Business

The Federal Aviation Administration is maintaining its zero tolerance policy for unruly passenger behavior.
A federal judge struck down the Biden administration’s mask requirements for public transportation this week.
Disputes over masks account for more than 70% of unruly passenger reports, the FAA says.

Passengers wearing protective masks masks board a Boeing Co. 737-800 operated by Avelo Airlines ahead of the airline’s inaugural flight at Hollywood Burbank Airport (BUR) in Burbank, California, U.S., on Wednesday, April 28, 2021.
Bing Guan | Bloomberg | Getty Images

The Federal Aviation Administration is maintaining its zero tolerance policy for unruly passenger behavior even after a federal judge struck down the Biden administration’s mask requirements for public transportation this week.
After the Transportation Security Administration said the mask-mandate policy would no longer be enforced, airlines announced masks would become optional, effective immediately.

Disputes over masks accounted for more than 70% of the record 5,981 reports of disruptive passengers the FAA received last year.
The FAA introduced the zero tolerance policy in January 2021 in response to a surge in reports of unruly travelers from airlines and flight attendants. That policy calls for hefty fines and potential criminal prosecution for such behavior that previously might have spurred warnings or counseling.
Flight attendants and their unions have reported a surge in verbal abuse and physical assault by passengers during the pandemic.
The agency has referred 80 cases to the FBI, it said.
“Behaving dangerously on a plane will cost you; that’s a promise,” acting FAA Administrator Bill Nolen said in a statement. “Unsafe behavior simply does not fly and keeping our Zero Tolerance policy will help us continue making progress to prevent and punish this behavior.” 

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Novavax’s vaccine targeting both Covid and the flu triggered a promising immune response comparable with its stand-alone shots against the viruses, according Chief Medical Officer Filip Dubovsky.
The company plans to move forward with a phase two trial this year to confirm the appropriate dosing levels, and launch a phase three trial on efficacy during the 2023 flu season at the earliest, Dubovsky said.
Novavax does not currently have an authorized vaccine in the U.S. Dubovsky said the FDA is still reviewing the application for its stand-alone Covid shot.

A health worker prepares a dose of the Novavax vaccine as the Dutch Health Service Organization starts with the Novavax vaccination program on March 21, 2022 in The Hague, Netherlands.
Patrick Van Katwijk | Getty Images

Novavax on Wednesday said its vaccine targeting both Covid-19 and the flu triggered an immune response similar to its stand-alone shots against each virus, in an early indication that a combination vaccine targeting both viruses could prove effective though further study is necessary.
Chief Medical Officer Filip Dubovsky, during a call with reporters, said the company’s early phase clinical trial found that up to 25 micrograms of the Covid formulation combined with up to 35 micrograms of the flu formulation triggered a promising level of protective antibodies.

“What we demonstrated in this study is we were able to get the immune responses really comparable to what the individual vaccines did prior to combination,” Dubovsky said.
Participants in the phase one trial had a median age of 59 and all of them had previously received Covid vaccines. Novavax is presenting the data at the World Vaccine Congress in Washington, D.C., on Wednesday.
Novavax plans to move forward with a phase two trial this year to confirm the appropriate dosing levels, and launch a phase three trial on efficacy during the 2023 flu season at the earliest, Dubovsky said.
Public health experts expect Covid to become a seasonal respiratory virus similar to the flu that will likely require annual vaccination because immunity from the shots wanes over time. The vaccine makers are racing to develop combination shots targeting both viruses to make it easier for people to get protected when Covid and the flu are circulating simultaneously.
“Combination vaccines are an attractive public health intervention,” Dubovsky said. “You are hitting two life-threatening diseases in one medical contact, giving a single vaccination.”

