Apple’s shares swallow biggest loss in four years

NEW YORK/SAN FRANCISCO (Reuters) – Apple Inc shares tumbled more than 6 percent on Wednesday, chalking up their biggest single-day loss in four years as fears grow about intensifying competition in the mobile device market.

Investors and analysts blamed the sell-off on a mix of factors, including a forecast by an influential research firm that the iPad maker is continuing to cede ground to rival Google Inc’s Android gadgets, and unconfirmed reports that at least one major stock-clearing house was raising margin requirements on Apple stock trades.

Analysts also cited fears about a hike in the capital gains tax in 2013 in the event that ongoing Washington fiscal negotiations fail, as well as news that Nokia had beat Apple to the punch by striking a deal to sell its flagship Lumia through China Mobile, that country’s largest wireless carrier.

Wednesday’s drop rounded off a bleak 10 weeks for the most valuable U.S. company.

The stock was one of the day’s biggest percentage losers on the S&P 500, shedding $ 35 billion of market value as more than 37 million shares changed hands — blowing past the company’s average daily volume over 50 days of 21 million.

Apple‘s shares, once among the most desirable of portfolio holdings, have headed steadily lower since September on growing uncertainty about the company’s ability to fend off unprecedented competition. This year saw a surge in sales of Amazon.com Inc’s cheaper Kindle Fire and Microsoft Corp’s first foray into the tablet market with its Surface.

Meanwhile, Samsung Electronics continues to chip away at the iPad‘s dominance with its Galaxy line.

The assault on Apple‘s consumer-electronics home turf presents a stiff challenge for CEO Tim Cook, who was elevated shortly before the death of Silicon Valley legend Steve Jobs and is now charged with keeping the world’s largest technology company humming.

“This is not going to be a short-term trend. This is a management test, of how well they can perform without Steve Jobs,” said Brian Battle, director of trading at Performance Trust Capital Partners in Chicago. Referring to Apple‘s new iPad mini, which is only a smaller version of the existing iPad, Battle said the company needs “another home run” for shares to return to levels around $ 700.

“They need another new product that hits it out of the park. Without that, they could get a gradual grind-down in confidence,” he said.

On Wednesday, research firm International Data Corp said Apple most likely shed market share in the tablet computer space in 2012. Its worldwide tablet market share will slip to 53.8 percent in 2012 from 56.3 percent in 2011, while Android products would increase their share to 42.7 percent from 39.8 percent, IDC said.

Concerns that tax rates on dividends and capital gains may rise next year were also cited as contributing to the Apple sell-off.

The stock’s massive market value meant Apple was almost single-handedly responsible for Wednesday’s 1.1 percent decline in the Nasdaq 100 Index.

Apple is still up 33 percent this year, but is down nearly 24 percent from its record high of $ 705.07, hit on September 21. The stock slid more than 6.4 percent on Wednesday to close at $ 538.7923.

BEFUDDLING SLIDE

Some analysts were perplexed at the fall from favor in Apple stock, which has been a staple in almost all growth portfolios. The company is expected to deliver reliably high revenue and earnings expansion for years to come, and one in two tablets sold globally remains an iPad.

It is now gearing up for the introduction of its latest iPhone 5 and iPad mini in international markets. It will begin selling the iPhone 5 in 50 countries in December, including China and South Korea.

“Apple stock is significantly more volatile than its earnings and innovation stream,” said Daniel Ernst, analyst with Hudson Square Research. “And yet the wind blows slightly from the south instead of the east one particular morning, and the stock is down 6 percent.”

“It makes no sense. There are lines around the block for their products all around the world,” he added. “No other company has that.”

Separately, Nokia said it will partner with China Mobile, in a sales deal that will give the Finnish company an opportunity to win back Chinese market share from Apple‘s iPhone.

But some analysts continue to believe the dominant carrier in the world’s largest cellular market will eventually embrace the iPhone as well.

“China Mobile already carries multiple smartphones from multiple vendors. We continue to expect China Mobile to add the iPhone in the back half of 2013,” Piper Jaffray’s Gene Munster wrote in a research note.

While lines for the latest iPad model appeared lighter than usual when it hit stores in November, Apple said at the time that demand was so strong that it “practically sold out of iPad minis.” It sold 3 million of the new iPads — including the full-sized version — in the first three days on the market.

Some analysts suggested that investors also sold shares of Apple amid uncertainty over ongoing fiscal negotiations in Washington. If no agreement is reached on the issue, higher tax rates on dividends and capital gains are possible in 2013.

