CAR WASH CHARGES: L.A. City Attorney Rocky Delgadillo filed criminal charges against the owners and executives of four car washes in the Hollywood area, alleging multiple violations of labor laws. The 176-count criminal complaint against car wash owners Benny and Nissan Pirian, and manager Manuel Reyes alleges that workers were paid below state and federal minimum wage levels, not paid for overtime, and discouraged from taking meal and rest breaks. Owners and managers also are accused of routinely harassing employees who were trying to form a union.
STEAMING UP: Southern California Edison signed contracts with Google-backed startup BrightSource Energy Inc. for the supply of 1,300 megawatts of clean solar thermal power. The companies claim the agreement is the world's largest solar deal. Edison, a unit of Rosemead-based Edison International, said the 20-year deal calls for Oakland-based BrightSource to build seven projects. The deal will require approval from the
California Public Utilities Commission.
HOSPITALS SOLD: Tenet Healthcare Corp. signed a definitive agreement to sell USC University Hospital and USC Kenneth Norris Jr. Cancer Hospital to USC for $275 million. The sale means that Dallas-based Tenet and the university will drop all lawsuits against each other. USC had filed a lawsuit seeking to terminate its relationship with Tenet and Tenet had filed a counterclaim. The parties said last year that they would negotiate a sale.
New Coverage: Anthem Blue Cross, the state's largest for-profit health insurer, has agreed to pay a $1 million fine and offer new coverage to 2,330 people it dropped after they submitted bills for expensive medical care. As part of the settlement negotiated with the California Department of Insurance, Anthem also will offer to reimburse those people for medical expenses they paid out of pocket after they were dropped. Thousand-Oaks based Anthem, a subsidiary of Indianapolis-based WellPoint Inc., estimated that those reimbursements could reach $14 million.
ZENITH LAYOFFS: Zenith National Insurance Corp. said it will cut 100 positions, the equivalent of 6 percent of its work force, in response to the economic downturn that has trickled down to its main workers' compensation business amid other companies' job cuts. The Woodland Hills-based property casualty insurer said it will take a charge of about $3.3 million in the first quarter for the reductions. The company expects cost savings of $6.5 million from the staff cuts.
WATER CONSERVATION: Water use restrictions proposed by L.A. Mayor Antonio Villaraigosa could slam local building owners, gardeners and plant nursery operators. In the most sweeping restrictions in 30 years, Villaraigosa wants to limit outdoor watering to just two days a week Monday and Thursday and sharply raise water rates when customers exceed thresholds. Violators face fines of up to $600, with water shutoffs possible after five violations. The outdoor watering restrictions would apply to residential and commercial addresses, and to most outdoor landscaping.
DISTRIBUTION DEAL: Walt Disney Studios said it has agreed to a long-term exclusive distribution deal with Steven Spielberg's DreamWorks SKG production company. The division of Burbank-based Walt Disney Co. will handle distribution and marketing for 30 live-action DreamWorks films under its Touchstone Pictures brand beginning in 2010. The deal came after Universal Pictures balked at a demand for a $250 million upfront loan to DreamWorks' principals, co-founder Spielberg and Chief Executive Stacey Snider.
MERGER UPDATE: Image Entertainment Inc. said Nyx Acquisitions Inc. made a $1.3 million payment to put its $60.2 million acquisition of Image back on track. Image, a Chatsworth home entertainment distributor, said last month that San Francisco-based Nyx was in breach of a merger agreement because it failed to make the required payment by a Jan. 20 deadline. The transaction is expected to close by Feb. 26 if shareholders approve the deal at a Feb. 24 special meeting. Image also reported third quarter net income of $304,000, compared with a net loss of $2.05 million a year ago. Revenue rose 43 percent to $39.2 million.
EARNINGS: CB Richard Ellis Group Inc. reported fourth quarter net income of $6.53 million, down 95 percent from a year ago. Revenue fell 30 percent to $1.28 billion. Lions Gate Entertainment Corp. reported a third quarter net loss of $93.4 million, compared with net income of $7.3 million a year ago. Revenue rose 8 percent to $324 million. Activision Blizzard Inc. reported a fourth quarter net loss of $72 million on revenue of $1.6 billion. This was the first full quarter of combined results since its July merger with Vivendi Games. Macerich Co. reported fourth quarter net income of $63.2 million, up 58 percent from a year ago. Funds from operations rose 39 percent to $184 million. DaVita Inc. reported fourth quarter net income of $98.4 million, up 15 percent from a year ago. Revenue rose 8 percent to $1.46 billion. DirecTV Group Inc. reported fourth quarter net income of $332 million, down 5 percent from a year ago. Sales climbed 9 percent to $5.31 billion. Mercury General Corp. reported a fourth quarter net loss of $168 million, compared with net income of $44.6 million a year ago. Net premiums earned fell 7.5 percent to $680 million. Long Beach-based Molina Healthcare Inc. reported net income of $15.5 million, down 13 percent from a year ago. Revenue rose nearly 20 percent to $812 million.
The Feb. 9 Real Estate column headlined "Developer Gives Bank Equity Stake in Property" misrepresented the financing structure the California Landmark Group used on its R1 residential project in Marina del Rey. In 2005, Corus Bank gave California Landmark a construction loan and separately the bank got an equity stake in R1 by investing in the condo project, which the developer would later split into for-rent and for-sale sections. After paying off a substantial portion of the construction loan, the developer refinanced the rental part of the property with Freddie Mac in November 2008 and used proceeds from that loan to pay off nearly the entire balance of the Corus construction loan. Corus is still an investor in the project.
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