SENTENCING: Former KB Home Chief Executive Bruce Karatz has been sentenced to five years probation, including eight months of house arrest, for his conviction on charges of backdating stock options. U.S. District Court Judge Otis Wright also ordered Karatz to pay a $1 million fine and complete 2,000 hours of community service. Karatz, 65, was convicted in April on three felony charges that he concealed the backdating of stock options by KB Home executives. Federal prosecutors had recommended that he be sentenced to more than six years in prison and fined $7.5 million. But probation officials cited Karatz’s record of community service and charitable contributions.
NEW OWNERS: Regulators have closed a pair of distressed Los Angeles County banks, which were sold to two local institutions. Western Commercial Bank, a small lender in Woodland Hills founded just before the financial crisis and saddled with heavy loan losses and dwindling capital, was sold to First California Bank in Westlake Village. The assets of Westminster’s First Vietnamese American Bank, which had had $48 million in assets and $47 million in deposits, was acquired by Grandpoint Bank. (See page 1.)
FOR SALE: The Beverly Hilton Hotel, site of a stalled $500 million development, has been put up on the market by owner Beny Alagem. Cushman & Wakefield Sonnenblick Goldman, which is listing the property, said the decision was triggered by several unsolicited offers for the historic hotel, where four years ago Alagem proposed adding two condo towers and a Waldorf Astoria hotel.
RESIGNED: Kevin Czinger has unexpectedly resigned as chief executive of Coda Automotive, a high-profile Santa Monica electric car company that hopes to start selling its first vehicle in the domestic market by the end of the year. Czinger, a former venture capitalist and investment banker who joined the company in 2008, left after reaching “mutual consent” with parent Coda Holdings, the company said. Co-Chairman Steven “Mac” Heller will serve as chief executive while a search is conducted for a permanent replacement.
LAWSUIT: A former MannKind Corp. executive has sued the Valencia biotech in New Jersey state court, alleging that the company suppressed potential fraud in clinical trials of a diabetes treatment pending before U.S. regulators. John Arditi, MannKind’s former senior director for regulatory affairs, contends that the company withheld information about potential “scientific misconduct” at clinical trial sites in Russia and Bulgaria. The company dismissed the allegations as being without merit.
RISING OUT: Chief Executive Nelson C. Rising resigned from MPG Office Trust Inc., effective Monday, in a disagreement over how the Los Angeles real estate company should recover from the real estate downturn. Chairman Paul M. Watson will serve as interim chief executive until a successor is named. Rising acknowledged in his resignation letter that he and board members agreed on the need to recapitalize, but differed on how to do it. “I believe the board and I do not share a common vision for the strategic direction of the company and a capital structure necessary to achieve it,” he wrote.
STRIKE: Crew members on the hit reality TV show “The Biggest Loser” went on strike last week in a dispute over union representation. Crew members seeking to join the International Alliance of Theatrical Stage Employees walked off the set of the show, which is filmed on a ranch in Calabasas, after their demand to be recognized as union members was rebuffed by the show’s producers.
FRIENDLY PLACES: The Los Angeles County Economic Development Corp. named Alhambra and Cerritos the most business-friendly large and small cities in Los Angeles County, respectively. LAEDC criteria for the annual awards include commitment to economic development, efforts to help businesses grow and expand, and competitive business tax and fee structures. Alhambra beat finalists Carson, Downey, Torrance, West Covina and Whittier in the large cities category. Cerritos beat Azusa, Commerce, Duarte, La Mirada and Monrovia in the small cities category.
ACQUISITION: Live Nation Entertainment Inc. has acquired Ticketnet, France’s second largest ticket retailer, for an undisclosed amount. Live Nation of Beverly Hills, considered the world’s largest live entertainment company, said that the deal is a significant step in its global expansion strategy and complements its concert promotion activities in France. Ticketnet handles 6.6 million tickets annually for more than 40,000 events each year with a team of 100 employees. The unit will continue to be led by its managing director, Francois Thominet.
EARNINGS: Motorcar Parts of America Inc. reported fiscal second quarter net income of $3.5 million, 1.7 percent higher than a year earlier. Revenue rose 4 percent to $40.9 million. … Aecom Technology Corp. reported fiscal fourth quarter net income of $67.8 million, 25 percent higher than a year earlier. Revenue rose 12 percent to $1.83 billion. … Arden Group Inc. reported third quarter net income of $3.45 million, 26 percent lower than a year earlier. Revenue fell 3 percent to $100 million. … American Apparel Inc. reported a third quarter net loss of $9.5 million, compared with net income of $4.2 million a year earlier. Revenue fell 10.5 percent to $135 million. … CytRx Corp. reported a third quarter net loss of $4.41 million, compared with net income of $3.86 million a year earlier. The company does not have products on the market and does not report income. … Superior Industries International Inc. reported third quarter net income of $10.4 million, compared with a loss of $12.7 million a year earlier. Revenue rose 65 percent to $183 million. … Activision Blizzard Inc. reported third quarter net income of $51 million, 240 percent higher than a year earlier. Revenue rose 6 percent to $745 million. … RadNet Inc. reported a third quarter net loss of $280,000, compared with a loss of $1.72 million a year earlier. Revenue rose 5 percent to $140 million.
