Exclusive: TV networks start seven-day ratings push with advertisers

LOS ANGELES (Reuters) – U.S. television broadcast networks are taking the first steps to persuade advertisers to pay for commercial viewership that occurs up to seven days after a program airs, a shift that would provide a new revenue stream to help combat ratings erosion.

The networks argue that the rising popularity of digital video recorders is pushing a sizeable number of viewers to delay watching their favorite programs beyond the first three days, the time period most often used for calculating ad payments.

Some advertisers are ready to make the move to a seven-day metric. One of the big four networks, Walt Disney Co’s ABC, earlier this year reached deals with some sponsors that bring in payments for eyeballs counted between days four and seven.

The other broadcasters have begun talks with advertisers and hope to convince them to switch to the longer window in time for the “upfront” selling season that starts early next year, when billions of dollars in ad commitments will be made, according to people familiar with the discussions.

Since 2007, most TV ad time has been bought and sold based on “C3,” a ratings measurement based of the average number of commercial minutes watched during a program either live or within three days of its airing.

TV networks want advertisers to shift to “C7,” which captures commercials watched within seven days.

Advertisers hesitate to pay for the added days, particularly for time-sensitive ads pitching a department store’s one-day sale or the opening of a summer movie blockbuster. Media buyers are pushing for precise measurements of each commercial viewed, rather than an average for an entire program, as well as a tabulation of how many people are watching on mobile devices.

The debate intensified after Nielsen data showed a sharp decline in three-day viewing at the start of the fall TV season compared with last year.

The drop is partly due to “the greater penetration of DVRs and the greater usage of DVRs, which clearly have shifted the rating in the direction of C3, and ultimately, hopefully, C7,” Disney CEO Bob Iger told analysts on a November 8 conference call.

Most viewing of network prime time shows still takes place within three days. But the post-three day viewers are growing and can be significant. Ratings for ABC comedy hit “Modern Family” increased by 5 percent, to 6.5 million viewers age 18 to 49 viewers, when counted by the C7 measurement instead of C3.

The later viewers also are among the most-coveted by advertisers, according to ABC research, which showed people who watched a show after three days were more highly educated and had higher incomes. For days four through seven, “the people who are doing the viewing are some of the most desirable available from an advertiser’s perspective,” said Charles Kennedy, senior vice president of research for ABC and the ABC Family cable network.

Earlier this year, ABC made deals with some sponsors to pay for ad time based on C7 numbers, ABC spokesman Kevin Brockman said. “We expect to do more of them if they make sense for us and our clients,” Brockman said.

At CBS, the flagship network of CBS Corp, CEO Leslie Moonves has been outspoken in pressing for a C7 metric and said it “represents a significant opportunity for us that is still in the very early stages.”

“As we move forward, we will make it a priority to get paid for all of the viewing that is going on across our shows, including DVR viewing beyond C3,” Moonves told analysts on a November 7 conference call.

Advertisers are not ready to commit to the switch and will be looking for something in return if they agree to a longer window. Timing is a big concern for many brands that want to get a message out to large numbers of consumers during a specific time period. Some commercials lose their value for sponsors over a few days.

“In moving to C7, you’ve got to be careful because you are taking away some of the advantage of why clients buy television,” said Sam Armando, director of strategic intelligence for SMGx, a division of media buying agency Starcom MediaVest Group.

Advertisers believe simply adding more days to the current metric fails to adequately capture viewership. Brands are lobbying for a more precise measurement that tracks viewership of each commercial, rather than an average for a program over a time period, they say. They also want information on how many people see their ads on programs watched on computers or Internet-connected mobile devices like phones and tablets.

“If the industry is going to make a move, we need to consider it all before we just make a little baby step to C7,” Armando said.

(Reporting By Lisa Richwine; Edited by Ronald Grover and Andrew Hay)

Gadgets News Headlines – Yahoo! News

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Chevy Chase is leaving NBC's sitcom 'Community'

LOS ANGELES (AP) — The NBC series "Community" will finish the season without Chevy Chase.

