South Loop residents oppose DePaul arena

The prospect of a DePaul University men's basketball arena being constructed on land just north of McCormick Place is drawing strong opposition from the Prairie District Neighborhood Alliance, a South Loop residents' organization, according to a letter released Tuesday.
 
A survey of 700 neighbors of the site, conducted by the community group, found more than 70 percent oppose construction of a Blue Demons arena there, Tina Feldstein, president of the organization, stated in the letter.
 
An arena would not fit within the residential and historic character of the area and could put two landmark structures, the Harriet F. Rees House and the American Book Co. building, at risk, the letter stated. It would also add to traffic congestion and potential rowdiness in an area already overburdened when conventions are in progress at McCormick Place or major events, including Chicago Bears games, are taking place at Soldier Field, Feldstein said in an interview.
 
"We're not against vibrant development, which hotel and retail would bring," Feldstein said. And the group would support an arena at an alternate site on the Near South Side, she said.
 
The letter was written in support of an alternate plan for the so-called "Olde Prairie" blocks, which is being put forward in bankruptcy court by developers Pam Gleichman, Karl Norberg and Gunnar Falk. Their plan calls for hotel and retail development on property directly north of the McCormick Place administrative offices and West Building on Cermak Road.
 
If they lose control of the property, it is expected to go up for auction, making it possible for the Metropolitan Pier and Exposition Authority, the state-city agency that owns McCormick Place, or other parties to make a run at it.
 
DePaul is weighing several sites, including property near McCormick Place and the United Center on the Near West Side. As well, the Allstate Arena in Rosemont is fighting to retain the team.
 
The neighborhood's opposition adds to resistance by Ald. Robert Fioretti, whose 2nd Ward includes McCormick Place.
 "That is not a place to put an arena -- far away from the school," he said. "I think there are traffic issues related, and it would be a bad deal for taxpayers in these economic times."

Fioretti noted such a project likely would require public subsidy.
 
The Olde Prairie blocks have not been officially designated as a potential site for a DePaul arena, but Fioretti said it is his understanding that they are being seriously considered.
 
Jim Reilly, chief executive officer of the exposition authority, known as McPier, has publicly acknowledged that there have been talks with DePaul. A spokeswoman on Tuesday said it would be premature to comment further at this point.

A DePaul spokesperson could not be reached for immediate comment.
 
Chicago Mayor Rahm Emanuel has said he would like DePaul to bring men's basketball back to the city. A spokesman declined comment beyond that.
 kbergen@tribune.com | Twitter @kathy_bergen

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City, bartender ask court to set aside 'code of silence' verdict

Mayor Rahm Emanuel's administration asked a federal judge Monday to set aside a jury verdict in the infamous videotaped beating of a female bartender by an off-duty Chicago police officer — essentially agreeing to pay the woman $850,000 now in return for erasing the jury's finding that a police "code of silence" protected the cop.

The unusual request is an attempt to prevent last month's damaging verdict from being cited by lawyers in other lawsuits against the Police Department. The former bartender filed the motion jointly with the city; she stands to quickly collect the jury award she won without risking the chance of losing on appeal or having the trial judge reduce the amount.

It will be up to U.S. District Judge Amy St. Eve to weigh the interests of the parties involved in the lawsuit against the interest of the public in having the record of the jury's verdict stand. City lawyers said they plan to appear before the judge Monday.

The city battled Karolina Obrycka's lawsuit for five years, arguing that former Officer Anthony Abbate's attack on her, which was caught on security video and eventually went viral on the Internet, was the action of an off-duty officer and not the responsibility of the Chicago Police Department.

As part of her case against the city, Obrycka's lawyers argued that a pattern and practice of covering up police corruption and misconduct exists in the department. Moreover, she argued, Abbate behaved with a sense of impunity because he believed fellow officers would protect him. The jury agreed in its Nov. 13 verdict.

Although the city argued in Monday's court papers that the jury's verdict was "ambiguous" and tied to the peculiar circumstances of the Abbate case, lawyers also wrote that they want the verdict removed from the record because it could influence other lawsuits against the Police Department, of which there are many.

In a statement, Corporation Counsel Stephen Patton said the city reached out to Obrycka after the administration determined it didn't want to appeal the verdict.

