Albertsons on Wednesday formally terminated its proposed $25 billion merger with Kroger and filed a lawsuit against its supermarket competitor, saying Kroger violated its contract and didn’t follow through on commitments to help get the deal approved.

It comes a day after a judge blocked the planned tie-up.

In a news release, Albertsons said Kroger broke its merger agreement “by repeatedly refusing to divest assets necessary for antitrust approval, ignoring regulators’ feedback, rejecting stronger divestiture buyers and failing to cooperate with Albertsons.”

“Kroger’s self-serving conduct, taken at the expense of Albertsons and the agreed transaction, has harmed Albertsons’ shareholders, associates and consumers,” Albertsons’ General Counsel and Chief Policy Officer Tom Moriarty said in a statement. “We are disappointed that the opportunity to realize the significant benefits of the merger has been lost on account of Kroger’s willfully deficient approach to securing regulatory clearance.”

In a statement, Kroger called the allegations in the lawsuit “baseless and without merit.”

“This is clearly an attempt to deflect responsibility following Kroger’s written notification of Albertsons’ multiple breaches of the agreement, and to seek payment of the merger’s break fee, to which they are not entitled,” the company’s statement said.

About two years ago, Kroger announced plans to buy Albertsons and combine forces to fend off Walmart, Amazon and Costco. The deal would have put nearly 40 supermarket chains, including Kroger’s Fred Meyer and Albertsons’ Safeway under a single company.

The lawsuit Wednesday amounts to something of a corporate divorce battle.

The companies are at odds about who should pay for the legal fees associated with the merger and who, if anyone, is responsible for paying a breakup fee.

Albertsons said in its news release that it is owed both a $600 million termination fee and “relief reflecting the multiple years and hundreds of millions of dollars it devoted to obtaining approval for the merger, along with the extended period of unnecessary limbo Albertsons endured as a result of Kroger’s actions.”

Kroger, on the other hand, pushed back against payments to Albertsons in its statement and said it “looks forward to responding to these baseless claims in court.”

Shares of Albertsons and Kroger were up about 0.5% and 1%, respectively, in early trading Wednesday.

A rogue employee was responsible for hiding $151 million in delivery expenses over the course of nearly three years, Macy’s said Wednesday.

In a statement accompanying its quarterly earnings results, the department store chain said a single employee responsible for small package delivery expense accounting had intentionally created erroneous cost entries from the fourth quarter of 2021 through the third quarter of 2024. The employee also falsified underlying documents, according to a Macy’s regulatory filing Wednesday morning.

Macy’s Chairman and CEO Tony Spring said on the company’s earnings call that its investigation found the employee “acted alone and did not pursue these acts for personal gain.”

The employee told investigators that a mistake was initially made in accounting for small parcel delivery expenses, and then the person made intentional errors to hide the mistake, according to sources familiar with the investigation.

In an announcement last month that first revealed the situation, Macy’s estimated the erroneous entries totaled between $132 million and $154 million. The revelation led Macy’s to delay reporting its quarterly results for two weeks and caused its shares to tumble.

“We’ve concluded our investigation and are strengthening our existing controls and implementing additional changes designed to prevent this from happening again and demonstrate our strong commitment to corporate governance,” Spring said in a statement. “Our focus is on ensuring that ethical conduct and integrity are upheld across the entire organization.”

Macy’s did not disclose any additional information about how the employee’s actions were discovered and reiterated that the person is ‘no longer with the company.’

Macy’s said the investigation found that its internal accounting controls were vulnerable to employees sidestepping them. The company said it is revising those processes.

After consulting with its longtime independent accounting firm, KPMG, Macy’s also said that a report released in February on its internal controls ‘should no longer be relied upon’ — nor should KPMG’s previous endorsement of Macy’s internal controls.

In premarket trading Wednesday, Macy’s shares were down as much as 11% as it also reported earnings that missed analysts’ estimates.

Although $151 million is small relative to the $4.36 billion Macy’s said it had tallied in overall delivery expenses during the period in question, it is more than the entire company’s most recent fiscal year net profit of $105 million.

