• Justice Samuel Alito is rejecting calls for his recusal from January 6-related cases.
• Alito blamed his wife for flying two controversial flags that have ties to right-wing movements. 
• But Alito's explanation for why and when his wife flew one of the flags isn't adding up. 

Supreme Court Justice Samuel Alito is doubling down on blaming his wife for flying two flags that are associated with right-wing groups and ideas over the couple's homes in recent years.

In a Wednesday letter to House and Senate Democrats, Alito rejected lawmakers' calls for him to recuse himself from two high-profile cases involving former President Donald Trump and January 6 rioters, saying he had nothing to do with the partisan flags flying over his properties.

"My wife is fond of flying flags," Alito wrote. "I am not."

But Alito's efforts to address the flag fiasco have left more questions than answers, all the while sparking another neutrality crisis for a high court already wracked by conflict of interest allegations.

Neighborly dispute

What began as a dispute over an anti-Trump sign in Alito's Virginia neighborhood back in 2021 has exploded into a national news story after The New York Times reported this month that an upside-down American flag was flown outside the justice's house soon after the January 6, 2021, Capitol riot.

Upside-down American flags have been used as a symbol to protest slavery and the Vietnam War, but the practice has more recently been adopted by proponents of the "Stop the Steal" campaign, which erroneously claims Trump won the 2020 presidential election.

Alito has repeatedly denied any part in flying the flag above his home, telling The Times earlier this month that his wife, Martha-Ann Alito, raised the flag in response to an ongoing fight with two residents in the neighborhood.

In his Wednesday letter, Alito said his wife was involved in "nasty" fight with two neighbors, adding that she only raised the flag after a male neighbor "berated her" using "foul language, including what I regard as the vilest epithet that can be addressed to a woman."

But Emily Baden, one of the neighbors involved in the dispute, told The Times this week that it was she — not her then-boyfriend — who used the curse word, saying the verbal altercation took place weeks after the flag was flown outside Alito's home. The outlet obtained a text message and police call that backed up Baden's timeline, calling into question Alito's version of events.

The Supreme Court did not immediately respond to a request for comment from Business Insider.

Alito said he asked his wife to take the flag down "as soon as I saw it," but for "several days," she refused. 

"My wife and I own our Virginia home jointly. She, therefore, has the legal right to use the property as she sees fit, and there were no additional steps that I could have taken to have the flag taken down more promptly," he wrote. 

Martha-Ann Alito appeared to have at least some awareness of the upside-down flag's meaning in 2021, telling a Washington Post reporter at the time that the flag was "an international signal of distress" and suggesting its presence at her home was in response to the neighborhood dispute.

A second flag

Alito's explanation for why his wife raised the upside-down flag in January 2021 also doesn't account for the second controversial flag now tied to the couple.

The Times reported this month that an "Appeal to Heaven" flag was flown outside Alito's New Jersey beach house as recently as last summer. The flag also has ties to January 6, 2021, rioters and proponents of a more Christian government.

Alito said he was not familiar with the "Appeal to Heaven" flag when his wife flew it, writing that he assumed it was expressing a religious and patriotic message. He said neither he nor his wife were aware the flag had any association with the "Stop the Steal" movement. 

"She did not fly it to associate herself with that or any other group, and the use of an old historic flag by a new group does not necessarily drain that flag of all other meanings," Alito wrote. 

In his letter to Democrats, Alito says he is "confident" that his explanations are sufficient cause for rejecting calls for his recusal.

However, the Supreme Court's own code of conduct states justices shouldn't give the appearance of any political opinion or bias with regard to issues that could appear before the court. Alito and his colleagues will soon rule on two major cases related to the January 6, 2021, rioters and Trump in outcomes that could have an influence on the upcoming 2024 presidential election.

A legal ethics professor told BI earlier this month that the flags would have almost certainly disqualified Alito from such cases if he were on a lower court, but the Supreme Court's code of conduct is "merely performative."

