Thursday morning headlines

Redstone squabble: Chairman Sumner Redstone has had a major falling out with his daughter and heir apparent, Shari Redstone, that is expected to result in her departure from the Viacom board, the WSJ reports this morning. No details at this point, but the Journal reports that both sides are negotiating some sort of separation agreement. Earlier this year, Redstone settled a lawsuit with his estranged son Brent Redstone. From the Journal:

The departure of Ms. Redstone would raise questions about potential succession for Mr. Redstone, 84 years old. Two years ago, in the wake of Mel Karmazin's departure as Viacom's No. 2 executive, Ms. Redstone was named vice chairman of the company. At the time the appointment was seen as endorsing her status as heir apparent. Mr. Redstone said through a spokesman at the time that she would "likely be the controlling shareholder and chairman after I'm gone." Ms. Redstone took an increasingly visible role at the company, attending more internal meetings. She also made clear she didn't always agree with her father. In a 2005 interview with the Journal, she said, "It's fair to say that I don't hesitate to tell my father what my point of view is," adding that "some disagreement is healthy."

Markets back up: Maybe this will be the day the Dow makes it over the 14,000 mark. Stocks are up in early trading - in part the result of good earnings from IBM and Bank of America.

Will backdating case be dumped?: Attorneys for former KB Home CEO Bruce Karatz will be watching today to see whether U.S. District Judge Charles Breyer acquits former Brocade Communications CEO Gregory Reyes on charges related to the backdating of stock options. Breyer has been skeptical of the government's case against Reyes, who was indicted last year on securities fraud and conspiracy charges. Karatz is under investigation by the feds in connection with the backdating of stock options at KB. Whatever happens in the Reyes case could provide clues on how the feds decide to handle other backdating cases. (USA Today)

Virgin offers L.A.-SF service: This is Virgin America, the new airline launched by British billionaire, and it will begin five daily flights between the two cities on Aug. 8. The airline is expected to quickly follow with daily service from SF to NY and Washington. Flights between San Francisco International and LAX are expected to start at $44 one-way, or about half the cost of other carriers. From the LAT:

The Los Angeles-San Francisco route is considered one of the more profitable and busiest ones. Three major U.S. carriers alone account for 29 flights a day between LAX and SFO, and several low-cost carriers offer a dozen more flights connecting nearby smaller airports such as Long Beach and Oakland. It's too soon to know what the effect will be, but fares for the LAX-SFO flights are relatively low because of the competition. Carriers are flying planes that for the most part are full. "I'm not sure if it would start a fare war, but it does give consumers another option," said Michael Boyd, president of airline consulting firm Boyd Group in Evergreen, Colo. For consumers, "having more airlines is good, having less is not."

Changing rental market: Apartment owners find themselves with new competition: The owners of all those vacant and unsold homes. The result is that rents are not increasing at the same blistering pace of recent years. Much of the action is taking place in the Inland Empire, where there's been so much construction of both homes and apartments. The occupancy rate in the Inland Empire fell to 93 percent in the second quarter from 94.9 percent a year ago, according to RealFacts. In Los Angeles and Orange counties, the average monthly rent in the second quarter rose 6.4 percent to $1,607, compared with a year ago, but the occupancy rate slipped slightly to 95.3 percent. (LAT)

Still no port deal: Contract talks for harbor-area clerical workers continued late Wednesday, with both sides indicating that a deal may be a day or more away. More than 900 workers have been threatening to walk off the job since early Monday after more than two months of negotiations. This is potentially a very big deal because more than 7,000 ILWU longshoremen who load and unload ships have pledged not to cross picket lines. That would effectively shut down the port complex. (Press-Telegram)

Hollywood hovering: It's over David Beckham and his wife Push or Posh or whatever the heck she's called. This Sunday, the ridiculously over-covered couple will be covered again when Tom Cruise and Will Smith host a private, welcome-to-L.A. bash at the Museum of Contemporary Art's Geffen Contemporary. Guest list includes all the usual suspects: Winfrey, Clooney, Spielberg, Geffen, Bruckheimer, blah, blah, blah. Beckham's mouthpiece keeps insisting that he's come to L.A. to play soccer and not be a movie star. Right. (LAT)

Preppy is in: Go ahead - take out those club ties, patchwork shorts and pink dress shirts. After two decades of being politically incorrect, the preppy look is back in style. Of course, there are some deviations from the old Brooks Brothers look - illustrated by the rap group T-Pain's madras shorts and bow ties at the BET Awards. From the WSJ:

This is a period that lusts for symbols of the good life: $3,000 crocodile handbags, $20,000 tourbillon watches, $250 bottles of olive oil, and big charitable donations that assuage the guilt of driving an SUV. The preppy look is the affordable weekend version of all that. It's what the people who run the nation have always worn at their country homes. Now, as in the 1980s, people who want to suggest they live that lifestyle are wearing it, too. Never mind that preppies were traditionally old-money understated; now the look is about flamboyant colors and embroidered whales. Over drinks a few days ago at power-burger restaurant J.G. Melons in Manhattan, I noted three pairs of madras shorts, two loud Lacoste shirts, a Nantucket Reds T-shirt, and one Vineyard Vines canvas tote -- not to mention Mayor Michael Bloomberg, who was dining there. Though casual in slacks and a button-down that evening, Mr. Bloomberg has been photographed in a Vineyard Vines tie.