"From the city's perspective, vacating the judgment eliminates the risk that the judgment will be misused in a way that hinders the city's ability to defend itself in future cases," Patton said.

The city also argued in the motion that the misconduct in the Abbate case happened several years ago and things are different now. The old Office of Professional Standards, which investigated the Abbate case, was renamed and reconfigured in the wake of the scandal. Also, city lawyers noted that there is a new mayor as well as a different police superintendent.

While the city's effort to erase the jury's verdict would not strike down the record of testimony in the trial, it does pose some risks to the public good, experts said.

"By allowing the kind of agreed-upon whitewash of the jury verdict, it tends to increase the possibility of future bad conduct," said Richard Zitrin, a law professor at the University of California Hastings College of the Law, who has testified before Congress about secret settlements in police misconduct cases.

"The problem is that the lawyer representing the plaintiff has a duty to do what's right for the plaintiff, and that duty does not include a duty to do what's right for the public as a whole."

Obrycka's lawyer, Terry Ekl, did not respond to calls for comment Monday. City officials also did not immediately answer questions about the move.

In the memorandum filed Monday, the city cited some legal precedents supporting the move to vacate the jury verdict. But federal courts have not always agreed with such motions when public misconduct issues are involved.

In a 2000 case in Virginia, after a federal jury found for a plaintiff in a police excessive force lawsuit, both sides filed a motion to vacate the verdict in favor of a settlement. In that case, the judge wrote, "the public's interest in judicial economy, finality of judgment and the integrity of the courts outweighs the parties' interest in having the verdict vacated."

Lawyer Christopher Smith, who has represented several plaintiffs in lawsuits against the Chicago Police Department, said claims of a pattern and practice of coverups are allowed into cases rarely and on narrow terms.

Applying the precedent from the Abbate verdict to other lawsuits is challenging, he said. However, given the circumstances of the case — the fact that Abbate was off-duty and in a bar — the verdict made a strong statement.

Because the jury decided that the department covered up for a drunken off-duty cop attacking somebody in a bar, the case shows "it's so well-known to officers that no matter what we do, we know we're going to get backed up," Smith said. "No matter how far away (the alleged behavior) was from a police action, there's always a police influence if there's a code of silence."

dheinzmann@tribune.com

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Facebook voting begins on Instagram data-sharing, email privacy

SAN FRANCISCO (Reuters) - Facebook Inc opened the polls on Monday for its roughly 1 billion users to vote on a variety of changes to the social network's policies, including a proposal to scrap the user voting system that Facebook introduced in 2009.

Facebook also said it had "clarified" some of the proposed changes, specifying that a new policy allowing it to share user data with recently acquired photo-application Instagram will be carried out in compliance with applicable laws and that Facebook will seek user consent when necessary.

The proposed changes, which Facebook announced on November 21, generated roughly 89,000 user comments as well as concerns from some privacy-advocacy groups and a request for more information from the Data Protection Commission in Ireland, where Facebook's European business has its headquarters.

"Based on your feedback and after consultation with our regulators, including the Irish Data Protection Commissioner's Office, we've further clarified some of our proposals," said Elliot Schrage, Facebook Vice President of Communications, Public Policy and Marketing in a post on Facebook's company blog on Monday.

Facebook is proposing to eliminate the 4-year-old system that allows users to vote on changes to its governance policies. The company says the voting system hasn't functioned as intended and is no longer suited to its current situation as a large publicly traded company subject to oversight by various regulatory agencies.

Facebook said on Monday that it would incorporate user suggestions for creating new tools to "enhance communication" on privacy and governance matters.

Another proposal would loosen the restrictions on how members of the social network can contact other members using the Facebook email system. The company said it planned to replace the "Who can send you Facebook messages" setting with new filters for managing incoming messages.

Facebook's potential information sharing with Instagram, a photo-sharing service for smartphone users that it bought in October, flows from proposed changes that would allow the company to share information between its own service and other businesses or affiliates it owns.

The change could open the door for Facebook to build unified profiles of its users that include people's personal data from its social network and from Instagram, similar to recent moves by Google Inc.

Facebook said on Monday that the proposed change was "standard in the industry" and "promotes the efficient and effective use of the services Facebook and its affiliates," such as allowing users in the U.S. to interact with users in Europe.

"This provision covers Instagram and allows us to store Instagram's server logs and administrative records in a way that is more efficient than maintaining totally separate storage systems," the company wrote in a separate post on its website Monday titled "explanation of changes".