• Bank of America analysts predict AI will create a new class of devices called 'IntelliPhones.'
• AI enhancements could make phones more context-aware and proactive.
• There's a new battle brewing over who will create the most useful AI-powered phone. 

The first cellphone came out in the early 1980s. It was connected to a cellular radio system and didn't require a physical connection to a network.

Then, we had feature phones. These connected to the internet and could store and play music.

Apple ushered in the smartphone era, with location data, fancy cameras, and the all-important App Store.

Is AI about to launch a new chapter? Analysts at Bank of America Securities think so. And they've come up with a new name for this future device.

The "IntelliPhone."

Yes, it's an awful name. Too many syllables. No one is ever going to say, "Ugh, I can't find my IntelliPhone. Have you seen it?"

However, artificial intelligence models, chatbots, and other AI-powered applications could get so useful that our current smartphones might look kinda dumb in the future.

Maybe no one will have to ask where their IntelliPhone is, because it will somehow find itself.

"Context awareness will be the key differentiator," Wamsi Mohan, an analyst at Bank of America Securities, wrote in a research note on Wednesday that listed a number of future capabilities that may take these gadgets way beyond current handsets.

Hype warning

A word of caution here. The AI hype cycle is in overdrive right now, and Mohan and his colleagues were writing a research note about Apple ahead of its WWDC conference next month.

The company is expected to unveil a slew of new AI features for iPhones at this event. It's common for Wall Street analysts to issue positive research and "buy" recommendations in instances like this.

The mother of all upgrade cycles

Still, Mohan makes some compelling arguments. If AI tools on phones can really set them apart from current devices, consumers have a new reason to buy a fresh handset.

"We see the introduction of AI smartphones (IntelliPhones) as a once in a decade upgrade event," Mohan wrote.

At Google's I/O conference earlier this month, the internet giant showed off several new AI capabilities for Pixel, Samsung, and other Android phones.

"It's a once-in-a-generation moment to reinvent what phones can do," Android chief Sameer Samat told Business Insider. "We are going to seize that moment."

Consumers will only embrace these new devices if they're actually useful in everyday situations. Google has already shown off some of these new killer applications for AI. Apple will have to show off more of these powerful use cases at WWDC if it's going to keep up.

Mohan at BofA describes a wide range of new capabilities that could set IntelliPhones apart from smartphones and fire up the mother of all upgrade cycles.

"We view the upcoming AI enabled phones (IntelliPhones) to drive a multi-year upgrade cycle similar to the step function improvement driven by the introduction of smartphones," he wrote, calling this a "once in a decade type of event."

IntelliPhone capabilities

Here are some of the potential capabilities of IntelliPhones, according to BofA:

Context aware assistance: AI-enabled phones will offer more advanced personal assistants that understand context better and provide more relevant and timely responses.

Proactive suggestions: These assistants could proactively suggest actions based on user patterns.

Object and scene recognition: These phones can identify objects, people, and scenes in photos and suggest actions like sharing, searching for more information, or buying related products.

Real-time translation: AI-capable phones offer real-time language translation making communication easier while traveling or interacting with people who speak different languages.

Predictive health alerts: AI could predict potential health issues by analyzing patterns in collected data and alert users to seek medical advice if needed.

AI driven content creation: Users may be able to create more immersive and engaging AR/VR content with the help of AI tools on phones that simplify the creation process and enhance the final output.

Music Haptics: AI could refine vibrations from music to improve the experience for phone users who are deaf or hard of hearing.

Vocal Shortcuts: AI could recognize speech patterns and improve speech recognition for users with conditions that affect speech such as cerebral palsy, or those who have suffered a stroke. Users could also assign custom utterances that Siri can understand to launch shortcuts and complete complex tasks.

• Telsa faces investor pushback on reinstating Elon Musk's $55 billion pay package.
• The largest public pension fund in the US currently plans to vote against the pay plan.
• Musk called out the pension fund for "breaking their word."

