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A jury will decide whether British pop star Ed Sheeran is guilty of copying parts of Marvin Gaye’s “Let’s Get It On” for his Grammy-award winning hit “Thinking Out Loud.”

In his decision made public Thursday, U.S. District Judge Louis Stanton refused to grant Sheeran’s request to throw out the lawsuit, which has been brought by the estate and heirs of the late producer Ed Townsend who co-wrote “Let’s Get It On” with Gaye, according to a Reuters report.

“Thinking Out Loud” was released on Sheeran’s “X” album in 2014 and won two Grammys in 2015, while Gaye’s “Let’s Get It On” single reached number one on the U.S. Billboard chart in 1973.

Judge Stanton found “substantial similarities between several of the two works’ musical elements,” and said a jury should decide whether Sheeran and labels Sony/ATV Music Publishing and Atlantic Records infringe copyright.

Sheeran was originally sued in 2016 by Kathryn Townsend Griffin and other relations of Townsend, and court documents allege that Sheeran and his representatives “copied the ‘heart’ of ‘Let’s’ and repeated it continuously throughout ‘Thinking’.”

The judge also cited footage of Sheeran performing “Thinking Out Loud,” “which shows him seamlessly transitioning between (the two songs),” Stanton wrote, and the video is set to be played at the trial.

This is the second lawsuit against Sheeran being overseen by Judge Stanton. Structured Asset Sales, founded by banker David Pullman, says it owns part of “Let’s Get It On” and is suing for $100 million.

Paul Williams, a spokesperson at Sony/ATV Music Publishing, declined to comment on the case when contacted by CNBC.

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Market expects fall in profit



Robin Li, chief executive officer of Baidu.

Nelson Ching | Bloomberg | Getty Images

Chinese search giant Baidu is facing stiff competition from newer rivals, and has seen over $60 billion of its value wiped off since its peak last year.

It’s part of China’s internet trio — Baidu, Alibaba and Tencent — which have collectively been named “BAT.” But it’s facing an increasingly tough advertising market, and has been falling behind the other two rivals.

Often dubbed “China’s Google,” Baidu has seen its shares slide nearly 40% this year. In contrast, gaming titan Tencent is up just over 6%, while e-commerce giant Alibaba is more than 27% higher.

At its peak in mid-May 2018, Baidu was worth around $99 billion — with its shares priced at $284. Stocks of the search giant have fallen to $96.7 a share with its market cap plunging to $33.8 billion. Comparatively, Tencent and Alibaba are both worth over $400 billion.

Baidu earnings

Ahead of its second-quarter earnings report on Monday, analysts are expecting further pain for Baidu.

Wall Street is predicting the following results for the June quarter:

  • Revenue of 25.76 billion yuan ($3.66 billion), according to estimates from Refinitiv. If that number is realized, it would represent a near 0.8% year-on-year decline.
  • Earnings per share of 2.91 yuan, according to Refinitiv estimates. If achieved, that would be a more than 83% year-on-year decline.

For a long time, Baidu has enjoyed dominance of China’s search market given the absence of major competition. Google exited the market in 2010.

But Baidu was slow to respond to the growth of mobile and has faced growing competition from new entrants, such as TikTok parent ByteDance. As a result, advertisers have switched their budgets to other platforms.

“This is a structural change that is unfavorable to Baidu’s core search business,” Xueru Zhang, senior analyst at 86Research, told CNBC.

Mobile push

In China, there is a trend of so-called “super apps.” These are products like Tencent’s WeChat or Ant Financial’s Alipay where a user can do a number of different things ranging from payments to ordering food all within one app.

Baidu has been investing heavily in its own mobile offering. It has an app where users can search and watch videos as well as a number of other functions. The company announced last week that the number of daily active users on the app had surpassed 200 million.

It has introduced features such as mini programs which is an app within the app — something that WeChat has on its platform already. The aim is to increase the amount of time users spend within the app. But Zhang said Baidu is late to the party.

“Baidu is just a follower, and the market did not give much credit to these initiatives,” Zhang told CNBC.