Investors who had hoped for a special dividend this year, as many other corporations have announced on expectations of higher tax rates next year, may be disappointed as time is running out.

“If you were expecting a special dividend by year end, that’s less likely to happen because its December 5,” said Colin Gillis, an analyst with BGC Partners.

The fear of higher taxes on capital gains also has prompted some investors to lock in profits now, particularly on a stock like Apple, which has posted gains of at least 25 percent for four consecutive years.

“Depending on what happens with the (U.S. fiscal negotiations), rates could rise next year or they could stay the same,” said Battle, of Performance Trust Capital. “They will not be lower, so if you’re an investor who has seen gains in Apple, it is better to take those gains this year rather than next.”

Tax selling “can take a life of its own,” said Tim Ghriskey, chief investment officer of Solaris Group in Bedford Hills, New York.

“Some taxable investors take the gains, that creates some negative momentum, institutional investors are heavily weighted the stock and reduce exposure.”

Some market participants also cited reports by media including CNBC, which Reuters could not confirm, that margin requirements on the trading of Apple stock had been raised by at least one clearing firm.

(Additional reporting by Charles Mikolajczak in New York and Doris Frankel in Chicago; Editing by Bernadette Baum, Andrew Hay, Leslie Adler and Ken Wills)

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Sean Bean replaces Brendan Fraser in TNT pilot “Legends”

LOS ANGELES (TheWrap.com) – TNT‘s upcoming pilot “Legends” is getting a Stark makeover.

Sean Bean, who played ill-fated Lord of Winterfell Eddard Stark in HBO’s “Game of Thrones,” has signed on to replace Brendan Fraser in TNT’s upcoming pilot “Legends.”

Fraser dropped out of the pilot last month; the show would have marked his first starring turn on a TV series.

Bean will play Martin Odum, a deep-cover operative who has a chameleon-like ability to transform himself into a different person for each mission. The project is based on a book by spy novelist Robert Littell.

“Homeland” duo Howard Gordon and Alexander Cary are executive-producing the pilot, which comes from Fox 21, as are Jeffrey Nachmanoff (“The Day After Tomorrow”) and Jonathan Levin (“Charmed”).

Deadline first reported news of Bean’s “Legends” casting.

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Recipes for Health: Winter Squash and Walnut Spread — Recipes for Health

Andrew Scrivani for The New York Times

2 pounds pumpkin or winter squash, such as kabocha or butternut, seeds and membranes scraped away, cut into large pieces (if using butternut, cut in half crosswise, just above the bulbous bottom part, then cut these halves into lengthwise quarters and scrape away the seeds and membranes)

3 tablespoons extra virgin olive oil

1/2 medium onion, finely chopped

2 tablespoons finely chopped fresh mint

1/8 teaspoon freshly grated nutmeg

1/4 cup (1 1/4 ounces/35 g) lightly toasted walnuts, finely chopped

1 ounce Parmesan, grated (about 1/3 cup)

Salt and freshly ground pepper

1. Heat the oven to 425 degrees. Line a baking sheet with foil and oil the foil. Place the squash on the baking sheet and rub or toss with 1 tablespoon of the olive oil. Place in the oven and bake until tender, 40 to 60 minutes depending on the type of squash and the size of the pieces. Every 15 minutes use tongs to turn the pieces over so different surfaces become browned on the foil. Remove from the oven and allow to cool, then peel and place in the bowl of a food processor fitted with the steel blade. Pulse several times, scrape down the sides of the bowl, then purée until smooth.

2. Heat another tablespoon of the olive oil over medium heat in a large, heavy skillet and add the onion. Add a generous pinch of salt, turn the heat to medium low and cook, stirring often, until very tender, sweet and lightly caramelized, about 20 minutes. Remove from the heat and add to the squash. Add the mint, nutmeg, walnuts, Parmesan, and 1 tablespoon olive oil and pulse together. Season to taste with salt and pepper. Serve on croutons.

Yield: 2 cups

Advance preparation: This will keep for three to four days in the refrigerator and freezes well. It benefits from being made a day ahead.

Variation: Omit the Parmesan for a vegan version. If desired, blend in 1 to 2 teaspoons of light miso.

Nutritional information per tablespoon: 35 calories; 2 grams fat; 0 grams saturated fat; 1 gram polyunsaturated fat; 1 gram monounsaturated fat; 1 milligram cholesterol; 4 grams carbohydrates; 1 gram dietary fiber; 15 milligrams sodium (does not include salt to taste); 1 gram protein

Martha Rose Shulman is the author of “The Very Best of Recipes for Health.”