Tesla is facing increasing pushback from investors regarding its bid to reinstate Elon Musk's $55 billion pay package.

On Wednesday, there was yet another sign that Tesla might be facing an uphill battle when the CEO of the California Public Employees' Retirement System, Marcie Frost, told CNBC the fund plans to vote against the proposal to reinstate Musk's pay plan, pending any future conversations with Tesla.

"We do not believe that the compensation is commensurate with the performance of the company," Frost said.

CalPERS is the largest public pension fund in the US and is among one of Tesla's 30 largest investors with about 9.5 million shares, according to Bloomberg. The fund initially voted for Musk's pay package when it was taken to a shareholder vote in 2018.

Musk does not receive a salary from Tesla and his pay package is centered on a series of goalposts around the carmaker's financial growth. The plan, which was valued at $55 billion by Bloomberg when it was struck down by a Delaware judge in January, involves a 10-year grant of 12 tranches of stock options that are vested when Tesla hits specific targets. When the company hits each milestone, Musk gets stock equal to 1% of outstanding shares at the time of the grant. Tesla said it hit all of the 12 targets as of 2023.

Musk quickly posted on social media to criticize CalPERS's stance on the proposal on Wednesday.

"What she's saying makes no sense, as all the contractual milestones were met. CalPERS is breaking their word," Musk wrote on X.

CalPERS is joining a growing list of investment funds that are publicly expressing their desire to vote against Tesla's compensation plan for Musk. On May 21, a group of shareholders filed a letter with the Securities and Exchange Commission calling for investors to vote against both Musk's pay package and the proposal to reelect James Murdoch and Kimbal Musk. Separately, proxy advisory firm Glass Lewis said in a report on Saturday that the pay plan was "excessive" and presented investors with "uncertain benefits and additional risk."

Meanwhile, Tesla has been pulling out all the stops to promote the proposal. On Wednesday, the company began offering investors the opportunity to tour the Texas gigafactory alongside Musk in exchange for proof they'd voted in Tesla's annual meeting. Tesla has also argued the compensation plan is "critical to the future success of Tesla" and has even paid for a handful of advertisements promoting the pay plan.

The annual meeting for investors will take place on June 13. Shareholders will be asked to vote on several proposals in addition to the proposal to reinstate Musk's pay package, which was struck down by a Delaware judge earlier this year. The company is also asking investors to vote on a proposal to move Tesla's state of incorporation from Delaware to Texas and a separate proposal to reelect Tesla board members Kimbal Musk and Murdoch.

A spokesperson for Tesla did not immediately respond to a request for comment.

Are you a Tesla investor, do you work for the company, or have a tip? Reach out to the reporter via a non-work email and device at gkay@businessinsider.com or 248-894-6012

• American Airlines slashed its revenue and margin outlook for Q2 2024 on Tuesday.
• The airline also announced the departure of chief commercial officer Vasu Raja.
• American's CEO said part of its struggles is due to recent changes in ticket sales strategy.

American Airlines lowered its earnings outlook for the second quarter of 2024 and announced the departure of its Chief Commercial Officer on Tuesday.

Speaking at an event on Wednesday, CEO Robert Isom said the lower earnings guidance can be attributed to a weaker-than-expected marketplace and the airline's weaker-than-expected performance.

A key factor behind lower bookings is the airline's recent changes to ticket sales strategy, Isom said.

That's a not-so-tacit admission that the airline's recent shake-up of its corporate ticket sales and third-party ticket sales strategy quarterbacked by the outgoing CCO, Vasu Raja, has not worked.

"We are adapting our distribution strategy," Isom said at the event, which was hosted by Bernstein. "We moved faster than we should have and we didn't execute well."

In February, American Airlines announced changes to its ticket distribution strategy, including new rules that limit the accrual of loyalty points needed to elite status to tickets purchased from the airline and through select approved travel agencies.