"Where additional consent of our users is required, we will obtain it," Facebook said.

Facebook users have until December 10 to vote on the policies using a special third-party application provided by Facebook and Facebook said the results will be certified by an independent auditor.

The vote is only binding if at least 30 percent of users take part, and two prior votes never reached that threshold.

(Reporting By Alexei Oreskovic; editing by Andrew Hay)

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RG3, Redskins closing in on Giants with 17-16 win

LANDOVER, Md. (AP) — Robert Griffin III went down, the ball popped out, and the Washington Redskins scored a touchdown.

Look out, New York Giants and the rest of the NFC East. If the rookie quarterback keeps getting those kinds of breaks, it'll be hard to keep him out of the title hunt for years to come.

As it is, RG3 has the Redskins within a game of first place, leading a fourth-quarter rally in a 17-16 Monday night victory over the Giants, giving Washington a three-game winning streak in which it has dispatched division rivals — Philadelphia, Dallas and now New York — one by one.

"We know that our backs are against the wall," Griffin said. "And even though we won tonight, our backs are still against the wall."

The Redskins (6-6) appeared out of the running at 3-6 a month ago, but Griffin is proving his team can never be counted out when he's on the field.

With the Giants (7-5) losing three of four and the Cowboys (6-6) also at .500, the division is up for grabs.

Griffin did get another of his goals accomplished Monday by assuring Washington will win more games than last season's 5-11 team.

"You can put a check by that one, but there's a lot more goals that this team is stretching for and striving for," Griffin said.

Griffin completed 13 of 21 passes for 163 yards and ran five times for 72 yards, breaking Cam Newton's NFL record for yards rushing by a rookie quarterback.

His top target again was Pierre Garcon, who had eight receptions for 106 yards and a touchdown, showing no signs of the painful toe injury that forced him to miss six of the season's first nine games.

Alfred Morris ran for 124 yards on 22 carries, becoming the second Redskins rookie to run for 1,000 yards. Reggie Brooks had 1,063 in 1993.

Washington also ended a 10-game home losing streak in Monday night games, with Griffin again showing his knack for winning on a big stage.

Eli Manning completed 20 of 33 passes for 280 yards and a touchdown for the Giants, who had won 26 in a row on the road when holding a halftime lead.

They were ahead 13-10 at the break Monday against the Redskins, but they failed to finish the job for the first time since blowing a 21-0 halftime lead in a 24-21 loss to Tennessee in 2006.

Ahmad Bradshaw ran for 103 yards on 24 carries, and Victor Cruz had five catches for 104 yards for the Giants, who were uncharacteristically penalty-prone, getting flagged nine times for 73 yards.

The Giants moved the ball well all game, but the drives produced three field goals by Lawrence Tynes and only one touchdown — Manning's 4-yard pass to Martellus Bennett late in the first half.

The game's final score was Griffin's 8-yard pass to Garcon early in the fourth quarter, but the Redskins' first touchdown was one of the evening's crazy moments.

On second-and-2 from the New York 28, Griffin ran to his left and was being tackled by Stevie Brown after what would have been a 12-yard gain.

But as Griffin fell with his back to the ground, the ball popped out and went right on the fly to Washington receiver Joshua Morgan 3 yards farther upfield. Morgan then ran 13 yards for the score.

"We didn't run (that play) in practice because we wanted to save it for the game," Griffin said with a grin. "I knew he was going to be there for it. ... Joshua did a good job being in the spot where he was supposed to be."

It was the second time this season that a Griffin fumble has turned into Redskins touchdown. Garcon recovered one in the end zone in a win over Tampa Bay.

Another fumble by the Redskins — this one by Morris in the third quarter — was recovered by the Giants and set off mayhem. New York defensive tackle Linval Joseph yanked at Redskins center Will Montgomery's leg. Montgomery kicked at Joseph in response, and Joseph stomped at Montgomery. Joseph and a Redskins player were whistled for offsetting unnecessary roughness penalties.

Giants safety Tyler Sash left in the first half with a hamstring injury and eventually was ruled out for the game, and New York right tackle Sean Locklear was carted off with an injury in the fourth quarter.

