bid

JERUSALEM — Senior U.S. and European diplomats tried without success Thursday to persuade the Palestinian leaders to skip or modify their planned U.N. membership bid, officials involved said.

Riad Malki, the Palestinian foreign minister, told foreign journalists in Ramallah that the Palestinians would continue to listen to suggestions but that barring something very persuasive, President Mahmoud Abbas of the Palestinian Authority would submit a full membership application to the Security Council next Friday.

Another Palestinian official said Abbas told Dennis B. Ross, a top U.S. diplomat: “We appreciate the American role but you are too late. We have reached the moment of truth, and we are going to the Security Council.”

The United States has said it would use its veto there because it believes that the only way to Palestinian statehood is through direct negotiations with Israel.

“There was one suggestion that Palestine would be given some of the attributes of a state so that it could get funding from the World Bank, for example, but would not now seek membership in the U.N.,” the Palestinian official said, speaking anonymously in accordance with diplomatic protocol. “Another was for a resumption of negotiations based on the 1967 lines, but it didn’t include an Israeli settlement freeze. We rejected both ideas.”

There is still some discussion, however, of skipping the Security Council and going directly to the General Assembly, where there is no veto and where a majority is guaranteed. In that case, the Palestinians would be granted the status of a nonmember state while sparing the U.S. the damage to its standing in the Arab world that it would suffer from using its Security Council veto.

—Ethan Bronner, The New York Times

Customers angry over revamped pricing are
deserting Netflix

Some of Netflix’s popularity lies in its simplicity — in its ability to serve up films and TV shows and renew subscriptions automatically, without any thinking on the part of the customer.

Until now, that is.

A new pricing scheme is forcing Netflix’s 25 million customers to think about which service they want — access to online streams, access to DVDs by mail or both — and some have decided to rethink the monthly splurge entirely.

On Thursday, the company said that customers were canceling their subscriptions in greater numbers than it expected, about 1 million in total, causing a projected quarterly loss in customers for only the second time in its history. The company did not signal a shift in direction or a change its financial guidance for the quarter; still, its stock dropped almost 19 percent in heavy trading Thursday, closing at $169.25 and worsening a season-long selling streak. In July, the stock peaked at $304.79.

The downward revision reflects the negative reaction to Netflix’s decision, announced in July and adopted this month, to separate its DVD-by-mail service from its faster-growing Internet streaming service. Before, DVD-by-mail was a $2 add-on for some streaming subscribers; now, each service costs $8.

Netflix’s subscriber base had been on a reliably upward trajectory since its founding more than a decade ago, with one slight exception in 2007. The company — widely praised for making it easy to stream films and some TV shows via the Internet — had 24.6 million customers at the end of the second quarter of the year, when it last reported figures to investors. Back then, it expected that it would end the third quarter with 25 million, 3 million of whom would opt only for the DVD service.

But early Thursday morning it lowered its subscriber estimates for the third quarter, which ends in two weeks, to an expected total of 24 million, a quarterly decline of 600,000.

The decline is due in large part to customers who were unhappy about the price changes. Netflix now expects that 2.2 million customers will opt for DVDs by mail only.

—Brian Stelter, The New York Times

Skilling files high court appeal

Former Enron CEO Jeff Skilling is asking the U.S. Supreme Court to hear his appeal of an April decision by an appeals court that found errors made by prosecutors were “harmless.”

Skilling, convicted on 19 out of 28 charges following a 2006 jury trial, appealed those verdicts all the way up to the U.S. Supreme Court last year.

The Supreme Court ruled in June 2010 that one of the theories behind the conviction for conspiracy - the honest-services fraud theory - should not have been used in instructions given to the jury. Honest services fraud is defined as a company officer depriving a company “of the intangible right of honest services.”

The high court sent the issue back to the 5th U.S. Circuit Court of Appeals to determine if the use of the theory invalidated any of the charges. The 5th Circuit said it found the error to be “harmless,” however, saying there was ample evidence to allow the jury to convict based on other theories used by prosecutors.

In the appeal of the 5th Circuit decision filed earlier this month, Skilling’s attorneys said they are challenging the “harmless error” argument and the argument a defendant’s testimony can be categorically disregarded in such a review.

“Skilling’s petition will demonstrate that the Court’s holdings on both of these questions conflict with the decisions of other circuits and with Supreme Court precedent, and that both questions involve legal issues of nationwide importance in the demonstration of harmless-error review,” the filing says.

Skilling still will be resentenced by U.S. District Judge Sim Lake based on a prior ruling from the appeals court that the Houston judge applied federal sentencing guidelines improperly. A date for resentencing has not been set.

—Tom Fowler, Houston Chronicle