The strategy encouraged customers to buy directly from the carrier instead of third-party websites and travel agencies.

Last year, American gutted its corporate sales team, responsible for managing business travel needs for its major corporate clients.

Isom said that American is reevaluating its distribution strategy to make it easier for travel agencies, corporate clients, and customers in general to interact with the airline. This includes pausing some of the changes policy changes announced in February.

"Our approach has driven customers away from American and we are unequivocally committed to getting those customers back," Isom added.

In a regulatory filing, the airline said it now expects profit margins for the current quarter to be 1% lower than it had predicted in April. In addition, American expects second-quarter revenue to be as much as 6% lower than the same period in 2023.

Raja, who joined the company in 2004 and took over as CCO in 2022, will officially leave the company in June.

Shares of American Airlines fell more than 13% in trading on Wednesday.

• China is developing sensors to hunt enemy submarines from aircraft.
• Recent patents show a focus on magnetic detection and improved sonobuoys.
• New capabilities are critical for China to guard its aircraft carriers, two experts said.

China is developing new systems to hunt the US nuclear-powered submarines that could threaten a Chinese invasion of Taiwan, according to a new report.

The Chinese navy views anti-submarine warfare, or ASW, as essential to any successful amphibious operation and intends to use its aircraft to protect a flotilla from submarine attack by the US or Japan.

"The PLAN [People's Liberation Army Navy] clearly views fixed-wing and vertical lift ASW capabilities as a crucial component necessary for any of its amphibious based contingencies, be that a seizure of an island or reef, or the successful implementation of a Joint Island Landing Campaign against Taiwan," wrote Eli Tirk and Daniel Salisbury in a study for the China Maritime Studies Institute at the Naval War College. "ASW capabilities would be crucial for safeguarding high value surface assets such as carriers or an amphibious landing group, protecting them as they are in port embarking forces, sanitizing the operational area of enemy submarines, and escorting these assets on their way to staging areas and operational areas."

Also significant is that Chinese airborne sub hunters are tasked with protecting Chinese ballistic missile submarines as they sail to their patrol and launch locations. "The PLAN clearly views fixed-wing ASW as an important enabler of its at-sea nuclear deterrent," the report said.

The Chinese navy's current fixed-wing anti-submarine aircraft is the KQ-200, a four-engine turboprop aircraft that is China's equivalent of the US Navy's P-8 Poseidon. The PLAN has about 20 KQ-200s, which have a range of about 3,000 miles.

Much like the US Navy, China's submarine force tends to be secretive. But by examining open-source literature, Tirk and Salisbury were able to discern the efforts China is making in anti-submarine warfare, including patents filed by Chinese researchers.

For example, the state-owned China Electronics Technology Group Corporation filed a patent in 2020 for improved magnetic anomaly detection (MAD), a technology first used in World War II to detect subs by the effect of these big metal objects on the Earth's magnetic field. It's a useful but limited system that usually requires the aircraft to be flying within less than a mile of the target, and can only detect the presence of a sub rather than its course — which means a positive hit must be followed by laying a web of other sensors to be able to target the lurking submarine.

Chinese scientists want to use highly sensitive atomic magnetometers, which use lasers to detect changes in the energy levels between atoms caused by fluctuations in a magnetic field. CETC's patent is for technology that would "enable an atomic magnetometer to sense the direction of a target rather than just its existence," Tirk and Salisbury noted. "According to the filing, previous research on highly-sensitive atomic magnetometers had focused on scalar results (i.e. only the magnitude of a target's magnetic field), but could not provide vectors (i.e. magnitude and direction). MAD is already a shorter-range capability usually used for more precise positioning after other sensors have provided a rough search area, but any additional information could potentially give operators an edge during search operations."

A 2022 patent by Aviation Industry Corporation of China calls for a new system to operate sonobuoys, which are floating canisters, dropped by planes and ships, that detect subs by emitting active sonar signals or by passive sensors that detect the noise of a submarine. Current Chinese sonobuoys require "a complicated and labor-intensive series of manual button presses to configure sonobuoy parameters such as radio working frequency, working depth, working time, and pulse form to fit maritime conditions before deployment."