Redskins linebacker London Fletcher and left tackle Trent Williams, who were limited in practice by injuries Friday and Saturday, both started. The 37-year-old Fletcher extended his consecutive games streak to 236 — every game in his 15-year NFL career.

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Follow Joseph White on Twitter: http://twitter.com/JGWhiteAP

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Online: http://pro32.ap.org/poll and http://twitter.com/AP_NFL

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Katt Williams Arrested After Alleged Bar Rampage

LOS ANGELES (TheWrap.com) – Katt Williams didn’t have much to laugh about this weekend after the comedian was arrested in Seattle, following an incident at a bar during which Williams allegedly attacked a woman with a cigarette, according to the Seattle Police Department.

According to police Williams – born Micah Williams – “exchanged words” with other customers at the World Sports Grille in the city’s South Lake Union area Sunday afternoon and “brandished a pool cue” at the bar’s manager.

At one point, police say, Williams – who was in town to perform at the Paramount Theatre – followed a family outside of the bar and flicked a lit cigarette into their car, striking a woman just below the eye. He also threw a rock at the car, according to police.

Police showed up at the establishment just before 2:30 in the afternoon and, after a struggle to get Williams into the patrol car, transported him to the West Precinct. Williams was booked into the King County Jail for investigation of assault, harassment and obstruction, police said.

A representative for Williams has not yet responded to TheWrap’s request for comment.

According to TMZ, he has been released on bail.

The bar incident wasn’t Williams’ only brush with police this weekend. According to the Seattle Police Department, after the 41-year-old comedian’s show Friday night, three fans claimed Williams attacked them when they tried to take a picture with him after the show. Williams’ denied the allegation, saying that the fans had forced their way into his dressing room, and no arrests were made.

Williams told police after the Friday night incident that he planned to cancel Saturday’s show and leave town, but apparently didn’t.

Celebrity News Headlines – Yahoo! News

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Fossil fuel subsidies in focus at climate talks

DOHA, Qatar (AP) — Hassan al-Kubaisi considers it a gift from above that drivers in oil- and gas-rich Qatar only have to pay $1 per gallon at the pump.

"Thank God that our country is an oil producer and the price of gasoline is one of the lowest," al-Kubaisi said, filling up his Toyota Land Cruiser at a gas station in Doha. "God has given us a blessing."

To those looking for a global response to climate change, it's more like a curse.

Qatar — the host of U.N. climate talks that entered their final week Monday — is among dozens of countries that keep gas prices artificially low through subsidies that exceeded $500 billion globally last year. Renewable energy worldwide received six times less support — an imbalance that is just starting to earn attention in the divisive negotiations on curbing the carbon emissions blamed for heating the planet.

"We need to stop funding the problem, and start funding the solution," said Steve Kretzmann, of Oil Change International, an advocacy group for clean energy.

His group presented research Monday showing that in addition to the fuel subsidies in developing countries, rich nations in 2011 gave more than $58 billion in tax breaks and other production subsidies to the fossil fuel industry. The U.S. figure was $13 billion.

The Paris-based Organization for Economic Cooperation and Development has calculated that removing fossil fuel subsidies could reduce carbon emissions by more than 10 percent by 2050.

Yet the argument is just recently gaining traction in climate negotiations, which in two decades have failed to halt the rising temperatures that are melting Arctic ice, raising sea levels and shifting weather patterns with impacts on droughts and floods.

In Doha, the talks have been slowed by wrangling over financial aid to help poor countries cope with global warming and how to divide carbon emissions rights until 2020 when a new planned climate treaty is supposed to enter force. Calls are now intensifying to include fossil fuel subsidies as a key part of the discussion.

"I think it is manifestly clear ... that this is a massive missing piece of the climate change jigsaw puzzle," said Tim Groser, New Zealand's minister for climate change.

He is spearheading an initiative backed by Scandinavian countries and some developing countries to put fuel subsidies on the agenda in various forums, citing the U.N. talks as a "natural home" for the debate.

The G-20 called for their elimination in 2009, and the issue also came up at the U.N. earth summit in Rio de Janeiro earlier this year. Frustrated that not much has happened since, European Union climate commissioner Connie Hedegaard said Monday she planned to raise the issue with environment ministers on the sidelines of the talks in Doha.

Many developing countries are positive toward phasing out fossil fuel subsidies, not just to protect the climate but to balance budgets. Subsidies introduced as a form of welfare benefit decades ago have become an increasing burden to many countries as oil prices soar.

