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$2.00/APRIL 30 - MAY 6, 2012

Need for IT beats demand for other STEM jobs Study shows many computer-related jobs, but surplus of science, engineering, math grads By CHUCK SODER csoder@crain.com

Maybe the acronym “STEM” should start with the letter “T.” Among businesses in Ohio, the demand for people who specialize in information technology — the “T” in “STEM,” which stands for

“Science, Technology, Engineering and Math” — far outpaces demand for people in other STEM professions. Four times as many Ohioans work in computer-related jobs than in the other STEM fields combined. Also, the number of IT job openings exceeds the number of people grad-

uating from Ohio colleges with IT degrees. It’s the other way around for many STEM professions, where the number of graduates often exceeds the number of job openings, according to U.S. Department of Commerce data compiled by employment data analysis firm Economic Modeling Specialists Inc. The numbers don’t necessarily mean that too many Ohioans are graduating with degrees related to science, engineering and math,

said Jim Shanahan, director of the Entrepreneurship Innovation Institute at Lorain County Community College, and Jane Dockery, associate director of the Center for Urban Affairs at Wright State University. However, the data do indicate that, of all STEM fields, Ohio’s colleges need to put the greatest focus on convincing students to study information technology, they said. “Compared to other occupations, it’s big,” Dr. Shanahan said of IT. “Compared to STEM occupa-

tions, it’s big.” Wright State and LCCC analyzed the data for the Technology Transfer and Commercialization Task Force, a group of industry and university representatives that the Ohio Board of Regents formed to figure out how Ohio’s colleges can help the state create more high-tech jobs. The task force is putting together a report that will include several recommendations on how colleges can convert research dollars into new See STEM Page 6

New Medicare process dogs equipment sellers Even winning bidders wounded by new program, which feds say saves millions By TIMOTHY MAGAW tmagaw@crain.com

FILE PHOTO/RUGGERO FATICA

Jeff Walters says his company, Master Products of Cleveland, is winning business from Japanese automakers looking to buy parts from U.S. suppliers. Rising car production and other factors are driving up sales for local parts makers.

GOOD TIMES ROLL Surviving auto suppliers crank up production to meet growing demand for cars, American-made parts By DAN SHINGLER dshingler@crain.com

F 18

or many companies that remain links in Northeast Ohio’s automotive supply chain, the good ol’ days seem to be on their way back. Higher vehicle sales, plus decisions by Japanese carmakers to rely on more onshore companies to supply their U.S. plants after they suffered through disruptions caused by last year’s tsunami in Japan, are improving suppliers’ prospects here. A reduction

in the number of competitors also is helping those still in business. Cars and light trucks are selling at a brisk pace that could see 14 million vehicles sold in the United States this year, according to industry analysts polled recently by Automotive News, a sister publication of Crain’s Cleveland Business. Some of those experts are raising their projections and are calling for the sale of as many as 14.8 million vehicles this year, with sales rising to about 16 million units in 2014.

The Obama administration is celebrating its use of competitive bidding to buy medical equipment for Medicare beneficiaries as a big cost saver in 2011, but the Northeast Ohio companies that sell the equipment haven’t been so quick to sing the program’s praises. Rather, they contend the competitive bidding program, which rolled out in Cleveland and eight other metropolitan areas last year, has taken a bite out of their revenue while forcing them to trim staff and diversify their lines of business. The federal government in the coming year plans to roll out the program to another 91 markets, including Akron, Youngstown, Columbus and Toledo. As such, local suppliers expect an even more challenging environment, which is especially the case for companies

that sought refuge in markets that now will be subject to the bidding program. Integrated Medical Inc. in Cleveland was one of those companies. After losing bids in several device categories in Cleveland, the company shifted some of its sales force to the Akron area — a region, at least for the rest of the year, that still is covered under Medicare’s traditional fee-for-service model. However, if Integrated Medical loses bids for the Akron area, “that’s just putting the handcuffs on and putting us in a body bag,” company president Gary Bajusz said. “If you don’t win, you might as well just shut your doors,” Mr. Bajusz said. “It’s a very onerous program that they put out. We’re feeling the wrath of it.” Anton Yeranossian’s small, 13person company, A&A Medical Supply in Chagrin Falls, was able to See MEDICARE Page 5

INSIDE ‘Super commuters’ on the rise The number of people in Northeast Ohio who work in the metropolitan area but live somewhere else is up to 16%. That’s up from 12% in 2002. Other regions are seeing increases, too. Read why ‘super commuters’ do it and how they make it work. PAGE 3

See CARS Page 6

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APRIL 30 - MAY 6, 2012

CRAIN’S CLEVELAND BUSINESS

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Beachwood, Independence adopt similar biz strategies

INSIGHT

Suitors dig real estate in booming shale area

Suburbs’ growth slows, so they woo current employers By JAY MILLER jmiller@crain.com

Drilling revives industrial, office sites that have languished

Beachwood and its 3,000 businesses lie along Interstate 271. Slightly more than 11 freeway miles away, Independence, home to 2,000 employers, owes its growth as a commercial center to its location at the intersection of interstates 77 and 480. Yet now, both have reached the same business crossroads. And they are responding in similar ways — hiring new economic development directors and turning to more aggressive business development strategies. In particular, each is looking to put time and energy into talking to existing employers so those companies know that assistance is available for them to expand without moving to a new community.

Jeremy Rowan, Independence economic development director

Jim Doutt, Beachwood economic development director

By STAN BULLARD sbullard@crain.com

For nearly two years, Mr. Storck has made the weekly journey, ever since he accepted the job at Kent State, which was a career advancement for him. “You adjust,” Mr. Storck said. “Obviously, there’s the challenge of living alone and missing the family, but we’re making it work.” Mr. Storck is among the 16%, or 203,500 people, who worked in the Cleveland/Akron/Ashtabula combined statistical area in 2010 but lived outside of its confines. In a recent study by the Rudin Center for Transportation at New

Tiny Toronto, Ohio, population 5,200, calls itself the Gem City and prides itself on being Jefferson County’s second-largest town, after Steubenville. It also may be the next poster child for the effect the rush of energy companies to explore the Utica shale region is starting to have on commercial real estate in long-languid eastern Ohio. “The oil and gas boom has put us back on the map,” Toronto Mayor John Geddis said. The site of a demolished Chevrolet dealership just got snapped up by an oil field supplier. But the big talk in town concerns the former power plant that FirstEnergy Corp. spent millions demolishing and remediating of environmental problems so the 60-acre site could go back into use. With 1,000 feet fronting the Ohio River — slightly longer than the 57-story Key Tower in Cleveland — the “There will be a FirstEnergy land could be an supporting cast ideal site for docks for barges (behind the to ship oil and gas products to the Mississippi River and drillers). It’s Gulf of Mexico. stronger than Insiders say the site, which manufacturing.” could have been had for as little as $20,000 an acre three – Chris Hondlik, vice years ago, may trade for a president, Ostendorfjaw-dropping $200,000 an acre Morris Co. thanks to the river frontage. Mayor Geddis will not discuss specifics about the FirstEnergy land until a buyer is ready to go public, although he noted a group of executives recently dropped in by helicopter to size up the city’s riverfront offerings. “This is all very competitive and I want the jobs for the city,” Mayor Geddis said of the site he thought might become home of a new-breed electric cogeneration project and was once eyed by an Australian industrialist for a foundry. FirstEnergy spokesman Neil Durbin said the company has received multiple inquiries about the site of the power plant it retired in 1993, but declined to discuss the options it is reviewing, nor confirm the asking price. Big deals so far have garnered the media’s attention in the shale region. French-owned V&M Star is finishing up a $650 million tubular steel plant in Youngstown, even as Houston-based Baker Hughes Inc., an oilfield service provider, plans to build a $40 million service center and office building on 100 acres near Massillon. But other

See DRIVERS Page 22

See SHALE Page 20

JANET CENTURY

Scott Westcott, vice president and executive writer of internal communications at KeyCorp, logs 85 miles one way in his commute to downtown Cleveland from Erie, Pa.

For decades, Beachwood and Independence attracted new businesses without breaking a sweat — or without much in the way of incentives. Commercial real estate developers were drawn to their freeway interchange locations and acres of inexpensive, developable land, which they snapped up for building sites. Easy real estate lending allowed the developers to grow a steady stream of new office buildings that were attractive to businesses expanding in a growing economy or fleeing the higher costs of downtown Cleveland. But growth began to slow as the 2000s arrived, and rents in the two suburbs rose to downtown levels. Then the Great Recession brought business failures, the closing of regional offices of national companies and staff downsizings, all of which contributed to soaring vacancies — and fewer income tax payers — in office buildings.

DISTANT DRIVERS Study shows region’s ‘super commuters’ grow in number

See STRATEGIES Page 8

By GINGER CHRIST gchrist@crain.com

teve Storck lives in Stow, but only on weekdays. Mr. Storck, Kent State University’s senior associate vice president for finance and administration, is one of a number of super commuters — those who live outside of the combined metropolitan statistical area in which they work. He lives in a condominium in Stow Monday through Friday and makes the two-hour drive home to his family in Westerville, a suburb of Columbus, on weekends.

CORRECTION

THE WEEK IN QUOTES “We are seeing strong forecasts and expect it to continue as long as gas doesn’t go above $4.25 to $4.50 a gallon.”

“Fifth Third would certainly view Northeast Ohio as a marketplace in which we’re committed to grow our business.”

— Bill Adler, president of Stripmatic Products in Cleveland. Page One

— Jerry Kelsheimer, president and CEO of Fifth Third Bank, Northeastern Ohio. Page 11

“I definitely think that summer associate programs are opening up more. … Law firms are optimistic that their clients are doing better again.”

“I see a lot of policies that absolutely prohibit the use. But then the employer provides them hands-free technology. Now we have a built-in conflict.”

— Barbara Weinzierl, director of career planning and placement, University of Akron law school. Page 13

— Eric Johnson, partner in Walter & Haverfield’s labor and employment law group. Page 13

An April 23, Page One story misstated the disposition of a case filed by the City of Cleveland against Flash Seats LLC, the secondary ticket market owned by Cleveland Cavaliers majority owner Dan Gilbert. The court granted the city’s request to enforce its administrative subpoena, but the parties are awaiting the court’s ruling on Flash Seats’ motion to vacate the judgment, which could lead to further proceedings.