Sony Pictures Television said Wednesday that the actor is leaving the sitcom by mutual agreement with producers.

His immediate departure means he won't be included in the last episode or two of the show's 13-episode season, which is still in production.

Chase had a rocky tenure playing a bored and wealthy man who enrolls in community college. The actor publicly expressed unhappiness at working on a sitcom and feuded last year with the show's creator and former executive producer, Dan Harmon.

The fourth-season premiere of "Community" is Feb. 7, when it makes a delayed return to the 8 p.m. EST Thursday time slot. The show's ensemble cast includes Joel McHale and Donald Glover.

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Well: Officials Warn Against Baby Sleep Positioners

Health officials are warning parents not to use a special device designed to help keep babies in certain positions as they sleep. The device, called a sleep positioner, has been linked to at least 13 deaths in the last 15 years, officials with two federal agencies said on Wednesday.

“We urge parents and caregivers to take our warning seriously and stop using these sleep positioners,” Inez Tenenbaum, the chairman of the Consumer Product Safety Commission, said in a statement.

The sleep positioner devices come primarily in two forms. One is a flat mat with soft bolsters on each side. The other, known as a wedge-style positioner, looks very similar but has an incline, keeping a child in a very slight upright position.

Makers of the devices claim that by keeping infants in a specific position as they sleep, they can prevent several conditions, including acid reflux and flat head syndrome, a deformation caused by pressure on one part of the skull. Many are also marketed to parents as a way to help reduce a child’s risk of sudden infant death syndrome, or SIDS, which kills thousands of babies every year, most between the ages of 2 months and 4 months.

But the devices have never been shown in studies to prevent SIDS, and they may actually raise the likelihood of sudden infant death, officials say. One of the leading risk factors for sudden infant death is placing a baby on his or her stomach at bedtime, and health officials have routinely warned parents to lay babies on their backs. They even initiated a “Back to Sleep” campaign in the 1990s, which led to a sharp reduction in sudden infant deaths.

With the positioner devices, if an infant rolls onto the stomach, the child’s mouth and nose can press up against a bolster or some other part of the device, leading to suffocation. Even if placed on the back, a child can move up or down in the positioner, “entrapping its face against a bolster or becoming trapped between the positioner and the crib side,” Gail Gantt, a nurse consultant with the Food and Drug Administration, said in an e-mail. Or the child might scoot down the wedge in a way that causes the child’s mouth and nose to press into the device.

“The baby’s movement may also cause the positioner to flip on top of the baby, trapping the baby underneath the positioner or between the positioner and the side of the crib,” she said.

Of the 13 babies known to have suffocated in a sleep positioner since 1997, most died after they rolled from their sides onto their stomachs. The Consumer Product Safety Commission has also received dozens of reports of babies who were placed on their sides or backs, “only to be found later in hazardous positions within or next to the product,” the F.D.A. said in a statement.

Many baby books for new parents specifically urge against using sleep positioners, and the American Academy of Pediatrics does not support their use for SIDS prevention. Though the F.D.A. has never approved the positioners for the prevention of SIDS, it has in the past approved a number of the devices for the prevention of gastroesophageal reflux disease and flat head syndrome. But the agency said that in light of the new safety data, it believed any benefits from using the devices were outweighed by the risk of suffocation.

As of Wednesday, the agency is explicitly advising parents to stop using sleep positioners, and it has asked manufacturers of the devices to submit clinical data showing that the benefits of their products outweigh the risk of serious harm. In addition to avoiding the devices, experts say, parents should keep things like pillows, comforters, quilts and bumpers away from their infants and their cribs. Soft bedding can increase the likelihood of a baby suffocating.