Novavax, an early participant in the U.S. government’s 2020 race to develop Covid shots, does not currently have an authorized vaccine in the U.S. The company asked the Food and Drug Administration to authorize its Covid vaccine in January. Dubovsky told reporters on Wednesday that the FDA is still reviewing Novavax’s application.
Novavax’s Covid vaccine uses different technology than Pfizer’s and Moderna’s shots, which rely on messenger RNA to turn human cells into factories that produce copies of the virus spike protein, inducing an immune response that fights Covid. The spike is the part of the virus that latches onto and invades human cells.
Novavax’s shots, on the other hand, fully synthesize the virus spike outside the human body. The genetic code for the spike is put into a baculovirus that infects insect cells, which then produce copies of the spike that are purified and extracted. The spike copy, which can’t replicate or cause Covid, is injected into people to induce an immune response against the virus.
The vaccine also uses an adjuvant that contains an extract purified from the bark of a tree in South America, to induce a broader immune response. The adjuvant has been used in licensed vaccines against malaria and shingles. Novavax’s stand-alone Covid shots consist of 5 micrograms of the spike copy and 50 micrograms of the adjuvant.
Novavax uses the same technology for its stand-alone flu vaccine candidate, which targets four strains of the virus.
While the up to 25 microgram Covid formulation in the combination vaccine is higher than the stand-alone shot, Dubovsky said it’s well within the range of the other FDA-licensed Covid vaccines, which have dosing levels between 50 and 100 micrograms.
The 25 microgram formulation tested in the combination vaccine trial was well tolerated and safe, Dubovsky said. The most common side effects were injection site pain, fatigue and headaches, he said.

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Options traders are making a ton of noise in Tesla’s stock as the company gears up to report earnings after the bell Wednesday.
The electric vehicle manufacturer headed up by Elon Musk — who continues to make a lot of noise himself — has struggled so far this year, but the options market is betting that Tesla could be back in positive territory for 2022 by the end of this week.

“[Tesla] was the fourth-busiest [single stock option] in contract terms today and the busiest in notional terms. Right now, the options market is implying a move of about 6% by the end of the week,” Optimize Advisors CIO Michael Khouw said Tuesday on CNBC’s “Fast Money.”
Bullish traders were largely responsible for the flood of trading volume Tesla’s options experienced Tuesday, though the most popular contract targeted a post-earnings move slightly smaller than the 6% predicted by the market as a whole.
“The most active options were the [April 22 weekly] 1,100 and 1,050-strike calls. The 1,050s, for example, saw nearly 30,000 trade at a price of $20 per contract,” said Khouw. “Buyers of those calls are risking a little under 2% of the current stock price to make a bullish bet that the stock is going to be up about 4.3% by the end of the week.”
Tesla was down more than 3% midday Wednesday.
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Walmart is seeking a new trial in a case over the firing of a longtime employee with Down syndrome.
In a court filing late Tuesday, Walmart said it did not know about the link between Spaeth’s disability and her struggles to adapt to a new work schedule, which ultimately led to her firing.
The big-box retailer is asking that the damages ordered to be paid to Spaeth be tossed and that a new trial was merited.

Scott Olson | Getty Images

Walmart is seeking a new trial in a case over the firing of a longtime employee with Down syndrome. A jury in July found Walmart wrongfully terminated the employee, Marlo Spaeth, and awarded her monetary damages.
In a court filing late Tuesday, Walmart said it did not know about the link between Spaeth’s disability and her struggles to adapt to a new work schedule, which ultimately led to her firing. Spaeth served as a store associate at a Walmart SuperCenter in Wisconsin for nearly 16 years.

The big-box retailer further claims the U.S. Equal Employment Opportunity Commission, which represented Spaeth in the case, did not show proof that Walmart “discriminated against her ‘with malice or with reckless indifference to [her] federally protected rights.’ ” The company is asking that the damages ordered to be paid to Spaeth be tossed and that a new trial was merited.
Walmart declined to comment beyond the filing. The EEOC did not immediately respond to a request for comment.
The request for a new trial extends a yearslong battle between the company and the EEOC in the disability-discrimination lawsuit. Walmart, the largest private employer in the country, lost the disability lawsuit last year against the EEOC. The federal agency took up the case on behalf of Spaeth.
A jury and judge found that Walmart violated the Americans with Disabilities Act when it fired Spaeth rather than adjusting her schedule as a “reasonable accommodation” to her disability. Her work hours were changed when the Walmart store began using a computerized-scheduling system.
Spaeth and her sister, Amy Jo Stevenson, repeatedly asked supervisors to restore her old schedule but Walmart refused, according to the lawsuit. Walmart began tallying days when Spaeth left the store early and later fired her for excessive absenteeism.