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CRAIN’S CLEVELAND BUSINESS

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APRIL 30 - MAY 6, 2012

At Giant Eagle, a new kind of power Latest store features solar array, skylights By GINGER CHRIST gchrist@crain.com

The area’s largest grocery chain is launching in Northeast Ohio its first store powered in part by solar energy. Pittsburgh-based Giant Eagle Inc.’s newest store and GetGo location opened last week on Royalton Road in Broadview Heights, complete with a solar array on its roof. Through use of the solar roof and skylights, 35% of the store’s energy is generated through renewable sources. Giant Eagle already has eight LEED-certified locations and is applying for LEED certification for the Broadview Heights store. The new 83,000-square-foot store replaces the company’s 30,000square-foot store in Brecksville, which employed 65 people. All of the Brecksville employees transferred to other Giant Eagle locations, with 35 relocating to the Broadview Heights site. The new store also is employing an additional 250 workers. The store is the company’s first new location in the Cleveland area since 2008, when it opened a store on West 117th Street. It features a sub shop, pizza station, two-story café, state liquor agency and bakery as well as an in-store Huntington Bank branch. The Huntington branch is one of more than 100 in-store locations created through a 15-year partnership the grocer signed with the bank in 2010. Giant Eagle has 175 corporate and 54 independently owned supermarkets as well as 168 fuel stations in four states. ■

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Giant Eagle’s new store in Broadview Heights features a rooftop solar array — the production of which is monitored on the screen below. Giant Eagle says 35% of the store’s energy is generated through the solar array and skylights.

Daily deals site Living Social buys Cleveland tech outfit By SCOTT SUTTELL ssuttell@crain.com

Onosys, a Cleveland-based provider of mobile and online ordering software and services to the restaurant business, has been bought by online daily deals company LivingSocial.com. Brendan Lewis, a spokesman for Washington, D.C.-based Living Social.com, last week confirmed a Bloomberg report of the acquisition. Terms of the deal were not disclosed. Mr. Lewis said the addition of Onosys will help LivingSocial .com expand the services it can offer to companies. Onosys will become part of the Merchant Solutions Group at Living Social.com, which Mr. Lewis said is run by Dickson Chu, a veteran of Internet companies including Yahoo and PayPal. Stan Garber, one of three Case Western Reserve University students who founded Onosys in 2007, said

ON THE WEB

Story from www.CrainsCleveland.com.

in an interview last week that the company has 20 employees at present and plans “to hire quite a bit.” The company currently is looking for developers, web designers and account executives, Mr. Garber said. The company also expects to be in the market for new space as it outgrows its current headquarters at 1814 E. 40th St., Suite 5D, Mr. Garber said. Onosys works with more than 75 brands, including big names in the restaurant business such as Applebee’s International Inc., Panera Bread Co. and Papa John’s International Inc. The two other founders of Onosys are Oleg Fridman and Alex Yakubovich. Last summer, Onosys developed a full-featured Facebook application that allows restaurant customers to place food orders through the restaurant’s Facebook page. ■

Volume 33, Number 18 Crain’s Cleveland Business (ISSN 0197-2375) is published weekly, except for com-

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bined issues on the fourth week of May and fifth week of May, the fourth week of June and first week of July, the third week of December and fourth week of December at 700 West St. Clair Ave., Suite 310, Cleveland, OH 44113-1230. Copyright © 2012 by Crain Communications Inc. Periodicals postage paid at Cleveland, Ohio, and at additional mailing offices. Price per copy: $2.00. POSTMASTER: Send address changes to Crain’s Cleveland Business, Circulation Department, 1155 Gratiot Avenue, Detroit, Michigan 48207-2912. 1-877824-9373. REPRINT INFORMATION: 800-290-5460 Ext. 136

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APRIL 30 - MAY 6, 2012

Medicare: Suppliers push for change Continued from PAGE 1

maintain its staffing levels by securing new business in Akron and areas near Ashland and Columbus when the bidding program reared its head in the Cleveland area. But, like Integrated Medical, if A&A Medical comes up short in bidding for business in those additional regions, Mr. Yeranossian said the company’s future could be in dire straits. “If we don’t win any bids — God forbid — that’s going to put us in a really hard situation,” said Mr. Yeranossian, the company’s CEO.

A loss for the winners

now, and ultimately the beneficiary is going to be hurt.” For instance, Mr. Marx said equipment suppliers would be forced to scale back services or staff because of reduced reimbursements, which could cause delays in the delivery of equipment such as portable oxygen tanks and hospital beds. Also, Mr. Marx said the program causes confusion among Medicare beneficiaries who require several pieces of equipment and now aren’t able to one-stop shop with suppliers that didn’t win bids in each equipment category. However, the Centers for Medicare & Medicaid Services con-

tend in a recent report that its regional offices received a mere 151 complaints about the program in 2011 — a small fraction of the 2.3 million beneficiaries in the nine regions involved in the initial rollout of the program.

Invacare enters the fray While the government shows no signs of slowing in its quest to expand the bidding program nationwide, the medical equipment industry is pushing legislation to replace the process. Invacare Corp. in Elyria, which makes wheelchairs, portable oxygen and other health care equipment, is one of the companies leading

the charge to scrap the bidding program. The company has a big stake in the fight: Its customers are the equipment suppliers struggling to stay afloat. “We’re hand in hand with the industry. We need our customers to be strong, vibrant companies across the country,” said Cara Bachenheimer, Invacare’s senior vice president of government relations. “Their interest is our interest.” Ms. Bachenheimer said Invacare supports a “market pricing program” over the competitive bidding program. Under the current system, the government pays the winners the median price of the winning bids. Under the industry’s proposal, the final price of a piece of medical equipment would be based on the market clearing price — the price at which supply equals demand to pay

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Patient problems Aside from whittling away their business, one of the hallmark complaints of the home care equipment sector is that the program will reduce competition and cause patients to suffer. “It’s very hard to provide service at the levels patients should get with the way the program is run and the way pricing ended up,” Mr. Marx said. “There is cost-shifting right

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all suppliers. Also, under the current system, suppliers’ bids are non-binding. Industry advocates, however, would like to see companies with the winning bids be forced to accept a contract or forfeit a cash deposit made to enter the bidding. Such a move, they contend, would eliminate low-ball bids. Ms. Bachenheimer admitted that getting the bill through Congress, especially in an election year, is “not an easy lift,” though she expects hearings on the matter in the House of Representatives in June or July. “We’re trying to line up our ducks and garner enough support. ... We’re early in the process, but it’s going to be a long year. This is certainly not a slam dunk, but it would be a markedly better system than we have now,” she said. ■

The Centers for Medicare & Medicaid Services said the competitive bidding program reduced Medicare costs in 2011 by $202 million, or about 42%, over 2010 medical equipment expenditures in the nine markets covered by the program. Acting Medicare administrator Marilyn Tavenner said in a news release the program is expected to “save tens of billions of dollars for beneficiaries and taxpayers over the next 10 years.” Still, the Cleveland-area companies that won bids say the program has been detrimental to their bottom lines. Because they were forced to bid so low, any uptick they saw in new business was offset by lower reimbursements from the feds. Seeley Medical Inc. of Andover, in Ashtabula County, won most of the categories up for bid in the Cleveland region, but the company still cut a quarter of its staff through attrition and layoffs in preparation for the program’s start in January 2011. While the company saw a slight increase in new business, the drop in Medicare reimbursements — which on average was about 32% — forced Seeley Medical to evaluate whether to take on new patients or invest in the latest home care equipment, according to company president Joe Petrolla. “If you look at simple math, we’re cutting off limbs now,” Mr. Petrolla said. “We’re not cutting off fat.” Any adjustments companies have made to weather the storm are just quick fixes to a problem that’s only going to get worse as the bidding program takes root across the country, according to Joel Marx, CEO of the Medical Service Co. in Cleveland and chairman of the Ohio Association of Medical Equipment Services, an advocacy group. In March 2011, Mr. Marx’s company acquired a respiratory equipment company in upstate New York, a region not yet affected by the competitive bidding program. Revenue from that acquisition has been used to support Medical Service’s business in Cleveland and Cincinnati, another area included in the initial roll-out of the bidding program.“It isn’t the answer, but it delays the impact another couple of years,” Mr. Marx said.

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CRAINâ&#x20AC;&#x2122;S CLEVELAND BUSINESS

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STEM: Grads often land in other fields continued from PAGE 1

technologies, increase the amount of capital available for startups and improve the stateâ&#x20AC;&#x2122;s high-tech work force. Though Dr. Shanahan wouldnâ&#x20AC;&#x2122;t say what recommendations the work force committee will make, he noted that IT would be a big focus area. So will the idea that students pursuing degrees in one STEM field should be grounded in concepts from the others, as they tend to be connected.

Numbers game Numerically, however, the STEM fields are quite different. A group of occupations consisting of 10 IT fields employed a total of 106,279 Ohioans in 2010 â&#x20AC;&#x201D; four times more than all other STEM occupations combined. And thereâ&#x20AC;&#x2122;s apparently room for more people: In 2010, job openings in those fields exceeded the number of people who graduated from Ohio colleges with related degrees by 2,471. That gap equals 2.3% of total IT employment in the state. By that same calculation, colleges are producing what looks like a surplus in other STEM fields. For instance, when all five engineering

occupations are combined, the number of 2010 graduates exceeds the number of jobs openings by 245, which is equal to 1.3% of total engineering employment in the state. On a percentage basis, forestry and conservation had the biggest surplus, 172, or 14.3% of a work force of 1,206. The numbers, however, donâ&#x20AC;&#x2122;t tell the whole story. The surpluses could be bigger than they appear because not every job opening calls for a recent college graduate; many are filled by people rotating between jobs. Then again, the surpluses could be smaller, too: Roughly half of STEM graduates donâ&#x20AC;&#x2122;t go to work in their field of study after graduation, according to a study called â&#x20AC;&#x153;STEMâ&#x20AC;? that the Georgetown University Center on Education and the Workforce released last December. The study suggests that many STEM graduates donâ&#x20AC;&#x2122;t take jobs in their fields, even though the positions tend to pay well, because they are more interested in pursuing jobs that fulfill personal desires. Plus, other industries often want their ability to solve problems â&#x20AC;&#x201D; another reason for colleges to put more focus on STEM skills, said Nicole Smith, a senior economist at the center who worked on the study.

â&#x20AC;&#x153;Part of the value of STEM is your marketability,â&#x20AC;? Dr. Smith said.