A.I. focus

Baidu has been shifting its business to focus on artificial intelligence (AI) products. This includes its driverless car technology unit and voice assistant for example.

“We are leveraging Baidu AI to provide enterprise solutions to businesses and local governments, which significantly expands our total addressable market,” Baidu CEO Robin Li said in the first-quarter earnings statement.

While 2019 looks to be a year of pain for Baidu, the market sees a recovery in 2020 as some of these initiatives begin to make money.

“Its new initiatives in AI-related area are actually growing very fast,” Zhang said. “Although meaningful financial contribution from new AI initiatives are unlikely to kick in any time soon, the company has proven its capability to commercialize AI technology in a broad range of applications at a pace and scales that is hard to compete (with).”

Zhang said her firm believes “Baidu is one key player riding on China’s upcoming AI era,” and added: “These new AI businesses will be the long-term value driver for Baidu.”

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US tech firms to influence decision on Huawei license extension: IDC



A Huawei logo is pictured at their store at Vina del Mar, Chile July 18, 2019.

Rodrigo Garrido | Reuters

U.S. President Donald Trump is set to decide Monday on whether to extend a temporary agreement allowing Huawei to do business in the U.S. — and Washington’s decision will likely be influenced by American tech firms, according to research firm International Data Corporation.

The U.S. Commerce Department placed the Chinese tech giant on a blacklist — the so-called Entity List — in May, preventing American companies from selling or transferring technology to Huawei unless they were granted a special license. Days later, the U.S. government eased some of those restrictions for 90 days. That temporary reprieve is set to end on Monday.

According to Reuters and the Wall Street Journal, the U.S. is going to extend the license by another 90 days that will allow Huawei to continue buying parts from American companies.

“This is about, in my opinion, as much about the pressure that U.S. components suppliers are exerting on the government as opposed to say punishing Huawei,” Crawford Del Prete, president at IDC, told CNBC’s “Squawk Box ” on Monday.

Del Prete explained that Huawei’s core product lines — including telecommunications equipment, servers, storage, networking gear and even its smartphones — have “very, very complex supply chains and they rely on technology that has a very, very long lead time.” There are no near-term alternative ways for Huawei to access those advanced technologies without buying them from American companies, Del Prete said.

Ahead of the deadline, Trump told reporters on Sunday that Huawei was a national security threat. “We’ll see what happens. I’m making a decision tomorrow,” Trump said about the possible license extension.

Race for 5G

After Trump met with Chinese President Xi Jinping at the G-20 summit in June, the two leaders agreed at the time to pause the trade war and restart negotiations. Trump also said at the meeting he will allow U.S. companies to keep selling products to Huawei.

Huawei is considered one of the leading names in the race to develop the nascent 5G technology — the next generation of high-speed mobile internet that’s expected to be a major factor in the tech industry for years to come. But the company has been facing mounting concerns that its technology could enable China to spy on others through those high-speed mobile networks.

“I’m not in a position to say whether they are a threat or not, but I think the onus is on Huawei to be able to say … ‘No we’re not a threat to security,'” Del Prete said.

For its part, Huawei has repeatedly denied that its products represent any risk.

Huawei has been dragged into the trade dispute between the United States and China as both countries race for 5G supremacy.

US-China trade fight

Earlier this month, Trump announced the U.S would put a 10% levy on additional $300 billion in goods imported from China starting Sept. 1. Some of those tariffs were subsequently delayed until Dec. 15 to avoid hitting the holiday shopping period.

“I think what the U.S. government is trying to avoid is the consumer feeling this in a significant way,” Del Prete said.

He explained those tariffs would have a direct impact by raising import costs and increasing average selling price of affected goods. Companies, he said, could struggle to meet seasonal demand for products if the levies disrupt their supply chain. That would leave American consumers dissatisfied if they couldn’t buy laptops, phones and other affected items because they were unavailable.

“So, the impact, we think, of extending these tariffs is really to make sure we have a robust Fall buying season,” Del Prete said. “That December 15 date is not by accident, in terms of being able to make sure that the component supply chain is flushed through and the consumers can have access to their products.”