“The safest crib is a bare crib,” Dr. Susan Cummins, a pediatric expect with the F.D.A., said in a statement. “Always put your baby on his or her back to sleep. An easy way to remember this is to follow the ABC’s of safe sleep – Alone on the Back in a bare Crib.”

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Hostess wins court approval to shut down

Twinkies maker Hostess Brands Inc. won court approval to start shutting down operations, selling its assets and laying off its 18,500 workers, after the failure of an 11th-hour mediation to try to resolve a labor dispute.

U.S. Bankruptcy Judge Robert Drain gave Hostess the go-ahead Wednesday to sell its plants and brands after he presided over the closed-door talks Tuesday with the company and the striking Bakery, Confectionery, Tobacco and Grain Millers Union, which represents about 5,000 Hostess workers.

Heather Lennox, a lawyer for Hostess, said in court that the company has received a "flood of inquiries" from potential suitors.

Among the possible bidders are Nature's Own parent Flowers Foods Inc., Sun Capital Partners Inc., Sara Lee owner Grupo Bimbo, Pabst Blue Ribbon owner C. Dean Metropoulos & Co. and investment firm Hurst Capital, according to reports and analysts.

An outpouring of concern and nostalgia broke out last week when Hostess said publicly that it would shut down. It held back to give mediation a try, but Wednesday's action kindled disappointment among workers' families.

"My uncle lost his job of 27 years working for Merita Bread (partnered with Hostess)," tweeted user @sunlightmocha. "He had only ever taken ONE sick day. It's so sad."

"I'm so sad Hostess went out of business," tweeted user @NikkiKiley1. "My dad lost his job and I will never get to eat a Twinkie again. What a bad day."

"This is truly a sad day for thousands of families," said Ken Hall, general secretary-treasurer of the non-striking Teamsters union, the largest at Hostess with 6,700 members.

The 82-year-old company said that it would shrink its head count to 3,200 workers in the coming months and that those remaining would stay until the liquidation is done, which it said would take a year.

Hostess, based in Irving, Texas, will end up closing 33 bakeries, 565 distribution centers and 570 bakery outlet stores nationwide. In Southern California, the maker of Ho Hos, Ding Dongs, Dolly Madison Cakes, Wonder bread and other products employed more than 500 workers at the start of the year.

Hostess filed for bankruptcy in January for the second time in a decade.

It first moved to shut down its operations Friday, blaming the union for a strike that "crippled its operations at a time when the company lacked the financial resources to survive a significant labor action."

The baker said its "inflated cost structure," which it attributed primarily to its collective bargaining agreements, put it at a "profound competitive disadvantage."

Workers who walked off their jobs accused Hostess of awarding pay increases to executives while pillaging employee benefits and wages.

In court Wednesday, Drain noted that the failure of the talks was the result of disagreements and not the fault of either party. He allowed the company to remain in control of the liquidation, rejecting a request to turn the Chapter 11 proceeding into one overseen by the U.S. trustee's office under Chapter 7.

The company will return to court later to seek approval to sell off specific brands, which financial advisors testified could generate $1 billion in proceeds.

Last year, Hostess reported sales of $2.45 billion, down 2% from the year before, according to estimates from research group PrivCo. The company's net loss more than doubled to $341 million from $136 million, according to the report.

tiffany.hsu@latimes.com

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LAFD looks at ways to speed up emergency response times

Los Angeles Fire Department officials, facing criticism over slow response times to 911 calls, are considering two new strategies that could get rescuers to the scene of medical emergencies more quickly.

One program, known as "quick launch," reduced the time it took to get fire units moving by an average of 50 seconds — roughly in half — during a test period in 2006. The experiment allowed dispatchers to send units before fully determining the nature of emergencies, according to internal LAFD documents obtained by The Times.

The test was discontinued because so many rescue units were being dispatched that it created gaps in coverage, department officials said during a Fire Commission meeting Tuesday. "It ties up resources," Fire Chief Brian Cummings explained to reporters.