Worker shortage? Up pay However, some researchers, such as Hal Salzman, who reviewed Georgetownâ&#x20AC;&#x2122;s study, argue that many STEM graduates end up in other fields because they have a hard time finding jobs in their field of study. Dr. Salzman â&#x20AC;&#x201D; a senior faculty fellow in the John J. Heldrich Center for Workforce Development at Rutgers University â&#x20AC;&#x201D; said when industries lack people with certain skills, they raise wages and get what they need. For example, there was a shortage of petroleum engineers a few years back, but after salaries in the field went up, the number of graduates almost tripled, he said, citing his own research. â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;ve not been able to find an area where industry says, â&#x20AC;&#x2DC;weâ&#x20AC;&#x2122;ll payâ&#x20AC;&#x2122; and graduates donâ&#x20AC;&#x2122;t respond,â&#x20AC;? he said. Ms. Dockery, of Wright State, described the gap in IT graduates in Ohio as a â&#x20AC;&#x153;wake-up callâ&#x20AC;? for colleges in the state. As for other STEM fields, it looks like Ohio is â&#x20AC;&#x153;pretty much on track,â&#x20AC;? she said. Even so, needs vary by region and by industry, Ms. Dockery said. Surveys conducted by Wright State

APRIL 30 - MAY 6, 2012

suggest that some industries in that region, especially aerospace, have had trouble finding technical employees with the knowledge and experience they want. â&#x20AC;&#x153;The employers are frustrated,â&#x20AC;? she said. Ken Alfred, executive director of the Cleveland Engineering Society, said local companies remain â&#x20AC;&#x153;relatively cautiousâ&#x20AC;? when it comes to hiring engineers because of the downturn. Even so, he noted that he has seen a few more job postings online as of late. Plus, companies still talk about how hard it is to find talent. â&#x20AC;&#x153;It is still a challenge to find the right types of people to fill roles that

Cars: Despite trends, suppliers still eye Plan B continued from PAGE 1

s 2EGISTER AT s #RAINS#LEVELAND COM "REAKFAST

Sixteen million is a bit of a magic number for the industry, because U.S. vehicle sales were at or above 16 million units from 2000 to 2007. But even 14 million is a big improvement over a dismal 2009, when only 10.4 million vehicles were sold in the United States. Sales totaled 12.8 million vehicles in 2011. But other factors also are benefiting U.S. suppliers, and some say the current environment seems better than it did at the height of the boom, when credit was easy, jobs were plentiful and Americans were in a car-buying state of mind. â&#x20AC;&#x153;It feels better than 2006 because there is more attention toward localization,â&#x20AC;? said Jeff Walters, president of Master Products in Cleveland. Master Products makes dampers, steering components and parts that end up in shocks that go into vehicles made in the United States. That includes vehicles made by Japanese car companies with U.S. production plants, such as Honda in Marysville, Ohio, near Columbus. Mr. Walters said his company and others are benefiting from a trend toward localization that began when the tsunami hit Japan in March 2011. That disaster not only cost Japan a terrible toll in human suffering, but it also knocked out of commission many Japanese plants that were supplying U.S. auto factories owned by Toyota and other Japanese carmakers. Some U.S. plants were down for extended periods because they could not get the parts they needed to complete their vehicles. In the tsunamiâ&#x20AC;&#x2122;s aftermath, Japanese automakers have sought to find new suppliers closer to their operations in the United States, providing more business to companies such as Master Products, Mr. Walters said.

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Jerry Zeitler, president of Cleveland-based Die-Matic Corp., said his auto business definitely is up. He cites two reasons: There are fewer suppliers than there were five years ago or so, and there are more U.S. auto plants to supply. â&#x20AC;&#x153;I can think of at least six companies in the Greater Cleveland area that closed in the last four years,â&#x20AC;? Mr. Zeitler said, referring to nowshuttered suppliers such as DickeyGrabler Co., some of which were his competitors. On the plus side, U.S. auto companies are stronger today than they were in previous decades, with

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UNDERWRITTEN BY

are available out there,â&#x20AC;? Mr. Alfred said, adding that his daughter, who has an advanced engineering degree and lives out of state, has had trouble finding a job in her niche. Dr. Shanahan, of LCCC, said colleges likely will need to turn out more STEM graduates in almost every category as high-tech industries grow. He described it as â&#x20AC;&#x153;job No. 1â&#x20AC;? for the task forceâ&#x20AC;&#x2122;s work force committee. Job No. 2 will be to make sure students have the knowledge and, especially, the on-the-job experience that high-tech businesses want. â&#x20AC;&#x153;Obviously the next big question is, what are we teaching them?â&#x20AC;? he said. â&#x2013;

healthier profit margins and new products requiring new parts, Mr. Zeitler said. Also, auto companies from other nations, including Korea, have been opening plants in the United States and need parts, he said. â&#x20AC;&#x153;I donâ&#x20AC;&#x2122;t think anyone could have predicted the explosive growth and success the South Korean OEMs (original equipment manufacturers) have had in the last three to four years,â&#x20AC;? said Mr. Zeitler, whose precision stamping company also makes parts that go into medical devices and other products. â&#x20AC;&#x153;Few of us wanted to do business with them five years ago â&#x20AC;&#x201D; the prestige and volume wasnâ&#x20AC;&#x2122;t there like it was at GM or Chrysler,â&#x20AC;? he said. â&#x20AC;&#x153;My, have things changed.â&#x20AC;?

Beware the vortex Does all of this mean that area auto suppliers are content and free of worry? Hardly â&#x20AC;&#x201D; â&#x20AC;&#x153;worry freeâ&#x20AC;? and â&#x20AC;&#x153;auto supply businessâ&#x20AC;? are not words most of them use in the same sentence. Business is good now, they say, but theyâ&#x20AC;&#x2122;ve seen how quickly the industry can go into a tailspin and are braced against that happening again. Bill Adler, president of Stripmatic Products in Cleveland, said heâ&#x20AC;&#x2122;s seeing increased demand for the parts his company makes for automotive shocks, struts and other components. Mr. Adler said his sources tell him business will continue to improve, but heâ&#x20AC;&#x2122;s still cautious. â&#x20AC;&#x153;We are seeing strong forecasts and expect it to continue as long as gas doesnâ&#x20AC;&#x2122;t go above $4.25 to $4.50 a gallon,â&#x20AC;? Mr. Adler said. Likewise, Mr. Walters of Master Products said he likes his auto business, but heâ&#x20AC;&#x2122;s still â&#x20AC;&#x153;always looking for Plan Bâ&#x20AC;? because he knows how cyclical it can be. Also, the ground beneath the industry constantly is changing. Japanese automakers are moving their supply chains to the United States, but they could build their own supply plants here as well, he said. Mr. Zeitler advises others to enjoy making money from the auto industry, but he warns them not to depend upon it too heavily. â&#x20AC;&#x153;I think companies like us have to be diverse, flexible and financially conservative in order to respond to the ever-increasing economic changes and swings in the global market,â&#x20AC;? Mr. Zeitler said. â&#x20AC;&#x153;Just because automotive is seemingly healthy and rebounding, we canâ&#x20AC;&#x2122;t get sucked back into the volume vortex. Itâ&#x20AC;&#x2122;s easy to do, and we Americans have short-term memories.â&#x20AC;? â&#x2013;

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APRIL 30 - MAY 6, 2012

SOMETHING FOR EVERYONE Horseshoe casino officials hopeful buffet appeals to non-gamblers, too

xecutive chef Steven Varga won’t be able to help you cash in upstairs, but if you visit “The Spread,” the buffet on the lower level of the Horseshoe Casino Cleveland, he thinks you’ll leave a winner. During a media tour of the 400seat restaurant last Wednesday, April 25, Mr. Varga, a Solon native, showed off the various styles of cooking he’s bringing to the casino. It’s an international mix that draws heavily on the output of regional farmers. The buffet will open with the casino on May 14. “We’re trying to concentrate on farm-to-table concepts using local dairy, meats and produce,” said Mr. Varga, who is returning to Northeast Ohio after a career in Phoenix and Las Vegas, where most recently he was chef de cuisine at The Henry, a restaurant inside the Cosmopolitan of Las Vegas casino. Mr. Varga said he’s contracted with a commercial fishing operation to provide Lake Erie perch, and his goat cheese supplier is Lake Erie Creamery on Cleveland’s West Side. The menu will feature local vegetables as they come into season, starting with asparagus in May. Mr. Varga supervises a kitchen staff of 55. Adding front-of-the-house workers, the restaurant employs about 140 people. The open-kitchen buffet has seven stops, including stations featuring

Asian, Italian and American foods, salads, and grilled and barbecued meats. At one station, called the Shuffle, diners will be able to choose from a rotating mix that will include dishes such as pierogis, red beans and rice, and duck enchiladas. A dessert station will feature locally produced ice creams and gelatos and a variety of pastries. The Spread will serve breakfast, lunch and dinner from 7 a.m. to 10 p.m. and, with direct entry from the lower level of Tower City Center, Mr. Varga hopes The Spread will attract downtown workers as well as gamblers. He said the quick, buffet-style service and broad breakfast menu, which will include a made-to-order omelet station and breakfast staples that will include eggs Benedict and house-made biscuits, should make The Spread a favorite for executive breakfasts. Kaywan Samadani, Horseshoe’s director of casino services and food, said the 12,000-square-foot space was given a warm, 1950s-steakhouse look with dark wood and chrome and a floor of bleached hardwood tiles, harkening back to the original Binion’s Horseshoe Casino in Las Vegas. Prices for patrons coming in off the street will be $11.99 for breakfast, $15.99 for lunch and $23.99 for dinner. Members of the Horseshoe’s Total Rewards program will receive a $2 discount. ■

RUGGERO FATICA PHOTOS

ABOVE: Kaywan Samadani, Horseshoe Casino Cleveland’s director of casino services and food, said the buffet space resembles the original Binion’s Horseshoe Casino in Las Vegas. BELOW: A few options buffet customers will have.

Strategies: Officials have wealth of incentives they can employ continued from PAGE 3

In the last month, both suburbs have hired new economic development directors to map strategies for revitalizing their business development efforts. Independence hired Jeremy Rowan, a former economic development officer with the city of Akron and Bel Air, Md. He replaces Ron White, who is retiring after 10 years on the job. In Beachwood, Jim Doutt, who served for a decade as executive director of the Medina County Economic Development Corp., joined the city last Monday, April 23. Beachwood had been without a full-time economic director for more than a year, since the resignation of Vince Adamus in February 2011. Brad Sellers, now the mayor of neighboring Warrensville Heights, filled the gap on a part-time basis until his election last fall.