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$20 million Porsche flops in auction snafu



Attendees view the 1939 Type 64 coupe, designed and driven by Porsche AG automobiles founder Ferdinand Porsche, displayed during the RM Sotheby’s auction at the 2019 Pebble Beach Concours d’Elegance in Pebble Beach, California, U.S., on Saturday, Aug. 17, 2019.

Bloomberg | Bloomberg | Getty Images

A Porsche that was expected to sell for over $20 million flopped on the auction block Saturday night, after the sale was thrown into disarray by a technical error.

The car, a 1939 Porsche “Type 64” that was already facing controversy in the collecting world, hit the auction block Saturday night at RM Sotheby’s in Monterey, California, as part of the sales surrounding the Concours D’Elegance car extravaganza.

RM Sotheby’s auctioneer started the bidding at $13 million. But the giant screen display in the auction room showed the first bid as $30 million. The next bid was $14 million, but the screen showed $40 million — an error that continued all the way up $17 million, when the screen showed $70 million.

The crowd was erupting in cheers and shouts as the price on the screen was showing that the Porsche was selling for a record-shattering price. But at $17 million, the auctioneer stopped the bids and announced that the screen showing $70 million was wrong and that the leading bid was $17 million.

“I’m saying 17, not 70,” said the auctioneer, Maarten ten Holder. “That’s 17 million.”

The crowd in the auction room — often a boisterous one after a day of parties and events in the area — immediately started booing and shouting at the error.

There were no more bids after $17 million. Since $17 million was below the reserve price — or minimum required by the seller — RM Sotheby’s pulled the lot.

“The car didn’t meet reserve,” RM Sotheby’s said in a brief statement. “We will make every effort to sell the car post-sale.”

Some attendees in the audience said that because ten Holder is Dutch, his “17 million” sounded like “70 million,” so both the screen operator and audience was confused.

Whatever the reason, the sale debacle was an embarrassing and costly mistake for RM Sotheby’s, which expected to auction off nearly $200 million worth of cars over the weekend.

“We take pride in conducting our world-class auctions with integrity and we take our responsibility to our clients very seriously,” the company said. “This was in no way intentional on behalf of anyone at RM Sotheby’s, rather an unfortunate misunderstanding amplified by excitement in the room.”

It also marked a fitting climax to a week of sales that fell well below expectations, and could signal more trouble ahead for the classic car market. Total sales for six auctions over the course of the week were expected to top $380 million, according to Hagerty, the collectible-car insurance and valuation firm. But the preliminary total as of Sunday morning, with virtually all the auctions complete, was only $245 million — marking a 34% decline from last year.

Experts said the wild swings in the stock market and fears of a global slowdown may have weighed more than expected on the minds of wealthy collectors.

“Whether it’s the threat of recession, broad economic volatility or too many cars crammed in too few hours, there’s no denying the this year’s Monterey Auction Week results were depressed,” Hagerty said in a statement.

Sotheby’s did manage to sell a 1994 McLaren F1 for $19.8 million just shy of its estimate of $21 million to $23 million. And it sold one of the James Bond Aston Martin DB5’s — used in promotions for “Thunderball” — for $6.4 million Thursday night. Gooding & Co. sold a 1958 Ferrari 250 California LWB Spider for $9.9 million.

But along with the Porsche, which Porsche AG said was not a genuine Porsche, RM Sotheby’s also failed to auction off a 1953 Aston Martin DB3S works race car, which was expected to fetch over $8.75 million and only attracted a high bid of $7.5 million.

Other auction houses also had expensive misses, including Mecum’s 1959 Ferrari 250 Monza that went unsold at $20 million.

The only segment of the market that was strong this week in Monterey was the low end, for cars under $75,000. A 1970 Triumph TR6 went for $28,000 at Bonhams, more than double its current Hagerty market value. And a 1961 Chevy Impala convertible sold for $66,000 — also well above its book value.

“With all these statistics signaling a slumping market, the question will be whether this is felt in the broader market or be isolated to this week’s sales,” Hagerty said.

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