Burst Pipes Erupt Into Legal Woes

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A plethora of reclaimed wood makes Detroit a gold mine of materials for artists, craftspeople, PAGE 17 MARCH 21-27, 2016 NAFTA fears rise again in primary

By Dustin Walsh [email protected] The state presidential primary showed that Michigan’s working class hasn’t lost its leeriness of free trade in the 22 years since President Bill Clinton signed the North American Free Trade Agreement. Where And as the presidential election season heats up, so they has the angst against poten- stand tial ill effects of globalization Candidates’ and free trade, such as job positions on displacement, as this region trade, Page 21 tries to re-establish itself as a manufacturing power. MICHAEL LEWIS II Those worries were a winning issue for candidates Bernie Sanders and Don- ald Trump, both free-trade critics, in Michigan. But are the worries legitimate? Burst pipes erupt into legal woes Even local economists and experts don’t agree on whether free trade and increased imports and exports have been good or bad over- By Kirk Pinho nomic Development Corp., a mortgage all for Michigan’s economy and residents. [email protected] Roberts Riverwalk Hotel holder on the property, the entities are But they do agree on this: The fear is real, It was a brutally cold day — Jan. 7, faces insurance owed more than $1.3 million. Ask and it’s had a real impact on politics. 2014, during the depths of that winter’s Roberts, and he says he owes far less “Free trade has now become the boogey- polar vortex, with wind chills dropping to settlement dispute than that because Signal performed man of populist sentiment,” said Don Grimes, 40 degrees below zero — when taxed work that was “unnecessary, redundant economist and senior research associate of the water pipes in the Roberts Riverwalk Hotel That much isn’t in dispute. But just or excessive,” according to his formal re- Institute for Research on Labor, Employment along the Detroit River began to expand. how much Signal Restoration is owed for sponse to a lawsuit in Wayne County Cir- and the Economy at the University of Michigan. The pressure mounted. Pipes burst. its work is; the broken pipes are emblem- cuit Court. “The people are mad over free trade, and So Michael Roberts, the property’s atic of a number of challenges now fac- “The only thing they were asked to do there’s been an increase in anxiety.” owner since 2010, called Signal Restora- ing the site — and Roberts — involving is fix a few pipes, plumbing repairs, that’s Grimes said free trade has raised the stan- tion Services LLC, the property repair creditors, lenders, and lawsuits. it,” Roberts said last week. dards of living locally and nationally, increased company with offices nationwide. If you ask Signal and the Detroit Eco- SEE HOTEL, PAGE 22 SEE NAFTA, PAGE 21

“It’s a tragedy he was so successful.” FormerYpsilanti Mayor Cheryl Farmer,who battled James Olsafsky over an adult bookstore Court fights,changing trends dethrone one-time peep show prince

By Robert Snell Court records and interviews Ideas or Front Page. ever, are revealed in a series of state [email protected] portray Plymouth Township resi- Olsafsky, who once reaped a profit and federal court filings — including The peep show prince of metro dent James Olsafsky as a publicity- of about $3 million a year from the a November federal lawsuit filed by a Detroit’s empire is crumbling follow- shy porn titan clinging to a shrink- chain, recently lost a stake in 19 stores peep-show repairman — that offer ing costly legal fights, a government ing corner of the U.S. adult across the South following a fight with insight into the life and career of a crackdown and the flood of free In- entertainment industry. partners. The full scope of Olsafsky’s controversial figure. This Hazel Park shop is one of dozens of ternet pornography, which have In recent years, Olsafsky had ties current and former business holdings The filings show a businessman adult bookstores tied to Plymouth drained millions from the lifestyle of to a network of about 40 adult book- is unclear, however, because his fi- saddled with a multimillion-dollar Township’s James Olsafsky. a little-known entrepreneur. stores and distribution companies nancial interests are a maze of limited court judgment amid a fundamen- stretching from the West Coast to liability companies and some ven- tal shift to online pornography in © Entire contents copyright 2016 Rhode Island and including five in tures held in relatives’ names. the 30 years since Olsafsky, now 67, by Crain Communications Inc. All rights reserved. metro Detroit named either Intimate Cracks in Olsafsky’s empire, how- SEE PEEP, PAGE 24 crainsdetroit.com Vol. 32 No 12 $2 a copy. $59 a year.

Keeping automotiveve

NEWSPAPER suppliers ahead of the curve 20160321-NEWS--0002-NAT-CCI-CD_-- 3/18/2016 3:32 PM Page 1

2 CRAIN’S DETROIT BUSINESS // MARCH 21, 2016

reported. The new Funland Farm is ments that could cost more than $26 MICHIGAN intended to bring back memories of million. The Jackson Citizen Patriot INSIDE the park’s Deer Park Funland origins. reports the recommendations are THIS ISSUE The park also plans to interact from SmithGroupJJR.The plan in- BANKRUPTCIES ...... 7 DEALS & DETAILS ...... 18 with fans on social media. Special cludes construction of a 25,000- to CALENDAR ...... 18 throwback Thursdays will be fea- 30,000-square-foot, $7.5 million CLASSIFIED ADS ...... 21 tured on its Facebook page show- event center on the Grand River; OPINION ...... 6 BRIEFS casing images from the park’s histo- more than $1.3 million in utilities OTHER VOICES ...... 6 ry and encouraging guests to share and infrastructure upgrades; and PEOPLE ...... 20 Snyder takes hits in Flint knowledged that a state law, which memories on Instagram. adding new barns, a horse arena RUMBLINGS ...... 26 water hearing in D.C. allows state-appointed officials to Michigan’s Adventure opens for and livestock facilities for about WEEK ON THE WEB ...... 26 take control of troubled municipali- the season Memorial Day Weekend. $7.5 million. Gov. Rick Snyder last week ties, failed in Flint. Several Democ- It is owned and operated by San- Ⅲ A property development com- blamed career bureaucrats in rats on the House Oversight and dusky, Ohio-based Cedar Fair Enter- pany plans to spend $10 million to COMPANY INDEX: Washington and his own state for Government Reform Committee tainment Co., which runs 15 amuse- transform a former foundry build- SEE PAGE 25 the Flint water contamination cri- called for Snyder to resign; Utah Rep. ment and water parks and five ing just east of downtown Kalama- sis, while the head of the federal En- Jason Chaffetz, the oversight panel’s hotels. zoo into a campus-like office space vironmental Protection Agency fault- chairman, and other Republicans with on-site dining, the Kalamazoo proved the consumption of beer ed him and other Michigan said McCarthy should step down. MICH-CELLANEOUS Gazette reported. Kalamazoo-based and wine while pedaling, she’s hop- officials. Snyder told lawmakers that offi- developer Treystar plans to convert ing to break the 200-trip mark for At a contentious congressional cials at the Michigan Department of Ⅲ The Food and Drug Administra- the 78,000-square-foot building for the year. She’s considering bringing hearing Thursday, the Republican Environmental Quality repeatedly as- tion expanded approval of a drug office and other uses and says the another trolley to Bay City, and is in governor repeatedly apologized for sured him that water being piped in from Pfizer, which has a manufac- project will attract 100 jobs. talks about expanding her business his role in the crisis, which occurred from the Flint River was safe, when turing facility in Kalamazoo,to treat Ⅲ After a debut season that saw into Frankenmuth and Midland. when state officials switched Flint’s in reality it had dangerous levels of a small subset of lung cancer pa- nearly 200 rides throughout down- Ⅲ Byron Township grocer Spar- water supply to the Flint River two lead. Darnell Earley, Flint’s former tients with a rare mutation, AP re- town Bay City, the Sunrise Pedal Trol- tanNash tapped Chris Meyers as its years ago to save money, The Asso- emergency manager, said at the ported. The agency said Xalkori ley is kicking off its sophomore sea- new CFO, effective April 11, the ciated Press reported. hearing that he was overwhelmed capsules are now approved for pa- son with big plans for expansion, Grand Rapids Press reported. At EPA Administrator Gina Mc- by challenges facing the city and re- tients with the ROS-1 gene muta- the Bay City Times reported. Ashley Naperville, Ill.-based KeHE Distribu- Carthy faulted state officials, noting lied on experts from the MDEQ and tion, who make up about 1 percent Anderson, owner of Bay City’s pedal tors, Meyers was CFO of North that the impoverished city was EPA to advise him. of U.S. patients with non-small cell trolley, had 24 tours booked as of America’s second-largest natural under state management when its lung cancer, the most common last week, and after the state ap- and organic wholesaler. Ⅲ water supply was switched in April Michigan’s Adventure marks form of the disease. The twice-a- 2014. State officials did not require 60th season with new fare day drug is part of a new generation Correction that the river water be treated for of medications that fight disease by corrosion, and lead from aging Michigan’s Adventure is returning targeting specific genes found in Ⅲ A story on Page 8 of the March 14 issue should have said Cedric pipes and fixtures leached into Flint to its roots. To commemorate the certain patients. Turnbore, who was recently promoted to director of operations by Cobo homes and businesses. Muskegon County park’s 60th an- Ⅲ A master plan for the Jackson Center management company SMG, is a 26-year veteran of the hospitali- The nearly four-hour hearing pro- niversary, West Michigan’s largest County Fairgrounds calls for a new ty industry rather than SMG. He has been with SMG, holding manage- duced no major revelations, al- tourism attraction will be opening a event center, removal of a harness ment positions at Cobo, for the past six years. though Snyder for the first time ac- petting farm this season, MLive.com racing track and other improve-

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CRAIN’S DETROIT BUSINESS // MARCH 21, 2016 3 PACE PURE CONFUSION? paves path

Revamp of state travel website aims to put tourists on right road to energy

By Lindsay VanHulle given limited time).” Crain’s Detroit Business/Bridge Magazine This is a problem for LANSING — In the midst of state tourism promoters. efficiency launching new TV ads encour- After years of false starts aging Michigan tourists to try and trying to resolve prob- Creative financing method Michigan craft beer or restau- lems on Michigan.org with rants that specialize in farm-to- patches and tweaks, Travel less known, underused table meals, the state is falling Michigan, the state’s tourism short with some basic func- division, plans a full re- By Jay Greene tionality of the trip-planning design of what is believed to [email protected] feature of its official travel be a decade-old website Powers Distributing Inc. in Orion Township website. before the end of the has saved an average of $2,000 per month Namely, vacationers year. Improving navi- on electricity by installing a rooftop solar who want to use Michi- gation and content panel array and investing in LED lighting gan.org as a detailed plan- will be priorities. and other energy-efficient technologies, ning tool can’t accurately gauge distances between at- The Michigan Strategic Fund board last month award- said Gary Thompson, COO of Powers. tractions or relate to area accommodations. ed a $390,000 contract to Sarasota, Fla.-based Miles Powers also tapped into an underused fi- “I am trying to determine distances from (The) Henry Media LLP for the website project. The company plans nancing mechanism to fund renewable en- Ford and Greenfield Village to a campground,” wrote one to incorporate more photos and videos, personalized ergy and efficiency projects — the Property prospective tourist. “I could not tell where these attrac- content, social media and trip-planning tools as part Assessed Clean Energy program, or PACE. tions were in relation to any of the campgrounds that of a site that is responsive to both desktop and mo- “PACE is designed so that the energy sav- displayed.” bile users. ings generate the funds to make the bank “Sometimes the interactive maps are harder to Today, “it’s just not a very usable, intuitive site,” said payments, which the township collects navigate,” wrote another. “I needed something that Dave Lorenz, Travel Michigan’s vice president, adding through our property taxes,” Thompson showed area-to-area or city-to-city and how close that many people instead seek out regional convention said. “It is cash flow positive and encourages they were (with the goal of planning to do things in and visitors bureau websites to find the information people to make sustainable improvements.” two locations if they were close enough to each other, SEE TRAVEL, PAGE 22 Thompson said PACE has allowed Powers Distributing to extend its bank payments over 20 years, reducing monthly payments and giving the beer distributor greater cash flow to fund other projects. For example, Powers Distributing is considering whether to add up to 25,000 additional square feet of solar panels to a second building sometime in the future, he said. As the price of electricity goes up and companies look to reduce their carbon footprint for public health reasons, a growing number A Pure Michigan moment: the sun rising over are looking into projects like solar and wind Traverse City’s West Grand Traverse Bay. energy or energy-efficiency technologies. ALISON GOSS/TRAVEL MICHIGAN From 2013 to 2015, Powers added more than 16,000 square feet of solar panels to its SEE PACE, PAGE 23 MUST New fast-casual restaurants to offer ‘chicken with attitude’ READS Atomic Chicken landing Shop in Detroit’s West Village during looking to put their new restaurants mer Popeyes Louisiana Kitchen loca- OF THE WEEK the fourth quarter of this year. in former chicken joints. tion in Detroit’s New Center at in New Center, Clawson The trio is investing and financing Baldridge had been eyeing the Woodward and Milwaukee avenues, about $500,000 to get the two Atomic former Faym-Us Chicken and Seafood one block off the last M-1 Rail stop, for By Sherri Welch Chicken restaurants off the ground. restaurant on South Main Street his chicken and waffles restaurant. [email protected] The restaurants are expected to cre- north of 14 Mile Road in Clawson. The two separately mentioned A trio with deep local restaurant ate about 50 jobs, combined. Reyner was looking to lease a for- SEE CHICKEN, PAGE 25 pedigrees plans to launch a fast-ca- The fried chicken will come in a sual fried chicken startup this number of varieties, ranging from spring with not one but two loca- buttermilk and “smokin’ hot” to tions — the first in Clawson in April panko-crusted Japanese. Some op- and the second in Detroit’s New tions will include sriracha or ginger Center area later this spring. soy glazes. They’ll be dished up with Hospital turnaround? Atomic Chicken will offer customers sides including smashed sweet pota- Family investors seek to buy Doctors “chef-driven” varieties of fried chicken toes with Michigan maple and car- Hospital out of bankruptcy; old name of and waffles, fried chicken sandwiches damom, black-eyed peas with bacon, Pontiac General goes back on building, and smothered chicken over biscuits. gorgonzola mac and cheese, sweet Page 9 Teaming up on the new restaurant vinegar slaw and cinnamon apples. are Scott Moloney, owner of Treat For dessert, patrons will be able Dreams in Ferndale and Woodpile BBQ to choose from homemade pud- Newspaper talks Shack in Clawson; Matt Baldridge, dings in butterscotch, banana vanil- With no talks set until the end of the former chef at the Rattlesnake Club la and Faygo Rock ’n Rye. month, News and Free Press journalists and Cliff Bell’s and executive chef at Independent of one another, are expected to be without a contract for the former Seldom Blues; and Café Baldridge and Reyner had each JANNA COUMOUNDOUROS, LILACPOP STUDIO the first time since 1995 strike, Page 8 Muse chef and owner Greg Reyner, been considering a chicken and The fiberglass chicken will remain atop the old Faym-Us Chicken and Seafood in who also plans to open Geiger Eat waffles concept. And both were Clawson as it becomes one of two Atomic Chicken locations. 20160321-NEWS--0004-NAT-CCI-CD_-- 3/18/2016 3:18 PM Page 1

4 CRAIN’S DETROIT BUSINESS // MARCH 21, 2016 MSX acquires Australian Intellectual Property | Litigation | Technology

firm,adds to Transactional experience on par global reach with the major Silicon Valley law firms. By Sherri Welch [email protected] – BRAD KANCIGOR,KANCIGOR, ASSOCIATEASSOCIATE GC Synopsys,Synopsys, IncInc Detroit-based MSX International has acquired Australia-based Sewells Group, creating what the companies say will be the largest YOUNG BASILE. global provider of business process Strategic advisors to the world’s and training services to automotive dealerships. most innovative companies. Terms of the deal, which closed last week, were not released. ANN ARBOR TROY SILICON VALLEY CHICAGO Sewells, which operates in the Asia-Pacific, Middle East and Asian www.youngbasile.com markets, will operate as a subsidiary of MSX, retaining its 500 employees. It will add $50 million in revenue to MSX’s $600 million in annual revenue, MSX CEO Fred Minturn said. As a result of the deal, MSX will have 6,000 employees and operations in 80 countries. Automakers are looking to A Fee-Only Wealth Management Group contract with suppliers that can serve their needs worldwide, Minturn said. “Together with our strong operations in North America and Europe, Michigan’s #1 Financial Advisor Sewells Group provides us with di- versified and truly international opportunities to enhance value cre- ation for our combined customer base,” he said. Currently, MSX operates in the &KDUOHV&=KDQJ U.S., United Kingdom, Eastern &)30%$06)6&K)&&/8 Europe, France, Germany, Brazil, 0DQDJLQJ3DUWQHU United Arab Emirates, Australia and China. 2QHRIWKH1DWLRQ熎V7RS1$3)$5HJLVWHUHG The addition of Sewells will in- )HH2QO\)LQDQFLDO$GYLVRUV crease its presence in the Asia-Pacif- ic, Africa and Middle East regions and its business with automakers there, including Ford Motor Co., Gen- eral Motors Co. and Volkswagen AG, Minturn said. Sewells, which Minturn said has a strong management team, has We Uphold a Fiduciary Standard been in those regions a lot longer and is very mature there, he said. Together, MSX and Sewells will 犇犆犇:HVW%LJ%HDYHU5RDG offer complementary services for 70th TheKey to your 犇犊WK)ORRU Anniversay your next successful customers, Minturn said. 7UR\0,犊犎犆犎犊 Commercial CONSTRUCTION Automakers contract MSX to im- Industrial project depends on prove automotive dealer perform- 犈犊犎犌犎犍犇犈犋犎RU 犎犎犎犍犍犍犆犇犈犌 the Company YOU select. ance through business process out- Large Residential sourcing and training in the service Explore your options... and parts areas. Sewells also offers business man- www.zhangfinancial.com agement and operational efficiency services, but its dealership training is in sales and marketing. And it $VVHWVXQGHUFXVWRG\RI/3/)LQDQFLDODQG7'$PHULWUDGH D.J. MALTESE provides business intelligence data analytics to help dealerships better $VUHSRUWHGLQ%DUURQ犑V0DUFK犋犈犆犇犌5DQNLQJVEDVHGRQDVVHWVXQGHUPDQDJHPHQWUHYHQXH Construction Corporation JHQHUDWHGIRUWKHDGYLVRUV犑ILUPVTXDOLW\RISUDFWLFHVDQGRWKHUIDFWRUV $VUHSRUWHGLQ run their business, Minturn said, %DUURQ犑V$XJXVW犈犊犈犆犇犋7KHUDQNLQJUHIOHFWVWKHYROXPHRIDVVHWVRYHUVHHQE\WKHDGYLVRUV DQGWKHLUWHDPVUHYHQXHVJHQHUDWHGIRUWKHILUPVDQGWKHTXDOLW\RIWKHDGYLVRUV犑SUDFWLFHV noting that’s an area MSX has been 1$3)$5HJLVWHUHGVWDWXVUHSRUWHGDVRI6HSWHPEHU犇犎犈犆犇犋RQZZZQDSIDRUJ Architectural Quality Since 1946 wanting to enter. The two companies will now have cross-selling op- 0LQLPXPLQYHVWPHQWUHTXLUHPHQW犇犆犆犆犆犆犆 portunities with customers, he said. Automakers “are always looking ...Buy right the first time! 412 N. Main Street, Plymouth, MI 48170 to minimize the number of suppli- CALL TODAY 734-737-0500 ers they have to deal with,” Minturn Excellence in Construction Services and Craftsmanship, said. “This gives them one-stop GET CONNECTED “SIX DEGREES” a family tradition since 1946 shopping for all of their retail network needs.” Ⅲ DETROIT STYLE www.djmaltese.com Sherri Welch: (313) 446-1694 Try it now at crainsdetroit.com/mostconnected Twitter: @SherriWelch 20160321-NEWS--0005-NAT-CCI-CD_-- 3/18/2016 4:32 PM Page 1

CRAIN’S DETROIT BUSINESS // MARCH 21, 2016 5 Industrial,Stevens buildings sell to JV

