California Inc.: Billions in bets being placed on the big game
Welcome to California Inc., the weekly newsletter of the L.A. Times Business Section.
I’m Business columnist David Lazarus, and here’s a rundown of upcoming stories this week and the highlights of last week.
Investors this week will be grappling with increasingly loud talk of another recession coming down the pike. On Friday we learned from the Commerce Department that the U.S. economy slowed sharply at the end of last year, expanding at an anemic 0.7% annual pace.
Relativity Media: Film and television studio Relativity Media, the Beverly Hills-based company that declared bankruptcy last year, will face a key court hearing Monday as it works to regain its financial footing. Relativity founder Ryan Kavanaugh hopes Judge Michael E. Wiles will use the hearing to confirm the company’s plan to emerge from bankruptcy protection. In early January, Relativity announced that “House of Cards” star Kevin Spacey and his production partner would join the company as investors and executives.
Financial reports: After some disappointing revenue figures from Apple last week, investors are bracing themselves for a week full of earnings from key California companies. First up on Monday will be financials from the new Google parent company Alphabet (based in Mountain View) as well as Mattel (El Segundo). On Tuesday, Yahoo (Sunnyvale) will announce its earnings, followed on Wednesday by Twitter (San Francisco) and CBRE Group (Los Angeles). LinkedIn (Sunnyvale) gets its turn on Thursday.
Madoff movie: Those who want to relive one of the greatest scams of all-time might be interested in the ABC miniseries “Madoff” that will air Wednesday and Thursday. Richard Dreyfuss stars as Bernie Madoff, the New York financier who bilked investors out of billions of dollars via a massive Ponzi scheme. Blythe Danner portrays Madoff’s wife, Ruth. Fifteen people either pleaded guilty or were convicted at trial for their role in the scheme. In 2009, Madoff was sentenced to 150 years in prison.
Oil by rail: A proposal by Phillips 66 to bring crude oil by train to its seaside refinery in Santa Maria will be aired before the San Luis Obispo County Planning Commission on Thursday and Friday. Philips wants to bring the oil to the refinery up to 250 times a year on 80-car trains that would come from both Northern and Southern California. San Luis Obispo planning staff members have recommended that the proposal be turned down, citing the possibility of accidents and spills, and “toxic air emissions.”
Jobs numbers: The Labor Department on Friday releases its report on job growth and unemployment in January — the first key indicator of whether the recent financial market turmoil is harming the U.S. economy. Analysts expect the economy added a solid 210,000 net new jobs, although that would be down from December’s 292,000 figure. The unemployment rate is expected to hold steady at 5%.
Monday’s Business section rolls the dice on all the betting expected for Super Bowl Sunday. Millions of people will put money on the game — even if they don’t care about football. A minority will gamble legally at Nevada’s casinos but most will make friendly, if often illegal, wagers at their workplace, corner bar or Super Bowl house party. Add it up and Americans will spend at least $4.2 billion betting on the Super Bowl this year, the American Gaming Assn. estimates.
Here are some of the other stories that ran in The Times Business section in recent days that we’re continuing to follow:
Solar power: California utility regulators narrowly passed new rules for compensating owners of rooftop solar systems, delivering a win to the solar industry that will help shape the state’s future energy policy. The California Public Utilities Commission, on a 3-2 vote, approved increased fees for rooftop solar owners but stopped short of the even higher charges that the state’s investor-owned utilities wanted. Bernadette Del Chiaro, executive director of the California Solar Energy Industries Assn., called the vote “a historic moment for rooftop solar.”
You look marvelous: Barbie just got several makeovers at once. Mattel, in an effort to boost its slumping sales by diversifying the look of its classic doll, is rolling out Barbies with three new body types and an array of complexions. Dolls with the new body types — tall, curvy and petite — are now available for order. Barbies coming out this year also include seven skin tones, 22 eye colors and 24 hairstyles. The move is part of Mattel’s efforts to revive Barbie’s popularity. The doll brand’s slowing sales have dragged down the El Segundo toy maker’s performance.
Mammoth deal: “The Flying Tomato” has gone from carving the slopes to owning them. Olympic gold medal snowboarder Shaun White has taken a minority stake in the company that runs Mammoth Mountain and recently spent $38 million to buy Snow Summit and Bear Mountain, the Southern California resorts where he perfected his ollies, rail slides and back flips. As a part owner of Mammoth Resorts, White will help oversee the operation of more than 4,000 acres of skiable land in California, visited by more than 2 million skiers and snowboarders each year.
Fresh start: American Apparel Inc. is poised to exit bankruptcy without mercurial founder Dov Charney. A U.S. Bankruptcy Court judge approved the L.A. clothier’s plan to reorganize and repay its creditors, officially ending Charney’s reign by rendering his large ownership stake worthless. American Apparel will instead be taken private, with control going to its largest bondholders likely early in February. Chief Executive Paula Schneider said the company will push ahead with its turnaround plan to cut costs and refocus design efforts while preserving its U.S. manufacturing operations.
DeVry lawsuit: The U.S. Federal Trade Commission filed suit against the operators of DeVry University, alleging that the for-profit education group misled students about their job prospects and potential earnings after graduation. The suit focuses on two claims DeVry made in advertisements on television, radio and social media: that 90% of graduates seeking employment got jobs in their fields within six months and that students’ incomes a year after graduation were 15% higher than the average of all other college graduates. The complaint, filed in federal court in Southern California, alleges those claims are “false and unsubstantiated.”
WHAT WE’RE READING
And some recent stories from other publications that caught our eye:
Wait here: Getting ready to fly? Condé Nast Traveler looks at the best and worst TSA checkpoints nationwide. Best wait times: Tampa (11.4 minutes), Fort Lauderdale (12.3), San Diego (12.5), Detroit (12.6) and Portland (12.8). Worst wait time: JFK (16.8 minutes).
Heavy: Car magazine could barely contain its glee when it learned that Delorean Motor Co. will restart production of the classic stainless-steel-bodied DMC-12 — a replica of the one that traveled through time in “Back to the Future.” Estimated cost: About $100,000.
Google this: A New York Times reporter found that it’s no picnic trying to interview Google co-founder Larry Page. “I can tell you from experience that it is really awkward and emasculating to try to interview someone who doesn’t want to talk. You feel like a big dork.”
G.I. Joystick: Donald Rumsfeld — yes, that Donald Rumsfeld — says he’s done business, he’s done politics, he’s done the whole go-to-war thing. Now, Rumsfeld, 83, declares on Medium.com, he’s working with a team of developers to create a mobile gaming app. Seriously.
Big news: The long and the short of it from our friends at GQ. “An enterprising L.A. surgeon has invented a silicone penis implant, which, because we’re sure you have a friend who’ll want to know, costs 13 grand and can nearly double your size.”
Did someone say Super Bowl? The Chicago Bears dropped the mic in 1985 with their “Super Bowl Shuffle.”
For the latest money news, go to www.latimes.com/business. Until next time, I’ll see you in the Business section.
Your guide to our clean energy future
Get our Boiling Point newsletter for the latest on the power sector, water wars and more — and what they mean for California.
You may occasionally receive promotional content from the Los Angeles Times.