The discovery also comes as Macy’s attempts a turnaround amid broad shifts in consumer habits, with the chain having announced in February a plan to close 150 stores over several years. Earlier this week, an outside investor group said it had taken a significant stake in Macy’s seeking to shake up the retailer’s operations, including monetizing its real estate holdings.

OpenAI said Monday it’s releasing its buzzy AI video-generation tool, Sora, later in the day.

The AI video-generation model works similarly to OpenAI’s image-generation AI tool, DALL-E: A user types out a desired scene, and Sora will return a high-definition video clip. Sora can also generate video clips inspired by still images and extend existing videos or fill in missing frames. The Microsoft-backed artificial intelligence startup, which burst into the mainstream last year thanks to the viral popularity of ChatGPT, introduced Sora in February.

It’ll debut to U.S. users as well as to “most countries internationally” later today, according to OpenAI’s YouTube livestream, and the company has “no timeline” yet for launching the tool in Europe and the U.K., as well as some other countries.

OpenAI said users don’t need to pay extra for the tool, which will be included in existing ChatGPT accounts such as Plus and Pro. Employees on the livestream and OpenAI CEO Sam Altman demonstrated features like “Blend” (i.e., joining two scenes together at the user’s direction), as well as the option to make an AI-generated video endlessly repeat.

Until now, Sora has mainly been available to a small group of safety testers, or “red-teamers,” who test the model for vulnerabilities in areas such as misinformation and bias.

Reddit users asked OpenAI executives in October about Sora’s release date, questioning whether it was being delayed “due to the amount of compute/time required for inference or due to safety.” In response, OpenAI’s product chief Kevin Weil wrote, “Need to perfect the model, need to get safety/impersonation/other things right, and need to scale compute!”

“We obviously have a big target on our back as OpenAI,” Rohan Sahai, OpenAI’s Sora product lead, said on the livestream, adding that the company needs to prevent illegal use of the technology. “But we also want to balance that with creative expression.”

OpenAI closed its latest funding round in October at a valuation of $157 billion, including the $6.6 billion the company raised from an extensive roster of investment firms and Big Tech companies. It also received a $4 billion revolving line of credit, bringing its total liquidity to more than $10 billion.

It’s all part of a serious growth plan for OpenAI, as the Microsoft-backed artificial intelligence startup battles Amazon-backed Anthropic, Elon Musk’s xAI, Google, Meta, Microsoft and Amazon for the biggest slice of the generative AI market, which is predicted to top $1 trillion in revenue within a decade.

Earlier this month, OpenAI hired its first chief marketing officer, indicating plans to spend more on marketing to grow its user base. And in October, OpenAI debuted a search feature within ChatGPT that positions it to better compete with search engines like Google, Microsoft’s Bing and Perplexity and may attract more users who otherwise visited those sites to search the web.

With Sora, the ChatGPT maker is looking to compete with video-generation AI tools from companies such as Meta and Google, which announced Lumiere in January. Similar AI tools are available from other startups, such as Stability AI’s Stable Video Diffusion. Amazon has also released Create with Alexa, a model that specializes in generating prompt-based short-form animated children’s content.

Video could be the next frontier for generative AI now that chatbots and image generators have made their way into the consumer and business world. While the creative opportunities will excite some AI enthusiasts, the new technologies present serious misinformation concerns as major political elections occur across the globe. The number of AI-generated deepfakes created has increased 900% year over year, according to data from Clarity, a machine learning firm.

OpenAI has made multimodality — the combining of text, image and video generation — a prominent goal in its effort to offer a broader suite of AI models.

News of Sora’s release follows protestors’ decision to leak what appeared to be a copy of Sora over concerns about the ChatGPT maker’s treatment of artists.

Some members of OpenAI’s early access program for Sora, which it said included about 300 artists, published an open letter in late November critiquing OpenAI for not being sufficiently open or supporting the arts beyond marketing.

“Dear corporate AI overlords,” the protestors’ open letter stated, “We received access to Sora with the promise to be early testers, red teamers and creative partners. However, we believe instead we are being lured into ‘art washing’ to tell the world that Sora is a useful tool for artists.”

The letter added that hundreds of artists provided unpaid labor for OpenAI through bug testing and feedback on Sora, and that “while hundreds contribute for free, a select few will be chosen through a competition to have their Sora-created films screened — offering minimal compensation which pales in comparison to the substantial PR and marketing value OpenAI receives.”