By Kirk Pinho Mike Duggan’s goal of having at least million The Griswold apartment de- [email protected] 20 percent of the new multifamily velopment, which is under con- A pair of downtown affordable housing units in the city being re- struction for 80 new units on top of senior housing buildings will reserved for low-income renters. an existing 10-story building at main that way even after being ac- “This is a signature project, and Washington and Michigan Avenue. quired by a joint venture between we are looking forward to the oppor- Invest Detroit is also a financer of Detroit-based developer The Rox- tunity to work with the new stew- that project and provided financing bury Group and Invest Detroit. ards of these properties,” Arthur on the $94.5 million David Whitney Totaling 165 units, the deal to buy Jemison, the city’s director of hous- redevelopment project. the Industrial State Bank Building and ing and revitalization, said in a state- Renovations to the Industrial and the Stevens Building north and south ment. Stevens buildings, which were con- of Grand River Avenue on Washing- Southfield-based Fourmidable verted into Section 8 housing in the ton Boulevard closed Thursday, ac- Group, which owns and manages early 1980s, are expected to be fi- cording to the buyers. the Himelhoch Building, will man- nanced at least in part with federal Previously owned by Gilbert age the Industrial and Stevens low-income housing tax credits. Ⅲ KIRK PINHO COSTAR GROUP “Buzz” Silverman, the early 20th cen- buildings. Fourmidable will also be Kirk Pinho: (313) 446-0412 The Industrial State Bank Building (left) and the Stevens Building, which serve as tury buildings are expected to under- property manager for Roxbury’s $24 Twitter: @kirkpinhoCDB senior housing in Detroit, were acquired by a joint venture last week. go about $10 million in improvements to individual units, common areas and building systems, said David Di Rita, principal of Roxbury. There are 127 units in the Indus- trial building, which stands 22 stories at the northeast corner of Wash- ington and Grand River and was designed by architect Louis Kamper, who designed the Book-Cadillac Hotel, the Book Tower and Broderick Tower. It is expected to be renamed the Louis Kamper Building. The Stevens Building is the smaller and older of the pair, standing six stories on the southeast corner of Washington and Grand River. It was built in the 1900s and has 38 units. There are no plans to rename it. The two buildings, which sold for an undisclosed price, are nearly fully occupied. Stacy Fox, fellow principal of Rox- bury, said that although the deal wasn’t in her company’s “strike zone” — these are the first buildings entire- ly for affordable housing owned by Roxbury — they “felt this is an im- REL ABLE portant complement to what we are doing in the west district.” “We knew and felt that if we didn’t step in and get these properties under control, they could well go the way other Section 8 properties have gone, which is market rate,” she said. “It was important to maintain them for their intended use. I really believe in that mission and really look forward to raising the quality of life for these residents by upgrading these properties.” They were put up for sale about a year ago. According to the buyers, aside from the Industrial and Stevens buildings, there are only two other downtown Section 8 buildings: the Himelhoch Building, next to Roxbury’s David Whitney Building redevelopment and across Woodward from the Broderick Tower, and the 114- unit Washington Boulevard Apart- You rely on your employees. The feeling is mutual. ments, owned by Silverman next to the Westin Book-Cadillac Hotel. At Aflac, we know the most important ingredient to your success is your employees Fox said an offer was made on the performing at their best. Which is why we help with costs not covered by major medical Washington Boulevard apartments, insurance and pay employees directly. And with One Day Pay,SM we make it a priority but that property “fell out of the deal.” to pay claims as fast as possible — in 2015, Aflac paid 1.2 million One Day PaySM claims. “Given the scarcity of available See what Aflac can properties in the area and rising Give the people you depend on, something they can depend on. property values and rents, it is criti- do for your business at aflac.com/reliable cally important that these remaining affordable properties be protected and improved,” David Blaszkiewicz, *Aflac pays policyholders directly, unless otherwise assigned. **One Day PaySM available for most properly documented, individual claims submitted online through Aflac SmartClaim® by 3 p.m. ET. Aflac SmartClaim® not available on the following: Disability, Life, Vision, Dental, Medicare Supplement, Long-Term Care/Home Health Care, Aflac Plus Rider, Specified Disease Rider and Group president and CEO of gap-financing policies. Aflac processes most other claims in about four days. Processing time is based on business days after all required documentation needed to render a decision is received and no provider Invest Detroit, said in a further validation and/or research is required. Individual Company Statistic, 2015. Individual coverage is underwritten by American Family Life Assurance Company of Columbus. In New York, individual coverage is underwritten by American Family Life Assurance Company of New York. Worldwide Headquarters | 1932 Wynnton Road I Columbus, GA 31999. statement. Z160117BR1 3/16 Keeping the buildings as affordable housing aligns well with Mayor 20160321-NEWS--0006-NAT-CCI-CD_-- 3/18/2016 4:04 PM Page 1

6 CRAIN’S DETROIT BUSINESS // MARCH 21, 2016 CRAIN’S DETROIT BUSINESS Nonprofits would benefit from OPINION more volunteer biz leadership ne of metro Detroit’s most 2015 — 37 percent vs. 32.8 percent oimportant corporate donors statewide. recently have been moving in There is no doubt that a return to Trade isn’t job loss interesting new directions. pre-recession corporate giving lev- According to Crain’s, Delta will els would be extremely beneficial to more than double the amount it many organizations. A return to an gives back to communities world- older style of corporate volunteer wide in the coming year and plans involvement, however, might be culprit,technology is to contribute 1 percent of its previ- OTHER VOICES: even more helpful. Specifically, a ous-year net income to charitable Michael Montgomery return to more senior business onald Trump has made free trade the fall guy in this organizations in its target markets leaders playing active volunteer year’s presidential election. Tapping the angst and fi- and hub cities. The DTE Energy Michael Montgomery is a principal in leadership roles at nonprofits, in- Dnancial insecurity of voters has catapulted him to the Foundation made $15 million in Montgomery Consulting, a Huntington cluding serving on boards and leadhead of the Republican pack. grants during 2015, the most in its Woods-based fundraising and nonprof- ing fundraising campaigns. That it management consulting firm. But if you want to blame job losses on something or some- history and a 25 percent increase model for corporate involvement over 2014. General Motors realigned served metro Detroit well for a very body, pick technology. its foundation and corporate giving — a significant proportion of local long time, and some organizations “The biggest contributor to job losses is productivity efforts to provide “sharper geo- nonprofits have not been meeting still benefit from senior executive growth, not trade,” University of Michigan economist Don graphical focus and sustained sup- their fundraising goals in recent volunteers. Grimes tells Crain’s Dustin Walsh in his Page 1 report. “With- port for its charitable and commu- years. Such involvement, however, is out free trade, you’d have a few more jobs, but only tem- nity activities.” Since 2014, our firm has periodi- now the exception. It was not al- porarily. Trade is not a negligible contributor to job losses, If other companies follow Delta cally surveyed a sample of Michigan ways that way. When I staffed the and DTE and substantially increase nonprofit organization leaders. In initial phase of Focus: Hope’s first but plays a much smaller role than productivity.” their giving, many organizations our most recent survey: campaign in 1997-2000, the cam- By productivity, economists mean things like the number across the U.S. would benefit. Ⅲ 18.78 percent of total 2015 giv- paign team included owner-opera- of auto parts produced per worker, or the number of projects According to the most recent edi- ing to the organizations we sur- tors of large enterprises, then-CEOs completed in a set time frame by a given work team. Think tion of Giving USA, corporate giving veyed came from corporations, in of the Detroit 3 and the heads of about your job today — and think about how it was done a as percentage of pretax profits was contrast to 5 percent of total nation- major banks, utilities and tier-one just 0.7 percent in 2014, the lowest wide giving coming from corpora- auto suppliers. Not surprisingly, decade ago. From the plant floor to even small businesses level since 1974. At the same time, tions, according to the most recent that team was nearly unstoppable. with fewer than 10 employees, the speed of business has ac- GM’s concern with sustainable sup- edition of Giving USA. Since then, however, very seldom celerated because of computers, software, robotics and other port might sensitize other compa- Ⅲ 32.8 percent of our statewide have that many high-level business tech and productivity improvements. nies to this critical issue facing respondents reported that their or- leaders united for any cause, let As Trump knows, it’s easier to blame politics and policies many American nonprofits. ganizations had not met their 2015 alone help a nonprofit launch its than to look at the issues more thoughtfully. Changes like those, however, might goal. first major campaign. be particularly helpful to metro De- Ⅲ Metro Detroit respondents As a result, many very good troit organizations. First, Detroit is a were even more likely to report that groups now languish without vol- major Delta hub and headquarters their groups had not made goal in unteer leadership of sufficient D.C.smackdown just rhetoric for the other stature to really companies. push their causes The Flint water blame game moved to Washington, D.C., Second, Michi- “A return to pre-recession corporate forward. Hope- last week, and nobody looked good — not the headline-seek- gan nonprofits giving levels would be extremely fully, a return to ing inquisitors on the House Oversight Committee, nor EPA are generally higher levels of more depend- beneficial to many organizations. A corporate giving Administrator Gina McCarthy. And especially not Michigan ent on corporate return to an older style of corporate will re-interest Gov. Rick Snyder. giving than non- volunteer involvement might be even more senior busi- Those calling for Snyder’s resignation are grandstanding; profits in other ness leaders to since October, the governor has been acting quickly to help areas. Third, our more helpful.” again play active fix the mess. If he were to resign, a lieutenant governor would organizations volunteer roles at need the money Michael Montgomery,principal,Montgomery Consulting nonprofits. Ⅲ succeed him, and the remediation work might slow down. Snyder told lawmakers that officials at the Michigan De- partment of Environmental Quality repeatedly assured him TALK ON THE WEB water being piped in from the Flint River was safe. In reality, the corrosive water from the river caused lead to leach from Re: Detroit workforce agency Reader responses to stories and Michigan would go to an out of- pipes and into the city’s water system. chief to lead schools foundation blogs that appeared on Crain’s state company. Doesn’t anyone at website. Comments may be edited MEDC see the irony in that? It’s a complex situation. The city bears responsibility for the outstanding choice What an to for length and clarity. John quality of the water main lines, and because of the city’s ac- lead the Detroit Public Schools tions, protective mineral coatings in the pipes were washed Foundation. Congratulations to de- Re: Willow Run driverless car away, leading to the contamination. Yet leaders at the state cision makers responsible for this troit. Pull the plug, file the bank- project gets CEO,directors and federal levels bear responsibility for enforcing water appointment. ruptcy and wipe the slate clean. Donna M. Dauphinais This is not a statewide issue. With all the open land available quality rules. William J in this state, why would they rip There is plenty of blame to go around, but the latest hear- Re: Earley testifies he was down the historic Willow Run As- ings in Washington left us with two comments: ‘grossly misled’about Flint Re: MEDC discloses details on sembly Plant just to build a test Ⅲ First, we are incredulous that Snyder hasn’t removed all bids to redesign travel website track? What a destructive waste. the key players in his Cabinet who did not elevate the Flint is- Was Earley grossly misled in the Justin Sutton outrageous and unaccept- sues more quickly. The names are made clear in the volumi- Detroit Public School system too? This is Seems like whatever he touches gets able. There were several Michigan- Re: Bed converts to wheelchair, nous emails Snyder has released. messed up. based companies that were less ex- puts nurses,docs in driver’s seat Ⅲ Second, how dare the congressional watchdogs belabor Educator57 pensive than the Florida firm they this crisis and then go on “spring break” without enacting hired. What message are they trying I loved reading about this new tech- legislation that would provide emergency funding to the very Re: Michigan House approves to send? nology, especially since I am deep people they were ostensibly serving by having the public $48.7 million for Detroit schools Rose McInerney into helping identify and provide in-home caregivers for my aging fa- smackdown last week? Once more, the out-state taxpay- This borders on unbelievable that ther (also a mechanical engineer!). Instead of political rhetoric, how about some assistance? Ⅲ er is being called upon to bail out De- the most visible effort to promote JT49 20160321-NEWS--0007-NAT-CCI-CD_-- 3/18/2016 4:15 PM Page 1

CRAIN’S DETROIT BUSINESS // MARCH 21, 2016 7 Willow Run car testing site gears up with CEO,board

By Dustin Walsh vation and potentially a curved tun- work with the Society of Automotive In May, Ann Arbor Spark was February. [email protected] nel, Maddox said. Engineers to establish voluntary awarded a nearly $250,000 grant to “It’s an out-of-the-box idea, and A CEO has been hired and a non- Vehicles will be able to travel at standards for the testing of au- develop a plan for the center at Wil- it’s very compelling when you look profit organization and board of di- speeds up to 80 mph. tonomous vehicles with hopes that low Run. The grant was awarded as at where we believe the industry is rectors formed to handle the It will also feature a large config- the National Highway Traffic Safety part of a program by the U.S. Depart- going.” $80 million development of the Wil- urable intersection and areas to Administration will look to the center ment of Commerce. Before joining UM, Maddox low Run autonomous car testing simulate urban, suburban and for guidance. The plan is to expand on the ef- served as the associate administra- site. commercial area (a mall or freight “Our prime mission of creating forts by UM, which opened its tor for vehicle safety research The American Center for Mobility, center) as well as an off-road sec- and accelerating those standards $6.5 million Mcity connected and at NHTSA. Before that, he was a located at the former General Motors tion for possible military vehicle will naturally fit with what NHTSA autonomous vehicle testing compliance officer at Volkswagen Co. Willow Run Powertrain Plant in use, he said. wants to do in the future,” Maddox grounds in Ann Arbor last year. AG. He earned a bachelor’s degree Ypsilanti Township, will be headed “MDOT is our partner here, so said. “We see an opportunity to real- from the University of Maryland by John Maddox, who will serve as we’re relying heavily on them to “If the tech is as valuable as we ly advance what Mcity has started and a master’s from the University CEO. bring clients something very realis- think it is for mobility, safety and and take that work to a much larg- of Detroit Mercy. Ⅲ Maddox previously served as the tic,” Maddox said. energy, we want to expedite those er level,” Steve Arwood, CEO Dustin Walsh: (313) 446-6042 assistant director The organization also plans to standards.” of the MEDC, told Crain’s in Twitter: @dustinpwalsh of University of Michigan Mobili- ty Transforma- tion Center and its own test site, Mcity. He will re- tain a partial appointment at John Maddox: UM, the organi- Expects center to zation said in a open by early 2018. news release. Board members for the center include Doug Rothwell, president and CEO of the Business Leaders for Michigan; Paul Krutko, president and CEO of Ann Arbor Spark; Jon Kinsey, assistance vice president for research at UM; and Huei Peng, director of UM’s Mobility Transformation Center. The center, announced by Gov. Rick Snyder during his Jan. 19 State of the State address, is expected to become a national testing and product development site for self- driving and connected cars. The 335-acre site, where Ford Motor Co. made B-24 bombers during World War II, is owned by Revi- talizing Auto Communities Environ- mental Response Trust. The nonprofit is working to take ownership of the property with the expec- tation of opening in early 2018, Maddox said. You do business where we do business. The state of Michigan is expected to provide $20 million in funding toward the project, which is a joint We should meet. initiative between the Michigan De- partment of Transportation, Michigan Economic Development Corp., Busi- ness Leaders for Michigan, UM and At Huntington we believe that a stronger business community makes the whole community stronger. Ann Arbor Spark. That’s why we work so hard to truly understand your business goals, and to deliver the insights that Maddox said the organization is working to secure the remaining can get you there. We’re proud of the place we call home, and together we can make it even better. $60 million for the build-out of the center; the design is nearly completed. The center will feature a 2.5-mile loop that will serve as a simulated highway with ramps, bridges, merge lanes, signs, changes in ele-

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8 CRAIN’S DETROIT BUSINESS // MARCH 21, 2016 Detroit newspaper labor pacts expire,but no strike expected

By Bill Shea the guild is without protections such taken unpaid furloughs. The last con- [email protected] as arbitration for disputes, he said. tract, signed in 2013, included 1 per- Journalists at Detroit’s daily news- Gannett and Free Press manage- cent raises that only some received. papers are operating without em- ment declined to talk, making it im- “We want to restore those past cuts ployment contracts for the first time possible to independently verify the now that we’re doing better,” Gal- since the devastating 1995 strike. union’s claims. lagher said. This time, Gannett isn’t The collective bargaining agree- “We do not comment on any po- claiming the newspapers are losing ments for the Detroit Free Press and tential or ongoing negotiations,” said money, Gallagher said. And because it The Detroit News expired Saturday — Aaron Velthoven, Michigan.com’s isn’t asking for wage reductions, the though nobody expects another spokesman and vice president for company isn’t making its financials strike. marketing. Michigan.com is the pub- available for the union to examine. The Newspaper Guild of Detroit Local lic-facing name used by the Detroit Crain’s has been told in the past by 34022, representing the newsrooms Media Partnership, which manages the officials familiar with the finances that of both newspapers along with those shared business functions of the the newspaper partnership in Detroit of the Observer & Eccentric papers, said newspapers under a joint operating was losing money through 2014. A se- four bargaining sessions with man- agreement. Virginia-based Gannett, ries of staff reductions, wage and ben- agement and lawyers for Gannett Co. owner of the Free Press, owns 95 per- efit cutbacks, reductions in home de- Inc. have failed to result in a new deal. cent of the partnership, while News livery, and other measures by Gannett The union said management told owner Digital First Media has the rest. in recent years have been aimed at negotiators that an extension of the They maintain separate newsrooms. cutting costs, but it’s not known if the current deal wasn’t necessary, and The guild and management joint- newspapers are currently profitable. pledged to operate under terms of ly agreed to negotiate new contracts Gannett is offering merit pay rather the contract. for the Free Press and The News along than across-the-board raises, Gal- Local union leaders are displeased with the Gannett-owned suburban lagher said. The union opposes that with that arrangement, especially be- O&E papers for the first time. The and said management told guild ne- cause the most recent contract was talks represent 232 unionized news- gotiators that it doesn’t actually have extended into March to give Gannett room personnel. an on-paper plan for merit raises. Ac- more time to ready itself for talks. Wages are the key issue, according cording to a bargaining bulletin issued “We find it to be a petty move on to union officials. by the guild to its members, 61 percent their part,” said John Gallagher, pres- Under past contracts, newsroom of staff has received a single merit raise, ident of the local newspapers guild staff has taken up to a 6.5 percent pay or none, over the past three years. and a Free Press business reporter. cut because of Gannett’s financial The union has noted that Gannett Without extending the contract, problems in Detroit. Staff also has has been spending cash in recent months: Last year, it authorized a $150 million stock buyback, and it currently Enjoy all the action from your is buying the Milwaukee-based Journal courtside seats with a Media Group for $280 million. Gannett last year spun off its more PISTONS BLACK MEMBERSHIP. lucrative digital and broadcast operations into a new company. Gannett • Highest level of beneﬁts Vision is planning retained 90-plus newspapers. The day before the company split • VIP member experiences for what was once unthinkable. in July 2015, shares of Gannett • Private event invitations (NYSE: GCI) were trading at $38. The split saw the new company’s shares LIMITED INVENTORY AVAILABLE open trading at $14 a share, and they’ve stayed in that range since. Gannett’s 2015 annual report shows that the company had $146 million in net income on $2.9 billion in total operating revenue. Those are declines from $211 million in 2014 income on $3.1 billion in revenue. Union leaders said there are no plans for work stoppages or a strike — the memory of the strike from 1995-97 that devastated both the union and the newspapers is still fresh to veteran journalists. “I don’t think anybody’s talking a strike. That was a painful period for the company and guild,” Gallagher said. T he connected car has seismically altered the automotive industry. The rules and players change daily. The legal implications seem infinite. Outside observers agree there is You need a trusted partner to navigate you through this most critical no appetite for a work stoppage. tipping point, and beyond. “Everyone in the industry understands how vulnerable the print Butzel Long has the history, expertise and global reach to stay ahead of media is,” said Henry Baskin, this new reality. Our profound understanding of what lies ahead gives founder and principal of Birming- you the confidence to shift your business into high gear. ham-based The Baskin Law Firm PC that does media work. Trust. Always. The last newspaper strike left an indelible mark on both labor and management, he said. Pistons.com/premium “No one profited from that strike. Ann Arbor • Bloomfield Hills • Detroit • Lansing • New York It was ill-conceived from both sides,” (248) 377-8477 Washington, D.C. • Alliance Offices Worldwide • 313-225-7000 butzel.com Baskin said. The next bargaining sessions are scheduled for March 31 and April 1. Ⅲ 20160321-NEWS--0009-NAT-CCI-CD_-- 3/18/2016 10:05 AM Page 1