FULL COVERAGE: 911 breakdowns at LAFD

But with pressure building to reduce response times, Cummings and the fire commissioners said Tuesday that the department will reexamine the program to see if it can be improved.

The agency also plans to roll out a separate program that would quickly alert paramedics and emergency medical technicians whenever a 911 call is received from their area. The alert would give rescuers a head start on gathering gear and getting into their trucks while dispatchers collect information on the nature of the emergency, according to the commander of the LAFD dispatch center.

The department is struggling to improve its data analysis and trying to reassure the public and elected officials about its emergency response performance. Fire officials have been under scrutiny since March, when they acknowledged that for years they had produced reports that made it appear rescuers were getting to victims faster than they actually were.

Fire commissioners on Tuesday also discussed a study by a special task force that found the department has produced inaccurate response-time data that should not be relied upon. Some of the faulty reports were used by City Council members when they decided to shut down fire engines and ambulances at more than one-fifth of the city's 106 firehouses.

A Times investigation earlier this year found LAFD's dispatchers lag well behind national standards that call for rescuers to be sent to those in need in under 60 seconds on 90% of 911 calls. Those findings were confirmed this week in the report from the task force, which was headed by Asst. Chief Patrick Butler and included experts from inside and outside the department.

The quick-launch dispatching experiment was conducted over a four-week period in the summer of 2006. Dispatchers normally ask callers a series of carefully scripted questions to determine the severity of a medical incident. The answers typically must be entered into a computer before firefighters are dispatched.

The pilot program got rescuers rolling earlier in the 911 call-handling process. The 50-second reduction in average dispatching time exceeded officials' expectations and was "especially encouraging," according to an internal LAFD study obtained by The Times.

But Asst. Chief Daniel McCarthy, commander of the LAFD dispatch center, said firefighters were being sent to shooting scenes and other potentially dangerous locations not knowing what to expect.

"We put people at risk when we did that," McCarthy told The Times.

He said the department also will deploy a new dispatching system known as "quick alert." Rescuers will be notified over loudspeaker and by Teletype as soon as a medical 911 call is received involving their fire station's service area, speeding up so-called turnout time. Special notification equipment is expected to be installed at fire stations over the next 18 months, McCarthy said.

Last week, The Times reported that waits for medical aid vary dramatically across Los Angeles' diverse neighborhoods. Residents in many of the city's most exclusive hillside communities can wait twice as long for rescuers as those living in more densely populated areas in and around downtown, according to the analysis that mapped out more than 1 million dispatches since 2007.

Cummings acknowledged the findings on Tuesday, saying waits for help are longer in areas farther from fire stations.

"It is a matter of geography," the chief said. "Personally, if I had a serious medical condition, I'd live close to a hospital."

FULL COVERAGE: 911 breakdowns at LAFD

robert.lopez@latimes.com

ben.welsh@latimes.com

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Eric Stonestreet Wasn’t Drunk, He Swears

We realize there’s only so much time one can spend in a day watching new trailers, viral video clips, and shaky cell phone footage of people arguing on live television. This is why every day The Atlantic Wire highlights the videos that truly earn your five minutes (or less) of attention. Today:

RELATED: What Happens When You Sing ‘All Night Long’ All Night Long

So if you were one of the few people watching the American Music Awards, (which no one watched) you may have seen Eric Stonestreet be a little tipsy. But that isn’t half as enjoyable as watching Eric Stonestreet watching himself be a little tipsy that night. (Also, wow, he’s sort of a bro.)