‘The world changed’ Both Beachwood and Independence appear to have the same strategy in mind — learn how to play the economic incentive game, now critical to attracting new development, and begin to pay more attention to the needs of their existing bases of developers and employers. “During the 1980s and 1990s, when the vast majority of these offices buildings were built, we didn’t

have an economic development director” and didn’t offer incentives, said Vernon Blaze, financial coordinator for Independence and a former city councilman. “It seemed like every month a developer was coming to propose a new, speculative office building; we were in the sweet spot. “The world changed since then, and we haven’t had a multitenant office building proposed in (several years),” Mr. Blaze said. Something similar happened in Beachwood, as multitenant office building development — the kind that brings real estate brokers with tenants in tow and spurs ancillary retail and hotel development — moved north into Mayfield Heights. “The pipeline slowed down a little bit,” said Mayor Merle Gorden. “That made us look at where we needed to grow and where we wanted to forecast the city of Beachwood.”

Changing face of Commerce Development in Beachwood hasn’t been totally dormant, though. Some dirt has been pushed around and roads and sewers built in the Chagrin Highlands tract. The highlights there have been University Hospitals’ Ahuja Medical Center and the under-construction world headquarters of Eaton Corp., which is leaving downtown Cleveland.

Beachwood intends to continue helping the developer, the Richard E. Jacobs Group Inc., build out Chagrin Highlands. “One of the things we want to do is targeted attraction in Chagrin Highlands,” Mr. Doutt said. “We want to target the cluster of high tech and the cluster of health care there.” But Beachwood must figure out what to do with Commerce Park, a 190-acre, 80-building development that began in the 1960s with oneand two-story buildings designed for light manufacturing and assembly. That kind of business is gone, and Beachwood City Council earlier this year rezoned several parts of the city’s commercial district to allow for 21st-century uses. One of the most recent new tenants at Commerce Park is a dog kennel, and city council is clearing the way with new zoning that will allow a developer to put an upscale apartment complex at the corner of Chagrin Boulevard and Green Road once three aging office buildings are demolished.

tax abatement and low-cost construction and renovation financing through intermediaries such as the Cleveland-Cuyahoga County Port Authority. Their city councils also might be persuaded to allow job creation and retention income tax credits. Beyond that, both Cuyahoga County and the state of Ohio and Team NEO, the regional development attraction nonprofit, have or are developing programs that include tools such as county microloans for businesses such as dog kennels. Those tools also include six- and even seven-figure loans and grants from programs such as the state Third Frontier initiative, which targets high-tech businesses. These higher-level government programs also can funnel leads to qualifying cities when they learn of new business opportunities. “Those relationships are important,” said Mr. Rowan, the Independence economic development director. “You have to develop those relationships so those folks know what (your community) has to offer.”

Time to get creative

Love the ones you’re with

To keep their communities growing, these new economic development directors will need to learn an increasingly complicated financial incentive playbook. They will have available to their cities traditional incentives such as

Businesses looking to expand into new communities have a variety of ways to learn about those programs. Existing businesses that have been growing in place, though, often don’t learn of them until a real estate broker starts

showing them new locations — often in distant communities — because the current one seemed inadequate for one reason or another. That’s a key reason why Beachwood and Independence both are considering hiring a second economic development person to knock on the doors of existing businesses and property owners. Steven Weitzner, a principal with Silverlode Consulting Group of Cleveland, thinks both communities are choosing smart strategies. Mr. Weitzner, whose firm has counseled communities such as Brunswick, Medina, Shaker Heights and Solon, said these two communities have been able to get by without strong economic development efforts because they were attractive areas and had the newest and fanciest office buildings. But they’ve had more competition lately, especially as companies express interest in moving to a revived downtown Cleveland. Business retention, Mr. Weitzner said, “is easily the biggest missed opportunity in the world of economic development. “We always advise that communities should be spending the vast percentage of their time and resources on retention and expansion because it’s a lot easier to keep growing what they have than it is to attract something new,” he said. ■

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WWW.CRAINSCLEVELAND.COM

Chagrin Falls company pleases cloud customers

THE FUTURE BEGINS WITH A CAPITAL â&#x20AC;&#x153;Gâ&#x20AC;?.

Duncanllcâ&#x20AC;&#x2122;s services offer convenience, cost savings By CHUCK SODER csoder@crain.com

Itâ&#x20AC;&#x2122;s hard for the folks at duncanllc to explain how their cloud computing services work. That is, until they pull up Microsoft Windows on an iPad or some Lyle other device that uses a completely different operating system, said president Todd Lyle. â&#x20AC;&#x153;When they see it, theyâ&#x20AC;&#x2122;re blown away by it,â&#x20AC;? Mr. Lyle said. The tactic must be working: The Chagrin Falls â&#x20AC;&#x153;cloud services brokerageâ&#x20AC;? â&#x20AC;&#x201D; a term used to describe companies that resell data center services and software products that run over the Internet â&#x20AC;&#x201D; has gained a bit of attention lately. For one, duncanllc this month was named a â&#x20AC;&#x153;Cool Vendorâ&#x20AC;? by Gartner Inc. of Stamford, Conn. The technology research firm lauded duncanllcâ&#x20AC;&#x2122;s ability to move businesses into â&#x20AC;&#x153;the cloud.â&#x20AC;? Instead of using their own computer servers, duncanllc clients rent servers in data centers owned by companies such as Amazon .com Inc. Instead of buying licenses for Microsoft Windows, they can rent them from duncanllc, which resells a variety of Microsoft products. The end result is that clients donâ&#x20AC;&#x2122;t

spend as much up front and no longer must maintain their own computer systems. Plus, they can pull up any of their software programs â&#x20AC;&#x201D; even Windows itself â&#x20AC;&#x201D; from any device, be it a laptop, a smart phone or a tablet computer. The 5-year-old company, which only a year ago began aggressively pursuing customers, now is generating enough cash to cover its costs, said Mr. Lyle, who wouldnâ&#x20AC;&#x2122;t provide sales figures for the nineemployee firm. Duncanllc has worked to make inroads in the legal community. For instance, the Cleveland Metropolitan Bar Association has vetted the company and plans to add it to the associationâ&#x20AC;&#x2122;s MVP Partnership program. Duncanllc would be one of the first service providers to join the program, through which companies provide discounted services to bar association members. Attorneys often want to access files from whatever device they happen to be carrying, said Rita Klein, membership, marketing and public relations director for the bar association. â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;ve got more members and attorneys who are going mobile,â&#x20AC;? she said. â&#x2013;

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CRAIN’S CLEVELAND BUSINESS

WWW.CRAINSCLEVELAND.COM

APRIL 30 - MAY 6, 2012

PUBLISHER/EDITORIAL DIRECTOR:

Brian D. Tucker (btucker@crain.com) EDITOR:

Mark Dodosh (mdodosh@crain.com) MANAGING EDITOR:

Scott Suttell (ssuttell@crain.com)

OPINION

S-mart hire

nyone who lived during the days when NASA sent astronauts to the moon knows that it sometimes took a mid-course correction to get a spacecraft’s passengers safely to their destination. The company behind the Cleveland Medical Mart & Convention Center has made such an adjustment with the recent hiring of former McKinsey & Co. executive Jim Bennett as a senior vice president to guide the operation. Civic leaders in Cuyahoga County have made a big bet in putting nearly a half-billion dollars of taxpayer money behind the medical mart and convention center complex, which is under construction at the site of the city’s old convention center. They desperately want the project to succeed but have been concerned about the path the med mart concept has been taking under its developer, Chicago-based MMPI. Mr. Bennett’s presence should help improve their comfort level. It isn’t just Mr. Bennett’s familiarity with the Cleveland market, and vice versa, that should work in the med mart’s favor. It is his 30 years of experience working with clients of consulting giant McKinsey & Co., plus his involvement over the last decade with tech companies, that give Mr. Bennett the business acumen to make a go of the groundbreaking venture. A decade ago, in a Crain’s story about his recent appointment as head of online recruiting firm EmployOn Inc., Mr. Bennett was asked what made him different from the typical tech company CEO. His answer was simple and to the point. “I have made a career out of making money,” he said. Mr. Bennett also is no stranger to the world of medicine that the trade show complex hopes to exploit. During his McKinsey career, he was coleader of the firm’s worldwide health care provider practice and leader of its health care payer and provider practice in the United States and Canada. He worked with management and physician leaders as well as drug and pharmaceutical companies on a global basis. Even now, he serves on the board of Within3, a company in Cleveland that builds private, online communities for drug companies, medical associations and other life sciences institutions. Last October, Cuyahoga County Executive Ed FitzGerald announced the creation of a panel of local civic and medical leaders to give MMPI the community’s input into its business and marketing plans for the medical mart and convention center. The hiring of Mr. Bennett now puts someone with strong Cleveland ties inside the walls of the kingdom. The timing of this mid-course correction is opportune, considering that the opening of the trade show complex is still more than a year away. Mr. Bennett should have ample time to help formulate and execute a game plan for this project, which the city and county are pinning so much hope on as a generator of convention and meeting business and all the outside dollars it brings into an economy. It’s a smart mart hire, and it should pay dividends for MMPI and the community.