CRAIN’S DETROIT BUSINESS // MARCH 21, 2016 9 SPECIAL REPORT: HEALTH CARE

JAY GREENE Senior Reporter [email protected] Twitter: @jayBgreene 24-year-old RECOVERY leads efforts at hospital

anyam Sharma, who will be 25 next month, is lead- Sing his family’s effort to turn around the newly renamed ROOM Pontiac General Hospital from a cumulative $73 million-plus loss Reorganization plan aims to pull the past seven years to financial success. Pontiac General out of bankruptcy “We hope to turn a $1.5 million profit this year. It will be the first profit in 15 years,” said Shar- By Jay Greene Chapter 11. ma, who was recruited by his [email protected] The bankruptcy case is still un- parents in early 2015 from Doctors Hospital of Michigan is derway with more than 700 credi- PricewaterhouseCooper’s mergers still open for business and expect- tors seeking millions in dollars of LARRY PEPLIN and acquisitions unit to run the ed to emerge from bankruptcy unpaid bills against the former Sanyam Sharma (center) is leading the effort to revive Pontiac General Hospital, family business, Infrahealth Group under new ownership — and it’s physician-owners, according to with key help from his parents, Sanjay (left) and Priyam. of Cos. newly renamed to an old name: Bloomfield Hills-based Simon PLC. “I took a significant pay cut,” Pontiac General Hospital. Unsecured creditors are expected Partners was created for the sole proached them about placing said Sharma, who graduated “We never closed,” said CEO to recover $1.6 million over four purpose of making a 35 percent in- medical students (from St. Marti- from the University of Texas in John Ponczocha, “but some people years out of the $13.2 million they vestment in the hospital and help- nus) for clerkships. They called Austin in 2011 with degrees in thought so because of the bank- claimed, court records show. ing turn it around. back in July and asked for help. economics, mathematics and ruptcy.” But last month, U.S. Bankruptcy An undisclosed amount of seed They needed us to take a minority business administration. He has Unable to turn a profit and pil- Court Judge Walter Shapero ap- funding for Sant Partners came stake and our consulting services.” interned at several larger coming up red ink that totaled more proved a reorganization plan by from Sanyam’s parents, Sanjay and Sanjay Sharma, now the hospi- panies, including Berkshire Hath- than $73 million from 2009 to Sant Partners LLC over two compet- Priyam, who own and operate In- tal’s chief information officer and away and Capital One. 2014, a small group of physician- ing groups, Save the Hospital Group frahealth and St. Martinus Universi- president of the medical school, Sharma’s parents are Priyam, owners of the hospital, legally and Allied Global Consulting. ty, a medical school on the island came to Pontiac first to evaluate who holds a master’s degree in known as Oakland Physicians Med- Founded last summer by of Curaçao. the hospital’s information technol- computer science from Florida ical Center LLC, led by board chair- Sanyam Sharma, who is executive “We heard about the hospital ogy services. He discovered major State University, and Sanjay, who man and psychiatrist Yatinder vice president of Infrahealth Group, through (a consultant) last March,” problems with the revenue cycle has a doctorate in computer sci- Singhal, M.D., last July filed for an Austin, Texas-based health care said Sanyam, Sant’s managing di- software that had led to a backlog ence from the University of Illinois bankruptcy protection under administrative services firm, Sant rector and founder. “We ap- SEE PONTIAC, PAGE 10 at Urbana-Champaign. “Dad moved to Austin to work for Dell Computers and later they started Infrahealth in our basement. It has a patented product for insurance verification and el- igibility for hospitals and physicians,” Sanyam said. “I grew up in an entrepre- neurial family, and the family business now has 400 employees, mostly in India, and serves clients across the U.S.” While his parents plan to pur- chase a house in Oakland Coun- ty, Sanyam said he will continue to rent and oversee the hospital operations until it begins to generate positive cash flows. “There aren’t a lot of things to do around here for a person my age,” Sanyam said, adding that he is still in charge of Austin- based Infrahealth. “I want to grow this business and branch out into other areas,” he said. Ⅲ

A new sign went up at Pontiac General Hospital last week, as owners focus on a turnaround.

PHOTO BY KIRK PINHO 20160321-NEWS--0010-NAT-CCI-CD_-- 3/18/2016 10:06 AM Page 1

10 CRAIN’S DETROIT BUSINESS // MARCH 21, 2016 SPECIAL REPORT: HEALTH CARE and assuming the hospital’s liabili- lion line of credit and plans to invest cited possible mismanagement, fected medical-surgical volume, ra- PONTIAC ties and $13 million in debt. $375,000 in the hospital, is its chief underutilized and noncompetitive diology, cardiology and general sur- FROM PAGE 9 Officially, the Sharmas won’t take medical officer. Jolly is a neurologist facilities for the hospital’s financial gery. There were fewer patients left of about $24 million in uncollectible ownership until the closing in mid- and investor with up to $500,000 troubles. to admit, and the losses were bills. April. Currently, Sant is considered committed. Pontiac General is licensed for 306 predictable.” “We have significantly improved by the court as the debtor-in-posses- “We have met with 90 percent of beds, but only about 30 of the li- Flint-based McLaren Healthcare our systems and have an 80 percent sion, or DIP, lender and consultant. the employees personally, from the censed beds are staffed in a medical- Corp. was one of the original in- collection rate (of current bills),” But under the new leadership boiler room to surgical unit that ranges occupancy vestors when the hospital initially Sanjay said. “We will collect about team, which includes bankruptcy the kitchen,” from 25 percent to 50 percent. It also emerged from bankruptcy in 2008. $4 million this year in commercial trustee Basil Simon, patient-care Priyam said. “I operates a 30-bed adult psychiatric For nearly three years, McLaren’s insurance payments.” advocate Aldo Martinez, Ponczocha am impressed by unit that averages more than a 90 management tried to improve op- Sanyam said Infrahealth invested and the Sharma family, Pontiac the passion of percent occupancy rate. erations, nearly breaking even in $1.5 million to keep the hospital General Hospital is slowly being the people who Its main sources of revenue, said 2009 with a $1 million loss. open. But “it wasn’t long before the reborn. work here and Ponczocha, are the adult psychi- But McLaren, unable to reach hospital filed for bankruptcy. That “Sant Partners has expertise and live in the neigh- atric unit, the medical-surgical unit, agreement with the board on a long- made everything more complicat- will be able to return the hospital to John Ponczocha: borhood.” a primary care health center man- term financial strategy, sold its 35 ed,” he said. profitability by instituting good Pontiac hospital Priyam said aged by Oakland Integrated Health- percent investment in early 2011 for At that point, Sanyam said, the management practices and by ex- never closed, CEO employees have care Network, an 18-resident family $3 million, taking a $2 million loss. Sharma family decided to go all in, panding its medical staff,” said Todd says. expressed con- medicine program sponsored by Yusuf Hai, managing director of buy the hospital and propose a re- Sable, a partner with Detroit-based cern there could the hospital, outpatient surgery and business advisory services with CIG organization plan. Honigman Miller Schwartz and Cohn, be further layoffs. The hospital a 24-hour urgent-care center. Capital Advisors in Southfield, said “We have Infrahealth and the who is representing Sant. workforce has shrunk over the past But those revenue sources did exterior economic forces and lack of medical school,” said Sanyam of the Priyam Sharma, who will be- decade to about 240 workers from not come close to bringing the hos- synergy caused the hospital to fail family’s investments. “But if we come one of the hospital’s four more pital out of the red. over the years. want to really increase our revenue board members with son Sanyam than 800. “Over time and for various rea- “You had doctors on the board and business, we needed to buy a after the closing, said the family has “We are a family business and sons, including claimed misman- who tried to do everything — man- provider. That’s why we identified held several town hall meetings for don’t want to make layoffs like in agement, it came to pass that age and practice medicine — and it this project.” employees and the community. the past,” Priyam said. “We have debtor’s facilities and medical serv- didn’t work out great,” Hai said. Under the court-approved reor- The two other board members been shifting people around based ices became substantially underuti- Hai said the Sharma family has a ganization plan, Sant would take will be physicians Jawad Shah and on their skills. We stress customer lized and noncompetitive, its fi- good opportunity to turn around over the hospital by essentially writ- Surindar Jolly. Shah, a neurosur- service and quality.” nances became severely distressed, the hospital if they put in place the ing off its earlier $1.5 million loan geon who has taken out an $8 mil- In his Feb. 2 decision, Shapero and its books and records in disor- right service mix to fill a primary der,” wrote Shapero. care and specialty market niche. For example, in 2014 the former “If the (Sant) group does a good Doctors’ Hospital lost $12.7 million job, someone will come and pick on net patient revenue of $12.6 mil- them up” and acquire the hospital, lion, according to Louisville, Ky.- Hai said. based Cost Report Data. From 2009 Sanyam said his family has no to 2013, the hospital lost more than plans to sell the hospital. “We have $73 million. gotten offers, but nothing we will Sources told Crain’s that multiple take at the moment,” he said. “We factors led to financial losses. They plan to grow the company and hold included competition from two onto it at this point.” larger, multi-system owned hospi- Chad Grant, CEO of McLaren Oak- tals and a poor economy in the Pon- land in Pontiac, said the new Ponti- tiac area. ac General could succeed if it focus- Other problems included a shift es on primary care. away from inpatient care to outpa- “Health care is a very competitive tient services that reduced revenue, environment with all the pressures lack of medical staff recruiting and on organizations,” Grant said. “It is an erosion of the physician base very difficult to be successful with- that led to fewer patients and a out appropriate scale.” dysfunctional board-management Grant said he has met with the relationship over multiple adminis- Sharma family and understands trations. they want to expand inpatient “The previous owners kept shut- medical-surgical services. “It will be ting down services to cut expenses,” difficult because services are mov- Sanyam said. “Over time, that af- SEE NEXT PAGE

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CRAIN’S DETROIT BUSINESS // MARCH 21, 2016 11 SPECIAL REPORT: HEALTH CARE

FROM PREVIOUS PAGE General is facing is various pay- backs owed to Medicare and Medic- ing more into the outpatient area,” aid programs, Sanyam said. he said. “Medicare says we owe them $6.7 Like Pontiac General, Grant said, million. They are recouping 100 McLaren Oakland also offers the percent (of our billing and graduate community adult behavioral health medical education program),” he services.“Behavioral health is an said. “If there are no changes, we unmet need in Pontiac, but reim- will pay it off in two years.” bursement is not attractive,” he But Sanyam said the hospital has said. “We provide behavioral health presented Medicare with a five-year services with a geriatric inpatient payment plan, which, if approved, unit for ages 50 and above.” will free up cash for operations. Grant said McLaren Oakland “It would be a substantial im- makes a little money on its 27-bed provement” in revenue to the hospi- unit that averages 20 patients per tal, said Simon, the bankruptcy day. “It isn’t a huge revenue genera- trustee who is a partner at Simon tor,” he said. Stella and Zingas PC in Detroit. “We Overall, Pontiac’s economy is hope some money will get released.” growing stronger with several larger The Michigan Medicaid program employers expanding workforces also has been recovering overpay- and that should help all hospitals, ments. “We owed them $3 million Grant said. and still owe $500,000,” Sanyam “We have significantly improved said. “We are working with (state of- our financial performance” over the ficials) to (forgive) that debt.” last several years, said Grant, noting Simon, who calls himself the that of the hospital’s 150 staffed “lame-duck trustee,” meets weekly beds, its average census is about 100 with Ponczocha and others to ap- patients, or 67 percent. prove bills and review revenue and “Our partnership with Karmanos expenses. (Cancer Institute) has brought us “Cash flow is improving and admissions, and our new ER center things are gradually getting better,” in Clarkston has also brought us in- said Simon, who noted that the patient volume,” said Grant, noting Sharmas, as DIP lender, must sup- that insurance expansion under the plement hospital revenue to keep Affordable Care Act has helped im- the hospital solvent while under prove cash flow by reducing charity bankruptcy protection. Ⅲ care. Jay Greene: (313) 446-0325 But one of the problems Pontiac Twitter: @jaybgreene

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12 CRAIN’S DETROIT BUSINESS // MARCH 21, 2016 SPECIAL REPORT: HEALTH CARE Med school ties aid Pontiac hospital’s turnaround

By Jay Greene “Last year we saw more than neurosurgery, orthopedics and a 24- [email protected] 6,500 patients, and our growth has hour outpatient pharmacy. One of the key advantages cited Pontiac General’s health history been 6 percent to 8 percent a year,” Ongoing services include outpa- by Sant Partners LLC in its court-ap- she said. “People know we are here tient surgery, endoscopy, pain man- proved bankruptcy reorganization Founded in the early 1900s as the first hospital in Oakland County, and come back.” agement, 24-hour urgent care, radi- plan for Pontiac General Hospital is its Pontiac General Hospital originally was owned by the city of Pontiac as Brinson said the hospital’s fami- ology and a reference laboratory. medical education relationship a safety net provider. ly medicine residency program The hospital’s reorganization with St. Martinus University, a med- It was sold in 1993 and became North Oakland Medical Centers. After works well with the health center’s plan also calls for 18 surgical resi- ical school on the Caribbean island never earning a profit, North Oakland filed for bankruptcy in 2008. It staff in offering patients a mix of dents to be rotated with Crittenton of Curacao. was purchased by a group of 42 physician investors and Flint-based primary, mental and dental health Hospital Medical Center. The Sharma family, which in- McLaren Health Care Corp. and renamed Doctors’ Hospital of Michigan. care services. “They are coming back, maybe in cludes Sanjay, Priyam and Sanyam, But after nearly three years of unprofitability in 2011, McLaren sold The three-year agreement with two years. We need to build our sur- purchased the license of shuttered its 35 percent interest back to the doctor investors. OIHN expired last December, but gery department first,” Sanyam said. St. Martinus in 2010. They renovat- From 2009 to 2014, Doctors’ Hospital lost more than $73 million. A Sanyam said the two partners have In 2011, Crittenton Hospital ed it and opened it in 2011. Sanjay is $2 million judgment against the hospital and accreditation problems a month-to-month agreement until loaned $4 million to the former Doc- president of the medical school. led to the physician investors filing Chapter 11 bankruptcy in July. they agree to a long-term contract tors’ Hospital of Michigan in a compli- St. Martinus now enrolls 500 stu- In early February, Sant Partners LLC, headed by Sanyam Sharma and after the closing. cated arrangement that included dents, with the first class graduating financially backed by his parents, Sanjay and Priyam, who own Austin, Pontiac is considered the only the transfer of the 18 surgical this summer, said Sanyam Sharma, Texas-based Infrahealth Group and St. Martinus University medical school, medically underserved area in Oak- residents. Sant’s founder and managing direc- had its bankruptcy reorganization plan approved for the hospital. land County. Last year, Oakland As a secured creditor under the tor. His parents are Sant’s financial Jay Greene County officials made it clear how reorganization plan, Crittenton will backers and also own the medical important it is to continue the fami- receive $100,000 cash at closing and school. ly medicine residency program with agree to accept a total of $650,000 “We have 200 students who could reorganization plan estimates Ponczocha said. “Our unit is nearly OIHN for the Pontiac community. over three years at a 3 percent inter- come now,” Sanyam said. “We will $20,000-per-month revenue in July, always full, and sometimes we have “Eighty percent of the patients at est rate. start with 10 a month at first, and by increasing to $40,000 per month in to turn away people.” the family medicine residency pro- From bad to good? the end of the year we will have up to 2017 and $80,000 per month in 2018. Generating lease revenue and in- gram and the Family Medicine Cen- 50 students in family practice, psy- Another boost to the hospital patient referrals for the hospital is ter receive Medicaid or Medicare After Ponczocha recovered from chiatry, surgery, pain management later this year will be when the 30- the Family Medicine Clinic, which is benefits, allowing more individuals back surgery and returned to the and radiology” rotations. bed inpatient psychiatric unit ex- owned by Oakland Integrated Health to have access to quality health hospital in late June, he learned the Because medical schools pay hos- pands by 10 beds, said hospital CEO Network, a seven-clinic federally care,” said Oakland County in a The Joint Commission had issued a pitals to train their students in clerk- John Ponczocha. qualified health center. statement. preliminary denial the week before ships, Sanyam said the medical “We will start construction this Since 2012, patient volume has Sanyam said Pontiac General also on the hospital’s accreditation. school will provide reliable cash flow. summer on the ($500,000) psych been steadily growing, said OIHN’s plans to expand services through “They found 67 deficiencies, and For example, the court-approved unit expansion on the fourth floor,” CEO, Debbie Brinson. joint ventures in inpatient surgery, the CMS (Centers for Medicare and Medicaid Services) issued six violations on the hospital’s conditions of participation in Medicare,” he said. The violations covered a range of service areas, including governance, leadership, infection control, medication management, fire and life safety, and environment of care, he said. Hamid M. Soueidan “My whole effort for six months was to correct everything,” he said. ® “Any potential plan would have In Your Corner. failed without accreditation.” But on Dec. 8, the Joint Commis- sion made another surprise visit, and on Dec. 10 the hospital received Varnum welcomes Hamid Soueidan to the fi rm. full accreditation, he said. ■ Experience representing individuals “There was a real challenge in and businesses in tax, insurance, and keeping the hospital open and sta- ble. The threat of closure was always international law matters. there,” he said. ■ International experience in Beirut, Every day, said Ponczocha, he felt like he was Monty Hall on the old Lebanon, assisting clients from the Middle “Let’s Make a Deal” television show. East and Africa to establish a presence in “Vendors called and asked for free trade zones. $3,000 payment. I asked if they could take $1,000.” Ponczocha, a veteran hospital executive who has worked in the Trini- ty Health and Henry Ford systems, said he is cautiously optimistic that Pontiac General has a future. “Given where we were on July 8 (bankruptcy filing), I feel real positive about it,” he said. “I am optimistic about growing surgery volume, adding medical staff and increasing admissions. We have the potential to get much busier here.” By the end of the year, Sanyam said, the hospital is projected to turn a $1.5 million profit. “It will be the first profit in 15 years,” Sanyam said. Ⅲ Ŷ Detroit Ŷ Novi Ŷ Grand Rapids Ŷ Kalamazoo Ŷ Grand Haven Ŷ Lansing Ŷ Ann Arbor Ŷ Hastings Contact Hamid Soueidan at [email protected] Jay Greene: (313) 446-0325 Twitter: @jaybgreene 20160321-NEWS--0013-NAT-CCI-CD_-- 3/18/2016 11:22 AM Page 1