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Euro Watch: Spending Data Points to Continuing Woes in Euro Zone

PARIS — European consumers continue to cut back on spending, official data showed Wednesday, indicating that the region’s financial crisis and ailing job market were weighing on hopes of an economic recovery.

Retail sales in the 17-nation euro zone fell 1.2 percent in October from September, and were down 3.6 percent from a year earlier, Eurostat, the statistical agency of the European Union, reported Wednesday.

For the entire 27-nation European Union, sales declined 1.1 percent from September and 2.4 percent from October 2011, Eurostat said.

The big dip in retail sales was partly a result of front-loading of purchases before value-added taxes rose in some countries, said James Nixon, an economist in London for Société Générale.

The fiscal crisis in the euro zone and the austerity measures employed to combat it have made companies reticent about hiring, helping to drive the euro zone into recession in the third quarter. That has created a vicious circle, in which falling consumer spending is expected to weigh further on the economy.

A reading Wednesday on euro zone activity from a private data and analysis firm also suggested the economy continued to contract. Markit Economics’ composite purchasing managers’ index for November came in at 46.5. That was a bump upward from the 40-month low of 45.7 in October, but the 10th straight month below 50, a level that suggests shrinking output.

On Friday, Eurostat reported that unemployment in the euro zone rose to a record 11.7 percent in October from 11.6 percent a month earlier, and that the jobless rate among those under 25 years of age was 23.9 percent.

The European Commission on Wednesday expressed grave concern about the problem of youth unemployment, noting that just the immediate cost to governments — in terms of lost revenue and social outlays — worked out to an estimated €150 billion, or $196 billion, a year, or 1.2 percent of E.U. gross domestic product.

It recommended a new program to address the problem, with measures including job guarantees for young people, labor market changes to reduce obstacles to hiring across European borders, and further efforts to provide high-quality training and apprenticeship programs.

The European commissioner for employment and social affairs, Laszlo Andor, said in a statement that the cost of failing to help put young people to work would be “catastrophic.”

The European Central Bank and its British counterpart, the Bank of England, will hold policy meetings Thursday, and though signs of weakness would appear to give the central banks scope for action, neither is believed to be planning any major changes to current monetary policy.

Economists expect the E.C.B. to leave its main refinancing rate at 0.75 percent, while the Bank of England is expected to stand pat at 0.5 percent.

Action by the central banks has helped to calm markets and relieve the pressure on the euro, but conditions remain unsettled. As an indication of the stresses that have sent investors scurrying for the perceived safety of major sovereign bonds, yields on France’s 10-year sovereign debt fell on Wednesday to around 2 percent, the lowest level on record.

The dismal retail sales data came as the European Stability Mechanism, the euro zone’s permanent new bailout fund, said it had issued about €39.5 billion in bonds to cover the recapitalization of Spain’s banking sector.

Euro zone leaders agreed in June to provide up to €100 billion to help Spanish banks, which have been battered in the aftermath of a property bubble collapse and economic dislocation caused by austerity measures. The funds were originally raised by the bloc’s temporary bailout fund, the European Financial Stability Facility, and the transaction Wednesday represented an effective transfer of that money from the old facility to the permanent one.

The fund said that €37 billion would be handed over some time in December to the Spanish government’s own banking rescue fund, the FROB, to cover the needs of BFA-Bankia, Catalunya Banc, NCG Banco and Banco de Valencia. The FROB will use the remaining €2.5 billion to capitalize Spain’s “bad bank,” a company called Sareb that is being used to sift through soured assets.

The action Wednesday “is an important event as the E.S.M. has now started to actively fulfill its role as the permanent rescue mechanism for the euro zone,” Klaus Regling, the head of the European Stability Mechanism, said in a statement.

Mr. Nixon, of Société Générale, predicted that the euro zone economy would shrink in the fourth quarter at an annualized 1.2 percent rate, but said he expected some of the northern European economies, including Germany, to start pulling away from the laggards in 2013.

“We may have reached a bottom,” Mr. Nixon said, citing an easing of tension in the market for sovereign debt and smoother financing conditions. “At least things aren’t getting worse any faster.”

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L.A. fire chief blames slower response times on budget cuts

Los Angeles Fire Chief Brian Cummings turned the tables on City Council members Tuesday, blaming increased 911 response times on budget cuts approved by lawmakers.

"You gave us a budget," Cummings said during a nearly two-hour City Hall hearing. "We're giving you the most effective Fire Department that we can within that budget."