A federal jury ordered the company in July to pay more than $125 million in damages in the lawsuit — one of the highest in the federal agency’s history for a single victim. Those damages were later reduced to $300,000, the maximum allowed under federal law.
In late February, a federal judge ordered Walmart to rehire Spaeth and give her more than $50,000 in back pay. 
Stevenson told CNBC last week that her sister would soon return to her job at the Walmart store. She said the pair were firming up Spaeth’s start date.
Stevenson said her sister’s decision to return after all she had been through was easy, saying she missed the customers and was eager to put on her Walmart vest again.
“She’s going to walk in there proud as a peacock,” Stevenson told CNBC last week. “That’s who she is. She is a Walmart associate. To be that again will make her whole in some sense.”
Stevenson learned of Walmart’s filing when contacted by CNBC on Wednesday morning.
“We believe the jury got it right the first time,” she said. 

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Dr. Scott Gottlieb told CNBC on Wednesday people can still protect themselves against Covid by wearing quality masks like an N95 or KN95.
Gottlieb’s comments were in response to a federal judge striking down the Biden administration’s nationwide mask requirement for transit, including airplanes.
“One-way masking does work,” the former FDA commissioner said.

People concerned about getting Covid can still protect themselves by properly wearing masks, like an N95 or KN95, even if nobody else around is, Dr. Scott Gottlieb told CNBC on Wednesday.
Gottlieb’s comments come two days after a federal judge in Florida nullified the Biden administration’s Covid mask mandate for public transportation, including airlines. Many mask rules for other settings have already been relaxed.

“If you have a good-fitting mask, a high-quality mask on and you’re wearing it well, you’re going to afford yourself a high degree of protection,” the former Food and Drug Administration commissioner said on “Squawk Box.” “One-way masking does work,” he added.
“So people who feel vulnerable, if they continue to do that, are going to be able to protect themselves in that setting even if other people aren’t wearing masks,” argued Gottlieb, who now serves on the board of Covid vaccine maker Pfizer.
In response to the Florida ruling, the Transportation Security Administration indicated it will not enforce the pandemic policy; major U.S. airlines also said they’d no longer require masks.
The Department of Justice signaled Tuesday it will likely appeal the ruling from U.S. Judge Kathryn Kimball Mizelle, who was appointed by former President Donald Trump in 2020.
The end of the public transit mask requirement has been met with relief by some and concern by others, especially people who have underlying health conditions that make them more vulnerable to serious Covid illness.

While many public-health mitigation measures for places like sports venues and restaurants have ended, supporters of the mask mandate for public transit note that some people have no choice but to commute via trains and buses. For that reason, they believe the policy is an important layer of protection against Covid, particularly in light of more transmissible variants.
Gottlieb said he thinks the Center for Disease Control and Prevention should’ve let the mask mandate expire Monday, instead of deciding last week to extend the policy to May 3. However, he acknowledged that people “will be made to feel vulnerable by this policy … especially children under 5 who have health conditions and can’t be vaccinated” and the immunocompromised.
At the same time, Gottlieb said he believes “the masks were probably providing a lot less protection than people assume because most wore cloth masks,” not the highly protective N95s and KN95s.
“For people who feel at risk, I would submit that one-way masking still does work,” reiterated Gottlieb, who led the FDA from 2017 to 2019 in the Trump administration. He again stressed the need for it to be a high-quality mask. “I’m still going to wear a mask in certain occasions where I feel I’m in a confined space and there’s a lot of people around, where I’m in environments where [Covid] prevalence are higher,” he added.

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The Virgin Group founder told CNBC Wednesday that individuals, companies and governments need to play their part to reduce reliance on Russian energy.
Small personal sacrifices would lower demand, bringing down prices and easing the cost-of-living crisis, he said.
Airlines like his own Virgin Atlantic — which have been heavily impacted by rising energy costs as they seek to capitalize on post-pandemic travel demand — could cut certain unprofitable routes, for example, Branson noted.