FROM THE PUBLISHER

Sometimes, nice guys do finish first

McDonald House, and Ben has made it a f you’re a golfer, you must be happy point to play in it from his earliest days for Ben Curtis, the former Kent State as a professional golfer. He even traveled star who ended a six-year victory with the Claret Jug —the trophy for windrought at the recent Valero Texas ning the Open Championship — to our Open. And if you love our part of the 2004 event, happily letting folks hold and world, you should be even happier. pose with that treasured object. Northeast Ohio doesn’t have a better More serious golf fans know that Ben, ambassador than Ben. Soft-spoken, who built a home near Kent a gracious, humble and charming couple years ago for him, wife in a manner honed by small- BRIAN Candace and their two young town Ohio life, Ben broke into TUCKER children, has been struggling tears as the CBS reporter interrecently on tour. He’s missed viewed him on the 18th green cuts and his future as a profesafter winning the tournament. sional was challenged, to say Most casual golf fans know the least. Perhaps no athletic Ben came out of obscurity as a endeavor is as unforgiving in its PGA Tour youngster to win the insulation as golf; you are only 2003 Open Championship at as good as your recent wins, England’s Royal St. George’s and for Ben, the wait had been Golf Club. As he spoke to the a long time. crowd that day after winning golf’s oldest Now, he not only pocketed a great $1.1 title, it was clear that the limelight-ofmillion purse, but more importantly victory speech wasn’t his favorite expeearned a two-year exemption on tour, rience. But he was heartfelt in his words, good through the 2014 season. No more and he made us all — especially us Kent worrying about whether his agent could State alums — exceedingly proud. get him a spot in this or that event, as he I have the honor to chair a pro-am attempted to win enough to keep his golf tournament for Cleveland’s Ronald

tour card. Ben can now relax a bit and concentrate on his golf game, his family and the institutions here that he cares deeply about. Ben Curtis is exemplary of the kind of professional athlete that stands apart mostly as such a good human being. **** WE SHOULD BE CHEERED by the news that Ohio education officials are looking at changing the way our high school seniors spend their last year before college. If a senior has passed the Ohio Graduation Test, accumulated the needed credits to graduate and passed the college entrance exam, he or she too often spends that last year in a half-day (or less) of classes, perhaps juggling a part-time job in the course of the day. Those who aren’t inspired to take early college classes are then simply “cruising,” and that isn’t exactly the best mindset to have as you enter college. Ohio education leaders are considering many reforms, and are actually leading the nation in this endeavor. The faster they implement meaningful change, the better we all are for their work. ■

PERSONAL VIEW

Cleveland’s lakefront approach backward By KEVIN PATRICK MURPHY

n 1850, the mayor of New York City decided that the best way to attract real estate development in an under-built section of the city was to invest in a public space, so plans were implemented to develop Central Park. During the 15 years following the development of Central Park, taxes paid to the city of New York in the area surrounding the park increased more than 900%. Due in large part to the success of Central Park, many American cities adopted the approach that public spaces should be used as a means to attract both businesses seeking new locations and the millions of people migrating around the country. For many cities, this approach paid off

Mr. Murphy is a partner in the Real Estate practice group of Cleveland-based Walter & Haverfield. handsomely with population booms, job creation, real estate development and soaring tax revenues. One such city was Baltimore, which in 1965 turned around its decrepit Inner Harbor thanks to a group of executives that formed Charles Center-Inner Harbor Management Inc. (CC-IH), an independent, nonprofit development corporation that entered into an exclusive contract with the city of Baltimore for Inner Harbor development projects. CC-IH played a significant role in the disposition of toxic dredged materials, the acquisition of almost 1,000 harbor properties and the relocation of more than 700 businesses.

By contrast, in Cleveland in 2000, Mayor Mike White announced his plan for downtown lakefront development. Mayor White’s plan, which was formulated with the aid of a Chicago architectural firm and included an entertainment pier resembling Chicago’s Navy Pier, stalled almost immediately after City Council denounced his approach as a violation of city contracting policy. In 2004, Mayor Jane Campbell unveiled her plan for lakefront revitalization that provided for thousands of housing units, office buildings, retail shops, public parks, an 18-hole golf course and a boardwalk. Despite the fact that her plan marked the first time in almost a century that a lakefront development plan for the city emphasized Lake Erie as See VIEW Page 11

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CRAINâ&#x20AC;&#x2122;S CLEVELAND BUSINESS

WWW.CRAINSCLEVELAND.COM

THE BIG ISSUE How far do you commute to work now, and how far would you be willing to commute for the right job?

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I live downtown and I work downtown, except when weâ&#x20AC;&#x2122;re at client locations and we drive all over Cleveland. I donâ&#x20AC;&#x2122;t know, 45 minutes would be a fair commute. I donâ&#x20AC;&#x2122;t feel comfortable driving, regularly, much farther than that.

I also live downtown, so it depends where we go when weâ&#x20AC;&#x2122;re at clientsâ&#x20AC;&#x2122; (offices). Right now I drive about 25 to 45 minutes, and Iâ&#x20AC;&#x2122;d say 45 minutes would probably be the max.

I live in Cleveland Heights, so thatâ&#x20AC;&#x2122;s about six miles maybe? If I had to, I would be willing to commute 35 or 40 miles; I have in the past. But my preference is to ride my bicycle to work.

I commute seven miles now. How far would I commute? Thirty miles. It would have to be really good, though.

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5/3 adds to local commercial staff By MICHELLE PARK mpark@crain.com

There are a number of new, but not novice, faces on Fifth Third Bankâ&#x20AC;&#x2122;s commercial banking team in Northeast Ohio. The Cincinnati-based bank since March has added to that team 10 people whose banking experience totals more than 180 years. Half of them joined the bank this April, and another offer has been extended, said Jerry Kelsheimer, president and CEO of Fifth Third Bank, Northeastern Ohio. â&#x20AC;&#x153;Fifth Third would certainly view Northeast Ohio as a marketplace in which weâ&#x20AC;&#x2122;re committed to grow our business,â&#x20AC;? Mr. Kelsheimer said. â&#x20AC;&#x153;We have invested in capabilities here at a level thatâ&#x20AC;&#x2122;s more significant

than perhaps we would in other markets.â&#x20AC;? The bank is driving to achieve double-digit growth in commercial loan production and to increase its market share in Northeast Ohio, Mr. Kelsheimer said. As it grows, it should generate more fee income and higher returns for shareholders, he noted. Fifth Third ranked seventh in deposits in Northeast Ohio in the most recent Crainâ&#x20AC;&#x2122;s list of banks, which published in December and is based on data from the Federal Deposit Insurance Corp. Its deposits totaled $4.2 billion, compared to $13.4 billion held by market leader, KeyBank. Already, the bank has seen â&#x20AC;&#x153;very meaningful growth,â&#x20AC;? Mr. Kelsheimer said. Commercial loan production volume in the first quarter of 2012

exceeded last yearâ&#x20AC;&#x2122;s pace by a â&#x20AC;&#x153;significant margin,â&#x20AC;? said Mr. Kelsheimer, and the bank expects the trend to continue through the year. â&#x20AC;&#x153;Itâ&#x20AC;&#x2122;s very conceivable that we could effectively double our commercial business in a three-year time frame based on current business trajectory,â&#x20AC;? he said. Fifth Thirdâ&#x20AC;&#x2122;s new commercial loan production in Northeast Ohio in the 12 months ended March 31 was $800 million. Fifth Third is one of many banks, big and small, beefing up commercial lending teams, according to James Thurston, spokesman for the Ohio Bankers League. â&#x20AC;&#x153;What the banks are doing, I suspect, are anticipating continued improvementâ&#x20AC;? in the economy, Mr. Thurston said. â&#x2013;

View: Toronto offers proper blueprint continued from PAGE 10

its focal point, most of the plan was never implemented. Most recently, Mayor Frank Jackson has proposed to remake the downtown Lake Erie shoreline with shops, restaurants, offices and a hotel â&#x20AC;&#x201D; at a cost of approximately $2 billion. City officials expect most of the money to come from the private sector. These are just a few recent examples of failed lakefront development proposals in Cleveland. The city, however, has a long, tired history in this department. Clevelandâ&#x20AC;&#x2122;s backwards approach to encouraging investment has always been the fundamental flaw of its lakefront revitalization efforts. Good development is tied to good infrastructure. New York came to the realization that public investment in public space stimulates private sector real estate development. Baltimore grew to appreciate the power of exercising its governmental authority to support private development projects. Cleveland, on the other hand, has repeatedly attempted to function as

a private developer, rather than pursue development partnerships with the private sector and other public-sector entities. To effectively develop the downtown shoreline, a lakefront development corporation â&#x20AC;&#x201D; comprised of representatives appointed by the city of Cleveland, Cuyahoga County, the state of Ohio and key private sector and nonprofit players â&#x20AC;&#x201D; must be established in Cleveland. Torontoâ&#x20AC;&#x2122;s waterfront development corporation should be used as the prototype. In 2001, Waterfront Toronto, a development corporation separate from the government but jointly funded by the city of Toronto, the government of Canada and the province of Ontario, was formed to realize the potential of nearly 2,000 acres of undeveloped, misused or derelict waterfront property. Waterfront Torontoâ&#x20AC;&#x2122;s 12-member board is appointed by the three levels of government, each of which contributed $500 million in startup capital to begin the revitalization process. Although the majority of the 2,000 acres is owned by the governments, Waterfront Toronto

controls the development process. Waterfront Toronto is not perfect â&#x20AC;&#x201D; it has no powers to borrow or raise funds, enter into joint ventures or create subsidiaries. Nevertheless, its focus on making the waterfront a public amenity by establishing strong waterfront connections has created and enhanced entire neighborhoods and commercial districts in downtown Toronto. Torontoâ&#x20AC;&#x2122;s approach to its waterfront represents the type of strategic thinking that Cleveland simply must embrace. It would be irresponsible to imply that lakefront revitalization alone can solve the major underlying problems that Cleveland currently faces, but it is an important step in what must become a regional growth strategy. By taking immediate steps to form a lakefront development corporation, and taking those steps with a sense of urgency, Northeast Ohio can begin to build towards a better future. To be sure, Northeast Ohio has seen its share of disappointment over the last several decades, but disappointment is not justification for capitulation. â&#x2013;

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TAX LIENS The Internal Revenue Service filed tax liens against the following businesses in the Cuyahoga County Recorder’s Office. The IRS files a tax lien to protect the interests of the federal government. The lien is a public notice to creditors that the government has a claim against a company’s property. Liens reported here are $5,000 and higher. Dates listed are the dates the documents were filed in the Recorder’s Office.

LIENS FILED Northwood Products Inc. 135 Blaze Industrial Parkway, Berea ID: 20-4718668 Date filed: Feb. 28 Type: Employer’s withholding Amount: $176,408.12 Retail Services Inc. 26200 George Zeiger Drive, Beachwood ID: 34-1745607 Date filed: March 20 Type: Employer’s withholding Amount: $153,377.30 LDH Painting Ltd. 11811 Shaker Heights Blvd., Suite 105, Cleveland ID: 20-3987745 Date filed: March 14 Type: Employer’s withholding, unemployment Amount: $141,763.10

Regina Savage DDS Inc. 5311 Northfield Road, Suite 215, Bedford Heights ID: 56-2372784 Date filed: Feb. 27 Type: Employer’s withholding, corporate income Amount: $100,652.15

ID: 34-1801887 Date filed: March 15 Type: Employer’s withholding Amount: $56,262.03

GOING PLACES

Johnnys Tavern and Restaurant Inc. 3164 Fulton Road, Cleveland ID: 34-1571273 Date filed: March 7 Type: Employer’s withholding Amount: $49,140.20

FINANCE

Two Marias LLC 1332 Carnegie Ave., Cleveland ID: 43-1953339 Date filed: Feb. 14 Type: Employer’s withholding Amount: $92,659.52

Northeast Contracting LLC 25446 Bryden Road, Beachwood ID: 20-4369728 Date filed: Feb. 22 Type: Employer’s withholding Amount: $41,631.98

Wonder Gro Inc. 26041 Cannon Road, Bedford Heights ID: 34-1761991 Date filed: March 20 Type: Employer’s withholding, corporate income, unemployment Amount: $61,541.04

A&R Trenching LLC 23525 Lorain Road, North Olmsted ID: 84-1672852 Date filed: March 1 Type: Employer’s withholding, partnership income, unemployment Amount: $40,204.66

Sitaaras Security Inc. 3646 Daleford Road, Shaker Heights ID: 34-1931570 Date filed: Feb. 17 Type: Employer’s withholding, failure to file complete return, unemployment Amount: $49,726.75 A Caring Alternative Inc. 1220 Huron Road, Cleveland

APRIL 30 - MAY 6, 2012

Records Central Inc. 4700 Lakeside Ave., Cleveland ID: 34-1035430 Date filed: March 14 Type: Employer’s withholding Amount: $37,399.93 SJT Enterprises Inc. 28045 Ranney Parkway, Westlake ID: 34-1638133 Date filed: March 13 Type: Employer’s withholding Amount: $37,147.63

JOB CHANGES LORAIN NATIONAL BANK: James Konopka to mortgage lending officer. WESTERN RESERVE BANK: Kristi Beeman Jack to vice president for commercial lending; Patty McLean to assistant vice president for commercial lending.