Cummings was summoned to appear before the council after he failed to produce a plan to improve service and response times, which have grown longer since budget cuts were ordered three years ago after the economic downturn.

The council asked for the blueprint in April. On Tuesday, Cummings was given an additional 60 days to submit the plan.

Cummings blamed the delay on the department's data problems, which have been the subject of multiple investigations by city auditors and outside experts. Years of response time data were found to be flawed and the LAFD has accurate data only for the last two to three months, Cummings said.

Reliable performance data from a longer period is needed before changes in the department deployment plan can be recommended, he said. Improvements will require more funding, he added.

"The simple answer is money," Cummings said. "The way we improve response times is by putting more resources in the field."

The department's performance has been under scrutiny since March when fire officials acknowledged producing inaccurate response time data that made it appear rescuers were getting to emergencies faster than they actually were.

Fire officials are dealing with other embarrassments. Federal officials are investigating whether confidential information was obtained illegally on hundreds of patients who rode in Fire Department ambulances, according to a city lawyer. The department also has been criticized by the city's top budget officials for going over its budget by millions of dollars.

On Tuesday morning, The Times reported on a YouTube video titled "Firehouse Burlesque Hula Hooping" showing a woman in high-heels and tight shorts dancing with a hoop at a Venice fire station. The video was a promotion for Hoopnotica, a fitness company. The firm's chief executive said the shoot was unplanned, lasted no more than 30 minutes and that no money changed hands.

Last year, firefighters from the same Venice firehouse and another station were investigated for allowing fire engines to be used in porn shoots. Shortly after those videos surfaced, the controversy spread to Cummings when the chief acknowledged that he once posed for racy photos with a bikini-clad woman when he was stationed in Venice as a captain.

Cummings said the department was investigating the hula hoop video. Councilman Mitchell Englander, who chairs the council's Public Safety Committee, said firehouse antics are "another part of the culture we have to change."

At the council meeting, Cummings and other fire officials reviewed the recent findings of a task force formed to examine the department's various data management troubles.

Councilman Eric Garcetti said he was happy the data problems were being addressed, but said he wanted a detailed plan for service improvements.

He also said the department needs stronger leadership. "I want somebody fighting for this department," he said. "Talk to your firefighters out there. They don't feel that is happening."

After the economic downturn, the council and Mayor Antonio Villaraigosa cut the LAFD's annual budget by $88 million — from $561 million in 2008 to $473 million in 2011.

The cuts led to service "brownouts," which took units out of service on a rotating basis, and which were eventually replaced by a new deployment plan. Cummings, an assistant chief at the time who oversaw development of the redeployment, predicted response times would match pre-recession levels following the changes. But investigations by The Times and City Controller Wendy Greuel found response times for medical emergencies have increased over the last four years.

Councilman Richard Alarcon admonished his colleagues, saying they should have known their budget cuts would lead to slower response times.

"Even Barry Bonds can't hit home runs with a plastic bat," said Alarcon, who voted against the cuts.

This spring, responding to concerns about the department's performance and the controversy over the accuracy of its data, lawmakers added back $40 million to the department budget. Cummings has requested an additional $50 million in next year's budget.

kate.linthicum@latimes.com

robert.lopez@latimes.com

ben.welsh@latimes.com

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Amazon launches Kindle content service for kids

NEW YORK (AP) — Amazon is launching a subscription service for children’s games, videos and books aimed at getting more kids to use its Kindle Fire tablet devices.

Amazon.com Inc. plans to announce Wednesday that the Kindle FreeTime Unlimited service will be available in the next few weeks as part of an automatic software update.

Amazon said subscribers will have access to “thousands” of pieces of content, though the company did not give a specific number. Kids will be able to watch, play and read any of the content available to them as many times as they want. Parents can set time limits, however.

The service, aimed at kids aged 3 to 8, will cost $ 4.99 per month for one child. It’ll cost $ 2.99 per child for members of Amazon Prime, the company’s premium shipping service. Amazon Prime costs $ 79 per year for free shipping of merchandise purchased in the company’s online store.

Family plans for up to six kids will cost $ 9.99 per month and $ 6.99 for Prime members.

The Kindle already allows for parental controls through its FreeTime service. Parents can set up profiles for up to six children and add time limits to control how long kids can spend reading, watching videos or using the Kindle altogether. With the content subscription service, kids can browse age-appropriate videos, games and books and pick what they want to see. They won’t be shown ads and will be prevented from accessing the Web or social media. Kids also won’t be able to make payments within applications.