Virgin Group founder Richard Branson on Wednesday called on individuals and governments to cap their driving speeds and turn down their heating in a bid to reduce reliance on Russian energy and bring about an end to the war in Ukraine.
The billionaire entrepreneur told CNBC that small personal sacrifices could reduce demand for Russian power, in turn bringing down prices and easing the cost-of-living crisis.

“It’s really important than we get rid of our dependence on Russian oil, gas and coal, and we must do that immediately,” Branson told CNBC’s Rosanna Lockwood.
“If we can reduce the West’s dependence on fuel, say by just 10%, that will free up something like three billion barrels of fuel. That will be plenty to make sure that countries like Germany do not have to import anymore,” he said, referring to European countries’ reliance on Russian energy.

The price of oil would come down dramatically and we would not have to continue to send checks to Putin.

Richard Branson
founder, Virgin Group

Russia is a major source of energy for consumers globally. The European Union is particularly dependent, importing 45% of its gas from Russia in 2021, according to the International Energy Agency.
However, Russia’s unprovoked invasion of Ukraine earlier this year has drawn that reliance into question. As governments have sought to reduce their dependence on Russian energy imports — which are seen as funding President Vladimir Putin’s war chest — prices have surged higher as global supply struggles to catch up with demand.
Oil prices moved higher early Wednesday, with Brent crude futures trading at around $108.23 per barrel at 2 p.m. London time.

Reduce speeds, turn down heating

Among Branson’s suggestions for reducing individual energy consumption were cutting household central heating and air conditioning usage by 1% and reducing driving speeds by 10%.
Governments could, for instance, drop the national speed limit from 70 [miles per hour] to 60 for the next year “in order to support Ukraine,” he said.
“The demand for fuel is going to come down dramatically and therefore the price of fuel will come down dramatically and therefore the cost of living will come down dramatically,” he said.

Businesses, meanwhile, can find other ways to limit energy use, Branson said.
Airlines like his own Virgin Atlantic — which have been heavily impacted by rising energy costs as they seek to capitalize on a post-pandemic travel resurgence — could cut certain unprofitable routes, for example.
“If you’re an airline, maybe [cutting] a couple of routes that are not making a lot of money,” Branson said.
“[If] you spread it out across all businesses and everybody around the world, the price of oil would come down dramatically and we would not have to continue to send checks to Putin,” he added.

The clean energy revolution is happening, and will happen much more rapidly than if this war didn’t happen.

Richard Branson
founder, Virgin Group

Branson said his proposals represent the views of a group of business leaders, known as the B Team. The non-profit, founded by Branson and Jochen Zeitz in 2012, seeks to achieve “accountability in business,” according to its website, and has members including Marc Benioff and Arianna Huffington.
The comments follow a blogpost published earlier Wednesday, in which Branson admonished Western countries for sending “billions of dollars to Russia for fossil fuels.”

Cleaner energy and lower prices

Some market observers have suggested that a rapid reduction of Russian energy use would result in the further destabilization of already volatile energy prices.
Branson, however, suggested that it would have the opposite effect, shoring up prices while also assisting countries with their transition to cleaner energy sources.

“The clean energy revolution is happening, and will happen much more rapidly than if this war didn’t happen. But, in the meantime, we can benefit from lower oil prices,” he said.
Virgin Atlantic has previously outlined plans to achieve net-zero carbon emissions by 2050. Branson did not give any update to that schedule Wednesday.
Branson has faced backlash in the past over his commitment to tackling climate change by critics who say he is too focused on heavily energy-dependent industries such as space travel.
He has countered that such endeavors create jobs and can “make space accessible at a fraction of the environmental cost that it’s been in the past.”

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Procter & Gamble’s fiscal third-quarter earnings and revenue topped Wall Street’s estimates.
The company raised its forecast for fiscal 2022 revenue growth but said it also expects inflation to rise in its next quarter.
Price hikes and productivity savings have helped offset some of the impact on P&G’s margins.