RELATED: Modern Family Is Scary

RELATED: ‘Seven Psychocats’ and the 50 Best Bond Moments in 007 Minutes

A few days ago we found out that Paul Rudd was in play called Grace on Broadway because … (wait for it) someone in the balcony puked on the audience members during the play. Four days late we can laugh at the whole thing. Mostly because we weren’t barfed on: 

RELATED: A ‘Mad Men’ Rickroll and the Man That Destroys Carnival Games

RELATED: A Video to Restore Our Faith in Humanity and a Glacier Tsunami

Here’s how to make some magic. What you’ll need: 

(1) Canadian newscaster with chubby fingers

(1) Technology

(1) Drunk piece of technology

Voila: 

And finally. Thanksgiving is upon us!  Today we’re thankful for squirrels who like to eat plastic: 

Wireless News Headlines – Yahoo! News

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One Direction's 2nd CD hits No. 1, sells 540,000

NEW YORK (AP) — One Direction's "Take Me Home" is the taking the boys to the top of the charts — and to new heights.

The group's sophomore album has sold 540,000 in its first week, according to Nielsen SoundScan. It's the year's third-highest debut behind Taylor Swift's "Red," which sold 1.2 million units its first week earlier this month, and Mumford & Sons' "Babel," which sold more than 600,000 albums in September in its debut week.

"We just want to say a massive thanks to all the fans who have supported us," band member Harry Styles, 18, said in an interview Tuesday from London. "We can send tweets and thank them, but 140 characters is never going be enough to say how much it means."

The album also debuted at No. 1 in the United Kingdom this week. The fivesome's debut, "Up All Night," came in at No. 2 in the United Kingdom last year; it was just released in March in America, where it hit No. 1 and has achieved platinum status.

"We were a little bit nervous about how people were going to take it," 19-year-old Niall Horan said of the new album during tour rehearsals. "Everyone gets that second album syndrome."

They say though they're excited, they won't be celebrating too much: "We're finishing rehearsing soon and we're going home to bed."

One Direction, who placed third on the U.K. version of "The X Factor" in 2010, is managed by Simon Cowell. In just a year, the band has become worldwide sensations, thanks to its feverish fans. They released a book and have a Nickelodeon show and 3-D movie planned. They also made the cut for Barbara Walters' most fascinating people of 2012 list, which includes New Jersey Gov. Chris Christie and U.S. gold medalist Gabby Douglas.

One Direction says those experiences have helped the group mature.

"We've been working hard. We're starting to grow up," Horan said. "We're still young, but we've passed the initial teenage years. ...We've grown up quite quick in the job we have to do and we became a lot more independent."

The group — which includes Zayn Malik, Liam Payne and Louis Tomlinson — will launch a worldwide tour in February. They hope to work with Katy Perry and are still trying to adjust to the celebrity and fame that has taken over their lives.

"I can see how it gets to people. I guess it's quite easy to get wrapped up in it all," Styles said. "We do the same things every other lad our age does. We go out, we have fun, we meet girls and stuff like that. Sometimes it gets written about, which, yeah, we think about it and it's absolutely crazy. It's still a bit weird thinking that that's the way it is."

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Online:

http://www.onedirectionmusic.com/us/home/

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Ecstasy Treatment for Post-Traumatic Stress Shows Promise

Gretchen Ertl for The New York Times

ALTERNATIVE TREATMENT Rick Doblin of the Multidisciplinary Association for Psychedelic Studies, which is financing research into the drug Ecstasy.

Hundreds of Iraq and Afghanistan veterans with post-traumatic stress have recently contacted a husband-and-wife team who work in suburban South Carolina to seek help. Many are desperate, pleading for treatment and willing to travel to get it.

The soldiers have no interest in traditional talking cures or prescription drugs that have given them little relief. They are lining up to try an alternative: MDMA, better known as Ecstasy, a party drug that surfaced in the 1980s and ’90s that can induce pulses of euphoria and a radiating affection. Government regulators criminalized the drug in 1985, placing it on a list of prohibited substances that includes heroin and LSD. But in recent years, regulators have licensed a small number of labs to produce MDMA for research purposes.