Amazon is launching the service as competition heats up in the tablet market among Apple, Barnes & Noble, Microsoft and Samsung. Amazon’s strategy is to offer the Kindle at a relatively low price and make money selling the content.

Offering a subscription service aimed at kids helps set the Kindle apart from its many competitors.

“We hope that our devices are really, really attractive for families,” said Peter Larsen, vice president of Amazon’s Kindle business.

Gadgets News Headlines – Yahoo! News

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Hugh Hefner heads to altar again, with “runaway bride”

LOS ANGELES (Reuters) – Playboy founder Hugh Hefner is headed to the altar again – with the blonde Playmate who ditched him five days before their planned wedding in 2011.

Hefner, 86, and his former “runaway bride” Crystal Harris, 26, obtained a marriage license in Beverly Hills on Tuesday, Los Angeles County Recorder spokeswoman Elizabeth Knox said.

Celebrity website TMZ.com said the couple, who reunited earlier this year, are planning a New Year’s Eve wedding.

Harris was Playboy magazine‘s Miss December 2009 and appeared on the July 2011 cover of the adult magazine with a “runaway bride” sticker covering her bottom half.

In what was described at the time only as a “change of heart,” Harris dumped the magazine mogul and left his Playboy Mansion five days before a lavish June 2011 wedding before 300 guests.

This time around, the couple are playing it low-key, staying mum on their busy Twitter accounts with Hefner’s spokeswoman declining to confirm or deny their plans.

Hefner, founder of the Playboy adult entertainment empire, has been married twice before. He and his second wife Kimberley Conrad, also a former Playmate, divorced in 2010 after a lengthy separation. His first marriage to Mildred Williams ended in divorce in 1959. He has two children from each marriage.

(Reporting By Jill Serjeant)

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Recipes for Health: Mediterranean Lentil Purée — Recipes for Health

Andrew Scrivani for The New York Times

The spicing here is the same as one used in a popular Egyptian lentil salad. The dish is inspired by a lentil purée that accompanies bread at Terra Bistro in Vail, Colo.

1/4 cup olive oil

1 large garlic clove, minced or pureed

1/2 teaspoon freshly ground cumin seeds

1/2 teaspoon freshly ground coriander seeds

1/8 teaspoon freshly ground cardamom seeds

1/4 teaspoon ground fenugreek seeds

3/4 cup brown or green lentils, washed and picked over

Salt and freshly ground pepper to taste

1 tablespoon plain low-fat yogurt (more to taste) or additional liquid from the lentils for a vegan version

Chopped cilantro for garnish (optional)

1. Combine 2 tablespoons of the olive oil and the garlic in a small frying pan or saucepan over medium heat. When the garlic begins to sizzle, add the spices. Stir together for about 30 seconds, then remove from the heat and set aside.

2. Place the lentils in a medium saucepan, cover by 1 to 2 inches with water, add a bay leaf, and bring to a boil. Add salt to taste, reduce the heat and cook until tender, 40 to 50 minutes. Remove the bay leaf. Taste and adjust salt. Place a strainer over a bowl and drain the lentils. Transfer to a food processor fitted with the steel blade.

3. Purée the lentils along with the garlic and spices. With the machine running add the additional olive oil and the garlic. Thin out as desired with the broth from the lentils. The purée should be very smooth; if it is dry or pasty, add more yogurt, broth, or olive oil. Taste and adjust salt. If desired add a few drops of lemon juice. Transfer to a bowl and sprinkle the cilantro over the top if desired, or spread directly on croutons or pita triangles.

Advance preparation: This will keep for four days in the refrigerator. You will probably need to moisten it with additional yogurt, olive oil or broth, and you may want to warm it and drizzle on a little more olive oil before serving.

Nutritional information per tablespoon: 31 calories; 2 grams fat; 0 grams saturated fat; 0 grams polyunsaturated fat; 1 gram monounsaturated fat; 0 milligrams cholesterol; 3 grams carbohydrates; 1 gram dietary fiber; 1 milligram sodium (does not include salt to taste); 1 gram protein

Martha Rose Shulman is the author of “The Very Best of Recipes for Health.”

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Los Angeles and Long Beach Ports to Reopen After Strike

LOS ANGELES — After an eight-day strike that crippled the ports of Los Angeles and Long Beach, clerical workers from a local office of the International Longshore and Warehouse Union on Tuesday night agreed to a new contract with the terminal operators at the ports. Union members will return to work Wednesday morning.