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Mills

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INVERNESS HOLDINGS LLC: Howard Essner to principal. RETIREMENT SOLUTIONS: Michele Marotta to administrative assistant.

HEALTH CARE METROHEALTH SYSTEM: Debbie Warman to vice president of human resources. PRIORITY HOME HEALTH CARE INC.: Renee Payne to billing assistant; Linda Stewart to medical records coordinator; Susan Lucia to receptionist/ office assistant. SISTERS OF CHARITY HEALTH SYSTEM: Terrence P. Kessler to general counsel.

INSURANCE KAISER PERMANENTE: Maria Dawe to account executive; Michael Willis to manager, account management; Tim Krenn to senior sales executive; Dick Schoeler to manager, broker relations, small group and individual sales. MEDICAL MUTUAL OF OHIO: Mark Hren to vice president and general auditor. OSWALD COS.: Michael Cremeans to practice leader, Life Sciences.

PORTER WRIGHT: Jennifer L. Strazzella to of counsel, Corporate Department.

MEDIA WKYC-TV, CHANNEL 3: Rita Andolsen to director of advocacy and community initiatives.

NONPROFIT AMERICAN SOCIETY OF SANITARY ENGINEERING: Ramiro Mata to staff engineer. CLEVELAND MUSEUM OF NATURAL HISTORY: Anne Todd Welki to chief financial officer. JEWISH FAMILY SERVICE ASSOCIATION OF CLEVELAND: Lisa Brody to manager of marketing and communications.

TECHNOLOGY PARK PLACE TECHNOLOGIES: Bob Idoine to chief information officer; John Burchard to director of strategy; Ken Barhoover to marketing manager.

UTILITIES

WALTER & HAVERFIELD LLP: David E. Schweighoefer to partner, Health Care Section.

FIRSTENERGY CORP.: Marlene Barwood to assistant controller, FirstEnergy Utilities.

MANUFACTURING

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RADIX WIRE CO.: James Schaefer to president.

DIX & EATON: Jessica Kahn to account executive.

AEROSPACE DIVISION OF THE AMERICAN SOCIETY OF CIVIL ENGINEERS: Dr. Wieslaw K. Binienda (University of Akron) received the 2011 Outstanding Technical Contribution Award.

WHITESPACE CREATIVE: Lisa Marshall to senior account executive; Helen Davis to project manager.

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INSIDE

17 SMALLER FIRMS, SOLO LAWYERS GET HELP FROM UA STUDENTS.

LEGAL AFFAIRS

FIRMS TELL WORKERS TO HANG UP Organizations require employees to buckle up their phones while driving By GINGER CHRIST gchrist@crain.com

hatting on a cell phone while behind the wheel won’t get most employees fired. But, as companies intensify efforts to protect themselves legally in a technology-engaged world, workers could see more stringent employer policies as they relate to cell phone use while driving. The city of Cleveland, for one, in March developed a personal electronic devices policy, which prohibits employees driving for work purposes from using an electronic device while on the road. At its core, observers say “Even if your employers are afraid of policy says it, being found vicariously you have to live guilty for accidents that it. It’s one thing occur while their workers to have it down are talking or texting as in writing; it’s they drive as part of their another to do it.” jobs. – Eric Johnson, partner, Walter & In just one of a number Haverfield of cases cited in a report issued last week by the National Safety Council, a jury found an employee driver and the firm that owned the company car liable, awarding $21.6 million in a 2007 fatal crash in Ohio. Cell phone records showed the employee driver was using a cell phone at the time of the accident. According to testimony, she may have been talking with her husband, according to the safety council, which did not identify the firm. Local lawyers warn that policies that simply restrict talking on a cell phone while driving leave out a number of other phone functions See DRIVING Page 14

Many firms boost hiring of students for summer Some eliminated them; some cut back, but now they’re adding to rolls By MICHELLE PARK mpark@crain.com

n the two years that Brouse McDowell LPA suspended its summer associate program, the incoming résumés actually increased. At the receiving end, Christopher Carney, the firm’s hiring committee chair, responded to each applicant, explaining that Brouse wasn’t hiring, but wishing them luck. “I was disappointed for the law students,” Mr. Carney recalled. “I felt bad that there were a lot of great students out there who were struggling to find jobs.” Brouse McDowell, which has offices in Akron and Cleveland, did away with its summer associate program for two years because of the economic downturn and uncertainty, Mr. Carney said. It didn’t want to hire associates, find that they did good work and then not be able to offer them permanent positions. Doing so could earn it a bad reputation and would be worse for the students.

INSIDE: A Case Western Reserve University program allows law students to gain experience with entrepreneurs. Page 18 This year is a different story. The firm is reviving its program this summer — one of many things pointing to a better summer all around for law students. Though many Northeast Ohio law firms did not suspend their summer associate programs, a good number did decrease the number they hired and now are beefing up again. Baker & Hostetler LLP, an 11office firm headquartered in Cleveland, has 12 summer associates starting work in late May, up from seven last year — something Ron Stepanovic attributes to economic improvement. “Things have obviously gotten better in the economy,” said Mr. Stepanovic, hiring partner for the firm’s Cleveland office. “Our transactions practice has picked up. Back in 2009 and 2010, there weren’t a lot of transactions being done, largely because people couldn’t get financing to do acquisitions.” With 12 summer associates, the firm is nearly back to its preSee SUMMER Page 15

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APRIL 30 - MAY 6, 2012

LEGAL AFFAIRS

Driving: Enforcement of policies more important continued from PAGE 13

and exclude other electronics devices. They also note that the existence of a policy isn’t enough; companies unilaterally must enforce the rules in order to be protected. Of course, there are a lot of intricacies involved in creating a comprehensive policy, which needs to be all-inclusive and reflect the company’s culture. “I see a lot of policies that absolutely prohibit the use. But then the employer provides them hands-free technology. Now we have a built-in conflict,” said Eric Johnson, partner in Walter & Haverfield’s labor and employment law group. Mr. Johnson likened creating a distracted driving policy to a sexual harassment policy. He said a company can’t restrict employee cell phone use while driving, then call a technician who’s on the road about a technical problem. Similarly, an employer can’t impose a sexual harassment policy and then allow employees to make suggestive comments about one another.

A progressive Progressive Progressive Corp. was an early adopter. The big insurer based in Mayfield Village in 2001 first developed a cell phone policy and, in the years since, has updated it to remain current, according to Jeff Sibel of Progressive public relations. Progressive’s mobile communications device policy prohibits all employees from using a mobile communications device or any other electronic equipment while driving for the company or operating a company vehicle. The city of Cleveland devised its policy because of requests from heads of various departments, some of whom had developed their own internal policies, said Deborah Southerington, director of the city’s human resources department. “We wanted to standardize it,” Ms. Southerington said. Ms. Southerington wasn’t aware of any violations of the policy. However, she did note that such violations would be handled on a case-by-case basis.

Live your policy Sarah Melamed thinks cell phone policies are not necessarily appropriate for firms of all sizes. “We look at it as one of those things that a smaller company doesn’t really need to tangle with,” said the president of the 22-person Cleveland-based advertising firm, Melamed Riley. To impose a policy seems too

overbearing, she said, especially when there is not a standardized legal restriction against cell phone use while driving. “I think we create a culture where people are encouraged to make the right decisions,” Ms. Melamed said. Even so, Rollie De Monte, an associate in the Cleveland office of Fisher & Phillips, said issues regarding employee cell phone use are becoming more prevalent because new regulations are bringing concerns to the forefront. According to a September 2010 survey by the National Safety Council, 18% of Fortune 500 companies report that they have cell phone policies banning use while driving. “I haven’t seen a lot of official discipline for violation of a cell phone policy, which I think is going to change as this becomes more of an issue,” Mr. De Monte said, referring to talking while driving. Mr. De Monte said he thinks companies with such policies might start highlighting them during new hire interviews. Walter & Haverfield’s Mr. Johnson takes Mr. De Monte’s thought even further. He said if a company doesn’t enforce its policy, it loses the protection the policy might provide in the event an accident occurs while an employee is driving while using an electronic device. “Where the key is to this is, even if your policy says it, you have to live it,” Mr. Johnson said. “It’s one thing to have it down in writing; it’s another to do it.”

On the books As public awareness intensifies over the dangers of talking and texting while driving, so, too, does the number of governing bodies enacting rules regarding the use of electronic devices. Such measures all have the potential for creating a trickledown effect on employers. For example, the U.S. Department of Transportation on Jan. 1 banned drivers of commercial motor vehicles from using handheld mobile phones during operation. In Northeast Ohio, a number of municipalities, including Lyndhurst, North Royalton and Summit County, have enacted texting-whiledriving bans, while others, such as North Olmsted and South Euclid, have passed laws restricting the use of handheld cell phones. Cleveland Councilman Zack Reed recently has said he wants to further address restrictions on cell phone use while driving in the city. ■

COMING UP Crain’s Cleveland Business on Nov. 26 will publish its fourth and final “Who to Watch” section of 2012, this time focusing on the legal field. Previous installments have profiled up-and-comers in technology and finance, and emerging health care

leaders will be featured July 16. We identify some difference-makers in each field and talk to industry observers about the issues facing those sectors today. To submit nominations, email Crain’s sections editor Amy Ann Stoessel at astoessel@crain.com.