“I feel survivor’s guilt, both for coming back from Iraq alive and now for having had a chance to do this therapy,” said Anthony, a 25-year-old living near Charleston, S.C., who asked that his last name not be used because of the stigma of taking the drug. “I’m a different person because of it.”

In a paper posted online Tuesday by the Journal of Psychopharmacology, Michael and Ann Mithoefer, the husband-and-wife team offering the treatment — which combines psychotherapy with a dose of MDMA — write that they found 15 of 21 people who recovered from severe post-traumatic stress in the therapy in the early 2000s reported minor to virtually no symptoms today. Many said they have received other kinds of therapy since then, but not with MDMA.

The Mithoefers — he is a psychiatrist and she is a nurse — collaborated on the study with researchers at the Medical University of South Carolina and the nonprofit Multidisciplinary Association for Psychedelic Studies.

The patients in this group included mostly rape victims, and experts familiar with the work cautioned that it was preliminary, based on small numbers, and its applicability to war trauma entirely unknown. A spokeswoman for the Department of Defense said the military was not involved in any research of MDMA.

But given the scarcity of good treatments for post-traumatic stress, “there is a tremendous need to study novel medications,” including MDMA, said Dr. John H. Krystal, chairman of psychiatry at the Yale School of Medicine.

The study is the first long-term test to suggest that psychiatrists’ tentative interest in hallucinogens and other recreational drugs — which have been taboo since the 1960s — could pay off. And news that the Mithoefers are beginning to test the drug in veterans is out, in the military press and on veterans’ blogs. “We’ve had more than 250 vets call us,” Dr. Mithoefer said. “There’s a long waiting list, we wish we could enroll them all.”

The couple, working with other researchers, will treat no more than 24 veterans with the therapy, following Food and Drug Administration protocols for testing an experimental drug; MDMA is not approved for any medical uses.

A handful of similar experiments using MDMA, LSD or marijuana are now in the works in Switzerland, Israel and Britain, as well as in this country. Both military and civilian researchers are watching closely. So far, the research has been largely supported by nonprofit groups.

“When it comes to the health and well-being of those who serve, we should leave our politics at the door and not be afraid to follow the data,” said Brig. Gen. Loree Sutton, a psychiatrist who recently retired from the Army. “There’s now an evidence base for this MDMA therapy and a plausible story about what may be going on in the brain to account for the effects.”

In interviews, two people who have had the therapy — one, Anthony, currently in the veterans study, and another who received the therapy independently — said that MDMA produced a mental sweet spot that allowed them to feel and talk about their trauma without being overwhelmed by it.

“It changed my perspective on the entire experience of working at ground zero,” said Patrick, a 46-year-old living in San Francisco, who worked long hours in the rubble after the Sept. 11, 2001, attacks searching in vain for survivors, as desperate family members of the victims looked on, pleading for information. “At times I had this beautiful, peaceful feeling down in the pit, that I had a purpose, that I was doing what I needed to be doing. And I began in therapy to identify with that,” rather than the guilt and sadness.

This article has been revised to reflect the following correction:

Correction: November 21, 2012

An article on Tuesday about using MDMA, or Ecstasy, in combination with psychotherapy to treat post-traumatic stress described incorrectly the office arrangement that a husband-and-wife team use to conduct therapy sessions using MDMA. The couple, Michael and Ann Mithoefer, hold the sessions in an office in a converted house; they do not conduct the sessions in their home office. And because of an editing error, an accompanying picture carried an incorrect credit. The photograph of the Mithoefers was taken by Hunter McRae, not by Gretchen Ertl.

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Ex-hedge fund manager Mathew Martoma accused of insider trading

NEW YORK — After building a huge stake in two drug companies, hedge fund manager Mathew Martoma told his powerful boss on a Sunday morning that they had to immediately dump their position.

It was an unusual request even by the outsized standards of Wall Street, but the hedge fund quietly liquidated its $700-million position within days.