As the strike dragged into its second week, both sides had come under increasing pressure from local officials to end the dispute, which had threatened to derail the Southern California economy during the holiday season. Officials from the Port of Long Beach estimated that $650 million in trade has been idled each day of the strike and a federal mediator arrived on Tuesday to help broker a deal.

“I am pleased to announce that an agreement has been reached between labor and management that will bring to an end the eight-day strike that has cost our local economy billions of dollars,” Los Angeles Mayor Antonio Villaraigosa said in a statement released Tuesday night. “With the strike now ending, we must waste no time in getting the nation’s busiest port complex’s operations back up to speed.”

Although only about 600 clerical workers had been participating in the strike, they managed to shut down 10 of the 14 shipping container terminals at the two ports, because thousands of longshoremen from the union would not cross the picket lines.

“This victory was accomplished because of support from the entire family of 10,000 members” of the International Longshore and Warehouse Union in the harbor community, Robert McEllrath, the president of the union, said in a statement announcing the agreement.

Neither the union nor the terminal operators offered details of the new contract agreement on Tuesday night.

Steve Getzug, a spokesman for the Harbor Employers Association, which represents the terminal operators, said the union voted on the proposal from the employers on Tuesday shortly before the federal mediator arrived. He added that the deal included “some compromise on staffing issues that were important to the employers.”

“And, importantly, a deal has been reached,” Mr. Getzug said. “The longshoremen expected to return 7 a.m., ready to get the cargo moving again.”

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No word from Supreme Court on gay marriage cases

WASHINGTON — The Supreme Court justices are not exactly facing the "fiscal cliff," but they will be under more pressure this week to decide which gay marriage cases they will rule on this term.

They discussed the pending appeals at their private conference on Friday, but announced no decisions. The justices will try again at their weekly conference this Friday, the last such meeting before the long holiday recess.

It is not uncommon for the justices to discuss an appeal for two or more weeks before voting to grant it. The gay marriage question is complicated because there are 10 pending appeals, including a defense of California's Proposition 8, which bans same-sex marriage.

Eight of the appeals ask the court to rule on the constitutionality of the Defense of Marriage Act, which bars federal benefits to legally married gay couples. Judges in New England, New York and California have declared this provision unconstitutional because it denies gays and lesbians equal protection of the laws.

The Supreme Court has a duty to rule when a major federal law has been struck down in one part of the nation. But it is not clear which case the court should decide.

The first ruling on the issue arose when Nancy Gill, a postal worker from Massachusetts, sued because she could not include her female spouse on her healthcare plan. She won, but Justice Elena Kagan may be forced to sit out that case because she worked on it as solicitor general, potentially setting up a 4-4 tie.

In October, Solicitor Gen. Donald Verrilli Jr. advised the court that the New York case of Edith Windsor "now provides the most appropriate vehicle" for deciding the constitutional question. It was filed after Kagan had stepped aside from the Justice Department.

Windsor and her partner, Thea Spyer, lived together for more than 40 years and married in Canada in 2007. When Spyer died in 2009, she left her estate to Windsor, but the Internal Revenue Service assessed Windsor $363,000 in estate taxes, saying she did not qualify as a "surviving spouse."

But because Windsor and Spyer were married in Canada, they may not serve as the proper stand-ins for the other plaintiffs who were legally married in one of the states.

Massachusetts has raised a third complication. State Atty. Gen. Martha Coakley filed a separate appeal and urged the court to decide the issue on states' rights grounds. Since marriage has always been a matter of state law, she argued, the Defense of Marriage Act violates the 10th Amendment, which protects the powers of the states.

If the court sees a problem with the Gill or Windsor cases, it could opt to decide similar cases involving federal benefits brought by same-sex couples from Connecticut, New Hampshire, Vermont and California.

Once the justices decide which of the Defense of Marriage Act cases to hear, they must decide whether to go further and rule on California's Proposition 8 and the potentially broader issue of the right to marry for gay couples. If the court votes to hear the case, the justices will decide by next summer on whether the state's ban on gay marriage violates the Constitution's guarantee of equal protection of the laws.

If the court turns down the appeal, it will clear the way for gay marriages to resume in California, but without setting a national precedent.

In addition, Arizona has asked the court to revive a state measure that denies benefits to the domestic partners of state employees — a case known as Brewer vs. Diaz.

The court's recent practice has been to announce on Friday afternoon which cases have been granted a review, and to announce on Monday the appeals that were turned down.

david.savage@latimes.com

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