CRAIN’S DETROIT BUSINESS // MARCH 21, 2016 13 CRAIN'S LIST: LARGEST PHYSICIAN ORGANIZATIONS $ $ $- , - ! $ & !- $ ! $ Rank )" # !*+ ( ( Ä% $' United Physicians Inc. Michael Williams, 2,386 NA NA IPA Beaumont Health, Beaumont Health-Farmington Hills, Children's Hospital 30600 Telegraph Road, Suite 4000, Bingham Farms president and CEO; NA of Michigan, Crittenton Hospital and affiliates, Detroit Medical Center 48025 Deborah Tasich hospitals, Pontiac General Hospital, Garden City Hospital, Henry Ford 1 (248) 593-0100; www.updoctors.com Withrow, EVP and Health System, Karmanos Cancer Center, McLaren Health Care Corp., COO Oakland Regional Hospitals, Select Specialty Hospitals, St. John Providence Health System, St. Joseph Mercy Health System, St. Mary Mercy Hospital of Livonia, Triumph Hospital of Detroit, UM Hospital, others B B Wayne State University Physician Group Lisa Keane 2,303 147,033 NA Group Beaumont Health, Children's Hospital of Michigan, Crittenton Hospital B 1560 E. Maple Road, Troy 48083 president and COO NA 731,385 practice Medical Center, Detroit Receiving Hospital, DMC Surgery Hospital, Pontiac (877) 978-3627; www.wsupgdocs.org General Hospital, Garden City Hospital, Harper University Hospital, Henry Ford Health System, Huron Valley-Sinai Hospital, Hutzel Women's Hospital, 2 Karmanos Cancer Center, McLaren-Macomb, McLaren-Oakland, Rehabilitation Institute of Michigan, Select Specialty Hospital, Sinai-Grace Hospital, St. Joseph Mercy Health System, St. Mary Mercy-Livonia, St. John Providence Health System, Triumph Hospital Detroit, UM Health System, Vibra Hospital of SE Detroit, others The Physician Alliance LLC Michael Madden 2,246 NA NA IPA St. John Hospital and Medical Center, Providence Hospital, Providence Park 20952 12 Mile Road, Suite 130, St. Clair Shores 48081 president and CEO 2,146 Hospital, St. John Macomb-Oakland Hospital, St. John River District 3 (586) 498-3555; www.thephysicianalliance.org Hospital, Children's Hospital of Michigan, Detroit Receiving Hospital, Beaumont Health, Henry Ford Health System, McLaren-Macomb, Harper Hospital, Henry Ford Health System, Karmanos Cancer Institute McLaren Physician Partners Gary Wentzloff 2,041 NA NA PHO McLaren Health Care Corp., Karmanos Cancer Center 4 2701 Cambridge Court, Suite 200, Auburn Hills 48326 president and CEO NA (248) 484-4928; www.McLarenpp.org University of Michigan Faculty Group Practice David Spahlinger 2,014 52,272 NA Group University of Michigan Health System 4101 Medical Science Building I, Ann Arbor 48109-0624 senior associate NA 2,234,769 practice 5 (800) 211-8181; medicine.umich.edu/medschool/ dean for clinical patient-care/um-physiciansfgp affairs C Henry Ford Physician Network Charles Kelly 1,910 NA 40,000 IPA Henry Ford Health System, others. Includes 1,179 employed physicians in 6 1 Ford Place, Detroit 48202 president and CEO 1,679 3 the Henry Ford Medical Group. (313) 874-1466; henryfordphysiciannetwork.com MedNetOne Health Solutions Ewa Matuszewski 1,200 NA NA IPA Crittenton Hospital and Medical Center, Henry Ford Health System, 7 4986 N. Adams Road, Suite D, Rochester 48306-1416 CEO NA Beaumont Health, Mercy Memorial Monroe, McLaren Health System, St. (248) 475-4701; www.mednetone.com John Providence Health System, Detroit Medical Center Consortium of Independent Physician Associations Paul MacLellan 1,100 NA NA IPA ProMedica Bixby Hospital, ProMedica Herrick Hospital, ProMedica Toledo 8 101 N. Main St., Suite 430, Ann Arbor 48104 CEO 1,100 Hospital, Hillsdale Community Health Center, Port Huron Hospital, St. (734) 302-2128; www.medicaladvantagegroup.com Joseph Mercy Hospital, Henry Ford Health System, St. Mary Mercy Hospital Oakwood ACO LLC William Isenstein 1,045 NA 119,000 PHO Beaumont Health-Dearborn, Beaumont Health-Taylor, Beaumont Health- 9 15500 Lundy Parkway, Dearborn 48126 executive director NA 18 Trenton, Beaumont Health-Wayne, Beaumont Health-Royal Oak, Beaumont (313) 586-5872; oakwoodaco.org and COO Health-Troy, Beaumont Health- Grosse Pointe, Beaumont Health- Farmington Hills United Outstanding Physicians LLC Yasser Hammoud 930 NA 130,000 IPA St. Mary, Henry Ford Main, Henry Ford Wyandotte, St. Joseph Mercy, 10 18800 Hubbard Drive, Suite 200, Dearborn 48126 medical director and 890 18 Detroit Medical Center, Garden City, Beaumont Health and hospitals (313) 240-9867; www.uopdocs.com CEO designated by health plans with which UOP physicians are contracted DMC PHO LLC Nazmul Haque 650 NA NA PHO Detroit Medical Center 28411 Northwestern Highway, Suite 750, Southfield chairman NA 11 48034 (248) 262-7369; www.dmcpho.com Greater Macomb PHO Jerome Finkel, 544 NA NA PHO Henry Ford Macomb Hospital-Clinton Township 12 43411 Garfield, Suite A, Clinton Township 48038 medical director; 529 (586) 263-2620; greatermacombpho.com Dirk DeLange, executive director Olympia Medical Services PLLC Randall Bickle 500 NA NA IPA Beaumont Hospital-Farmington Hills, Garden City, St. Mary-Livonia, 13 33300 Five Mile Road, Suite 210, Livonia 48154 president and CEO NA Providence Park, St. Joseph-Ann Arbor (313) 357-1215; www.olympiadocs.com Professional Medical Corp. Asif Ishaque, 489 NA NA IPA Hurley Medical Center, McLaren, Genesys 14 2425 S. Linden Road, Suite D, Flint 48532 president; Mike NA 11 (517) 336-1400; www.pmcpo.com Grodus, Sr. PO consultant Huron Valley Physicians Association PC Jeff Sanfield 463 NA 40,000 IPA St. Joseph Mercy Health System, Chelsea Community Hospital and 15 2002 Hogback Road, Suite 3, Ann Arbor 48105 president 416 4 Livingston (734) 973-0137; www.hvpa.com Oakland Physicians Network Services Rodger Prong, 450 NA 89,600 IPA St. Joseph Mercy Hospital Oakland, Huron Valley-Sinai DMC, Beaumont 16 2360 Orchard Lake Road, Sylvan Lake 48320 executive director; 410 15 Royal Oak, Crittenton, McLaren, Henry Ford, Providence (248) 682-0088; www.opns.org Nathan Chase, president IHA Health Services Corp. William Fileti 448 NA 73,520 Group St. Joseph Mercy Health System, University of Michigan Health System 24 Frank Lloyd Wright Drive, Lobby J2000, Ann Arbor president and CEO 448 694 13 practice 17 48105 (734) 747-6766; www.ihacares.com Oakland Southfield Physicians PC Jerome Frankel 430 NA 156,161 IPA Beaumont Hospital-Dearborn, Beaumont Hospital-Farmington Hills, 29200 Northwestern Highway, Suite 325, Southfield medical director 405 13 Beaumont Hospital-Trenton, Children's Hospital of Michigan, Crittenton 18 48034 Hospital and Medical Center, Henry Ford Health System, Huron Valley- (248) 357-4048; www.ospdocs.com Sinai Hospital, McLaren Oakland, Sinai-Grace Hospital, St. John Providence Health System, St. Joseph Mercy Health System, St. Mary Mercy Hospital Livonia Michigan Healthcare Professionals PC Jeffrey Margolis 364 NA NA Group Beaumont Health, Beaumont Hospital-Farmington Hills, Crittenton 30000 Northwestern Highway, Farmington Hills president NA practice Hospital, Detroit Medical Center hospitals, Garden City Hospital, Henry 19 48334-3292 Ford Hospital West Bloomfield, Huron Valley-Sinai Hospital, McLaren (248) 851-3300; www.mhpdoctor.com Macomb, McLaren Oakland, McLaren Lapeer, Pontiac General Hospital, Port Huron Hospital, St. John Providence Health System, St. Joseph Mercy Oakland, St. Mary Mercy Hospital Accountable Healthcare Alliance Robert Jackson 264 NA 20,000 IPA Henry Ford Wyandotte Hospital, St. Mary Mercy-Livonia, Beaumont Health, 20 8338 Allen Road, Suite 104, Allen Park 48101 president and 264 9 St. Joseph Health System, U of M Health System, Mercy Hospital Port Huron (517) 336-1400 medical director

This list of physician organizations encompasses physician hospital organizations and independent practice associations and is an approximate compilation of the largest such groups in Wayne, Oakland, Macomb, Washtenaw and Livingston counties. IPA = Independent practice association. PHO = Physician hospital organization. ACO = Accountable care organization. It is not a complete listing but the most comprehensive available. Unless otherwise noted, information was provided by the organizations. NA = not available. B Crain's estimate. Wayne State University Physician Group declined to provide data because of reorganization efforts. C On March 14, the boards of Detroit-based Henry Ford Health System and Jackson-based Allegiance Health signed the final agreement to merge.

LIST RESEARCHED BY SONYA D. HILL DBpageAD_DBpageAD.qxd 9/21/2015 1:13 PM Page 1 20160321-NEWS--0015-NAT-CCI-CD_-- 3/18/2016 10:09 AM Page 1

SPECIAL REPORT: AUTO LAW DUSTIN WALSH Senior reporter [email protected] Twitter: @DustinPWalsh Word change puts auto execs’heads on the dotted line enior executives from Volk- swagen AG late last year Sblamed “rogue engineers” for its device that falsified U.S. emissions results. The top brass at General Motors Co. pleaded igno- rance of its ignition switch defect linked to 124 deaths. The federal government plans to end the up-in-arms approach by automakers, and their suppliers, by improving reporting to the National Highway Traffic Safety Ad- ministration. Buried in the 1,300 pages of the Fixing America’s Sur- face Transportation Act, signed by President Obama last year, the changing of one word is striking fear in automotive executives. The FAST Act simply strikes the word ‘‘may’’ and inserts ‘‘shall” into the procedure that now requires a senior official responsible for safety in a company to sign his or her name to information related to a safety defect reported to NHTSA. In effect, that signature certifies that the senior official has re- viewed the report, has knowledge of the defect and that the report is completely factual. Before, the safety reporting rules did not require a signature. “All the major issues we’ve seen in the past few years, you didn’t see one executive step forward and put their head on the line,” said Jen- nifer Dukarski, an associate attorney at Butzel Long PC in Ann Arbor. Tech drives change “Now a senior official has to be competent and confident, trusting of their engineers that provided de- Joint development agreements growing; careful crafting a must tails, to put their name on that line. “Given the great public scrutiny over recent recalls, they may have By Doug Henze “(The use of JDAs) is in- motive technology is respon- when auto companies dive to fall on their sword if something Special to Crain’s Detroit Business creasing exponentially,” sible for the increased use. into areas where engineers goes wrong. I wouldn’t want my With the Motor City’s ties DeGrazia said. “I probably “The biggest difference is have little experience — such name on that document.” with Silicon Valley growing, have seven or eight going the content in automobiles as new software. That signature pins culpability the use of joint development right now. I think it’s the future — the infotainment stuff, the “You get to the market onto that official and, theoretically, agreements is on the rise. of Detroit — getting these autonomous cars — that’s quicker than trying to build will eliminate executives hiding be- Local legal experts say the things done.” driving a lot of it,” Hochkam- your own department of pro- hind unawareness, Dukarski said. contracts smooth ownership While the confidential na- mer said. grammers or buying a soft- She said automakers and suppli- issues, but the fast pace of tech ture of the agreements makes JDAs offer a number of ad- ware company,” DeGrazia ers need to assess policies and pro- innovation and the litigious it difficult to get a handle on vantages for partners that sign said. cedures to identify reporting re- nature of its largest players are how much the JDA total has on to them. Partnerships DeGrazia gives the exam- quirements and ensure those leading to a culture clash, often increased in recent years, at- spread development costs ple of Ford Motor Co. and responsibilities are taken seriously. making the agreements diffi- torneys who draft them agree and increase the delivery Google Inc., which are report- The signee will likely be the first cult to hash out. the number is on the rise. speed of the new product. edly considering partnering person contacted by NHTSA or the JDAs, which allow partners DeGrazia estimates he did “There’s a branding issue in to build an autonomous car. U.S. Department of Justice in the to pool their know-how to cre- only one or two of the agree- being first to market,” De- “Ford doesn’t have the event of an investigation. ate technology neither comments a year in the recent Grazia said. “They all want to software expertise and “This is more responsibility pany could produce alone, past, although that was part- be out there and act like Google is feeling like, ‘We’re than many of those (senior offi- have been around the indus- ly due to the economic they’re the first to market with not an automaker,’ ” De- cials) ever bargained for in some try for years. But these new downturn. this technology.” Grazia said. “That’s a win- cases,” Dukarski said. “This puts a players have caused a sharp Karl Hochkammer, partner Agreements with partners win situation if that ever goes new level of scrutiny on their work, increase in the practice, said and head of the information within the traditional auto anywhere.” and it’s going to be a challenge to Greg DeGrazia, partner and and technology transactions supply chain can save time JDAs are a simpler way for take a more critical and thorough intellectual property attorney practice at Detroit-based and smooth development, es- companies to cooperate than view of reporting.” for Warner, Norcross and Judd Honigman Miller Schwartz and pecially where patents exist. setting up a joint venture, The new rule is expected to be LLP in Southfield. Cohn LLP, said increased auto- Advantages are magnified SEE JDAs, PAGE 16 rolled out by the end of the year, Dukarski said. Ⅲ 20160321-NEWS--0016-NAT-CCI-CD_-- 3/18/2016 10:10 AM Page 1

16 CRAIN’S DETROIT BUSINESS // MARCH 21, 2016 JDAs FROM PAGE 15 which involves shareholders and the U.S. Securities and Exchange Commis- While your practice is keeping sion, DeGrazia said. While product development partnerships provide benefits, they patients healthy … also can bring friction. Carefully crafted JDAs can help ease those challenges. One issue is how to divide owner- … what’s keeping your practice secure? ship of “foreground” technology — the product the parties developed together — while separating it from the “background” technology each Turn “vulnerable” into “secure” by meeting company brought to the table. “You’re opening up your know- with a Rehmann advisor today. We’ll evaluate how to your partner,” said Tom Ap- your internal controls, fraud protection and pledorn, a partner at Honigman. “Unless they’re a trusted partner, risk management ... and then offer clear, you risk exposing your secret easily-implemented solutions to help you keep sauce.” DeGrazia said protecting intel- trouble at bay. Consider it a wellness checkup lectual property rights and assuring for your business. confidentiality are the two most important things JDAs accomplish. Contact me today to learn more. “We’ve had many, many fights in the auto industry, because the (automakers) always want to claim SANDY SHECTER, CPA, CGMA ownership,” DeGrazia said. Principal When partners are from different nations, JDAs help sort out whose [email protected] | 248.579.1100 laws govern and which company owns the technology in a region. “One company may own it in North America and another company may own it in Asia,” he said. With tech companies joining forces with auto companies on rehmann.comrehmann.com | 866.799.9580 projects, attorneys drafting JDAs are running into new challenges. Com- panies that have never worked together before have to beware of a culture clash. “Silicon Valley tends to move very fast, and they’re fine with making mistakes,” Hochkammer said. “That is something the traditional automotive manufacturers have not been comfortable with.” Companies such as Microsoft and Google manage intellectual property differently than automakers, De- Grazia said. “They’re very aggressive with their intellectual property, he said. “Google, Microsoft and Apple have something like 10 times the number of patent infringement lawsuits” Over $2 Billion recovered for than the automakers. Dealing with huge tech compa- our clients nies presents a different dynamic for auto companies, which are used to dictating most of the terms of an agreement to their suppliers. “I don’t think (tech companies) view themselves as being sub- servient to Ford,” DeGrazia said. In some cases, automakers will end up working with much smaller startups, which are able to move quickly with new technology, said Marc Malooley, a partner at intellectual property law firm Brooks Kush- man in Southfield. But automakers won’t necessari- ly have the upper hand there, either, he said. “In some cases, it doesn’t matter if the company is bigger or smaller, because they have a technology the automakers can’t replicate in house or get elsewhere,” he said. But the trade-off can be a stronger partnership, Malooley said. “(Now), the relationship is not so one-sided,” he said. Ⅲ 20160321-NEWS--0017-NAT-CCI-CD_-- 3/18/2016 10:11 AM Page 1