“We are not against the use of AI technology as a tool for the arts (if we were, we probably wouldn’t have been invited to this program),” the open letter stated. “What we don’t agree with is how this artist program has been rolled out and how the tool is shaping up ahead of a possible public release. We are sharing this to the world in the hopes that OpenAI becomes more open, more artist friendly and supports the arts beyond PR stunts.”

In late November, an OpenAI spokesperson responded to the protestors’ actions in a statement to CNBC.

“Hundreds of artists in our alpha have shaped Sora’s development, helping prioritize new features and safeguards,” the OpenAI spokesperson said at the time. “Participation is voluntary, with no obligation to provide feedback or use the tool. We’ve been excited to offer these artists free access and will continue supporting them through grants, events, and other programs.”

The pieces are coming together for the startup basketball league Unrivaled.

The 3×3 women’s hoops league announced Tuesday that it has signed a multiyear deal for Under Armour to become its official uniform partner and performance outfitter. This follows the league announcing a number of recent big player signings and reaching a media broadcast deal in October with TNT Sports.

Financial terms of the deal were not provided, but Under Armour will provide all players, coaches and staff with performance apparel and accessories both on and off the court.

“We couldn’t be more thrilled to partner with Unrivaled to outfit some of the best women’s basketball players in the world as they compete on this exciting new stage,” said Sean Eggert, Under Armour senior vice president of global sports marketing.

The retailer said that all players who do not have an active shoe deal will have Under Armour basketball footwear options available to them. Additionally, Under Armour will give players the opportunity to create custom products.

Unrivaled will kick off its inaugural season Jan. 17 in Miami. The league has positioned itself as a destination for WNBA stars to play basketball in the U.S. during the offseason.

In the past, many WNBA players have had to go overseas to play in the offseason as a way to supplement the income. Starting salary in the WNBA is $64,154 according to ESPN.

Unrivaled has signed 36 top players by offering attractive financial incentives that include equity. The league said it offers the highest average salaries in women’s professional sports league history. It’s being backed by a number of investors.

This latest deal comes as Baltimore-based Under Armour is in the midst of a turnaround effort after founder Kevin Plank took the helm again this past March. Former Marriott executive Stephanie Linnartz had been in the role for barely a year before she was ousted; she was the second CEO the company had cycled through in less than two years.

Over the past few years, the brand has struggled to keep up with competition and drive full-price sales, relying on promotions and the off-price channel to move its products.

Before she left, Linnartz had been trying to market more to women and improve the product offering, but when Plank retook the helm, he walked that strategy back and said the company would be doubling down on its men’s apparel business. He later announced a turnaround plan that centers on making Under Armour a premium brand and pulling back on discounting so it can improve profits and boost demand.

Last month, the company saw a bright spot when reporting fiscal second-quarter earnings. It lifted its annual profit forecast and Plank said the turnaround is “beginning to gain traction.” Still, the stock is down about 81% from its all-time high on Sept. 17, 2015.

Under Armour’s deal with Unrivaled offers a glimpse into where the company is putting its money and, perhaps, indicates it wants to focus more on female athlete as it looks to capitalize on the hype of women’s sports to reenergize the brand.

Under Armour currently has partnerships with top women’s college programs such as the University of South Carolina, Notre Dame, Maryland and Utah.

“As a brand, we have a long history of investing in women’s basketball, from the grassroots level all the way up to the pros,” Eggert said.

Earlier this year, Steve Cohen laid out his principles as the owner of the New York Mets, saying it was a “philanthropic” endeavor, in an interview with CNBC’s Andrew Ross Sorkin.

“I don’t care about the cost side,” Cohen said, adding: “If I can make millions of people happy, how cool is that? I actually do it as a civic responsibility.”

That attitude helps explain how outfielder Juan Soto ended up agreeing to the richest-ever contract in baseball on Sunday, and among the most lucrative signed by any professional athlete in the world. 

The deal for Soto, who’s 26 and from the Dominican Republic, comes to $765 million over 15 years and includes a $75 million signing bonus and has the potential to increase to more than $800 million, according to MLB.com.

