Compiled by Julie Leupold
TOP STORIES
Shares of Irvine chipmaker Microsemi Corp. took a wild ride last week after reports that Chief Executive James J. Peterson didn’t earn degrees from Brigham Young University that appear on his resume. Peterson denied misrepresenting his education, but the school maintains it never issued him degrees. San Diego investor Barry Minkow, who has shorted Microsemi’s shares hoping to profit from their decline, first made the allegations against Peterson. The news sent Microsemi’s shares down 40% before rebounding Friday to a market value of about $1 billion after Microsemi’s board expressed support for Peterson.
In related news, Irvine chipmaker Broadcom Corp. fired senior vice president of global manufacturing Vahid Manian after Minkow said he didn’t receive a University of California, Irvine, degree as stated in his biography. Minkow said he didn’t hold a short position in Broadcom’s shares.
TECHNOLOGY
Sage Software Inc., the Irvine-based maker of business software and a unit of Britain’s Sage Group PLC, saw sales fall 17% to $987 million for the 12 months through September. It reported earnings before interest, taxes, depreciation and amortization of $173 million, down 14%. Sage said it’s set to cut some 150 jobs from its North American operations. No word on how many of them would be local.
A federal appeals court sided with Broadcom Corp. in a legal battle with Qualcomm Inc. but said a lower court went too far when it ruled two Qualcomm patents invalid. The U.S. Court of Appeals for the Federal Circuit ruled the two video patents under dispute only should be considered unenforceable as they apply to a specific digital video standard. The appellate court sent the case back to U.S. District Court for the Southern District of California in San Diego.
Aliso Viejo-based Quest Software Inc. said it’s settling a two-year probe into stock options backdating with the Securities and Exchange Commission without admitting or denying wrongdoing. Under the terms of the settlement, which is subject to final approval by the SEC, Quest won’t be sued for fraud or fined and Chairman Vinny Smith is absolved of any responsibility.
HEALTHCARE
Johnson & Johnson is paying $1.1 billion for a key rival of Allergan Inc., making Allergan and Johnson & Johnson competitors in the medical cosmetic market. The company is buying Santa Barbara-based Mentor Corp., a maker of breast implants and developer of a wrinkle remover that could compete with Allergan’s Botox. Separately, the Food and Drug Administra-tion found that a glaucoma drug from Aller-gan grows, thickens and darkens eyelashes. An FDA advisory panel approved use of bimatoprost, the active ingredient in Aller-gan’s Lumigan, for cosmetic use.
Biolase Technology Inc., an Irvine dental device maker, is finishing up a 20% reduction of its 216-person U.S. workforce in order to cut its quarterly costs by $2 million. The company said it’s also reviewing cost-saving measures at its international subsidiaries.
REAL ESTATE
Houston-based Hines Interest LP confirmed early last week it acquired 53 Southern California office buildings in a transaction valued at almost $1.4 billion after the previous owner, Mexico’s Cabi Developers LLC, was unable make loan payments. The deal includes Fountain Valley Plaza in Fountain Valley. The portfolio in Los Angeles, Orange and San Diego counties originally was bought for $1.51 billion in 2007.
A trio of existing Grubb & Ellis Co. directors appears to have been re-elected by shareholders of the Santa Ana-based real estate brokerage and investor, thwarting an attempt by former chairman Tony Thompson to rejoin the board along with two hand-picked candidates. A final tally won’t be confirmed for a few weeks, officials said.
APPAREL
The county’s two largest mall retailers saw November same-store sales plunge, though Anaheim-based Pacific Sunwear of California Inc. did better than Wall Street expected while Foothill Ranch-based Wet Seal Inc. fared worse. Pacific Sunwear saw sales at stores open at least a year fall 10% last month versus a year earlier, better than the 14.3% decline analysts were bracing for. Wet Seal saw November sales drop 13.9%. Analysts on average expected a 10.8% drop.
FINANCE
David Nathan Zahler of Huntington Beach and business partner David Tai of Hacienda Heights face four felony counts of fraud for failing to make more than $18 million in workers’ compensation insurance premium payments for employees of their temporary staffing firm. Zahler, who ran Staffing Services Inc., and Tai are scheduled to be arraigned Dec. 17. Zahler’s attorney, Ronald Ziff, said his client denies the charges and plans to plead not guilty.
JPMorgan Chase & Co. gave 60-day notice to 250 employees in and around the Irvine Washington Mutual Inc. office campus and asked 321 to stay on temporarily as part of a transition team. Those who stay on temporarily, possibly until late 2009, will get double pay. Some 1,350 employees will remain in Orange County after the cuts. JPMorgan is cutting 9,200 jobs in all. They are tied to Washington Mutual, which JPMorgan acquired Sept. 25.
ECONOMIC INDICATORS
DOWN: Consumer bankruptcies in Orange County doubled to 852 in November from a year earlier, according to the National Bankruptcy Research Center.