CRAIN’S DETROIT BUSINESS // MARCH 21, 2016 17 Old homes build new businesses

wood through a network of contrac- Material from Detroit’s tors and property owners who want housing demolitions parts of their houses deconstructed. On occasion, they remove the wood finds new life as guitars, themselves. “People are happy for it to go to good use,” Fox said. Their furniture, eyewear biggest seller is picture frames. “It’s our bread and butter,” she added. By Marti Benedetti The company is profitable: Mutual [email protected] Adoration’s sales in 2014 were ecause Detroit leads the na- $60,000. Revenue jumped to tion in housing demolition, $140,000 in 2015, and the company Bthe city is swimming in used already had $70,000 in sales after wood and glass. What that means is the first month of this year. a nearly limitless supply of material Ⅲ Tree-Purposed Detroit, Livonia: for artists and those restoring his- In a different twist, this company, toric property. started by Evan and Kari Burger in Wood from inside walls, base- 2012, is a sawmill and custom work- boards, exterior siding, porches, shop that uses dead and unwanted hardwood floors, paneling, and trees to make natural edge table window frames of blighted houses and bar tops. “What we do with the has caught the fancy of many who trees we can’t salvage is grind them see value and beauty in reusing it. up for wood chips that we use for Old windows, many with century- power,” Kari said. One of their proj- old glass and hardware, also are ects was the woodworking for the being tapped to replace the win- bar top and stool tops at Johnny Noo- dows of old structures. dle King, a restaurant in Southwest The number of Detroit-area Detroit. artists using reclaimed or salvaged Ⅲ Workshop Detroit: Co-owners wood and glass to make everything James Willer, original founder of Re- from sunglass frames to bar tops to claim Detroit, and Kevin Borsay use guitars is expanding, and many are LARRY PEPLIN old-growth structural pine (the making a living out of their craft. Amy Swift of Building Hugger in Detroit (above) restores windows and doors from old buildings using pieces of reclaimed wood. wood wall studs behind the plaster) Reclaimed wood expert Craig Below left, a table made from repurposed wood from Tree-Purposed Detroit. Below right, a guitar from Woodward Guitar Co. to make high-end custom tables Varterian, executive director of non- and benches. To give each piece a profit Reclaim Detroit, a major sal- sense of history, it stamps the street vaged wood supplier and decon- address of the abandoned home the struction training center formerly in material came from. Workshop De- Highland Park, said used wood can troit, started in 2013, sources its be had for roughly the same price as wood from Architectural Salvage new lumber. But it takes skilled Warehouse of Detroit. Its showroom manpower to carefully remove it, is in the Fisher building, and its transport it and prepare it so it can work space is a couple blocks down be fashioned into useful objects. on Baltimore Avenue. Rare, high-end used wood can Ⅲ Woodward Guitar Co., Wixom: command a higher price. This company belongs to Liv- He said, before a fire recently de- ingston County Sheriff Department stroyed Reclaim Detroit’s ware- Detective Curt Novara, who makes house, that business was brisk. 12 to 15 hand-carved guitars a year “There’s an uptick in what we are with 100-year-old Douglas fir and doing this year. There is lots of activ- other woods such as maple. “Re- ity in deconstruction and reuse.” TREE-PURPOSED DETROIT WOODWARD GUITAR CO. claim Detroit had some maple off of Reclaim Detroit is a primary sup- a house on Trumbull near the old plier of reclaimed wood to Detroit Detroit Building Authority director of tors, such as Reclaim Detroit, re- doors of old buildings. They use re- stadium that I’m using,” he said. area artists and artists in surround- special projects. “We took down 58 sponsible for tearing out reusable claimed wood to replace damaged Using reclaimed wood for his gui- ing states. Varterian said the ware- in a week. In the summer, the goal materials from the houses. The goal or missing wood pieces and sal- tars that retail for $2,000 sets his house contained almost $500,000 in is 150 a week. We want to keep our is to avoid parts of the house with vaged window components such as product apart. “People like the vin- salvaged wood, mill shop equip- contractors (busy).” The city uses 13 lead paint and asbestos, but often pulleys, weights and locks. Both the tage sound of the old guitars. Well, ment, finished goods, field equip- or so demolition companies. asbestos inspectors and abatement wood and window components my guitars made of old wood have ment and vehicles when it burned to Farkas said, as of now, 40,000 more specialists need to be called in to were lost in the Reclaim Detroit fire, that same vintage sound.” Last time the ground in a fire in early February. blighted houses need to be demol- handle hazardous materials. but Swift is not worried. “We luckily Novara went to Reclaim Detroit, he Its temporary home is in a build- ished. That is a dramatic decrease “We encourage those relation- have a stockpile of wood that bought enough wood to last for at ing owned by the Henry Ford Health from last year, when the authority ships formed at the contractor should last us a few months,” she least nine months. “So when I run System on Detroit’s northwest side. was saying 70,000 needed to come level,” Farkas said. “The more we said. “Detroit has an endless supply out, they should be up and running Although no agreement has been fi- down. This is because as blighted work together, the more synergy of this material,” Varterian said. again.” nalized, discussions continue to re- houses are torn down, neighboring that can develop and the more ma- Ⅲ Homes Eyewear, Detroit: Owner Ⅲ Zimnicki Guitars, Allen Park: develop a city-owned former recre- houses become more valuable. They terial that can be captured and di- Achille Bianchi has been making Gary Zimnicki has been building ation center as Reclaim Detroit’s are being bought through the Detroit verted from the landfills.” sunglasses with wood frames from acoustic guitars made of spruce, new home. It is on Piquette Avenue Land Bank, repaired and made hab- Detroit area artists turning used deconstructed Detroit houses since maple, rosewood and mahogany and would cost $2 million to $3 mil- itable again. “Neighborhoods are wood into salable items has created 2012. He uses a 65-step process to for more than 30 years. But four lion to redevelop, said planned de- coming back online,” he said. a healthy demand for old-growth refine the wood. years ago, he started making a small veloper Ed Siegel. Demolition is done primarily in wood. Ⅲ LeadHead Glass, Ferndale: Chad percentage of his guitars from re- Varterian said using “urban neighborhoods that have an abun- Here are a handful of artists, most Ackley and Derek Smiertka use reclaimed wood. His source has been wood” to make things is not just a dance of occupied houses. Blocks of whom have been using Reclaim claimed wood and glass from Re- Reclaim Detroit, where he digs Detroit trend, it is a “Rust Belt with one or two houses are a lesser Detroit as their wood supplier. They claim Detroit to fashion handcraft- through stacks to find maple floor trend.” He has clients in Gary and priority unless they contain a house were asked where they will get ed wood and glass terrariums. boards for the backs and sides and South Bend, Ind.; Cleveland; and that poses a danger. Ninety-five per- wood while Reclaim Detroit is re- Ⅲ Mutual Adoration, Detroit: Clare Douglas fir or black walnut for the Chicago. cent of the houses are not emer- building its inventory: Fox and Wayne Maki started mak- top of the guitar. “I have plenty of This winter, blighted houses in gency demolitions, Farkas added. Ⅲ Building Hugger, Detroit: Found- ing custom furniture and picture stock now,” he said. The cost for one Detroit are coming down at a rate of The Detroit Building Authority ed in 2012, Amy Swift and her team frames from old-growth wood in of his guitars with either new or re- 20 to 120 a week, said Brian Farkas, works in tandem with the contrac- specialize in restoring windows and 2013. The couple obtains salvaged claimed wood is $4,500 to $6,500. Ⅲ 20160321-NEWS--0018,0019-NAT-CCI-CD_-- 3/18/2016 11:17 AM Page 1

18 CRAIN’S DETROIT BUSINESS // MARCH 21, 2016

Women’s Power Breakfast. 7-9 a.m. EXPANSIONS April 21. Gleaners Community Food DEALS & Munch’s Supply Co. Inc., New Lenox, CALENDAR Bank. Brings together more than Ill., a heating, ventilation and air 600 of the area’s most powerful conditioning distributor operating THURSDAY County Executive L. Brooks Patter- women. Co-chairwomen are Faye DETAILS in Chicago and northwest Indiana, MARCH 24 son is the honorary event chairman. Nelson, vice president public affairs, has opened locations at 30000 Investigative Journalism in the Age of San Marino Club, Troy. $32; $250 president, DTE Energy Foundation; Stephenson Highway, Unit C, Madi- BuzzFeed. 5:30-8 p.m. Association for a table of eight. Contact: Nancy Andra Rush, chairman and CEO, ACQUISITIONS & son Heights and 5805 Weller Court, for Women in Communications Maurer, (248) 952-6880 ext.2; email: Rush Trucking Corp.; Nancy MERGERS Suite C, Wyoming. Website: munch- and Detroit Press Club. A profes- [email protected]. Schlichting, CEO, Henry Ford Health Continental Automotive Systems Inc., michigan.com. sional development program with a Systems. Eastern Market Shed 3, Auburn Hills, a unit of Continental panel of reporters: Tresa Baldas, the UPCOMING EVENTS Detroit. $120 individual; $1,000 AG, Lindau, Germany, the high res- ASTI Environmental, Brighton, has federal courts reporter for the De- The Future of Talent in Michigan. 8-9:30 table. Contact: Suzette Hohendorf, olution 3-D flash lidar business opened an office for its real estate troit Free Press; Chad Livengood, po- a.m. March 31. Troy Chamber of phone: (313) 923-3535; email: from Advanced Scientific Concepts incentives and Brownfield redevel- litical reporter for The Detroit News Commerce. The state’s workforce [email protected]. Inc., Santa Barbara, Calif. This tech- opment group at 28 W. Adams Lansing Bureau; and Chastity Pratt, environment will be discussed by a nology will enhance the company’s Ave., Suite 1001, Detroit. Website: urban affairs reporter, Bridge Maga- panel of industry experts: Fuel: Detroit. 9 a.m.-5 p.m. April 21. Advanced Driver Assistance Sys- asti-env.com. zine. Robin Luce Herrmann, general Stephanie Comai, director, Michigan Fuel Leadership. Speakers include tems product. Websites: counsel to the Michigan Press Associ- Talent Investment Agency; Jocelyn Mark Kelly, commander of Space continental-corporation.com, NEW SERVICES ation, will moderate. Automotive In- Lincoln, vice president, recruitment Shuttle Endeavour’s final mission; advancedscientificconcepts.com. Business Leaders for Michigan, De- dustry Action Group, Southfield. $25 operations, Americas Region, Kelly authors Marcus Buckingham and troit, the state’s business round- members, $35 nonmembers, $15 Services Inc.; and Jennifer Llewellyn, Mitch Albom; Jacques Panis, presi- Benlee Inc., Romulus, a roll-off table, has rolled out a new website students. Contact: (248) 643-6590; manager, Oakland County Workforce dent, Shinola; Martha Stewart; Sarah trailer company, has acquired the featuring research and data about email: [email protected] Development, with moderator Kay, founder, co-director, Project assets of Huge Haul Inc., Big Bend, Michigan’s competitiveness, infor- Jennette Smith, editor, Crain’s Voice; others. Sound Board, Detroit. Wis., a lugger truck and trailer com- mation about BLM’s strategies and 2016 Great Lakes Business Intelligence Detroit Business. Kingsley Inn, $495 general; $895 VIP. Contact: Jor- pany. Websites: benlee.com, priorities, along with news and ac- & Big Data Summit. 8 a.m.-5 p.m. Bloomfield Hills. $25 Troy dan Broad, phone: (248) 206-7065; hugehaul.com. tion items. Website: WIT Inc. Program will feature case Chamber members, $35 future email: [email protected]. businessleadersformichigan.com. studies, interactive demos, oppor- members. Phone: (248) 641-8151; CONTRACTS tunities to meet with top providers email: troychamber.com/events. Burroughs Inc., Plymouth, a provider and network. The Somerset Inn Calendar guidelines. Visit of network check scanning tech- Hotel, Troy. $159. Contact: Aman- DEC Presents Peter Karmanos. 11:30 crainsdetroit.com and click “Events” nology, announced that Bur- Deals & Details guidelines. da Mansour, phone: (248) 641- a.m.-1:30 p.m. April 14. Detroit Eco- near the top of the home page. roughs SmartSource Micro Elite Email [email protected]. 5900 ext 244; email: nomic Club. Karmanos is principal Then, click “Submit Your Events” scanner is now certified with Use any Deals & Details item as a [email protected]; website: owner and CEO of the Carolina Hurri- from the drop-down menu that will Ranger for Macintosh software by model for your release, and look for greatlakesbisummit.com. canes, and chairman/co-founder of appear. Fill out the submission form, Silver Bullet Technology Inc., Pensaco- the appropriate category. Without MadDog Technology. Townsend Hotel, then click “Submit event” at the la, Fla., a provider of check scan- complete information, your item will Taste of Leadership Oakland. 4:30-7 Birmingham. $45 DEC members, bottom of the page. ner interfaces and scanner emula- not run. Photos are welcome, but we p.m. Leadership Oakland. This $55 guests of DEC members, $75 More Calendar items can be tion software. Website: cannot guarantee they will be used. event promotes networking and nonmembers. Phone: (313) 963- found at crainsdetroit.com/events. burroughs.com. connection opportunities. Oakland 8547; email: [email protected].

Girl Scouts of Southeastern Michigan wishes to recognize the 23 women and 6 men that have been nominated for the 2016 “Tough Cookie” Recognitions. They are truly an inspiration to the next generation of leaders. 2016 Honorees MAGGIE ALLESEE “ONE TOUGH COOKIE” RECOGNITION RECOGNITION FOR COMMUNITY SERVICE Honors female leaders, mentors and advocates Honors a woman who has contributed many years whose leadership and/or community service have positively impacted the workplace and the community. of service to the community through personal giving, contributing of her time and offering Raquel Garcia Andersen Karen Thorn Kaley inspiration to others. Lori Blaker Mary Kerwin Francine E. Pegues JoAnn Chávez Councilwoman Raquel Castañeda-López Prosecutor Jessica R. Cooper Hon. Donna Robinson Milhouse NANCY L. PHILIPPART Hon. Linda Davis Rep. Candice Miller RECOGNITION FOR LEADERSHIP Sandra Epps Margot Parr Honors a woman with a proven record of exceptional Bonnie Fahoome Laurie K. Prochazka leadership ability in her professional career and who Lynne Goodman Treger Strasberg has demonstrated a commitment to encourage Sharon L. Harris Holly Osterholm Swanson others to take on leadership roles. Suzanne Heath Maggie Varney

Laura Hughes Anne Doyle Our 2016 honorees will be recognized at the annual Cookie Gala “MAN ENOUGH TO BE A GIRL SCOUT” on March 30, 2016 at the DTE Energy Headquarters in Detroit. Honors men who have contributed many years of service encouraging and mentoring women’s leadership. They have a desire to create a future ﬁlled with smart and powerful women leaders Cookie Gala and have put this passion in to action. Presenting Sponsor John A. Evans Brad Simmons Peter M. Keating Larry E. Steward Gerald W. McCarty II Dan Varner 20160321-NEWS--0018,0019-NAT-CCI-CD_-- 3/18/2016 11:34 AM Page 2

CRAIN’S DETROIT BUSINESS // MARCH 21, 2016 19 Detroit chamber begins TV push ahead of RTA plan

By Bill Shea rail line, with specialized train-like leased in fall 2014. [email protected] wheeled vehicles with dedicated It would have 26 stops, take about The Detroit Regional Chamber is lanes, priority traffic signaling and an hour to travel the entire length taking to the airwaves in support of higher speeds. They likely would and run in a separate median lane the Regional Transit Authority for run along Woodward, Gratiot and with passenger stations. Some Southeast Michigan’s forthcoming Michigan avenues. downtown stations could be shared ballot proposal that will ask voters The tax would be the local fund- with the city’s new M-1 Rail streetcar to approve a mass transit tax. ing required to access matching system under construction. The chamber has planned a se- federal funding to build and operate SEMCOG developed the basic ries of television commercials high- a BRT system. The RTA would have BRT plan because it determined lighting the lack of effective regional to apply for such funding from the that transit improvements must be mass transit and how that is a drain federal government, and the made along the 27 miles of Wood- on the local economy. process is vigorously competitive ward — one of the region’s main “There will be an ongoing infor- and often lengthy. transit routes since the pre-colonial mation and educational campaign The Southeast Michigan Council of era — to bolster mobility and access through the summer — all designed PHOTO BY DETROIT REGIONAL CHAMBER Governments regional planning to jobs, connect people with desti- to show that Southeast Michigan The Detroit Regional Chamber says its series of television commercials highlights the agency, which deals with federal nations along the corridor, and to has one of the worst regional public lack of effective regional mass transit and how that is a drain on the local economy. funding for transit projects, has fuel economic development along transit systems in the country and been handling the BRT study for the the route. the different aspects of this very real nancial details were not disclosed. lo, N.Y.-based Joe Slade White & Co., RTA as the organization ramped up. The RTA also is responsible for problem facing employers having The RTA in May plans to intro- named for a noted longtime Demo- If the plan, tax and federal capital coordinating mass transit opera- access to talent and hiring new em- duce its regional mass transit plan cratic strategist who worked on funding are approved, the line tions and funding across the four ployees, workers getting to jobs, and that will include a November bal- Mike Duggan’s successful write-in could be underway by 2018 or 2019, counties, including cooperation seniors and people with disabilities lot proposal seeking a tax to fund campaign for mayor of Detroit. SEMCOG has said. among established transit agen- being stranded or with too few op- the project across Wayne, Ma- The RTA was created in 2012, BRT lines are less expensive to cies such as the Detroit Department tions,” Jim Martinez, the chamber’s comb, Oakland and Washtenaw after 40 years of failed attempts to build than train lines. of Transportation and SMART bus director of communications, said counties. do so, with the intent of creating a Woodward would be the initial systems. Ⅲ via email. The TV commercials are officially regional transportation plan and line, as recommended in a report Bill Shea: (313) 446-1626 The first 30-second spot started the work of A Coalition for Transit, network for the commissioned by SEMCOG and re- Twitter: @Bill_Shea19 airing Tuesday on targeted cable run by the Detroit office of Lansing- metro area. networks, the chamber said. based public relations and nonpar- Michael Ford, The campaign is being paid for tisan political consulting firm Tr- the RTA’s CEO, by the Detroit Regional Chamber Foun- uscott Rossman LLC. has said the or- dation with support from the Troy- The commercials don’t specifi- ganization’s based Kresge Foundation. Specific fi- cally endorse the RTA’s to-be-un- board is expect- veiled tax proposal. The plan re- ed to approve portedly is expected to be about a the ballot pro- Deadline nears to enter 1-mill property tax increase, which Michael Ford: RTA posal in July. equates to $100 on each $100,000 of CEO has said the Ford and other Cool Places contest a home’s taxable value. board is expected RTA officials “We’re focused exclusively now to OK a ballot pro- have spent Crain’s is still taking applications on a public information and educa- posal in July. about a year for its biennial Cool Places to Work in tion campaign to highlight the hosting meet- Michigan awards. problems facing Southeast Michi- ings with the public and business, The competition has two parts: gan’s regional public transit sys- political and civic leaders to get RETHINK one questionnaire for employers, tem,” Martinez said. opinions about transit needs and to another for employees. The com- “A strong, connected regional educate the public about mass tran- bined, weighted results of the two transit system has been a long- sit plans. YOUR COMMERCIAL will determine who qualifies for standing priority for the Detroit The RTA has a stated goal of get- Cool Places designation. Regional Chamber and our mem- ting a dedicated tax issue on the 2016 INSURANCE AND Best Companies Group of Harrisburg, bers to compete effectively across ballot to fund what will be laid out in Pa., supplies all participating com- the country and ensure future a master plan, which is expected to RISK STRATEGY. panies — regardless of whether they economic growth and vibrant be a bus rapid transit system. win the Cool Places recognition — communities.” Under a bus rapid transit (BRT) with an employee feedback report The spots were created by Buffa- system, buses operate much like a based on responses to a 72-question survey. The report can help company executives identify strengths and weaknesses in their company culture and practices. To be considered for Cool Places to Work in Michigan, companies must register by April 8. Once registered, companies will be invited to participate in the surveys. Businesses and nonprofits can apply. Applicants must have a mini- Call Paul Mattes mum of 15 employees working in Vice President-Principal Michigan and have been in busi- Certified Risk Architect ness at least one year, among other criteria. At the Sterling Insurance Group, we “RETHINK” every aspect of Companies pay a fee based on our clients’ insurance strategies. Our proprietary Risk Path Process, company size to Best Companies to cover survey costs. The cost ranges provides a diagnostic approach, investing our time and technical from $610 to $895 for online survey- “As part of the Cohen & Company team, we deliver resources to identify and manage your risk. This proven process will ing, and $765 to $1,660 for paper the strength and depth of more than 400 professionals minimize claims and effectively reduce your insurance costs. surveying. Contact Crain’s Assistant Manag- to help private companies seize opportunity.” 888.525.7575 | 586.323.5700 | sterlingagency.com ing Editor Kristin Bull at (313) 446- – Mike Lorenz, Partner Commercial Insurance • Employee Benefits • Personal Insurance 1608 or [email protected] with any questions regarding the nomina- one firm, better together | cohencpa.com/ghd 2015 tion process. Ⅲ 20160321-NEWS--0020-NAT-CCI-CD_-- 3/18/2016 11:30 AM Page 1