Bottles of Tide detergent, a Procter & Gamble product, are displayed for sale in a pharmacy on July 30, 2020 in Los Angeles, California.
Mario Tama | Getty Images

Procter & Gamble on Wednesday reported quarterly earnings and revenue that topped Wall Street’s expectations as price hikes helped to offset widespread inflation and a margins crunch.
The consumer goods giant reported a quarter riddled with economic challenges. Elevated commodity and freight costs dented the company’s margins, but higher prices and productivity savings helped counteract some of the drag on profits.

The company’s gross margin fell 4 percentage points compared with the year-ago period, although its operating margin dropped just 0.1 percentage point in the quarter.
“If we look at the current situation in the markets — the imbalance between supply and demand, geopolitical disruption, the need to disrupt supply chains, higher energy costs due to the war between Ukraine and Russia — all of those will continue to put pressure on the cost side,” CFO Andre Schulten said on a call with journalists.
Despite raising its fiscal 2022 revenue growth outlook, P&G said it expects its core earnings per share for the year to be on the lower end of its prior range.
Shares of the company were flat in premarket trading.
Here’s what the company reported compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:

Earnings per share: $1.33 adjusted vs. $1.29 expected
Revenue: $19.38 billion vs. $18.73 billion expected

P&G reported fiscal third-quarter net income of $3.36 billion, or $1.33 per share, up from $3.27 billion, or $1.26 per share, a year earlier.
Excluding items, the company earned $1.33 per share, topping the $1.29 per share expected by analysts surveyed by Refinitiv.
Net sales rose 7% to $19.38 billion, beating expectations of $18.73 billion. The company’s organic revenue climbed 10% in the quarter, although volume, which strips out the impact of currency and price changes, was up just 3%.
“So far our volume assumptions that we made going into the year were more conservative than what we’re seeing in the market, playing out,” Schulten said. “As we’ve taken pricing across the year, so far we see price elasticities — the consumer reaction relative to the increase we’re taking — to be about 20% to 30% more favorable than we would’ve assumed, based on historical data.”
Health care was the top-performing division for the company this quarter, with 16% organic sales growth, helped by a stronger cold and flu season and new sleep and digestive products. The segment includes Vicks and ZzzQuil cold medicine, Oral-B toothbrushes and Crest toothpaste.
P&G’s fabric and home care and its baby, feminine and family care divisions both reported organic sales growth of 10%. Fabric care, which includes Tide detergent, saw double-digit organic sales growth as the company raised prices and offered more premium products. The baby and feminine care segments got a boost from higher prices as well, in addition to market growth.
The company’s grooming segment, which includes Gillette and Venus razors, reported organic sales growth of 8%.
Its beauty division saw the weakest organic sales growth, reporting an increase of just 3%. The segment, which includes brands like Pantene and SK-II, was also the only one to report falling volume for the quarter. The company said hair care sales were hurt by pandemic-related slowdowns in volume.
For fiscal 2022, P&G raised its revenue growth forecast to a range of 4% to 5%, up from its prior outlook of 3% to 4%. The company likewise hiked its forecast for organic sales growth to a range of 6% to 7% from a range of 4% to 5%.
P&G reiterated its core earnings per share forecast for fiscal year 2022 but said it’s expecting the lower end of its predicted range of 3% to 6% growth, citing inflation and currency headwinds.
It’s predicting a $2.5 billion hit from higher commodity costs, $400 million from increased freight costs and $300 million from foreign currency headwinds. It marks the third consecutive quarter that the company has raised its full-year inflation forecast.
Read the full earnings report here.

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Philadelphia reinstated its mask mandate after cases there jumped 50% from April 1 through April 11, health officials said. Hospitalizations were steady as of April 11, but have since rapidly risen.
The number of people hospitalized with Covid there almost doubled last week, from 46 people on April 11 to 82 people on Monday.
Health officials called it a “worrisome sign that this wave could be more dangerous than we had hoped.”