"We are reviewing the subsidy periodically in the context of the total economy for Qatar," the tiny Persian gulf country's energy minister, Mohammed bin Saleh al-Sada, told reporters Monday.

Qatar's National Development Strategy 2011-2016 states it more bluntly, saying fuel subsides are "at odds with the aspirations" and sustainability objectives of the wealthy emirate.

The problem is that getting rid of them comes with a heavy political price.

When Jordan raised fuel prices last month, angry crowds poured into the streets, torching police cars, government offices and private banks in the most sustained protests to hit the country since the start of the Arab unrest. One person was killed and 75 others were injured in the violence.

Nigeria, Indonesia, India and Sudan have also seen violent protests this year as governments tried to bring fuel prices closer to market rates.

Iran has used a phased approach to lift fuel subsidies over the past several years, but its pump prices remain among the cheapest in the world.

"People perceive it as something that the government is taking away from them," said Kretzmann. "The trick is we need to do it in a way that doesn't harm the poor."

The International Energy Agency found in 2010 that fuel subsidies are not an effective measure against poverty because only 8 percent of such subsidies reached the bottom 20 percent of income earners.

The IEA, which only looked at consumption subsidies, this year said they "remain most prevalent in the Middle East and North Africa, where momentum toward their reform appears to have been lost."

In the U.S., environmental groups say fossil fuel subsidies include tax breaks, the foreign tax credit and the credit for production of nonconventional fuels.

Industry groups, like the Independent Petroleum Association of America, are against removing such support, saying that would harm smaller companies, rather than the big oil giants.

In Doha, Mohammed Adow, a climate activist with Christian Aid, called all fuel subsidies "reckless and dangerous," but described removing subsidies on the production side as "low-hanging fruit" for governments if they are serious about dealing with climate change.

"It's going to oil and coal companies that don't need it in the first place," he said.

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Associated Press writers Abdullah Rebhy in Doha, Qatar, and Brian Murphy in Dubai, United Arab Emirates, contributed to this report

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Karl Ritter can be reached at www.twitter.com/karl_ritter

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Court upholds $319M verdict in 'Millionaire' case

LOS ANGELES (AP) — A federal appeals court on Monday upheld a $319 million verdict over profits from the game show "Who Wants to Be a Millionaire" and rejected Walt Disney Co.'s request for a new trial.

A jury decided in 2010 that Disney hid the show's profits from its creators, London-based Celador International. The ruling Monday by a three-judge panel of the 9th U.S. Circuit Court of Appeals found no issues with the verdict or with a judge's rulings in the case.

"I am pleased that justice has been done," Celador Chairman Paul Smith said in a statement.

Disney did not immediately comment on the decision.

The ruling comes more than two years after the jury ruled in Celador's favor after a lengthy trial that featured testimony from several top Disney executives. The company sued in 2004, claiming Disney was using creative accounting to hide profits from the show, which first ran in the United States from August 1999 to May 2002 and was a huge hit for ABC.

The jury found that Celador was owed $269.2 million, and a judge later added $50 million in interest to the judgment.

The appeals court determined the verdict was not "grossly excessive or monstrous" and that it was not based on speculation or guesswork.

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Public-private group wins bid for delinquent mortgages

A homeowner with a delinquent mortgage speaks with a mortgage specialist at a JPMorgan Chase foreclosure consultation event in New York in 2011. (Shannon Stapleton/Reuters File Photo / December 3, 2012)

By Mary Ellen Podmolik




Tribune reporter

5:19 p.m. CST, December 3, 2012

A public-private partnership headed by the Illinois Housing Development Authority has emerged as one of the winning bidders in a September auction of delinquent mortgages held by the Federal Housing Administration.
 
Mortgage Resolution Fund will use $25 million of federal hardest-hit funds awarded to the state to buy 324 delinquent loans on Chicago-area properties. The loans, which were part of a neighborhood stabilization pool have an unpaid principal balance of about $62 million and the properties are valued at $40 million.
 
After the note sale closes, homeowners whose delinquent mortgages are part of the loan pool will be contacted by a new servicer in early 2013 that will offer to write down the principal balance of the loans and set up more affordable repayment terms to eligible homeowners. Those homeowners pay no cost to receive the loan modifications.
 
