RATE HIKE: The Workers' Compensation Insurance Rating Bureau, an industry actuarial body, is recommending that workers' compensation insurance rates in California increase 23 percent next year. The recommendation was sent to State Insurance Commissioner Steve Poizner, who rejected a comparable increase earlier this year and said that insurers could do far more to contain costs. Most companies have increased their rates between 5 percent and 15 percent in recent months. Poizner said he would give the latest rate proposal close scrutiny before issuing his recommendation later this year. The recommendations serve as guidelines for the industry.
CUTBACKS: Kaiser Permanente said it would eliminate more than 1,800 positions statewide as it struggles with drooping membership, uncertain health care reform and shriveling Medicare reimbursement rates. In the Southern California region, 650 administrative and service employees out of roughly 56,000 total workers have been notified that their positions would be cut, Many of the affected positions are temporary, on call or part time. None of those laid off will be members of SEIU-United Healthcare Workers, which reached an agreement with Kaiser that prevents the company from laying off members of the union.
FRAUD CONVICTIONS: Beverly Hills real estate agent Kyle Grasso and appraiser Lila Rizk were convicted on multiple federal charges of conspiracy and bank fraud for their roles in a multimillion-dollar Westside fraud ring. Jurors couldn't reach a verdict on another prominent agent, Joseph A. Babajian, who had also been accused in the case. The fraud ring included developers, agents and appraisers who bought relatively modest houses in some of the area's most expensive neighborhoods. They then inflated the homes' value to get loans. Banks lost more than $40 million on loans totaling $142 million.
WATER CHANGE: SouthWest Water Co. plans to separate the role of chairman and chief executive, and adopt other corporate governance changes at a shareholders meeting next month. The L.A. water services company, which brought in a new management team in 2007, recently restated several quarters due to accounting errors. Shareholders will meet Sept. 11 to approve the new corporate governance guidelines, which also lower the mandatory retirement age of directors to 72 from 75.
NEW JOB: Former Los Angeles City Attorney Rocky Delgadillo is joining Goodwin Procter LLP as counsel. Delgadillo will be focusing on building a book of business as a member of the firm's litigation department, which has 400 attorneys. He said the job won't change his plans to run for state attorney general in 2010, and announced that he has raised more than $936,000 in contributions since January.
OFFICIALS CLEARED: The U.S. Senate Select Committee on Ethics cleared two influential Democratic members of receiving improper discounts on mortgages from Countrywide Financial, the former Calabasas-based home lending giant that's now part of Bank of America. Sen. Kent Conrad of North Dakota, chairman of the Budget Committee, and Sen. Christopher J. Dodd of Connecticut, chairman of the Banking Committee, had come under scrutiny after it was disclosed that they had been included in the "Friends of Angelo" V.I.P. program, named after Angelo R. Mozilo, Countrywide's former chief executive.
LETTING GO: After reporting a wider second quarter loss, Maguire Properties Inc. said it intends to default on loans for seven office properties in Los Angeles and Orange counties, including the California Bank & Trust building in downtown Los Angeles. The L.A. real estate investment trust, which has had trouble keeping up with debt payments in the slow economy, intends to either sell the properties or let the banks take them over. Maguire Properties later said it had sold one of the properties, Park Place I in Irvine.
BILLBOARD BAN: The Los Angeles City Council passed an emergency ordinance banning new digital billboards, supergraphics and other outdoor advertising signs from most areas of the city. The unanimous vote came in response to a legal challenge from Liberty Media Group to an existing moratorium, which was set to be heard by a federal judge Aug. 17. Several council members feared that if Liberty Media's challenge prevails and the moratorium is struck down, hundreds of applications for new billboards and building-covering supergraphics would pour in.
EARNINGS: Edison International reported a second quarter net loss of $16 million, compared with net income of $261 million a year earlier. Revenue fell 19 percent to $2.83 billion. Public Storage reported second quarter net income of more than $199 million, 48 percent higher than a year ago. Revenue fell 2.7 percent to $407 million Superior Industries International Inc. on Friday reported a second quarter net loss of $21 million, compared with net income of $5.1 million a year ago. Revenue fell 63 percent to $80.9 million. Rentech Inc. reported third quarter net income of $36.1 million, compared with a net loss of $7.7 million a year ago. Revenue rose 51 percent to $91.4 million. Lions Gate Entertainment Corp. reported first quarter net income of $36.3 million, 937 percent higher than a year ago. Revenue rose 30 percent to nearly $388 million. DTS Inc. reported second quarter net income of $3.6 million, 157 percent higher than a year ago. Revenue rose 89 percent to $24.2 million.
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