A shopper wearing a protective mask as a precaution against the spread of the coronavirus selects fruit at the Reading Terminal Market in Philadelphia.
Matt Rourke | AP

Philadelphia health officials are keeping the city’s newly reinstated indoor mask mandate in place despite a federal judge’s ruling in Florida that struck down a federal requirement to wear face coverings on public transportation.
The city of brotherly love became the first major city in the U.S. on Monday to reinstate its Covid-19 mask mandate for indoor activities as the highly contagious omicron BA.2 subvariant drives new Covid cases higher across the U.S.

Many cities and states lifted mask mandates in February and March as cases plummeted from a pandemic peak of about 808,000 average new cases a day in mid-January to about 35,000 new cases a day this week. But infections across the U.S. have started to edge up in recent weeks, and cities like Philadelphia are experiencing a new surge in cases.
The Transportation Security Administration on Monday said it would stop enforcing mask rules hours after U.S. Judge Kathryn Kimball Mizelle in Tampa, Fla., ruled that the Centers for Disease Control and Prevention overstepped its bounds when it mandated face coverings on planes, trains, buses and other forms of public transportation.

Masked and unmasked travelers line up at a security checkpoint after the Biden administration announced it would no longer enforce a U.S. coronavirus disease (COVID-19) mask mandate on public transportation, following a federal judge’s ruling that the 14-month-old directive was unlawful, at Ronald Reagan Washington National Airport in Arlington, Virginia, U.S., April 19, 2022.
Kevin Lamarque | Reuters

While the ruling may lift Philadelphia’s mask rules on public transportation, the mandate still remains in place for other indoor venues, including restaurants, gyms and businesses.
“We are evaluating the implications of this latest ruling and will provide further clarity around masking on transit in Philadelphia when available. This ruling does not impact the city’s mask mandate for certain indoor places.” James Garrow, director of communications at the Philadelphia Department of Public Health, said in an email to CNBC.  
Philadelphia reinstated its mask mandate after cases there jumped 50% from April 1 through April 11, health officials said. Hospitalizations were steady as of April 11, but have since rapidly risen. The number of people hospitalized with Covid there almost doubled last week, from 46 people on April 11 to 82 people on Monday — what health officials called a “worrisome sign that this wave could be more dangerous than we had hoped.”

“We have been watching this wave of the pandemic sweep over Europe and it looks like it’s coming to Philadelphia now,” Health Commissioner Dr. Cheryl Bettigole said in a statement Monday. “We need to do whatever we can to make sure that our most vulnerable neighbors and loved ones stay safe. Each and every one of us has the ability to save lives today by putting our masks on and helping to stop the increase in cases.”
The city had been at Level 1, or “all clear,” after the initial omicron surge receded, meaning that mandatory measures such as indoor mask mandates had been lifted, according to Philadelphia’s public radio station. But the recent uptick in cases driven by BA.2 moved the city to level two, or “caution,” which requires masks. 
The mask mandate will be lifted once Philadelphia meets the thresholds of the “all clear” level again, according to the city. 
Other major city leaders have been hesitant to reintroduce the politically unpopular requirements.
In Chicago, the Department of Public Health said the return of a mask mandate is not expected in the near future, even as the city sees an uptick in cases.
“That is not something that we’re talking about at this time,” said Dr. Amaal Tokars, acting director of the department, according to NBC Chicago.  “However, I would never say that nothing has passed, but we are going to do what we think is wisest and best based on the current circumstances that we see.”
In Massachusetts, the public health commissioner said there are no plans at this time to reinstate a statewide mask mandate. Hawaii’s governor also said last week he is not considering reimposing a mask requirement for indoor public spaces. The state was the last to lift its mask mandate at the end of March. 
Similarly, public health officials from the state of Washington said the return of the mask mandate is not “in our best interest.” 
“I think what’s pretty clear is the public is pretty tired of mandates, and so I think (we) really need to use that power judiciously,” said state epidemiologist Dr. Mike Lindquist in an interview on TVW, Washington’s public affairs network. 
CNBC’s Spencer Kimball contributed to this report. 

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