"We want to help as many borrowers as possible achieve long-term stability so they can stay in their homes without the fear of foreclosure," said Mary Kenney, executive director of the Illinois Housing Development Authority.
 
Separately, Florida-based Bayview Acquisitions LLC submitted a winning bid of about $70 million for 1,430 other Illinois loans in a neighborhood stabilization pool that had an unpaid principal balance of about $269 million and an estimated property value of $155 million. Another 299 delinquent Illinois mortgages were sold as part of other pools.
 
Nationally, the note sale involved about 9,400 distressed loans. Bids were submitted to U.S. Department of Housing and Urban Development in September.
 
HUD said plans to sell another 10,000 to 15,000 distressed loans during the first quarter of 2013, and at least 40,000 during the next year in an effort to remove distressed loans from its portfolio.
 
mepodmolik@tribune.com | Twitter @mepodmolik

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Orange Bowl bid, new coach cap wild weekend for NIU

It was an incredible weekend for the Northern Illinois football program.

A 44-37 double-overtime victory over Kent State in the Mid-American Conference championship game kicked off the exhilaration Friday night at Ford Field in Detroit. That was followed by the announcement on Saturday that Dave Doeren had accepted the coaching position at North Carolina State.

On Sunday came the historic news that the Huskies were bound for Miami on New Year's Day to face Florida State in the Orange Bowl, becoming the first team from the MAC to earn a berth in a BCS bowl game.

"We're 12-1," NIU quarterback Jordan Lynch told ESPN. "We faced tons of adversity this year. We won tons of games. … We definitely deserve to be in there."

Capping things off, the school announced Sunday night the head coaching vacancy had been filled by promoting offensive coordinator Rod Carey.

"It has been crazy; it has been nuts. That's the only way to explain it," said Carey, who agreed to a five-year contract. "But it has been good. All of that has been wonderful … and what a privilege for our kids to go to the Orange Bowl. They were so excited they could barely stand up."

While some college observers vehemently argued that NIU didn't belong in the game, Florida State coach Jimbo Fisher told reporters in Tallahassee that he had no such qualms.

"You don't get in this game unless you're a good football team," Fisher said. "It's easy for talking heads to say that (NIU doesn't belong). They've earned the right to be here, they've earned the right to have this opportunity.

"We know we're going to get an inspired opponent, an opponent that's going to be ready to prove something."

NIU now has its third coach in three years. Jerry Kill left after the 2010 season to take the head coaching job at Minnesota. Doeren was 23-4 in just two seasons on the DeKalb campus. NIU athletic director Jeff Compher is hoping for a smooth transition from Doeren to Carey.

"That's why they did what they did in such a short amount of time," Carey said. "Because I have been here and they want the transition to be as seamless as it can be.

"I don't have any reason today to sit here and say that I want to go somewhere else. Listen, I was born in Madison, Wisconsin, and I went to high school in Minneapolis, Minnesota. Joe Novak (former NIU head coach) was the defensive coordinator at Indiana when I played there. So my ties and my knowing about NIU have gone back a long time. And I have wanted to be at this place for a lot of different times in my career. And I finally got here and now this has happened. I don't know why I would want to go anywhere else."

It is not yet clear how many other members of the NIU coaching staff will join Doeren at N.C. State.

"It will be a challenge; I don't know how it will all play out," Carey said. "But I do know that this staff just won back-to-back MAC championships. And as far as I am concerned, it's the finest staff I've worked with. So I would love to coach with all of these guys for a long time."

This year, Carey helped mold an offensive line of five new starters that helped Lynch become one of the best dual-threat quarterbacks in the nation. Carey transitioned into the role of offensive coordinator after the first game of the season when Mike Dunbar had to step away from that role while battling a serious illness.

"Mike Dunbar is one of the most high-character people and unbelievable people I have ever been around," Carey said. I have learned more from that man … he and coach Doeren I have learned more from."

fmitchell@tribune.com

Twitter@kicker34

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China's dot-com darlings tap cheap global credit

HONG KONG/SHANGHAI (Reuters) - Chinese search engine company Baidu Inc paid a lower interest rate than Google Inc when it sold $750 million in 10-year bonds last month.