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LEGAL AFFAIRS

Summer: Programs offer firms sneak peeks at potential hires continued from PAGE 13

recession numbers, Mr. Stepanovic said. Summer associates, he noted, perform due diligence and prepare some ancillary documents for transactions.

Back in the game Barbara Weinzierl sees evidence of the thaw in the greater number of firms that came to the University of Akron campus last fall to interview potential summer associates. The director of career planning and placement for the university’s school of law, Ms. Weinzierl said there was probably a 30% increase in the number of firms on campus in fall 2011 compared to fall 2010. “I definitely think that summer associate programs are opening up more,” she said, noting she also has heard that a number of firms in Cleveland, Canton and Akron are reviving programs and increasing their summer associate ranks. “I take away that the economy is coming back, and that there’s more work out there. Law firms are optimistic that their clients are doing better again or maybe engaging in transactions that they weren’t two or three years ago.” Brouse McDowell, which will welcome in May four summer associates, including one first-year law student, is back in the game now, in part because it has a hole in its ranks. “We had a talent gap because we had suspended the program,” said Michael O’Donnell, also a member of the firm’s hiring committee. “They’re a valuable part of the firm, and having suspended it, we need to sort of replenish the age group within the firm.” Though Calfee, Halter & Griswold LLP didn’t suspend its summer program, its number of associates has increased from four in 2009 to six in both 2011 and 2012. Similarly, Reminger Co. LPA, which has a year-round law clerk program, has six clerks this year, up from five in 2010-2011 and three in 2009-2010. The firm also is planning to add two more in May, a spokeswoman said. And Woodmere law firm Meyers, Roman, Friedberg & Lewis LPA, will have three summer associates this year, up one over recent years, said Barbara K. Roman, a principal with the firm and president of the Cleveland Metropolitan Bar Association. Local law firms have received markedly more résumés from students outside of Northeast Ohio in recent years, many local hiring chairs noted. “I did see as the hiring chair a large uptick in résumés from out-of-town students from upperechelon law schools,” Mr. Carney said, citing Harvard and Georgetown universities. “Where we normally do not see unsolicited résumés coming to Brouse McDowell, we saw a ton. That suggests to me that the market is still tight for law students.”

more students from national schools who may stay and practice here after graduation, Baker Hostetler’s Mr. Stepanovic said. “The major benefit is the training that goes on,” he said. The bar association’s Ms. Roman agreed. “That mentoring gives such an edge to the entering lawyers,” she said. Summer associate programs also afford law firms the chance to test-drive potential hires, she added — something she feels is particularly important considering

today’s economy and law climate. “(Firms) may not be hiring as many people as they did before, so when they do, they want really strong candidates,” Ms. Roman said. No one anticipates a return to summer associate classes of 20plus students like those hired in the 1980s and 1990s. “Some of it just has to do with efficiency,” Mr. Stepanovic said. “With technology the way it is, you can do the same amount of work with less students.” Plus, he noted, some clients

aren’t thrilled to pay for young associates to be trained on their time. In addition, the biggest firms that hired the biggest classes are the ones struggling most, noted Craig M. Boise, dean of ClevelandMarshall College of Law. Jennifer Blaga, the school’s director of career planning, also noted that firms are being smarter and not “overdosing on summer associates” to such an extent that they leave people without job offers or inundate themselves with too many associates for the work-

load they have. Though law students are cautiously optimistic that the job market is looking up, they are realizing that what used to happen with regularity years ago isn’t a sure thing today, the University of Akron’s Ms. Weinzierl said. “It’s not a guarantee that they’re going to get an offer just because they’ve got the summer associate job,” she said. “They realize that they’ve got to get in there and they’ve got to be the whole package that a firm is looking for.” ■

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More with less By all accounts, the resurgence of summer associate programs is a positive for law firms and law students. If Northeast Ohio’s legal market is strong, it should be able to attract

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LEGAL AFFAIRS

Use specific language in limiting former employees’ next steps

mong a company’s most valuable assets are its employees, its customers and its proprietary information. Noncompetition, nonsolicitation and confidentiality agreements can help protect these important assets against misappropriation by a competing business or by a departed employee. But in order to effectively use such agreements, there are pitfalls to avoid. A business has a legitimate interest in protecting against unfair competition, not ordinary competition. Thus, restrictions on former employees should be narrowly tailored. ■ In jurisdictions, such as Ohio, where noncompetition agreements generally are enforceable, the key terms are: the scope of the field in which the employee cannot compete with your business upon departure; the geographic territory in which he cannot compete; and the time period during which there can be no competition. The restrictions only should apply to the same type of employment with a competitor or to employment with a competitor in which the

nature of the employment jeopardizes your competitive position. ■ Second, consider customerspecific restrictions, where appropriate, and include prospective customers with whom the employee had direct contact. ■ Third, when imposing temporal restrictions, craft them with an eye toward anticipating how long it may take to eliminate customers’ identification with the former employee and how long it may take to train a replacement. Wrinkles in the law can present significant traps for unwary employers seeking to prohibit unfair competition by a former employee. Some states bar enforcement of noncompetition covenants against employees. Other states impose constitutional or statutory restrictions as to their permissible scope. In yet other states, there are various rules affecting the enforceability of noncompetition covenants depending upon when they are entered into during the employment relationship. If state laws pose obstacles to the use or enforcement of noncom-

DAVIDPOSNER

ADVISER petition agreements, there are other options to consider to prevent unfair competition by a former employee. One such option is a confidentiality agreement. If outright competition cannot be prohibited, then put contractual protections in place to bar the use of your proprietary information by the departed employee. Another option is a nonsolicitation agreement barring the ex-employee from actively soliciting your customers and from soliciting other employees from leaving employment. Financial disincentives or “clawback” agreements, can be effective in convincing former employees not to engage in competition, the

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idea being that the employee is not prohibited from competing but must “pay the price” for doing so. The law governing the enforceability of confidential information agreements is not uniform throughout the United States. What may be protectable in one jurisdiction may not be in another jurisdiction, and the degree of protection may vary, as well. To ensure that the broadest possible categories of information will receive the greatest degree of protection, the following key recommendations should be observed and implemented. ■ First, information which is intended to be confidential should be denoted as such — mark it confidential and be as specific as possible in describing the classes or categories of information that are considered to be confidential in any confidentiality agreement. ■ Second, treat confidential information confidentially. In other words, keep it secret — secrecy means not only secrecy from competitors, but also secrecy from suppliers, customers and even from nonessential employees. ■ Third, active steps must be taken to preserve the confidentiality of the information. Common affirmative security measures include password restricted access, encryption, sign-out logs, lock boxes, document destruction policies, as well as confidentiality agreements themselves. Moreover, confidentiality agreements can extend to more than just employees — they can be demanded of suppliers, customers, contractors, visitors and others. If the competitor hiring another

company’s former employee is you, the following are suggested steps: ■ First, require the employee to certify in writing that he is not bound by any contract that prohibits or restricts him from performing the duties for which he is being hired. ■ Second, and to the extent there are restrictions on the employee’s performance, craft the new position in a way that allows for compliance with the restrictions or that shows that the restrictions inhibit fair or ordinary competition as opposed to unfair competition. This may involve requiring the employee not to contact any customers or prospective customers of the former employer with whom he had personal dealings in his former employment for a certain period of time. ■ Third, require the employee to acknowledge in writing that he has been directed not to use or disclose any confidential, proprietary and trade secret information belonging to his former employer. ■ Fourth, require the employee to certify he will not solicit or induce former co-workers to terminate employment with the former employer. Careful attention to the drafting of noncompetition, nonsolicitation and confidentiality agreements is critical to the determination of their enforceability. Furthermore, quick and decisive action must be taken to commence litigation if they are violated, for these agreements will not be worth the paper on which they are written if not enforced. ■ Mr. Posner is a partner in the Cleveland office of Baker & Hostetler LLP.

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LEGAL AFFAIRS

OIL, GAS & MINERAL RIGHTS QUESTIONS?

UA program pairs students, small firms By KIMBERLY BONVISSUTO clbfreelancer@crain.com

olo practitioners and small law firms often need extra help but may not have the resources or the time to hire a full-time law clerk. Meanwhile, law students craving real-world experience haven’t been finding it as the economic downturn led to the scaling back or elimination of summer associate programs over the last few years. Hiring also has been down, leaving more law school graduates competing for fewer jobs. In response, the University of Akron’s School of Law is a year and a half into a program that it created to address today’s needs of both students and employers. The Law Clerk for Hire (LC4H) program is a free online resource that allows interested employers to search a database of Akron law students available to hire for temporary projects. Barbara Weinzierl, the law school’s director of career planning and placement, learned in 2008 during a meeting of the solo and small firm section of the Akron Bar Association about an arrangement with the paralegal section of the Akron Bar Association — small firms were hiring paralegals on an as-needed basis. “That got my wheels turning,” Ms. Weinzierl said. “I thought, ‘Why not do something like that for law students for small firms who can’t afford or don’t need a law student working 20 to 30 hours a week, but may need someone for five to 10 hours a week?’” Diana Colavecchio, who is in solo practice in Cuyahoga Falls, was chairing the Akron Bar’s solo and small firm section at the time and collaborated with Ms. Weinzierl on the LC4H program, which launched in November 2010. “In addition to not being able to really find steady employment, (law students) were seeing a decline in attorneys hiring them for even basic research,” Ms. Colavecchio said. “(Ms. Weinzierl) said if they put together a database of law clerks willing to be hired on an asneeded basis, would that be something we would work with them on? We said absolutely.” Employers register and create a confidential profile, which provides them access to a database of law students with personal résumé pages. LC4H generates a list of students matching criteria indicated by the employer. Once a match is made, the student and employer independently work out an arrangement.