These parameters aren't displayed on the sonobuoy control system. "This means the display and control system is unaware of whether a sonobuoy is on the rack or has been launched, what type of sonobuoys have been launched, or the parameters of any launched sonobuoys," Tirk and Salisbury wrote. "Instead, operators must manually input this data into the display and control system."

Other patents are for lighter sonobuoys, and improved communications between sonobuoys and aircraft. In 2022, China surpassed America in number of patents filed.

China has also been improving the quality of anti-submarine training. "The PLAN has acknowledged its limitations and has begun taking steps to improve the quality of its ASW training, both in simulators and in physical training environments," the report said. "PLAN ASW units are training under more realistic conditions, and breaking down administrative barriers which prevented them from generating more training opportunities in different operational environments."

For example, since 2015, training materials have stressed the need for ASW aircraft and ships to work closely together, which is standard practice in the US and Western navies. The PLAN is also using simulators to train sensor and weapon operators.

One exercise involved a patrol aircraft transmitting target data to a command ship, "which then integrated it with information from other sources and checked the information against a target information database to confirm whether or not the target was an enemy submarine," the CMSI report noted. "This indicated both a potential command relationship from command vessels to ASW aircraft and confirmed that the PLAN trains to compare potential targets to a database, despite its small (but expanding) ocean surveillance and intelligence collection fleet and a nascent underwater surveillance capability."

Michael Peck is a defense writer whose work has appeared in Forbes, Defense News, Foreign Policy magazine, and other publications. He holds an MA in political science from Rutgers Univ. Follow him on Twitter and LinkedIn.

• Sweden will send an ASC 890 aircraft to Ukraine in a $1.23 billion aid package.
• The airborne early warning plane enhances Ukraine's range against airborne and maritime targets.
• Sweden will also includes tanks, artillery ammunition, and more in its aid package.

Sweden will be delivering an ASC 890 airborne early warning and control aircraft to Ukraine, stepping up its alert system and range, as part of its $1.23 billion aid package announced Wednesday.

Pål Jonson, Sweden's minister of defense, said the aircraft will provide Ukraine "with a new capability against both airborne and maritime targets."

With the contribution of the ASC 890, Jonson added that Ukraine's "capability to identify targets at long range will be strengthened."

The ASC 890 aircraft, also known as the Saab 340, is an Airborne Early Warning and Control airplane equipped with a large radar that looks like a fin mounted above its fuselage. It can scan for aerial threats out to 250 miles, giving Ukraine a capability similar to the A-50 AEW&C planes Russia has used to guide its air defenses and fighter aircraft.

The ASC 890 can operate alongside F-16 fighter jets, National Advanced Surface-to-Air Missile Systems, and other air defenses, acting as a "force multiplier" by spotting and relaying targets to armed aircraft or ground-based missile batteries.

The aircraft's radar will also be able to detect drones and cruise missiles, according to Jonson.

Belgium made a commitment on Tuesday to send Ukraine 30 American F-16s over the next four years on the condition that they wouldn't be flown over Russia. Other countries have pledged Ukraine a total of roughly 85 F-16 jets.

Sweden and other allies such as Netherlands, Denmark, and Norway have also promised to send Ukraine F-16 jets.

President Volodymyr Zelenskyy has emphasized that the contribution of F-16s will help fortify Ukraine's position. Future missions to defend Ukraine's air space or attack ships in the Black Sea may be guided by targeted data relayed from an ASC 890.

Ukraine is currently tasked with defending its lines as Russia has bombarded them with deep strikes.

Sweden also plans to provide Ukraine with armored personnel carriers, Advanced Medium-Range Air-to-Air Missiles, and artillery ammunition along with other resources as part of its largest aid package yet.