China's three dominant dot-com names - Baidu, Alibaba and Tencent Holdings Ltd - have successfully tapped global funding this year, stockpiling a combined $6 billion in debt despite investor skepticism about opaque Chinese companies.

The big three plan to use the money to pad their industry advantage at home, to compete better abroad, and perhaps to buy cash-starved rivals.

Ultra-low interest rates on U.S. government bonds, the benchmark against which most debt is measured, have driven down borrowing costs around the world. That has been a boon to corporate borrowers who are finding plenty of yield-hungry investors willing to extend long-term credit.

"The mature guys, Alibaba, Tencent, Baidu, these guys need to fund new growth. They are incredibly dominant in China, so they need to expand into international markets and create new products," said Sean O'Rourke, an analyst at Shanghai-based Redtech Advisors.

O'Rourke said the money that Baidu raised in November - a total of $1.5 billion in 5- and 10-year bonds - would be more than enough to buy some of its smaller rivals, and said there were "dozens" of potential takeover targets.

While Baidu said it intends to use this tranche of funds for cross-border acquisitions, it could potentially spend it on buying domestic competitors that have listed abroad.

Baidu's bond sale was notable both for its size and its reception in the market, which has been skeptical of U.S.-listed Chinese companies after a rash of accounting scandals. The hurdle was especially high for Baidu because it lacks the physical assets bond investors prefer, and it was seeking a 10-year term, which is a lifetime for a technology firm.

Yet it managed to sell the debt at a yield of 3.518 percent, just 185 basis points over the risk-free rate that is normally associated with U.S. Treasury bonds.

Google sold 10-year bonds in May 2011 with a yield of 3.734 percent. Treasury yields have fallen since then, so if Google were to tap the market now it might obtain a lower rate.

IPO NO GO

The bond market embrace comes at a good time for technology companies because corporate the governance scandals have all but shut down another popular funding avenue - listing of shares on U.S. exchanges.

Just two Chinese technology companies have successfully launched U.S. initial public offerings this year, including newly listed YY Inc. That's down from 15 in 2011 and way off the 41 issues in 2010.

These IPOs have raised only $153 million this year, compared with $2.17 billion last year and $4.01 billion in 2010, Thomson Reuters data shows. By contrast, Tencent and Baidu raised $2.1 billion via bond issues this year, while Alibaba has raised a massive $4 billion in loans.

"It's a lot faster and simpler to raise bonds - raising equity would result in share dilution and takes a longer time," said Thomas Chong, Internet analyst with BOCI Research in Hong Kong.

Chong said the companies were keen to borrow even though their balance sheets are loaded with cash because they need U.S. dollars but their revenue is primarily in yuan.

Tencent is expected to nearly double its free cash flow in the current year to 18.3 billion yuan ($2.94 billion), according to Nomura. Baidu's free cash flow this year is estimated to hit 8.0 billion yuan, Credit Suisse said in a report.

China's tax laws provide another incentive to borrow in the international credit markets. If Chinese companies use domestic cash to repay foreign borrowing, they would have to pay a remittance tax of as much as 10 percent, said Catherine Chan, head of investor relations at Tencent.

"Raising offshore capital to repay offshore loans through bonds issues will help optimize our tax obligation while allowing us to take advantage of the higher deposit rates in China by parking cash generated from our operations onshore," she said.

SIZE MATTERS

Credit investors and analysts doubt that the positive reception afforded to China's tech giants will trickle down to smaller players whose prospects may be less certain. That means debt markets won't replace IPOs.

Many Chinese Internet companies could use cheap bond funding right now, especially those in gaming and e-commerce. But the lesser known firms are eyed suspiciously because they lack solid assets and their cash flows are unpredictable.

"It will take some time to educate the bond market about Internet companies, given we are usually asset-light and have a shorter track record than traditional brick-and-mortar industries," said Tencent's Chan.

Even for established names, market perceptions can change rapidly: Yahoo lost 80 percent of its market capitalization since its Internet peak in 1999 while Google's stock has risen more than six-fold since its stock market debut in 2004.

"If you look at the rapid rate of changes in technology and consumer behavior, I would be concerned about holding debt in the longer term. You could, for instance, have some new platforms or delivery medium emerging and taking over from these sites," said Tim Jagger, Singapore-based portfolio manager at Aviva Investors.

(Additional reporting by Melanie Lee in Shanghai; Editing by Emily Kaiser)

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