20 CRAIN’S DETROIT BUSINESS // MARCH 21, 2016 PEOPLE: SPOTLIGHT Colorado company to buy Accounting firm president Holt named Greenpath president and CEO Kristen Holt, former COO of Ann Arbor physicians group McKervey dies at age 61 Detroit-based United Way for Southeastern Michigan, was By Jay Greene EPMG is expected to con- named president and CEO of [email protected] tribute annualized net revenue By Tom Henderson professional. Farmington Hills-based Green- One of the biggest emer- of about $140 million, Envision [email protected] “I admired his strong leadership path Debt Solutions Inc., effective gency medical groups in Michi- said. The deal is expected to Kevin McKervey, president of style and his courage to step out- April 11. gan has signed an agreement to close in about 30 days. Southfield-based accounting and side the box. As a leader, when it Holt’s be acquired by Greenwood Vil- “(We are) celebrating 40 consulting firm Clayton & McKervey came time to make the call, the predecessor, lage, Colo.-based Envision years of delivering innovative PC, died March 13 at age 61. team always knew they could Jane McNama- Healthcare Holdings Inc. for about and compassionate care, and A cause of count on Kevin to be fair. He was a ra, filed a $120 million, according to Envi- we found ourselves considering death was not unique individual and will be wrongful ter- sion. opportunities to further evolve disclosed. sorely missed.” mination Ann Arbor-based Emergency so we are well positioned to best McKervey is Last June, McKervey appoint- lawsuit Physicians Medical Group em- serve our patients for the next survived by his ed his successor, Rob against the ploys more than 500 physicians 40 years,” Christopher R.H. wife, Patty, and Dutkiewicz, who assumed the credit coun- and other providers; staffs 37 Newton, M.D., CEO and man- two children, role of president on Monday. Kristen Holt seling non- health care facilities in Michi- aging partner of EPMG, said in a Michael and “Kevin personified professional- profit last gan, Illinois, Indiana, Ohio and statement. Jennifer. ism and caring,” Dutkiewicz said. week in Oakland County Circuit Iowa; and manages nearly 1 Envision owns multiple Kevin McKervey: He joined the “He was a mentor to many and a Court. McNamara departed last million patient encounters each physician-related services that Instrumental in firm in 1990 and friend to all. Everyone at Clayton & June after the Greenpath board year in hospital emergency de- contract with consumers, hos- Southfield firm’s served as presi- McKervey will miss his words of allegedly declined to renew her partments and urgent care cen- pitals, health care systems, growth. dent since 2012, wisdom and guidance. Our contract, and COO Donna McNeill ters. health plans, and local, state following the re- thoughts and prayers go out to his has since led the company. Founded in 1976, EPMG con- and national government enti- tirement of Don Clayton. He had family.” tracts with 22 health care facilities, officials said. led the international practice at Condolence cards may be sent Price to retire as DPS ties in Michigan and several It owns American Medical Re- Clayton & McKervey for years and to the McKervey family in care of Foundation president hospitals in Southeast Michi- sponse Inc., an ambulance com- was instrumental in the growth of the Clayton & McKervey office at gan, including Henry Ford Wyan- pany; EmCare Holdings Inc., the firm. 2000 Town Center, Suite 1800, Glenda Price, president of the dotte Hospital and at least eight which manages emergency, “Kevin and I were business Southfield, MI 48075. Detroit Public Schools Foundation facilities owned by St. Joseph anesthesiology, radiology, hos- partners for nearly 25 years,” Clay- Donations in McKervey’s since 2012, will retire March 25. Mercy Health System. pitalist and surgery physician ton, who remained chairman of name may be made to the Boys Pamela It also operates community services; and Evolution Health the firm, said in a news release. & Girls Club of Oakland & Macomb Moore, presi- paramedicine programs and LLC, a care coordination servic- “During this time, I came to Counties, the Methodist Children’s dent and provides telemedicine services es company. Ⅲ know him as a trusted friend, a Home Society and Benefit 4 Kids. Ⅲ CEO of the in urgent care and post-acute Jay Greene: (313)446-0325 confidant, a visionary and a well- Tom Henderson: 313-446-0337 Detroit Em- care operations. Twitter: @jaybgreene respected businessman and Twitter: @TomHenderson2 ployment So- lutions Corp. for four years, will succeed ADVERTISING SECTION Glenda Price Price effective March 28. Price previously was president of Marygrove Col- lege and interim president of the Michigan Col- leges Founda- Pamela Moore tion. Moore was Jennifer L. Dale and Thomas Tilton director of the Detroit Workforce CONSULTING Development Department for Director of Program Expansion & Business Development, nearly two years prior to head- ing DESC. The nonprofit DESC Kristine Scheer, Director of Program Operations has named COO Jose Reyes as Director of Development interim CEO. & Engagement, New Center Community Services Cambridge Consulting Jennifer L. Dale joins New Center Community Services as Director of Program Crittenton names Dimond Group Expansion & Business Development. She has spent more than 20 years leading fund & Margaret Dimond Scheer will focus on working was named business development operations as well as community relations, marketing, Crittenton Hospital with current and prospective clients to build president of communications & partnerships. At NCCS she is responsible for identifying, evaluating, Medical Center strategic, comprehensive benefit and insurance , replacing acting analyzing, developing & implementing new opportunities & partnerships. Jennifer is a president Terry Hamilton, who plans, reflective of the firm's unique and Leadership Detroit XXXII graduate & was named 40 under 40 by Crain's Detroit dynamic needs. Before joining Cambridge, she took leadership of the hospital Business in 2009. Ascen- spent more than 15 years as an independent after sion Health consultant. Prior to her consulting work, she Tony Watkins is now the Director of Program Operations at New Center Community Michigan served as group insurance underwriter at Services, he was previously the Clinical Manager for the Medication Clinics at NCCS. completed Prudential Insurance Company. Scheer speaks He has been a clinician manager within non-profit and private mental health settings and writes frequently about the Affordable Care the acquisi- within the Detroit-Wayne County area for 15 years. Tony is a former Law Enforcement tion last year Act, benefits program alignment and the Officer with the United States Air Force. Tony earned graduate degrees in Professional exchange marketplace. of the for- Counseling and Social Work with a certificate in Child Play Therapy. merly independent hos- Crain’s has moved its complete list Margaret Dimond pital based in of appointments and promotions to For more information or questions regarding Rochester www.crainsdetroit.com/peopleonth Hills. Dimond, recruited away advertising in this section, please call Lynn Calcaterra at from Detroit-based Barbara Ann emove. Guaranteed placement in Karmanos Cancer Institute, begins print and online can be purchased (313) 446-6086 or email: [email protected] her new duties May 1. Ⅲ at this website. 20160321-NEWS--0021-NAT-CCI-CD_-- 3/18/2016 3:33 PM Page 1

CRAIN’S DETROIT BUSINESS // MARCH 21, 2016 21

Where they stand share, and some to increased produc- but plays a much smaller role.” in the U.S., and Michigan, by in- NAFTA tivity — in that order,” McAlinden said. U.S. manufacturing productivity, creasing available investments for FROM PAGE 1 Democrats “Much of Delphi and Visteon moved to or how efficiently production in- new plants, workforce development the buying power of U.S. citizens ■ Bernie Sanders: Wants to reverse Mexico after the spinoffs in 2000. (Free puts, such as labor and capital, are training and finding new ways to and ensured economic growth. NAFTA and other free trade trade) didn’t save General Motors, and being used to produce a given level lower transportation costs. “The basic theory of economics: agreements. now assembly is moving to Mexico.” of output, parts and cars, shot up “We’re not going to reverse global- International trade raises everyone’s GM plans to invest $5 billion into sharply during the 1990s, growing at ization, and renegotiation is too risky, ■ Hillary Clinton: Has remained standing of living around the doubling its capacity in Mexico by an annual average of 4.1 percent be- opening a Pandora’s box for Mexico neutral on free trade. world,” Grimes said. “Over the last 2018. Ford is following suit with the tween 1990 and 2000. Manufactur- and others to renegotiate any and all 20 years, the most significant gains Republicans build-out of a new plant south of the ers achieve increased productivity treaties,” Masters said. “There’s no may be for the Chinese or Indians ■ Donald Trump: States he’ll either border, and FCA US LLC is moving by doing more with less, using au- substitute for taking the bull by the who have gained more than the scrap NAFTA or renegotiate. certain assembly to Mexico as well. tomation and efficiencies to create horns and doing things domestically U.S., but the theory holds up.” Livonia-based Alpha USA, a fami- more product with fewer workers. to make it easier for our companies ■ Ted Cruz: Wants to tax imports Economic theory says job losses ly-owned manufacturer of engi- Grimes argues that Michigan in to compete and create jobs. We need and recently has been vocal about are offset by lower prices gained neered fasteners for the automotive the Detroit 3’s heyday here operated to get our domestic house in order.” the negative impacts of free trade from increased competition and industry, created a joint venture in in a bubble economy under greater- McAlinden calls for a renegotiation but hasn’t taken a stand against it. lower operating costs. Mexico last year as a direct result of than-average wages in a specialized of NAFTA as well as punishing Mexico Through trade, we get cheaper tel- ■ John Kasich: Has been vocal on his shifting jobs due to NAFTA, said industry far longer than expected and for not following provisions in the evisions while focusing on higher- support of NAFTA and voted for it, but David Lawrence, vice president and enjoyed far more during that period. agreements, including worker rights value specialties, Grimes said, such if elected would fight harder to chief administrative officer. “Michigan enjoyed a monopoly in and environmental regulations. as automotive R&D and software. enforce provisions to keep jobs in the “Our customers have moved their auto production for decades, just as “First of all, the rules must be en- “Many people that lose their jobs U.S. production to Mexico and have re- others had monopolies on steel or the forced or the companies should pay a don’t think this way, but it’s better for quired us to support those operations Internet,” Grimes said. “The competi- fine … which can be used to compen- their kids,” he said. “We’re absolutely pared to other states,” McAlinden or lose the work,” Lawrence said. “We tion and deregulation, among other sate workers and states affected by better off through free trade and eco- said. “The benefits to trade are un- created a JV, but we’d prefer to have factors such as trade, put the squeeze NAFTA,” McAlinden said. “Second, a nomic growth through productivity.” evenly distributed. ... Costs in some re- done that as a business strategy for on those industries, and they’ve had ramp down tariff of 20 percent that Michigan’s gross domestic product gions like Michigan are so high in the growth and not having to do it be- to transform. One way is to put down- falls by 2 percent a year to allow some has grown to $417.3 billion in 2014 short run that even benefits in the cause of trade practices that are caus- ward pressure on wages.” time for adjustment in affected states from $385.3 billion in 2000, only seeing long run do not make up for them.” ing us to do work in other countries.” “Auto plants are making more and industries.” a stumble during the Great Recession. In 1999, five years after NAFTA was But the largest contributor to the vehicles with many fewer people Grimes said that the spirited debate But it’s nearly impossible for some- enacted, Michigan’s automotive manufacturing job losses in South- than in 2000,” Grimes said. “They over trade has more to do with the body who has lost a real job to swallow manufacturing employment was east Michigan remains a debate are producing more with less, and current global uncertainty than jobs. economic theory. While opening up 320,600, compared with just 175,600 among economists and researchers. there’s no indication that’s going to “Wage growth has been weak for 40 trade creates a larger, more competi- in December 2015. The Great Reces- Grimes, for instance, believes stop. We don’t want it to stop.” years, so everyone in the market has tive industry at cheaper costs for every- sion claimed many of these jobs, but free trade plays only a minor role in But to McAlinden, Lawrence and known weak wage growth. If we look one, manufacturing activity is concen- as McAlinden points out, the decline the region’s manufacturing decline. Marick Masters, director of at subjective measure, people are bet- trated in areas like the Midwest and was occurring before the recession. “The biggest contributor to job Labor@Wayne and professor of busi- ter off,” Grimes said. “The new aspect Michigan, said Sean McAlinden, chief The state lost 132,400 manufacturing losses is productivity growth, not ness at Wayne State University, the is the increase in anxiety, terrorism, economist for the Ann Arbor-based jobs between 1999 and 2007, accord- trade,” Grimes said. “Without free negative impacts of free trade need mass shootings and, more to the Center for Automotive Research. ing to Bureau of Labor Statistics data. trade, you’d have a few more jobs, to be countered. point, economic uncertainty.” Ⅲ “NAFTA was a disaster for Michi- “Much of the employment loss is but only temporarily. Trade is not a Masters said the U.S. needs to in- Dustin Walsh: (313) 446-6042 gan — there are no positives com- due to trade, some to loss of market negligible contributor to job losses, centivize manufacturing to remain Twitter: @dustinpwalsh REAL ESTATE JOB FRONT

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22 CRAIN’S DETROIT BUSINESS // MARCH 21, 2016

Roberts, 67, says he is confident — who is not named or implicated use buildings and other properties,” terest. Within three weeks of Signal HOTEL about the site, formerly known as the in the Signal Restoration lawsuit or he said, declining to disclose the Restoration filing its Dec. 7 lawsuit FROM PAGE 1 Omni Hotel in the Stroh River Place de- EDC counterclaim — had amassed current value of his holdings, or the against Roberts in Wayne County velopment, and that the legal issues a business empire that included TV revenue or profit of the Roberts Circuit Court, the EDC called in the But Signal says it did much more will be resolved. and radio stations, real estate devel- Riverwalk Hotel last year. $700,000 loan. work than that, at the request of “It’s all going to resolve with most opments, hotels and other holdings EDC forecloses Now it wants its money back, too. Roberts or his representative: of (the creditors) being satisfied fi- in the Roberts Cos. Insurance disputes $575,753 worth of it was never paid nancially, and me being satisfied fi- Its value: $1 billion, the CNN re- But in 2011, the EDC saw Roberts for, according to a construction lien nancially, and that’s that,” he said. port said. Since then, however, much as a solid bet to redevelop the Omni Another looming question: What foreclosure lawsuit filed in December. In the end, experts said, the hotel of it has new ownership: media sta- Hotel. Roberts, after all, had a strong happened to $800,000 in insurance Liens for unpaid work are not un- at 1000 River Place could end up tions have been sold or shut down; career in real estate and even politics payments? common in real estate, with payment sold to new owners to repay credi- and hotels and other real estate have (he was a member of the St. Louis That’s a question Signal Restora- disputes often arising between con- tors — if a judge rules in their favor been sold off to new owners, some- Board of Aldermen from 1977 to 1985 tion has about insurance claim pay- tractors and property owners . — or its legal owner, Roberts Hotels times in the middle of construction. and was a candidate for St. Louis ments allegedly made to Roberts by But it’s not just the Signal Detroit LLC, a Missouri entity regis- Jeff Kaiser, managing director in mayor in 1989). New Jersey-based Chubb Group of In- Restoration lawsuit that some ex- tered to Roberts, could file for the St. Louis office of CBRE Inc., said He served on committees and ad- surance Cos. perts are saying is a sign of a bumpy bankruptcy. his company was retained to sell a visory councils for the Federal Commu- In its lawsuit, Signal says there was a road ahead for the hotel. Arrived in Detroit number of Roberts’ downtown real nications Commission and the U.S. De- “direct pay” clause in its contract with The EDC, which issued Roberts a estate holdings in that city. partment of Commerce, according to his Roberts Hotels Detroit LLC, which is $700,000 first-position mortgage in Shortly after CNN published an “The only new high-rise residen- online biography on the website of the Missouri ownership entity. That February 2011 and is named as a de- August 2009 report trumpeting the tial building in downtown St. Louis in the Detroit RiverFront Conservancy web- clause stipulates that Roberts “agreed fendant in the lawsuit, alleges that it, Roberts brothers’ business success, forever, 50 years or so, they started it site. Roberts is on the board. to authorize and direct its insurance also, has not been paid on its loan. Michael Roberts came to Detroit. and then didn’t finish it,” he said. But, according to documents filed carrier to include Signal’s name on all It’s not the first time debt issues And there was a lot of hope sur- That project, formerly named the in circuit court, two extensions of the insurance drafts for all insurance work” have arisen over the site. There was a rounding his arrival. Roberts Tower, is now the 25-story EDC’s no-interest, no-payment period at the hotel, the lawsuit says. nearly $81,000 unpaid tax bill on “People were excited,” said Mike Tower at OPOP after the unfinished were granted on the hotel’s mortgage But Chubb included Signal on just which a lien was filed in November O’Callaghan, executive vice presi- project was purchased in October on Feb. 29, 2012, and a year and a half one payment — one check for $7,200 2013 and resolved in January 2014, dent of the Detroit Metro Convention 2012 in a $16.5 million portfolio deal. later on Aug. 22, 2013, with those terms — before it is alleged that it was “direct- according to county records. & Visitors Bureau. “They said they Roberts said the 2008 recession expiring Jan. 1, 2014. The loan’s maturi- ed by RHD (Roberts Hotels Detroit) (Roberts said in an email “there may were investing in the property and prompted “a strategic discussion” to ty date remained Feb. 1 of this year. and Roberts to cease any further pay- have been a mistake with the pay- were going to restore it to a pretty sell off some assets. The EDC says in court documents to Signal,” according to the law- ment” and that “it was corrected decent hotel.” “We still own strip shopping cen- ments that it is owed nearly suit. The lawsuit also alleges Roberts once we learned of it.”) Roberts and his brother, Steven ters, radio, various other loft mixed- $745,000 on the loan, including in- Hotels Detroit and/or its representa-

G E IV IL E M YO S U TO R E N MP SO LOYEES A REA

ence of residents who are familiar Travel Michigan has tried to jump- Lorenz called standard in the indus- said. That figure is projected to grow TRAVEL with the state and out-of-state visi- start the project at least twice before. try, to avoid biases or favoritism by 10 percent in the next year. FROM PAGE 3 tors who are exploring it, said Tim The request for proposals that pro- when choosing a vendor. Miles works exclusively with the they want. Smith, president and CEO of Detroit- duced the Miles Media contract was Smith said Skidmore Studio saw tourism industry. Clients include “The last thing we want to do is based creative firm Skidmore Studio. the third such request in more than a the state’s request for bids and more than a dozen state tourism frustrate people when they come to “You have the user first in mind” year. opted not to submit one, saying the departments, along with regional the website and force them off,” with any successful website, Smith Keeping the biz home? process can cost a bidding firm at visitors bureaus, international trav- Lorenz said. “That’s just wasting a lot said. That is followed by a clean, simple least $100,000 to prepare a proposal el agencies, resorts and airports. of money and a lot of time. The web- design; navigation that anticipates Miles Media won the current and the chances of landing a gov- It has not worked directly with site is an incredibly valuable tool — what a user will be looking for and website contract over 21 other com- ernment contract are slim. Michigan before, said Luciani, who when it is delivered properly.” making those items easy to find; and, panies that submitted bids, includ- Regardless, Smith said, the added that he has seen Pure Michi- ‘Better maps’ and more in Michigan’s case, better integration of ing 12 based in Michigan. choice of vendor is hard to defend. gan ads. However, the company has the popular Pure Michigan campaign. At least two others have done work “We really do need to invest in worked on behalf of the state through That’s not happening regularly, ac- “Other than the Pure Michigan for the state — MRM/McCann, based the state, but they don’t see that Brand USA, a public-private organiza- cording to open-ended website feed- iconography and the brand mark, it in Birmingham, whose sister adver- their own actions contradict that tion that works with the tourism in- back provided to Crain’s by the Michi- makes some attempts at doing that tising firm McCann Erickson is the very message,” he said. “They’re not dustry and the federal government to gan Economic Development Corp. The with typography, but it doesn’t carry agency of record for Travel Michigan investing in Michigan firms, even market the U.S. as a vacation destina- research is conducted by Ann Arbor- the brand,” Smith said. and produces the Pure Michigan ads, though Michigan firms bid on it.” tion to international travelers. based ForeSee, which measures cus- Ironically, emphasis on the state’s and Lansing-based Gravity Works De- Field experience “The current website is not only tomer experience and website us- $33 million Pure Michigan marketing sign LLC, which redesigned the official dated in design and content, but per- ability for clients in such industries as campaign has kept the state from in- state government site, Michigan.gov. Roger Miles, founder and CEO of forms only modestly in seasons out- retail, health care, consumer prod- vesting in its travel website: “Because Critics say the state should have Miles Media, bought the company in side of summer,” the company wrote ucts, government and travel. we’ve been putting our resources into found a Michigan-based company the 1990s. It had its start as a produc- in its proposal. “The site is back- Visitors encountered broken links, other marketing efforts,” Lorenz said, to do Michigan marketing work, er of travel brochures and pamphlets, wards-looking in its key capabilities incomplete events calendars, overly “we haven’t kept up with the time and though Lorenz said the decision was the kind often found in hotel lobbies. and features around content, per- broad search results and, one user changed with the new technology.” based on the recommendation of a Today, 90 percent of its work is sonalization, measurement, moneti- said, “a lot of useless info to sift He said he doesn’t remember committee that evaluates proposals digital, said Doug Luciani, Miles zation and social media integration.” through.” Variations of the suggestion when the tourism website last was based on both price and value. Media’s communications and Miles Media will hire Brighton- “better maps” came up repeatedly. redesigned, but for years it has been The committee, which included branding vice president. based digital marketing agency The challenge for Travel Michigan subject to so many small, back-end marketing staff and industry profes- The company employs about 200 TwoSix Digital as a subcontractor, is to create a website that can re- adjustments that future technical sionals, considered only bid people and has more than $50 mil- though the scope of work and sub- spond to the needs of a diverse audi- fixes aren’t possible. amounts of finalists — a process lion in annual net revenue, Luciani contract value have not yet been 20160321-NEWS--0022,0023-NAT-CCI-CD_-- 3/18/2016 5:22 PM Page 2