What’s especially notable about the contract is that none of the money is “deferred” — meaning it must be paid each year that Soto is on the Mets’ active roster. Besides the dollar amount, the lack of deferrals is what makes Soto’s contract even more eye-popping than the $700 million deal signed just last year by Los Angeles Dodgers star Shohei Ohtani: $680 million of Ohtani’s deal will not be paid until after 2034. 

For Soto, it means taking all the money up front. 

“It actually makes little sense why (Soto) would get such a big contract without deferrals,” Nathan Goldman, an associate professor of accounting at North Carolina State University, said in an interview with NBC News.    

Given the hefty combined personal income tax rates — approximately 15% for the wealthiest residents — levied by the city and state of New York, Soto’s ultimate payout will be somewhat diminished. 

Yet Soto retains the potential to earn even more money: According to MLB.com, he can opt out of his contract after his fifth year with the Mets if he believes he can command higher sums on the free market. 

However, the Mets can override that opt-out by increasing his annual salary by $4 million a year, from $51 million to $55 million for the final 10 years. 

And Soto’s contract does not include the amount the Mets and Cohen will have to pay to satisfy Major League Baseball’s luxury tax. Though ostensibly designed to create a more even playing field between large- and small-market teams, deep-pocketed owners like Cohen have not flinched at paying that penalty to acquire the most coveted players. 

The simple answer to unlocking Soto’s contract may simply be Cohen. Despite regularly carrying some of the most expensive contracts in baseball this century — including a $340 million deal signed with shortstop Francisco Lindor in 2022 — the Mets have been thwarted time and time again, including crushing losses in the playoffs and World Series. The team is nearing the 40th anniversary of its last championship.  The outlook seemed to change five years ago, when Cohen, a longtime hedge fund manager, purchased the team for $2.4 billion. Cohen has been an unusually accessible owner, meeting with fans on multiple occasions and often weighing in on social media. 

More importantly: Cohen, worth as much as $21.3 billion according to Forbes, has been among the most profligate owners in baseball since he took the reins of the team. According to data from Spotrac, a website that monitors sports spending, the Mets have held the largest annual payroll since 2023. A separate index from TheScore.com that tracks payrolls versus teams’ approximate revenues shows Cohen may actually be operating the team at a loss.   

Despite the annual ratcheting of payrolls, the winner of the World Series has often been unpredictable. But the baseball gods have been notoriously cruel to the Mets, despite their outsize spending. After crashing out of the first round of the playoffs in 2022 with a roster full of veterans, Cohen blew up the team and traded for prospects while loading up on another set of expensive free agents. 

But that team still only tied for second in the National League East Division this year and barely made the playoffs. While they nevertheless made it to the National League Championship Series, they were ultimately bested by the Los Angeles Dodgers, who went on to win the World Series in October.

Yet over time, payroll does seem to equate to winning — belying the infamous “Moneyball” approach to spending efficiently on under-used players. 

With Soto’s contract, it seems Cohen will not be denied again. According to reports, the New York Yankees, baseball’s long-running big spenders, offered Soto only $5 million less than the Mets. But despite making the World Series this year, the Bronx Bombers have faced roster turmoil in recent years, while continuing to employ a manager, Aaron Boone, now loathed by many fans. 

Ironically, Soto is coming over from the Yankees, where he was traded in December 2023.  

Soto is entering his peak years and continues to draw comparisons to the hitting legends Ted Williams and Barry Bonds. That combination of youth and potential helped clinch the salary record.    

Another key to Soto ending up with such a massive contract was simply timing. He took advantage of a year lacking in other mega free agents and was able to command a premium on the open market. 

It’s possible Soto’s contract will be surpassed in just one year. Analysts say Toronto Blue Jays star Vladimir Guerrero Jr., who finished sixth in MVP voting last season, is expected to command massive numbers when he enters free agency after the 2025 season. 

Even if no one ends up reaching or surpassing Soto’s figure, MLB will continue to lead all professional sports in titanic deals for contracts, for one simple reason: Unlike the NFL and NBA, it doesn’t have a salary cap.

According to Michael Ginnitti, Spotrac’s founder and managing editor, “Baseball’s luxury tax system … allows billionaires to spend billions on their team if they choose.”