Saying it "has no duty to warn people of fat, caloric content of commonly understood foods," McDonald's(NYSE: MCD) has asked a federal judge to drop a class action lawsuit filed on behalf of New York obese children with health problems. After all, "The understanding and comprehension of what hamburgers and french fries do has been with us for a long, long time."

Samuel Hirsch, the attorney for the plaintiffs, says Mickey D's has placed nutritional posters in out-of-the-way locations, making them hard to find. If his clients had been aware of the health dangers, he says, they "would have acted differently" and not eaten at the restaurant so much.

The judge did not indicate when he would make a decision.

The Motley Fool 50 followed all the major indexes up today, gaining more than 1%.

In today's Motley Fool Take:

Hewlett Packs a Punch

Though it's still too early to call it a success, Hewlett-Packard's(NYSE: HPQ) $19 billion acquisition of Compaq Computer appears to be paying early dividends. Reporting just its second quarterly earnings results since the consummation, the new company topped estimates and showed strong progress in several areas.

Earnings hit $0.13 a share, compared with a $0.17 loss on a combined company basis in last year's fiscal fourth quarter. Total revenue fell 1%, but was up 9% sequentially.

The big news thus far from the merger is the cost savings. CEO Carly Fiorina pointed to $651 million in permanent cost reductions in the past six months, 30% above targets. HP had cut 12,500 jobs as of the end of the quarter, also ahead of its goal of 10,000.

These results, combined with an affirmation of first-quarter earnings projections, are giving some hope to the PC sector. HP was up 15% in morning trading, the Goldman Sachs Hardware Index rose 6%, and the Philadelphia Semiconductor Index gained 7%.

Chief Financial Officer Bob Wayman did offer some words of caution about the holiday season, however, telling Reuters, "It's still not clear how strong the consumer market will be this year."

Still, the fourth-quarter results must be particularly pleasing to the CEO, who fought a bitter battle to get the acquisition some called "Fiorina's Folly" approved. "We are proud of our progress," she said. "We delivered solid results in a tough market. The HP team is executing, customers are responding and we're beginning to deliver on the promise of the merger. We feel good about our trajectory."

Fiorina has a right to be proud. Thus far, she receives high marks for her vision and execution.

Quote of Note

"When people talk, listen completely. Most people never listen." -- Ernest Hemingway

Cisco's Dividend Debate

Cisco (Nasdaq: CSCO) shareholders decided that they didn't want the spare $21 billion their company has stuck in the corporate couches. Ninety percent of them rejected a dividend proposal that would have required the board to consider sparing them some change every quarter, Chief Financial Officer Larry Carter said Tuesday at its annual shareholder meeting.

So, Cisco faces a dilemma all of us wish we had -- how to spend $21 billion. The correct answer for a corporation is to put the cash where it generates the best return for shareholders. The correct answer for me is to buy a tropical island.

Right now, the best return for shareholders does not come from letting billions sit in a savings account. The huge cash holdings of tech giants like Cisco and Microsoft(Nasdaq: MSFT) are dragging down their returns on assets, and ultimately the returns to shareholders.

So what are the alternatives?

1. Acquire smaller companies.
2. Reinvest in the company through capital expenditures and increased R&D.
3. Repurchase stock.
4. Pay out dividends.

Considering the acquisition binges of the '90s that these companies went on, they are probably leery of acquiring marginal businesses. With Cisco's excess capacity, it is unlikely capital expenditures would yield an acceptable return, and presumably R&D activities are fully funded.

So the debate really comes down to whether the company should buy back stock or pay out dividends to its shareholders. The two are not mutually exclusive, but do the shareholders benefit more from a buyback or a dividend?

A major stumbling block for the dividend crowd, of course, is the double taxation of dividends at the corporate and individual levels. Share buybacks delay taxation until the shareholders sell.

However, Cisco has shelled out massive amounts of stock option grants to the employees. So, if shares are repurchased and the price rises, the employees benefit much more than shareholders. Stock options don't pay dividends, so in the event of a dividend payout, the employees suffer (option prices decline as dividends increase). But the holders of common stock would receive cold cash. Although the tax penalty is real, the government still does not have a 100% bracket, so at least some of John Chambers' pocket change will rattle into your couch.

Finally, management needs to consider the company's stock price and probably reserve share buybacks for when the stock is undervalued.

Boeing, Going, Gone

So much for soft landings. Aerospace giant Boeing(NYSE: BA) announced that it will need to let another 5,000 employees go over the next year. The company had already trimmed its payroll by 30,000 workers since last year's terrorist attacks rattled the airline industry.

That's where Boeing finds itself today, being pulled in two completely different directions. In terms of its commercial aircraft business, things couldn't get much worse. Since the events of 9/11, the major carriers have had to scale back. Travel, especially business-class and international trips, just isn't what it used to be.

Eliminating roughly 20% of their scheduled flights has translated into lower demand for new planes and a longer useable life for their existing fleet. Airlines like UAL's(NYSE: UAL) United and AMR's(NYSE: AMR) American have canceled or deferred orders.