Federal authorities suggested Tuesday why Martoma was in such a hurry back in 2008 — he'd allegedly gotten an illegal tip about big problems with the companies' developmental Alzheimer's drug. It was the most profitable insider-trading scheme in U.S. history, netting $276 million in profit and avoided losses, according to prosecutors.

But it resulted in criminal charges against Martoma and a swirl of questions about his boss, Steven Cohen, who is one of the most celebrated figures on Wall Street.

Cohen is worth an estimated $8.8 billion and lives in a 35,000-square-foot mansion in Greenwich, Conn., that includes an ice rink and Zamboni machine. He helped bankroll a failed bid last year to buy the Dodgers.

His firm, SAC Capital Advisors, has drawn attention in recent years as the government launched a massive crackdown on insider trading.

The hedge fund reportedly told clients it received a subpoena seeking a "broad" array of documents in late 2010. Around that time, two hedge funds founded by SAC alumni were raided by FBI agents as the government pursued its insider probe.

Martoma is the fifth person affiliated with SAC Capital to be charged in insider-related cases. Cohen's ex-wife sued him three years ago, alleging that her former husband amassed his fortune partly through insider trading.

Cohen was not named in the dual federal and civil complaints Tuesday, but experts said the government might have him in its sights.

In a civil complaint filed by the Securities and Exchange Commission, Cohen is referred to as "Portfolio Manager A," the Wall Street Journal reported. The companion criminal action lists Cohen as the "owner" of hedge funds involved in the scheme, the Journal said.

"He is to hedge funds what Michael Milken, back in the '80s, was to investment bankers," said John Coffee, a law professor at Columbia University. "The government seems to be within one move of getting a key witness against one of the most important figures in the new universe of hedge funds."

An SAC spokesman disputed that.

"Mr. Cohen and SAC are confident that they have acted appropriately and will continue to cooperate with the government's inquiry," the spokesman said in a statement.

Martoma's lawyer denied wrongdoing by his client.

"Mathew Martoma was an exceptional portfolio manager who succeeded through hard work and the dogged pursuit of information in the public domain," the lawyer, Charles Stillman, said in a statement. "What happened today is only the beginning of a process that we are confident will lead to Mr. Martoma's full exoneration."

The case revolves around a drug developed by Irish biotechnology company Elan Corp. and New Jersey-based pharmaceutical giant Wyeth, which was acquired by Pfizer Inc. in 2009.

Martoma specialized in healthcare stocks for an SAC unit called CR Intrinsic. He got a series of tips about the drug, bapineuzumab, from Dr. Sidney Gilman, a neurology professor at the University of Michigan, the government said.

Gilman consulted for Elan and Wyeth. Martoma was connected to Gilman by an "expert network" that matches investors with specialists in various fields.

After initial optimism about bapineuzumab, a clinical trial showed disappointing results. Gilman allegedly alerted Martoma to the test results shortly before public disclosure in July 2008, prompting Martoma's 8:52 a.m. email to Cohen.

The subsequent selling accounted for a whopping 20% of Elan's trading volume and 11% of Wyeth's at one point, according to the FBI. The fund even bet against the companies by "shorting" their stocks.

"And so, just like that, overnight, Martoma went from bull to bear as he tried to dig his hedge fund out of a massive hole," Preet Bharara, the U.S. attorney in Manhattan, said at a news conference.

Elan shares slumped 42% the day after the results were revealed.

Martoma is the fifth former SAC employee and the 73rd defendant accused of insider trading by Bharara's office since August 2009. Of those defendants, 69 have been convicted, most of them through plea agreements.

Bharara's office agreed to not prosecute Gilman, 80, in exchange for his testimony.

Martoma, 38, got an annual bonus of $9.3 million, primarily stemming from the profits in Elan stock, according to the government.

