BUSINESS NOTES.

COMPANY MAY BE SLAMMED BY PUC: A San Diego telephone company faces one of the harshest punishments yet for ``slamming,'' an illegal practice of switching customers to their service without the client's permission.

The California Public Utilities Commission is recommending that Communications Telesystems International pay nearly $2 million in reparations and be expelled from doing business in California.

If adopted by the five-member commission April 23, the recommendation would strip CTS of its customer base in California and bar it from doing business in California for three years.

In addition, the 56,216 customers who complained they were ``slammed'' between 1994 and 1996 - that their long-distance telephone service was switched by CTS without their permission - would share $1,939,412 in damages. That would be about $33 a person.

STARBUCKS MAY INCREASE PRICES AGAIN: Starbucks Corp. may have to raise prices again if unroasted coffee prices stay high this year, said Orin Smith, the company's president and chief operating officer.

The Seattle-based coffee shop chain recently raised prices on cups of coffee by 5 cents, and on whole-bean coffee by 30 cents a pound. It was the first price increase since July 1995.

A recent rise in green coffee, or unroasted coffee, may prompt another increase if it lasts through the year, Smith told a conference sponsored by Robinson-Humphrey in Atlanta.

WAL-MART TO LIMIT DRUGS SALES: To help limit the growth of methamphetamine - feared to become the newest drug epidemic - Wal-Mart is voluntarily limiting each customer's purchase of cold, allergy and diet medications containing chemicals used to make the drug.

The pills involved in the program that began Feb. 1 contain pseudoephedrine or ephedrine, essential for making methamphetamine, or phenylpropanolamine, needed for amphetamine. From 75 percent to 85 percent of the nation's supply of the drugs - also known as ``meth,'' ``crank,'' ``speed'' and ``ice'' - is made from the pills, DEA agents said.

Under the guidelines Wal-Mart is imposing on itself, a buyer will be able to get a maximum of 17.3 grams of any of the three essential drugs at one time.

MURDOCH WANTS COPYRIGHT LAW CHANGED: News Corp. Chairman Rupert Murdoch will tell lawmakers today he needs copyright law changed so his planned ``Sky'' direct broadcast satellite network can deliver local television stations the way cable TV does.

To do that, Murdoch needs a change in U.S. copyright law, and he's trying to get lawmakers in Congress to tuck it into unrelated spending legislation that must pass by April 30.

Two competitors also plan to speak at tomorrow's hearing on competition in the video marketplace.

Amos Hostetter, chairman of Continental Cablevision Inc., and Stanley Hubbard Sr., president and chief executive of Hubbard Broadcasting Inc. and U.S. Satellite Broadcasting Inc., are likely to argue that the rules shouldn't be changed for Murdoch alone, analysts said.

McDONALD'S SAYS SLUMPING BUSINESS SHOULD IMPROVE: McDonald's Corp. said its slumping U.S. business should post improved results ``as the year progresses'' in 1997 while international operations should have an ``excellent year.''

The company also said in its annual report that same-store sales in the United States fell 6.4 percent last year to an average of $1.43 million for stores open at least 13 months from $1.54 million in 1996. That's a steeper decline than analysts had estimated.

McDonald's said it will open fewer restaurants in the United States this year than last year, and that more than 70 percent of its 2,400 to 2,800 new restaurants planned for the year will open outside the United States.

The company opened 726 restaurants in the United States in 1996 and 1,130 in 1995. The United States accounted for 27 percent of restaurants opened in 1996, compared with 47 percent in 1995 and 31 percent five years ago. Almost half of the restaurants opened in the United States in 1995 were small ``satellite'' outlets, compared with 25 percent in 1996.

DOW JONES PROFITS FALL 33 PERCENT: Dow Jones & Co., publisher of The Wall Street Journal, saw profits fall 33 percent in the first quarter as difficulties mounted at its Telerate financial information business.

The profit report, released Wednesday, came just one week before the company's annual shareholders meeting, which could prove a lively affair. Telerate, recently renamed Dow Jones Markets, is the focus of a $650 million overhaul that has generated some controversy.

TCI WON'T SPIN OFF LIBERTY MEDIA: Tele-Communications Inc., the nation's biggest cable company, scrapped plans Wednesday to split itself up after the Internal Revenue Service declined to make the transaction tax-free.

The Englewood, Colo.-based company announced in December that it would spin off the Liberty Media and international businesses as part of an effort to stem losses, reduce a heavy debt load and boost the company's sagging stock price.

At the time, TCI said the ultimate decision would hinge on a number of factors, including board approval and a favorable tax ruling by the IRS.