Checkout.com Checks Out
Struggling Internet retailer Checkout.com said its assets will be acquired by Atlanta-based rival Amplified Inc.
The deal essentially ends the new-media marriage between former Hollywood super-agent Michael Ovitz and supermarket tycoon Ron Burkle.
Privately held Amplified Inc., which supplies hundreds of thousands of digital music tracks to Internet retailers and other customers’ Web sites, will pay an undisclosed amount of stock for the bulk of Checkout’s assets.
Checkout’s 50 employees are expected to keep their jobs, boosting Amplified’s workforce to 140. Amplified plans to use Checkout’s technologies to improve its online presence and ultimately help usher in digital downloading.
Burkle has been getting out of the dot-com world and refocusing on retail. He resigned from the board of supermarket giant Kroger Co. earlier this month and his Yucaipa Cos. investment firm disclosed that it led an investment group that purchased a 6 percent stake in Kmart Corp., worth $206 million.
Lights Out for Power Exchange
The California Power Exchange, the Pasadena-based nonprofit that served as the state’s free market with electricity deregulation, announced that it laid off 20 of its 200 employees and will soon shut its doors.
Financial problems at Southern California Edison and Pacific Gas & Electric brought on by the state’s power crisis forced the exchange to ban Edison and PG & E; from trading. Those companies represented 70 percent of overall trading volume.
The announced closure means electricity buyers will have to rely on private deals.
The exchange was created as a place where marketers of power would be hooked into buyers with hourly auctions. The state required its three largest utilities, Edison, PG & E; and San Diego Gas & Electric to buy through the exchange to prevent secret deals with wholesalers.
For some, the exchange represents the strongest case against deregulation because prices were set at the highest acceptable bid, driving up the cost and causing susceptibility to price spikes.
Amgen Wins Infringement Suit
A federal judge ruled in favor of Amgen Inc., the world’s largest biotechnology company, in a closely watched patent dispute that’s expected to impact the development of new genetically engineered drugs.
The judge found that Thousand Oaks-based Amgen proved that three of its patents covering its anti-anemia drug Epogen were “infringed” by Transkaryotic Therapies Inc. of Cambridge, Mass., and its partner, European pharmaceutical giant Aventis, which want to sell their own version of the drug.
An appeal is expected but the decision was a huge victory for Amgen. Epogen the company’s brand name for the drug erythropoietin, which treats anemia in patients with kidney failure accounts for nearly half of the company’s $4 billion in annual sales.
The case raised the fundamental question of how broad a market a company could claim based on its genetic discoveries. Amgen had argued that if Transkaryotic won, it could use the same technology to copy virtually any biotech drug.
Transkaryotic claimed that Amgen’s patents were overly broad.
Amgen is awaiting U.S. Food and Drug Administration approval for an improved version of Epogen.
GM Must Pay $15 million for Crash
A San Bernardino County Superior Court jury ordered General Motors Corp. to pay more than $15 million to a Torrance man who became a quadriplegic in a rollover crash of a Chevy S-10 Blazer.
The verdict capped a lengthy retrial of the suit brought by 29-year-old Robbie Lambert after the accident in July 1990.
The jury ruled the Blazer was defectively designed due to the weakness of its roof, setting his damages at $25.7 million. But the panel found him 40 percent responsible for his injuries, paring the award to $15.4 million.
Lambert was 18 and an amateur hockey star at the time of the crash. He apparently fell asleep at the wheel, allowing the Blazer to drift off the highway. Lambert was wearing a safety belt, but the roof of the Blazer crushed inward in the crash, leaving him paralyzed.
Pinnacle Deal Off Table
Two affiliates of buyout firm Colony Capital of Los Angeles have ended their bid to buy casino operator Pinnacle Entertainment Inc. in a deal valued at about $1.3 billion.
Glendale-based Pinnacle said the parties involved, which had previously agreed on a Jan. 31 extension of their deadline to close the deal, mutually agreed that the merger agreement and all related transaction documents have been terminated.
Pinnacle did not say why the deal was terminated, but earlier reports indicated that Colony could not finance the deal at a favorable rate due to tightening credit for casino purchases.
Hilton Expanding in Mexico
Beverly Hills-based Hilton Hotels Corp. will provide sales, reservations and other services to Mexico’s Camino Real hotel chain, the company announced.
The 14 Camino Real hotels covered in the agreement will be included in Hilton’s frequent guest rewards program and will eventually adopt either the Hilton or Doubletree name once the Mexican chain’s owner, Grupo Empresarial Angeles, spends more than $40 million to upgrade hotel facilities.
The 359-room Camino Real in El Paso, the only American property included in the agreement, will be converted to a Hilton in April.
Grupo Empresarial Angeles will eventually become a Hilton franchisee under the agreement. Hilton currently operates nine hotels in Mexico and has five under development.
L.A., State Reach Accord on Port
The city of Los Angeles will repay the Port of Los Angeles $62 million that state officials alleged was improperly diverted to pay for municipal services and projects unrelated to the port.
Ending its 1996 lawsuit against the city, the State Lands Commission unanimously approved the settlement after more than 18 months of negotiations between state and port attorneys. The Los Angeles City Council and Mayor Richard Riordan signed off on the terms.
By law, the city may charge for certain services performed in the port but may not use the port to subsidize services beyond that area.
State and city officials contend the agreement should provide other port cities in California guidance about what harbor revenue can be used for.
Under the agreement, the city admitted no wrongdoing, but must repay the port about $62 million over the next 15 years in cash or credits against the bills the city sends the port for future services. The city is allowed to charge the port 100 percent for fireboats and 75 percent of the costs of providing other fire and emergency medical services in the harbor district.
The settlement also states that the city can bill for a variety of other services, including administrative overhead if it relates to the port, and park facilities that are either on or near harbor property. However, city officials can no longer charge the port for costs related to the L.A. Convention Center or Drum Barracks and the Banning Museum in Wilmington.
Toolmaker Sued by Rival
Pomona-based Forgecraft is facing a suit by Estwing Manufacturing Co. to stop it from selling tools similar to that company’s “Blue Grip” line.
Filed in Chicago, the federal suit accuses Forgecraft of making tools that are substantially identical in appearance to Estwing’s. Forgecraft also does business as Cal-Rainbow Products Inc.
Forgecraft has affixed Estwing’s Blue Grip trademark to its hammers in a manner that duplicates the appearance of Estwing’s hand tools, officials of the Rockford, Ill.-based company claim.
Estwing designs and manufactures hammers, axes, pry bars and other tools.