He got no bonus after disappointing years in 2009 and 2010 and was terminated in 2010. According to the government, an email recommending his termination said Martoma appeared to be a "one trick pony with Elan."

andrew.tangel@latimes.com

walter.hamilton @latimes.com

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Israel, Hamas keep up attacks as talks continue in Egypt

GAZA CITY — As negotiators worked on a tenuous cease-fire deal, Israel and Hamas pounded each other for a sixth day and anger rose in the Gaza Strip over the increasing number of casualties.

Hopes for a truce grew Monday night when Israeli Prime Minister Benjamin Netanyahu convened Cabinet members to discuss the details of what was said to be a multiphase, multiyear cease-fire agreement.

Officials in Egypt, where the talks were underway, expressed cautious optimism. Arab League leaders and United Nations Secretary-General Ban Ki-moon, who was visiting the region, were trying to help negotiate a deal. The White House said President Obama, who is visiting Asia, called Netanyahu and Egyptian President Mohamed Morsi on Monday.

Israel is seeking assurances from Egypt that Hamas will halt rocket fire into Israel and not be allowed to rebuild the weapon caches that Israel has destroyed in recent days. Hamas, which rules the Gaza Strip, wants an end to the land and sea blockade that has crippled its economy, and to targeted killings of its leaders by Israel.

Any sort of agreement must overcome huge obstacles. Israel views Hamas as a terrorist organization and the Islamist militant group refuses to recognize Israel's right to exist.

Even if the two don't alter those stances, any internationally endorsed truce would usher in a new phase in their relationship. Previously Israel and Hamas have refused direct negotiations, occasionally reaching informal agreements brokered through intermediaries, such as last year's deal to release captured Israeli soldier Gilad Shalit.

There are sizable risks for both sides, but also opportunities, said Doron Avital, a lawmaker with Israel's centrist Kadima party and a former commander of an elite military unit.

Hamas would win some of the international legitimacy it craves, but it would also need to moderate its behavior, just as the Palestine Liberation Organization did after signing the Oslo peace accords in 1993.

"It might elevate the status of Hamas, but that will also mean that Hamas will have to play realpolitik," Avital said. "It can't stay a terrorist organization forever. There's an interesting potential here."

Heated comments by Hamas political chief Khaled Meshaal during a Cairo news conference Monday underscored the level of animosity. He called Netanyahu a "child killer" and "murderer."

"It is Netanyahu who asked for a truce," Meshaal said. "Gazans don't even want a truce."

For Israel, besides gaining an end to rocket attacks from Gaza, a deal might start the process of encouraging Hamas to become more moderate. And if Egypt guarantees an agreement, it would be directly invested in keeping Hamas unarmed.

With no cease-fire in place, Israel has massed soldiers and armor along the Gaza border in preparation for a possible invasion. But ground fighting would almost certainly lead to more Israeli and Palestinian casualties, and voices on both sides have cautioned against it.

Some said the negotiations may have led to an uptick in violence in recent days, as each side attempts to intimidate the other before a truce is called.

Palestinian casualties were relatively low in the first days of the conflict, but have increased as Israel's air campaign hit targets in more populated areas. On Monday, Israel attacked the Sharouk communications building in Gaza City where it said four senior members of the Islamic Jihad militant group were meeting.

Among the dead was Ramez Harb, a Palestinian journalist. Israel said he was a legitimate target because he served in the information department of Islamic Jihad.

Hamas' Health Ministry said 107 people had been killed in Gaza, including more than two dozen children. At least 850 people had been wounded.

Three Israelis have died in the barrage of rockets from Gaza and a dozen have been wounded, including three on Monday. An additional 135 rockets were fired Monday, pushing the total over the last week to more than 1,000. Hamas has fired rockets at Tel Aviv and Jerusalem for the first time.

The White House said Obama, in his conversation with Morsi, emphasized that the rocket fire into Israel must end.

In a somber sign of the climbing death toll, hundreds of Gazans crowded around the Shifa Hospital morgue Monday morning in a familiar ritual: collecting the bodies of loved ones.

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