For Boeing, that has meant holding back on 500 deliveries, or roughly the same number of jetliners it delivered just last year. Even worse, competitors such as Airbus have taken to drastic price cuts to win the little business that's out there to win.

Ironically, the same tragic events that have placed its commercial aircraft in a holding pattern have fueled a surge in military spending. While the company lost out to Lockheed Martin(NYSE: LMT) on the lucrative Joint Strike Fighter contract last year, it's clearly in the thick of things as the country braces for the possibility of war with Iraq.

But with projected commercial aircraft deliveries expected to fall to as low as just 275 jets next year, it's easy to see why Boeing can't keep its workforce intact in the near term. Let's just hope the displaced don't stray too far away. In a couple of years, the pent-up demand is going to swell nicely for Boeing. But are you patient enough to wait that long until the control tower clears you for takeoff?

Discussion Board of the Day: Boeing

When do you see a Boeing recovery? Can it bounce back without its commercial airline business returning? What is the competition doing right or wrong? All this and more -- in the Boeing discussion board. Only on

Play Credit Cop

You set your car alarm, insure your honey's handsome earning potential, and have a rider covering that Bicentennial quarter collection stashed in the lower left-hand drawer of the guest room dresser. So, how about a little protection for your good name and well-earned credit record?

There are plenty of products to guard your credit and keep identity thieves at bay. But we're fans of financial self-defense, as recently discussed on the Consumer Credit discussion board. Here are three protective measures you can put into action right now -- that is, after you're done reading the next 353 words.

1. Photocopy the contents of your wallet. Make a record of all your credit cards, driver's license, and insurance cards, and any other items that contain personal information and access to a line of credit, discount, or rewards. Xerox both the front and back of all cards, and then put the copies in a safe place. Should your wallet go missing, you'll have a record of its contents and quick access to the phone numbers you need to cancel your cards. When you get a sec, also photocopy your passport.

2. Write yourself a note on your check re-order form. If you still use old-fashioned checks, next time you replenish your supply, delete all personal information that isn't required. That includes your Social Security number, driver's license number, home phone, and favorite color. Sure, a thief can get access to all of this information should he be so inclined. But you might as well make him work for it.

3. Take your name off junk mail lists. It's easy to get the ball rolling, but it might take a while to see the effects of turning off the spigot. Pick up the phone and opt out of pre-approved credit card offers by calling 888-5OPTOUT (888-567-8688).

Slow the slew of catalogs, mailers, and dating-service spam your mother signed you up for by contacting the Direct Marketing Association and giving them your first, middle, and last names (including Jr., Sr., III, and "Bunny"), current address, and home area code and telephone number (for phone opt-out service). Send your info to both the Mail Preference Service at P.O. Box 643, Carmel, NY 10512 and the Telephone Preference Service at P.O. Box 1559, Carmel, NY 10512. Fewer solicitations in your mailbox and trash can mean fewer opportunities for a thief to get credit in your good name.

This list is not all-inclusive, but it should give you a little more peace of mind. Now, go refill your coffee mug and make a pit stop at the Xerox machine with your wallet. Should you find yourself a victim of identity theft, here's a rundown of what to do.

Quick Takes

Morgan Stanley (NYSE: MWD) said it would fire 2,200 employees, another 4% beyond the 8% it has already shown the door in the last two years. The largest part (42%) is comprised of stockbrokers, with a chunk from investment banking. The news follows recent similar actions from ING Group (NYSE: ING), ABN Amro Holding(NYSE: ABN), and Lehman Brothers(NYSE: LEH)

General Electric (NYSE: GE) announced a $1.4 billion charge as it increased reserves against losses for its Employers Reinsurance unit. To learn more about that piece of GE, read Bill Mann's latest, Dim Times at GE. The company also increased its quarterly dividend by a penny to $0.19 a share.

Shares of budget teen clothing retailer Debs Shops(Nasdaq: DEBS) dropped 15% after its Q3 EPS came in $0.06 under consensus analyst estimates. Management said Debs would earn $1.80 to $1.85 a share this year, well off the prior forecast of $2.25 to $2.30.

No vay. Media giant Vivendi Universal(NYSE: V) has reportedly dissed oil billionaire Marvin Davis' offer to pay $15 billion and assume $5 billion in debt for the company's U.S. media businesses. Vivendi, which is under SEC investigation, is selling off assets to pay down its debt. Check out yesterday's Take on its latest tribulations.

And Finally...

Today on Rex Moore tells you how to build wealth slowly by Dripping.... Rick Munarriz lists four ways to become a savvy holiday shopper.... Tom Jacobs says good company financial disclosure makes money.... Dayana Yochim teaches you how to play credit cop.... How to profit from someone's demise, in Fool's School.... Don't walk blind on your job hunt.... In Hot Topics, how far should you go to get the job you want?... Post of the Day: Foolish Collective.

Bob Bobala, Robert Brokamp, Tom Jacobs, LouAnn Lofton, Bill Mann, Selena Maranjian, Rex Moore, Rick Munarriz, Matt Richey, Jackie Ross, Reggie Santiago, Dayana Yochim