CRAIN’S DETROIT BUSINESS // MARCH 21, 2016 23

tives “has used, or intends to use, the Christian Johnson. ing or by phone that the loan was mer Detroit-based pharmaceutical how court proceedings develop. insurance proceeds for other im- Less than a year after it was regis- due,” he said. company. Matt Lester, founder and CEO of proper purposes.” tered with the county, the mortgage “The only time I saw anything was The initial development of the Bloomfield Township-based Princeton Roberts denies that in court filings. term was amended. The current at the point they sent us a letter a few hotel perhaps was an answer to a Enterprises LLC, which has bought or is He says much of the money was term is 40 years, with it maturing on months ago that we were in default problem that didn’t exist, said Ron under contract to buy a pair of near- spent repairing Signal’s work, which Feb. 1, 2052, according to docu- and that we owed interest for a year. Wilson, CEO of Troy-based Hotel In- by properties — the Talon Centre office he said was unauthorized. ments filed with Wayne County. Boom. It was like a cliff.” vestment Services Inc. Shortly after it building and the 301-unit Stroh River Signal is being represented by “It is highly suspicious that a le- The EDC said in a statement that opened, he came to the hotel when Place apartments — said the hotel Birmingham-based law firm gitimate, arms-length lender would the loan was made through its Casino it was still owned by the Stroh fami- could use some work. Kostopoulos Rodriguez PLLC. extend a commercial mortgage Development Revolving Loan Pro- ly and performing poorly. “The bones of the building seem Dino Kostopoulos, managing term an additional 32 years, and do gram, which makes loans primarily to “The hotel, as beautiful as it was, very solid to the naked eye, and the partner of Kostopoulos Rodriguez, so without any expressed additional small businesses in the central busi- was not the type of hotel you would grounds have tremendous potential, denied in a statement that Signal did consideration,” said Kenneth Neu- ness district, the east riverfront and have built at that time, in that loca- but let’s be honest, it needs help.” work outside of what was requested. man, managing partner of the Neu- some areas of the Woodward corridor. tion,” Wilson said. Occupancy rates The best use for the site may be “All of the emergency work per- man Anderson Grieco McKenney PC “Since being named as a defen- were 50 percent or less. apartments or condominiums, formed by Signal on the Riverwalk law firm in Birmingham. dant in Signal’s lawsuit, the EDC has It got to the point where he rec- he said. Hotel was authorized by the owner But Roberts says the mortgage is taken, and will continue to take, ap- ommended that the Stroh family “A successful hotel is perhaps pos- or owner’s representatives,” he said. legitimate. propriate steps to protect its collater- close the hotel. It was, eventually, sible, but I don’t believe the Roberts And a third financial dispute at “It’s a bona fide mortgage that sits al position,” it said. The EDC is being mothballed from 1992-1994. hotel is in an ideal location for hospi- stake: A $2 million second-position on the property,” Roberts said. “I ne- represented by Detroit-based law Crain’s reported that the hotel re- tality, particularly in light of the cur- mortgage issued by Blackstar Finan- gotiate very good terms — I was able firm Kotz Sangster Wysocki PC. opened in May 1994 by Grand Her- rent hotel development and future cial LLC, another Missouri entity. to borrow $700,000 with no interest Messages left last week with itage Hotels. A few years later, in planned development in the CBD.” Signal claims in its lawsuit that the and no payments.” Lawrence Walker, the Detroit-based 1998, it was purchased by what was Roberts, though, remains opti- mortgage, issued in January 2012 with He also says the default on the first attorney representing both Roberts then Omni Hotels Corp. of Irving, Texas, mistic about the future of the hotel a maturity date of February 2020, “may EDC mortgage is a misunderstand- and Blackstar Financial, went unre- in an estimated $6 million deal. and resolution of the litigation. be a sham and given for no value.” ing. He says it was automatically put turned. Roberts then purchased the hotel “These businesses don’t make Legal and mortgage experts said into default when the Signal lawsuit A troubled location? from Omni in November 2010. money for five or six years. It takes a there are uncommon elements to was filed, and that he had been in So what’s in store for the site? while,” he said.“To be in Detroit on the mortgage, documents for discussions with previous executives Developed nearly 30 years ago as Roberts denies rumors that he top of that, which is a great city but which were apparently written by with the DEGC about continuing the the River Place Inn as part of the 25- has been quietly attempting to sell has its challenges, we are just trying Roberts’ daughter, Jeanne R. John- no-interest, no-payment terms of acre Stroh River Place project, the it, although the hotel could end up to do the right thing. Ⅲ son, and the issuing entity for which the loan. Roberts Hotel sits on land formerly on the market to satisfy the EDC or Kirk Pinho: (313) 446-0412 is registered to her husband, Jay “We were never informed in writ- owned by Parke-Davis & Co., the for- Signal Restoration debts, depending Twitter: @kirkpinhoCDB

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decided. Over the past four years, Michigan tions usually prefer to have a devel- rooftop solar panel — is hoped to Dave Serino, TwoSix Digital’s PACE Saves has helped 403 customers with oper or building owner show their be completed by the end of 2018 founder and strategist, said his FROM PAGE 3 $12.8 million in mostly energy-effi- interest for such financing before and help cut electricity costs of company is a small consulting recycling center, purchased LED ciency projects, Templeton said. opting in,” Mattler said. $20,000 per month by 30 percent. firm that would not have bid on lights and began working toward be- Under PACE, which has been ap- Improvements that qualify for fi- ABM Industries Inc. is advising the the project itself. coming a zero-landfill business. Its proved in 32 states, including Michigan nancing include upgraded heating arena. TwoSix Digital and Miles Media annual electric bill dropped to in 2010, property owners can receive and cooling systems, LED lighting, “Our electricity savings will pay have collaborated on projects dat- $139,000 from $205,000. long-term loans for energy upgrades at savings on water usage, solar pan- for the project and free up cash for ing back 10 years, Serino said, in- Michigan Solar Solutions of Com- fixed interest rates by working with mu- els, wind turbines, and basic up- other projects,” he said. “It’s really a cluding marketing work in merce Township and Dembs Roth nicipalities to repay the loans through grades to windows and doors. great program.” Louisiana and New Zealand. Construction Co. of Plymouth their property tax bills. Last year, Levin persuaded Levin has been able to persuade Serino’s background is in the worked on the Powers project. Michigan’s Lean and Green PACE Bloomfield Township to approve more than 18 counties in Michigan tourism industry. He said he PACE is one of two programs in program is being promoted by An- PACE for its businesses, said Leo to approve PACE. So far, in South- helped develop a website for the Michigan that help businesses and drew Levin, the son of U.S. Rep. Savoie, township supervisor. east Michigan, Levin has persuaded Ann Arbor regional convention home owners finance energy-effi- Sander Levin, and president of Levin “Detroit Skating Club asked us to Wayne, Macomb and Washtenaw and visitors bureau in the mid- ciency and renewable-energy proj- Energy Partners LLC. Levin is the former participate, and our feeling is if we counties to participate along with 1990s as its marketing director and ects. The other program, geared deputy director and acting director of can set up a program that doesn’t eight municipalities in other coun- later worked on an early email more for smaller businesses, schools, the Michigan Department of Energy, cost the township money and helps ties, including Southfield and Troy. marketing program for the state. municipalities and residential home Labor and Economic Growth in the Gov. commercial owners, why not do it?” Kenneth Randazzo, DTE’s man- TwoSix Digital was founded in owners, is called Michigan Saves. Jennifer Granholm administration. Savoie said. ager of energy optimization and en- January 2014. It offers clients help “We back the loans in case peo- In Michigan, PACE has been The Detroit Skating Club is plan- ergy partnership, said PACE and with strategy and digital and social ple default, up to $30,000, at rates somewhat limited because it’s a ning a $1 million investment in the Michigan Saves are financing op- media platforms. less than 5 percent with longer new and requires local governmen- next couple of years to upgrade its tions for customers. “We are going to be the local ex- terms,” said Mary Templeton of tal taxing bodies to approve the pro- arena and parking lot lighting sys- Last year, DTE processed more perts” on the website project, Seri- Michigan Saves in Lansing. “We gram for businesses in their juris- tems to LED lighting, said Jerod than 8,000 applications for business no said. “Miles has all the tools, all work with contractors who talk with diction, said Robert Mattler, Swallow, managing director of the customers but had only about 100 the expertise and the development owners about financing options.” managing director in Michigan of nonprofit arena in Bloomfield Hills. who went through the programs. end, and we’re bringing our local Like PACE, Michigan Saves works PACE Equity LLC, a national PACE de- “We are always trying to improve “Some may have gotten financ- relationships and our local closely with DTE Energy Co., Consumers velopment and finance company. the building and keep costs down ing from their own bank,” Randazzo expertise.” Ⅲ Energy Co. and other utilities to devel- “Many banks are not that famil- for our members,” Swallow said. said. “It is underutilized.” Ⅲ Lindsay VanHulle: (517) 657-2204 op energy-efficiency programs and iar yet with this alternative financ- Swallow said the project — which Jay Greene: (313) 446-0325 Twitter: @LindsayVanHulle incentives, Templeton said. ing mechanism, and local jurisdic- also includes a 150-square-foot Twitter: @jaybgreene 20160321-NEWS--0024-NAT-CCI-CD_-- 3/18/2016 5:02 PM Page 1

24 CRAIN’S DETROIT BUSINESS // MARCH 21, 2016

witness after Sturman was charged bookstores, particularly the Water- Corporate PEEP in 1987, testifying that Sturman hid ford Township location on West FROM PAGE 1 money in Swiss bank accounts and Huron Street. Facility Graphics that Olsafsky was ordered to destroy “We raided it a couple times be- That Inspire took control of a distribution net- documents. The trial ended with cause underage people were walk- work from an infamous, pioneering Sturman convicted and sentenced ing out with some pretty hardcore pornographer. to 10 years in prison — where he magazines,” Patterson said. “It was Now, rivals have absorbed revenue would die in 1997. nothing that created any public out- that once went in Olsafsky’s pocket. “I think everybody went on their cry for law enforcement.” “Pornography is free now,” said merry way,” Rosfelder said. “Apparent- The most damaging fight for Ol- Tom Nardone, whose ly, Jim learned well and safsky came in Washtenaw County. Troy-based PriveCo Inc. was a smart enough guy Farmer, the former Ypsilanti sells adult products to parlay what became mayor, heard complaints from resi- online. “That business his into something very dents around March 2000 about al- has really disappeared, lucrative.” leged illegal activity at the Michigan especially with the ad- Olsafsky’s shops sold Avenue Books and News adult book- vent of the Internet. pornographic movies, store in the heart of the city’s busi- There’s only a few still magazines and offered ness district, in which Olsafsky had a around.” coin-operated peep financial stake. She pushed for an Years ago, Olsafsky show booths where undercover investigation. was awash in cash. He customers could pri- Nothing happened until the had so much money vately watch video- bookstore hung a “Help Wanted” that he bought a $60,000 taped porn. sign in the window. MARK KOTILA/SYLVIA KOLASKI timeshare in Mexico The stores soon ran “An officer answered it,” Farmer and never visited. So Artists’ illustration of into trouble — trouble told Crain’s. much cash that his $3 James Olsafsky, who ran an that later helped Olsaf- The investigation was productive. million, 19-acre Malibu extensive network of adult sky limit Michigan’s “It looked like they were keeping Entryways, Lobbies, Common Areas, Training Rooms, estate overlooking the bookstores. obscenity laws. double books, and there was prosti- Conference Rooms, Offices and much more. Pacific Ocean had its In October 1991, po- tution activity in the basement,” own name — Villa Vista lice officers launched an Farmer said. We do more than provide graphic branding solutions that attract and inspire. Our mission is to evoke a unique emotional experience and leave Oceano — and celebrity boarders. undercover operation and raided “There was some undercover a lasting impression on our partners and their clients. As a national Mariah Carey leased it, and alternative stores in Waterford Township, Pontiac video, I do remember,” Washtenaw leader in large format graphics, we set the benchmark for quality. From rock band Stone Temple Pilots record- and Hazel Park. Officers seized explicit County Prosecutor Brian Mackie said. our passionate team of creative designers, expert printers, and ed the album “Shangri-La Dee Da” magazines and videotapes and traced The investigation expanded, professional installers to our world-class facility and state-of-the-art there, according to a 2007 Los Angeles the products to Olsafsky’s warehouse Farmer said, after police started prob- technologies—we make you look remarkably good. Times article. Olsafsky had so much in Livonia, where they found maga- ing other stores tied to Olsafsky in cash he gave an ex-wife $20,000 a zines and videotapes. Michigan. week in alimony just to go away. Olsafsky fought back. Investigators executed 26 search All thanks to peep show booths In 1993, he won when the Michi- warrants across Michigan and Ohio, and adult bookstores, a relic of metro gan Appeals Court ruled the state’s seized thousands of documents and Detroit’s economic underbelly. civil obscenity law was overbroad $545,000 in cash, according to court “That man represents millions of and unenforceable. records. iMBranded.com / (866) 717-4467 unsatisfied lives. It’s a tragedy he was Olsafsky’s empire soon grew and In a settlement, the Ypsilanti store so successful,” said former Ypsilanti his lifestyle reflected riches generat- was closed and the land transferred Mayor Cheryl Farmer, who battled ed by the XXX trade. to the city. Olsafsky years ago while trying to He bought a $60,000 timeshare in As part of the global settlement close his adult bookstore. Los Cabos, Mexico, around 1990 — that resolved additional civil cases, Olsafsky wouldn’t comment to then never visited it, according to peep show operations were shut Crain’s about his career or recent court records. down at 16 other Olsafsky-related troubles. In 1997, he bought Villa Vista stores by February 2001. “He’s had a fascinating career, but Oceano. The gated estate features a The deal was costly. with that came a lot of pain,” wife 7,000-square-foot Mediterranean The Michigan peep show booths Linda Olsafsky told Crain’s. “He is villa with a pool, tennis court, gym, posted 70 percent profit margins burned out.” arboretum and horse stables, ac- and generated $1.49 million in rev- The porn career of James Olsafsky cording to a real estate listing. enue in 1998. dates to at least 1971. That’s when he By then, Olsafsky made enough In all, the investigation led to was living near Cleveland, working money to buy a Villa Vista Oceano three stores closing and cost Olsaf- as a bookkeeper for Reuben Stur- every year. sky more than $3.9 million in rev- man, who was considered the He owned a stake in 22 adult enue, according to a court filing. world’s largest distributor of pornog- bookstores, two wholesale compa- Olsafsky’s income kept falling in raphy in the 1980s. nies and real estate, according to 2000, tumbling more than 61 per- Sturman owned a far-flung em- court records. In 1998, he earned cent to $1,054,019. Most of that pire, including 13 businesses in more than $2.7 million. money — $823,000 — went to his Michigan, which generated millions. Olsafsky’s success surprised Ros- ex-wife. Officially, Olsafsky was bookkeeper felder, the former IRS agent who A year later, his income slid to for about 20 bookstores from 1971 to spent two decades investigating $666,980. In a court filing, Olsafsky 1984. Unofficially, he was ordered to Sturman’s business practices and blamed the drop on a loss of market destroy records subpoenaed by a fed- Olsafsky’s role. share to competitors in certain areas eral grand jury, according to Olsafsky’s “(Olsafsky) was basically an in- and “a loss of market share to Inter- testimony in a federal court case. significant part of a very big opera- net providers.” Guys like Internet By the mid-1980s, with the feds tion,” Rosfelder said. “He was just in entrepreneur Nardone of PriveCo, closing in on a tax evasion indict- the right place at the right time and who helped fuel the drastic swing in ment against Sturman, Olsafsky took kept the ball rolling.” the adult bookstore business. over the Cleveland porn king’s Michi- Olsafsky had enough money to Hardcore competition gan distribution network, according afford a costly divorce. In August to the 2003 book Reefer Madness: Sex, 1998, Olsafsky filed for divorce from Nardone witnessed its impact on Drugs, and Cheap Labor in the Amer- Georginna Olsafsky after 20 years of mom-and-pop porn shops, particu- ican Black Market by investigative marriage. She got $20,000 a week. larly in metro Detroit. journalist Eric Schlosser. He got the peep show booths. In 1998, the year Olsafsky filed for “We basically watched while Temporarily. divorce, Nardone launched what (Sturman) tried to spin off the busi- Legal battles would become PriveCo. The reputa- ness enterprises to various man- tion of peep show booths and adult agers and trusted people,” Internal His network of bookstores largely bookstores helped inspire him. Revenue Service investigator Richard escaped the wrath of Oakland “The reason I started my company Rosfelder told Crain’s. “His expecta- County’s prosecutor in the 1980s, is, basically, the embarrassment of tion was they would continue to said L. Brooks Patterson, now Oak- having to go into those places,” Nar- funnel money back to him.” land county executive. done said. “The seediest one I went Olsafsky was a key government He remembered Olsafsky and his SEE NEXT PAGE 20160321-NEWS--0025-NAT-CCI-CD_-- 3/18/2016 5:12 PM Page 1

CRAIN’S DETROIT BUSINESS // MARCH 21, 2016 25

FROM PREVIOUS PAGE their limited liability company for with its vintage fiberglass chicken CRAIN’S into 17 years ago on Eight Mile had a his own benefit and failing to make CHICKEN perched on the roof, for an undis- FROM PAGE 3 DETROIT BUSINESS peep show. I’ll never forget it. Someone payments. closed amount. And yes, the www.crainsdetroit.com yelled, ‘We need a cleanup in Booth 3!’ The Oakland County lawsuit was their plans to their mutual friend chicken is staying, they said. Editor-in-Chief Keith E. Crain I couldn’t get out of there fast enough.” dismissed in 2014 after Dedvukaj Moloney, who thought they The New Center location in De- Group Publisher Mary Kramer, By 2003, Olsafsky’s empire was was given access to the company’s sounded very similar. So he intro- troit, leased from the building (313) 446-0399 or [email protected] Editor Jennette Smith, (313) 446-1622 or down to 17 adult bookstores, the bank accounts. duced them, and the trio hatched owner who also owns Roby Shoes [email protected] wholesale businesses and real estate. Olsafsky, in return, sued Ded- Atomic Chicken, their so-called on the same block, will have a Director, Digital Strategy, Audience Development Nancy Hanus, (313) 446-1621 or “This decline has been brought vukaj and her husband, Ded, alleg- “chicken with an attitude.” more elaborate design and seating [email protected] about through adverse governmen- ing they seized control of three The restaurant’s menu has for about 40. Managing Editor Michael Lee, (313) 446-1630 or [email protected] tal action and changing market con- companies through fraud and after morphed into not only chicken The restaurant was a fully func- Managing Editor/Custom and Special Projects ditions, by external factors outside he was unable to meet a demand and waffles, but a chef-driven, ar- tioning Popeyes up until last Daniel Duggan, (313) 446-0414 or [email protected] the control of (Olsafsky),” his lawyer for $72,000. The couple’s lawyer ac- tisanal chicken place with a spring, and all of the equipment is Assistant Managing Editor Kristin Bull, wrote in a court filing. cused Olsafsky of fraudulent ac- healthy component and a lot still there, Moloney said. (313) 446-1608 or [email protected] Olsafsky didn’t see the value of the tions before the case was dismissed more thought and prep going into “The neighborhood we’re going News Editor Beth Reeber Valone, (313) 446-5875 or [email protected] Internet, Nardone said. in April 2014. the food, Reyner said. into is not going to be the same Senior Editor Gary Piatek, (313) 446-0357 “I’m the reason this guy is hurt- The couple’s lawyer declined to “We want to do a fast-casual neighborhood it will be in 2017; we or [email protected] Research and Data EditorSonya Hill,(313) 446-0402 ing,” he said. “My $4 million in sales talk about Olsafsky or the case and concept … where you’re getting a want to reflect that,” Reyner said. or [email protected] a year came out of his pocket.” refused to make her clients available high-quality product at an afford- Editorial Support (313) 446-0419; YahNica Craw- Chicken everywhere ford, (313) 446-0329 While rivals like Nardone innovat- for an interview. able price (and) where when you Newsroom (313) 446-0329, FAX (313) 446-1687 , ed, Olsafsky tried to combat the drop Court files, however, indicate the only have a half-hour for lunch Atomic Chicken is the second TIP LINE (313) 446-6766 in income and changing market con- fight ended with Olsafsky giving up you can get in and get out.” fast-casual chicken restaurant set- REPORTERS ditions by expanding his empire. his ownership in 19 southern stores. Fast-casual restaurants offer ting up in Detroit’s Midtown area. Jay Greene, senior reporter Covers health care, in- Starting in 2009, Olsafsky and a “My husband’s biggest error was counter service and usually offer As Crain’s reported in January, surance, energy, utilities and the environment. (313) 446-0325 or [email protected] partner bought a chain of stores in trusting the wrong people and giv- seating, said Rachel Royster, senior local chef Zack Sklar is bringing a Chad Halcom Covers litigation, the defense indus- Georgia and other southern states, ing too much,” Linda Olsafsky said. coordinator, editorial content at spicy Memphis classic to Midtown try and education. (313) 446-6796 or Gus’s World Fa- [email protected] according to court filings In 2013, Olsafsky was sued by sev- Chicago food research and consult- with the opening of a Tom Henderson Covers banking, finance, tech- In September 2011, Olsafsky and eral companies that supplied adult ing firm Technomic Inc., in an email. mous Fried Chicken franchise at Third nology and biotechnology. (313) 446-0337 or [email protected] a partner bought six bookstores — entertainment videos, clothes, sex They feature higher-quality food Street at West Alexandrine Street. Kirk Pinho Covers real estate, Oakland and Ma- three in California, two in Colorado toys and costumes. They said they and better ambiance than fast food “What Zack is doing with his comb counties. (313) 446-0412 or [email protected] and one in Washington. weren’t getting paid. restaurants, with check averages place and what we have envi- Bill Shea, enterprise editor Covers media, Olsafsky has remarried and lives In July, Olsafsky was ordered to generally ranging from $9.50 to $12. sioned are totally different,” advertising and marketing, the business of Chipotle sports, and transportation. quietly in the background of a con- pay $1.6 million, according to feder- Prime examples include Baldridge said. (313) 446-1626 or [email protected] troversial industry. al court records. Mexican Grill Inc. and Panera Bread Co. “His is more of a classic, Southern Robert Snell, reporter Covers city of Detroit and regional politics. (313) 446-1654 or “When I met him, I asked him In November, one of Olsafsky’s Atomic Chicken’s first location, fried, where ours is going to be more [email protected] what he did for a living. He said ‘I’m former companies, Gulf Coast Visu- set to open early next month in culinary, chef-driven.” Lindsay VanHulle, Lansing reporter. (517) 657- als Management Co. LLC 2204 or [email protected] in the adult bookstore industry.’ I said , was sued for Clawson, hits those marks, Royster Even outside Midtown, chicken Dustin Walsh, senior reporter Covers the busi- ‘let me ask you two questions: is there breach of contract in federal court said, even though it will be a carry- and waffles are putting down deep- ness of law, auto suppliers, manufacturing and Kuzzo’s Chicken & steel. (313) 446-6042 or [email protected] anything to do with children or hurt- in Detroit by peep show booth re- out-only restaurant initially, given er roots in Detroit. Sherri Welch, senior reporter Covers nonprofits, ing women?’ He said ‘absolutely not.’ pair firm XXX International Amuse- its setup. Waffles on northwest Detroit’s Av- services, retail and hospitality. (313) ments Inc. 446-1694 or [email protected] “Then I said ‘I don’t really care,’ ” The lawsuit alleged a The owners purchased the for- enue of Fashion has seen lines out his wife added. “As long as you’re le- service contract was canceled and mer Faym-Us Chicken building, the door in its first year in business. Ⅲ ADVERTISING gitimate and pay your taxes, I don’t equipment damaged, according to Sales Inquiries (313) 446-6032; FAX (313) 393-0997 Advertising Director Matthew Langan care.” court records. Senior Account Executive Katie Sullivan The exact scope of Olsafsky’s em- A Gulf Coast lawyer has denied Advertising Sales Catherine Grace, Joe Miller, pire is unclear. But in 2012 he had an the allegations in a court filing. Diane Owen, Sarah Stachowicz, Katie Sullivan Classified Sales Manager Angela Schutte, (313) interest in more than 32 adult book- Meanwhile, collecting the $1.6 446-6051 stores — some with colorful names million judgment could be a daunt- Classified Sales Lynn Calcaterra, (313) 446-6086 like Love Shack or Inserection — in ing task, said Abraham Singer, the Events Manager Kacey Anderson Creative Services Director Pierrette Templeton Ohio, Louisiana, Alabama, Florida, suppliers’ lawyer. Senior Art Director Sylvia Kolaski Georgia, Tennessee and Rhode Island. “I don’t know why he didn’t pay. I Marketing Coordinator Ariel Black The six Michigan bookstores, think somewhere he has the Special Projects Coordinator Keenan Covington Sales Support Suzanne Janik, YahNica Crawford meanwhile, are in Chesterfield money,” Singer said. “The challenge Editorial Assistant Nancy Powers Township, Roseville, Waterford is going to be finding it. He always Production Manager Wendy Kobylarz Township, Taylor, Mt. Pleasant and prepared for the day that he kind of Production Supervisor Andrew Spanos at the corner of Eight Mile and De- had to hide from reality.” CUSTOMER SERVICE quindre roads in Hazel Park— Olsafsky isn’t hiding in the Malibu Main Number: Call (877) 824-9374 where every Tuesday is “Dude’s mansion. The ex-wife got the estate or [email protected] Subscriptions $59 one year, $98 two years. Out of Day,” and designated items are on in the divorce. state, $79 one year, $138 for two years. Outside sale to male customers. These days, Olsafsky is living in a U.S.A., add $48 per year to out-of-state rate for sur- face mail. Call (313) 446-0450 or (877) 824-9374. The expansion preceded years of $678,000 home in a Plymouth Town- Single Copies (877) 824-9374 legal battles, including a fight with ship subdivision. Reprints (212) 210-0750; or Krista Bora at [email protected] partners Olsafsky accused of “He’s retired,” Linda Olsafsky To find a date a story was published (313) 446- 0406 or e-mail [email protected] squeezing him out of the company. said. “He doesn’t want to do this Ⅲ Crain’s Detroit Business is published by Partner Linda Dedvukaj of anymore. It’s not profitable.” Crain Communications Inc. Rochester Hills sued Olsafsky in No- Robert Snell: (313) 446-1632 Chairman Keith E. Crain Twitter: @robertsnellnews President Rance Crain vember 2013, alleging he was using Treasurer Mary Kay Crain Executive Vice President/Operations INDEX TO COMPANIES William A. Morrow Executive Vice President/Director of Strategic These companies have significant mention in this week’s Crain’s Detroit Business: Operations Chris Crain Executive Vice President/Director of Corporate American Center for Mobility...... 7 MSX International...... 4 Operations KC Crain Atomic Chicken...... 3 Mutual Adoration ...... 17 Vice President/Production & Manufacturing Brooks Kushman PC ...... 16 Newspaper Guild of Detroit Local 34022 ...... 8 Dave Kamis Building Hugger...... 17 Oakland Physicians Medical Center...... 9 Chief Financial Officer Thomas Stevens Chief Information Officer Anthony DiPonio Butzel Long PC ...... 23 Pontiac General Hospital ...... 9, 12 G.D. Crain Jr. Founder (1885-1973) CIG Capital Advisors...... 10 Powers Distributing...... 3 Mrs. G.D. Crain Jr. Chairman (1911-1996) Clayton & McKervey ...... 20 Property Assessed Clean Energy...... 3 Editorial & Business Offices Detroit Building Authority...... 17 Reclaim Detroit...... 17 1155 Gratiot Ave., Detroit MI 48207-2732; Detroit Economic Development Corp...... 1 Regional Transit Authority for SE Michigan..19 (313) 446-6000 Cable address: TWX 248-221-5122 AUTNEW DET Detroit Free Press...... 8 Roberts Riverwalk Hotel...... 1 CRAIN’S DETROITBUSINESS ISSN # 0882-1992 is pub- Detroit Media Partnership ...... 8 Roxbury Group...... 5 lished weekly,except fora special issue the third weekof Detroit News ...... 8 Signal Restoration Services...... 1 November,and no issue the third weekofDecemberby Detroit Regional Chamber...... 19 Simon Stella and Zingas...... 11 Crain Communications Inc.at 1155 Gratiot Ave.,Detroit MI 48207-2732.Periodicals postage paid at Detroit,MI Emergency Physicians Medical Group...... 20 Travel Michigan...... 3 and additional mailing offices.POSTMASTER: Send ad- Homes Eyewear ...... 17 Tree-Purposed Detroit...... 17 dress changes to CRAIN’S DETROITBUSINESS,Circula- tion Department,P.O.Box07925,Detroit,MI 48207-9732. Honigman Miller Schwartz and Cohn LLP ..10, 15 TwoSix Digital...... 22 GST# 136760444.Printed in U.S.A. Invest Detroit ...... 5 Warner Norcross & Judd LLP...... 15 Entire contents copyright 2015 byCrain Communica- LeadHead Glass ...... 17 Woodward Guitar ...... 17 tions Inc.All rights reserved.Reproduction oruse ofedi- McLaren Healthcare ...... 10 Workshop Detroit...... 17 torial content in anymannerwithout permission is strictly prohibited. McLaren Oakland...... 10 Zimnicki Guitar...... 17 20160321-NEWS--0026-NAT-CCI-CD_-- 3/18/2016 5:00 PM Page 1

26 CRAIN’S DETROIT BUSINESS // MARCH 21, 2016 ON THE WEB RUMBLINGS WEEK MARCH 12-18

Detroit Digits district’s state-appointed manag- Van Conway battles his Art Van to build er warned teachers might not be A numbers-focused look at last paid after April 8, AP reported. Ⅲ Canton Twp. store week’s headlines: The U.S. Coast Guard ap- former firm over name proved a permit for the location across from Ikea and plans for a twin of the Ambas- an Conway, currently locked than $270,000 that year. 97 sador Bridge between Detroit and in litigation with his former McNamara contends in a newly rt Van Furniture plans to The new ranking of Wayne State Windsor. The agency completed a Vcompany, Birmingham- filed lawsuit against Greenpath at construct an 80,000- University Law School out of 149 review and evaluation of the De- based Conway MacKenzie Inc., after Oakland County Circuit Court that her Asquare-foot, two-story law schools nationwide, according troit International Bridge Co.’s appli- his removal as chairman and CEO, last five-year contract, for 2011 showroom in Canton Township, to the latest U.S. News & World cation for the proposed com- wants the advisory firm to remove through 2015, entitled her to two directly across from Ikea. The new Report Best Law Schools list. WSU muter bridge. Canadian officials his name from its operations. years of base pay ($441,636) if she site will be the first new Art Van climbed eight spots since last still must give approval. In an amended complaint, filed was terminated without cause. store the company has built in year, from 105th to 97th, passing Ⅲ The Detroit-Windsor Tunnel in Oakland County Circuit Court last The company board chair- Michigan in 13 years, a spokes- Michigan State University College will be closed some nights from week, Conway’s woman informed McNamara in woman said. The Warren-based of Law, which fell from No. 94 to August through December while legal team asked early 2015 the board wouldn’t company has purchased the 3.61- 100. The University of Michigan the tube’s ceiling is replaced, the the judge to renew her contract and was “going acre property at 41601 Ford Road. Law School is tied for eighth. tunnel’s management announced. order the com- in a different direction,” after Mc- Ⅲ COMPANY NEWS Forty neighborhood parks pany to remove Namara raised legal questions and playgrounds in Detroit will be all references to about the new contract, according Ⅲ 250,000 Aichi, Japan-based Omron Au- The approximate weight in renovated over the next two years Conway from its to the lawsuit. tomotive Electronics Co. Ltd., which pounds of the first steel roof truss under an $11.7 million plan website, market- Greenpath General Counsel Eric has sales and marketing offices in Mayor Mike Duggan announced at ing materials Lisbitt told Crain’s last week the installed on the new Detroit Red Van Conway: Novi, was expected to plead guilty Simmons Playground, one of the and the like. company does not comment on Wings arena. Olympia Says name belongs in Detroit and pay a $4.55 million parks getting improvements. “Many firms pending litigation. Entertainment of Michigan has to him, not his fine for rigging bids on the prices Ⅲ A $15 million redevelopment keep the name announced that so far 3,500 former company. of power window switches on the pieces of structural steel and 130 of the vacated Save-A-Lot store in of a former Snyder to speak at Honda Civic. Ferndale is expected to bring 90 founder, usually because they are Ⅲ pieces of precast concrete have Pancakes & Politics Plans moved forward for been placed, 27,000 cubic yards of new apartments to the north side dead. I’m still here, and I think I de- Jackson-based Allegiance Health to foundation concrete have been of Nine Mile Road downtown. serve my name back,” Conway said. Gov. Rick Snyder will follow his join Detroit-based Henry Ford poured and 70 foundation piers Construction on the building is “I doubt they’ll want to remove it congressional testimony about the Health System as part of a new af- have been drilled. expected to begin this summer. from their door because it could af- Flint water contamination crisis by filiation agreement, AP reported. Ⅲ Medical Marijuana Caregiver fect their recognition nationally.” speaking at the Pancakes & Politics The health systems said their Centers in Detroit soon will have In an emailed statement to event April 11 at the Detroit Athletic boards had approved a definitive 3.25 to fork over nearly $4,000 annual- Crain’s, the firm said, “The name Club. agreement and the deal should The proposed percent increase in ly to the city for fees associated belongs to the firm, as it always has. The 7:30 a.m. event, organized close in April. water rates Detroit residents may with a business license and an in- It has no intention of changing its by the Michigan Chronicle, comes Ⅲ Detroit-based Huron Capital experience, which would be the spection. The Detroit City Council name.” as Snyder copes with questions Partners LLC added Beavercreek, lowest increase in a decade. City authorized the fees; previously, The complaint also calls for the about his administration’s handling Ohio-based Dan German Orthodon- water officials said they minimized medical marijuana dispensaries firm to rescind any alleged agree- of the Flint water crisis. tics to its dental platform compa- rate increases by lowering overall were not required to pay fees. ment preventing Conway from op- Snyder has repeatedly apolo- ny, Spring & Sprout Dental Holdings contract costs and improving Ⅲ Sterling Heights-based Gen- erating his new company, Van Con- gized since state officials switched Inc. collections from delinquent eral Dynamics Land Systems lost a way and Partners LLC. Flint’s water supply to the Flint Ⅲ Romulus-based roll-off trail- customers. bid protest before the U.S. Govern- River in 2014 in a cost-saving move. er company Benlee Inc. acquired ment Accountability Office on a po- A familiar path for former Federal and state investigations are the assets of Big Bend Wis.-based cessions or bathrooms. Integrated tential $1.2 billion amphibious ve- Greenpath president? ongoing, but no one has been Huge Haul Inc. in an all-cash trans- now within the Detroit Pistons’ of- hicle contract, after charged with a crime. action. Terms were not disclosed. ficial app is proprietary technolo- preproduction awards from the Jane McNamara may have a Snyder testified during a con- Huge Haul manufactures roll-off gy from Detroit-based WaitTime. U.S. Marine Corps Systems Com- precedent in company history to tentious congressional hearing hoists and load luggers for waste Ⅲ Grey Ghost, a new meat-cen- mand went to two rival bidders. rely upon if she wants to contend in March 17 and blamed career bu- management trucks. tered restaurant and cocktail bar, Ⅲ The University of Michigan- court that Farmington Hills-based reaucrats in Washington and Michi- Ⅲ Herman Gray, president and has found a home in Midtown Dearborn will be the first university Greenpath Inc. owes her more than gan for the crisis. CEO of the Detroit-based United Detroit in a newly announced nationwide to offer students pro- $850,000 for firing her as president Way for Southeastern Michigan, was space to open this summer at 47 fessional credentials from the and CEO. Small-business group in Washington, D.C., Friday at a E. Watson St. — the former home New York-based Interactive Adver- Eighteen years ago, Greenpath’s expands in SE Michigan White House forum to speak on of Ye Olde Butcher Shoppe. tising Bureau, through a new col- board of directors declined to the agency’s use of Social Innova- Ⅲ Dan Gilbert’s Bedrock Real Es- laboration with the agency’s edu- renew a three-year contract to The Grand Rapids-based Eco- tion Fund support. tate Services LLC has purchased cation foundation that launches McNamara’s estranged husband, Al- nomic Development Foundation has Ⅲ Royal Oak-based Axle Brewing the 1900 Saint Antoine building for next year. Meanwhile, the Metro- bert Horner — who was then the announced it is expanding to Co. plans to open a taproom and an undisclosed price. It is expect- politan State University of Denver CEO. Instead, the board compensa- Southeast Michigan with the ap- beer garden in Ferndale this ed to be fully occupied by this announced it will begin offering tion committee reached a deal pointment of Beth Ann Arroyo as the Labor Day weekend to serve as its summer with a soon-to-be-an- bachelor’s degrees in a variety of naming then-COO McNamara his senior loan officer in charge of the “public face.” Final site plans will nounced tenant. musical disciplines through the successor, and gave Horner a three- market for the foundation. be presented to the Ferndale Plan- Ⅲ The Troy-based Kresge Foun- Detroit Institute of Music Education. year, $760,000 “transition package” The foundation is a certified de- ning Commission in April. dation is awarding $1.5 million in Ⅲ Three state universities — to leave the company, Crain’s re- velopment corporation that helps Ⅲ New York-based In Our Back- Kresge Innovative Projects: De- Michigan State University at No. 8, ported in 1998. match banks with small businesses yard opened an office in Detroit’s troit grants to 21 nonprofits for Ferris State University at No. 16 and At the time, Horner earned seeking U.S. Small Business Adminis- New Center area. The nonprofit projects or planning efforts to im- Lawrence Technological University at $185,007 in reported compensation tration loans. Specifically, the cor- combines online fundraising with prove city neighborhoods. No. 17— made the Princeton Re- as CEO, according to an IRS form 990 poration is certified to handle SBA community organizing to support Ⅲ FoodandWine.com put Ann view’s 2016 list of top 25 under- for the nonprofit in 1996, while Mc- 504 loans used for equipment and citizen leaders in small projects. Arbor’s Zingerman’s atop its list of graduate programs in game de- Namara as COO earned $142,597. commercial real estate purchases. Ⅲ An activist investor, New 22 best American delis, calling it “a sign. MSU ranked 10th among the Times have changed. McNamara CDCs fund the SBA-guaranteed York-based Moab Capital Partners full-on mini-empire … epitomized top graduate programs. had total compensation of $478,993 portion of the loan. LLC, called for the firing of Percep- by a glorious selection of sand- in 2012 and $636,307 in 2013, ac- Arroyo recently served as vice tron Inc. Chairman and interim wiches and Jewish comfort foods.” OBITUARIES cording to the most recent IRS 990 president of business banking at CEO Rick Marz, among sweeping forms available on Guidestar.org, PNC Bank. Ⅲ management changes, as the Ply- OTHER NEWS Robert B. Aikens, founder and while Director of Operations Russell The foundation plans to open a mouth metrology equipment sup- chairman of Birmingham-based Halsey had $224,573 in 2013 com- permanent office this summer, plier struggles with profitability. Ⅲ The Michigan House ap- commercial real estate develop- pensation. possibly in Troy. When it is open, Ⅲ The Palace of Auburn Hills has proved $48.7 million in supplement and management firm No COO is listed as such, but no business owners will be able to invested in technology that lets mental aid for the struggling De- Robert B. Aikens & Associates, died other executive reported for Green- walk in for free consultations on fans find the shortest line for con- troit Public Schools system after the March 2. He was 86. Ⅲ path on the IRS forms earned more loans. Ⅲ DBpageAD_DBpageAD.qxd 3/16/2016 9:17 AM Page 1

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