Not just for little guys Christopher Teodosio is a thirdyear law student who saw the LC4H program as an opportunity to gain practical experience outside the classroom. He worked for Brouse McDowell of Akron on research projects throughout the fall semester. He continued working for the firm as a research assistant through the spring semester. Through the LC4H program, he was able to demonstrate his abilities and was offered an associate position once he passes the Ohio Bar

this summer. “The activities exposed me to different areas of the law and gave me the opportunity to apply the law to different fact patterns,” Mr. Teodosio said. “It gave me the opportunity to improve my writing and gain feedback from experienced attorneys at the firm. “For students who are trying to juggle difficult law school courses with employment, the Law Clerk for Hire program can provide substantial benefits,” he said. Marc B. Merklin, managing partner with Brouse McDowell, said his firm heard about the LC4H program through an associate with ties to the Akron Bar and the University of Akron law school. While not necessarily a small law firm, Brouse McDowell had suspended its summer associate program over the past two years due to the economic downturn, instead turning to the LC4H program to meet research needs for its clients. Brouse McDowell has restored its summer associate program for this summer, but plans to continue to use the LC4H program throughout the year based on client needs. “This provided us the opportunity to find part-time help during the year without having to place ads and do the legwork to find qualified law students,” Mr. Merklin said. University of Akron law school dean Martin H. Belsky said the LC4H program also is a way for solo and small practitioners to get to know someone on an informal basis without making a commitment, while giving law students that “nitty-gritty” experience of dealing with project-based law. Although the school does not have a tracking mechanism in place to determine how many matches have been made through the LC4H program, Ms. Weinzierl said there is anecdotal evidence the program is working and growing. To date, 51 employers and 99 students are registered in the LC4H program.

Not alone The Cleveland-Marshall College of Law at Cleveland State University does not have a formal database like the University of Akron, but Jennifer Blaga, director of the Office of Career Planning, said she fields about six to 10 requests annually from alumni at small firms or solo practitioners looking for a law student to work on a short-term project. Ms. Blaga said she does targeted outreach or emails to students who meet the criteria the employer is seeking. She said students often return to a firm for more projects. Case Western Reserve University School of Law has a Short-Term Employment Program (CWRU Law STEP) that advertises opportunities on a password-protected jobs board that is searchable by students and recent graduates. Projects might include document reviews; research and writing; summarizing updates to laws/regulations; assistance with researching and writing articles, company newsletters or continuing legal education materials; and drafting/filing court document. ■

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LEGAL AFFAIRS

CWRU IP clinic assisting startups By MICHELLE PARK mpark@crain.com

tâ&#x20AC;&#x2122;s a job that can cost on average $15,000 to $20,000, but no invoice will be sent to Ramcryptor Holdings LLC for the legal work that went into patent applications that should be filed in the coming weeks. Ramcryptor, a startup technology company that is developing a processor hardware security technology, is the first client of the Intellectual Property Entrepreneurship Clinic launched in January at The Milton A. Kramer Law Clinic Center at Case Western Reserve University School of Law. The companyâ&#x20AC;&#x2122;s present legal advisers are two third-year students and Todd E. Behrens, clinic supervisor and a partner at the intellectual property law firm Medley, Behrens & Lewis LLC in Independence. The clinicâ&#x20AC;&#x2122;s early efforts have included an educational seminar and serving Ramcryptor with its patenting needs. The program is serving companies, such as Ram-

cryptor, that are affiliated with Shaker LaunchHouse in Shaker Heights, a for-profit business incubator, though itâ&#x20AC;&#x2122;s not limited to serving only them. The only costs its clients incur are government charges â&#x20AC;&#x201D; for example, the filing fees required by the U.S. Patent and Trademark Office. The goal is to grow the law clinicâ&#x20AC;&#x2122;s number of students and clients, Mr. Behrens said. â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;re still at the point of proof of concept of the clinic to make sure that weâ&#x20AC;&#x2122;re making progress in the right direction before we take on too many representations or have too many students enrolled,â&#x20AC;? he said. Heâ&#x20AC;&#x2122;s proud of the way the students helped Ramcryptor identify unique features of its inventions in an effort to obtain protection for their client. Being able to protect Ramcryptorâ&#x20AC;&#x2122;s technology is critical to the companyâ&#x20AC;&#x2122;s future because itâ&#x20AC;&#x2122;s a holding company founded to develop technologies with the hope of licensing them to other companies, said Jessica Mann, the companyâ&#x20AC;&#x2122;s inventor. The CWRU students were thor-

ough, she said, in suggesting other applications for the technology and assembling additional protection around those applications. Todd Goldstein, managing partner of LaunchHouse, estimates a few dozen people attended the first seminar the clinic offered. â&#x20AC;&#x153;Itâ&#x20AC;&#x2122;s been absolutely great,â&#x20AC;? Mr. Goldstein said of the partnership. â&#x20AC;&#x153;We now have the ability to select individual companies where we can actually work with their students to eliminate a lot of those costs and provide real value that can make or break a company. When a company can protect their idea, they kind of keep out the competition in a sense.â&#x20AC;? The work the clinic is doing will assist LaunchHouse in its mission of growing companies to some sort of exit or liquidity event, Mr. Goldstein said. Thereâ&#x20AC;&#x2122;s a competitive advantage for students, too. â&#x20AC;&#x153;They have the chance to develop different skills â&#x20AC;Ś that they wouldnâ&#x20AC;&#x2122;t necessarily get otherwise, given that the market for attorneys has been pretty rough lately,â&#x20AC;? Mr. Behrens said. â&#x2013;

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his year, Crainâ&#x20AC;&#x2122;s Cleveland Business honored those working in the regionâ&#x20AC;&#x2122;s general and in-house counsel positions during its General and In-House Counsel Summit, which was held April 18 at LaCentre in Westlake. As part of the program, a half-day education summit, which included the opportunity for continuing legal education credits, was presented. A general session and three track sessions, which covered the topics of health care reform, risk management and executive compensation, were available for participants to attend. Below are brief excerpts from each of the panelists who participated in the data privacy and risk general session, moderated by Ted Kobus, national head of data privacy, Baker Hostetler.

â&#x2013; What kind of guidance do you have for businesses that are collecting and maintaining personal information? Maria Del Monaco, attorney, Bureau of Consumer Protection, Federal Trade Commission: â&#x20AC;&#x153;Iâ&#x20AC;&#x2122;m only going to speak on my own behalf. ... Iâ&#x20AC;&#x2122;d like to tell you about our website, we have lots of information there for business and particularly information on data privacy. â&#x20AC;Ś We have a booklet titled â&#x20AC;&#x2DC;Protecting personal information: A guide for businessâ&#x20AC;&#x2122; (http://tinyurl .com/82yce4t), and this is a good place for any kind of company to

start addressing these sorts of issues. The booklet recommends five steps: Take stock, scale down, lock it, pitch it and plan ahead. Take stock means knowing what personal information your company has in its files and on its computers. You want to understand how personal information moves into, through and out of your business and you want to inventory all places where it can reside, including cell phones, home computers and things of that nature. Scale down means keep only what you need. Donâ&#x20AC;&#x2122;t use Social Security numbers as ways of identifying people and if you donâ&#x20AC;&#x2122;t need to keep credit card information â&#x20AC;&#x201D; thereâ&#x20AC;&#x2122;s no business need for it â&#x20AC;&#x201D; donâ&#x20AC;&#x2122;t keep it, and have and follow a written retention policy. Lock it means that you need to secure that data that youâ&#x20AC;&#x2122;ve decided to keep. You want to address physical security, electronic security, employee training, and the security practices of your contractors and services providers. Pitch it means you want to properly dispose of what you no longer want or need. So in terms of paper documents, that usually means burning, shredding or pulverizing. In terms of media, it means you want to destroy or erase things so as a practical matter they canâ&#x20AC;&#x2122;t be read or reconstructed. And plan ahead means have a plan for responding to data breaches.â&#x20AC;? continued on NEXT PAGE

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LEGAL AFFAIRS CRAIN’S 2012 IN-HOUSE AND GENERAL COUNSEL SUMMIT ■ What are the most common causes of data breach events? Jason Straight, vice president, legal technologies business development, Kroll Ontrack: “Unfortunately — or I’d have to say fortunately for someone in my business — even if you follow all the guidelines ... there’s no way to completely prevent a breach or protect yourself 100% against breaches. That’s because you’ve got some very intelligent criminals out there; they’re looking for ways, even the smallest gap they can squeeze into to obtain access to information that may be of value to them for whatever reason. The trends ebb and flow, but at any given time you have a mix of insider threats and outsider threats. Insider threats (are) caused by malicious, or more often negligent or accidental, activities of employees. This would be the lost laptops, emailing the work documents to your Gmail account and your Gmail account gets hacked, those kinds of activities that are carried out by insiders. Then you’ve got outside threats that are almost always malicious, although one trend we’ve seen is that the motivation for those attacks is evolving. It used to be ... that you really had to be most concerned about organized crime and that there were criminals out there that were looking to benefit

economically. ... But really I think it’s safe to say 2011 was the year of ... the ‘hack-tivist’ ... that in some cases are stealing information that has economic value but more often the intent is just to humiliate and embarrass a company, and that’s a heck of a lot harder to protect yourself against. These guys have really changed the game and changed the landscape. Some of these attacks have been extremely damaging to a company’s reputation. It’s the outsider threats, certainly in the last year, that have gotten the most attention. In the past I’ve said I think some of these outsider threats are overblown and not every company needs to worry about that, but it’s become such a huge issue and the impact of these breaches has become so significant that I think every company needs to pay attention to the trends and the latest methods and mechanisms that these entities are using … because they’re very well organized. They’re smart and they know where your weak points are probably better than you do.” ■ How are the security practices different for paper documents? Peter Albert, associate general counsel and privacy officer, Progressive Insurance: “By their very nature you have to secure electronic documents different

IN BRIEF than paper documents. I know Maria mentioned lock it up, seems pretty simple when I read the FTC’s guidance. ... With all due respect, sometimes it’s a little difficult to implement. For instance, I’ll get a question, ‘OK, we’ve got to lock up our paper documents. We have a common area where our claims adjusters are. ... Do we have to lock the cabinets during working hours’? That goes down the path, ‘Well, where is the room located? Do others have access to it? Can you centralize these files in a back room? How does that interfere with the day-to-day work functions? We’re a 24-by-7 shop so we have claims adjusters in there all the time that are accessing these files, so when exactly do you lock them up and is a lock on the front door sufficient,’ for instance? So you have to puzzle through a lot of those types of questions. Now, if paper documentation is lost and it has a Social Security number on it, or credit card figures, it can be every bit as damaging as losing an electronic file. The key distinction is if you lose an electronic file or flash drive … you can have far more sensitive information packed into a portable piece or device. Under the security breach laws ... where you have to notify consumers or individuals if you lose certain kinds of sensitive informa-

tion, they typically apply to electronic data. ... But if you lose the paper you don’t necessarily have to notify the individual. ■ Is there anything different with health care? Lynn Sessions, counsel, Baker Hostetler: “I’m a health care lawyer, represent a lot of health providers in handling data security issues, and when we look at paper breaches, which unfortunately are pretty common today in health care as health care organization move from ... paper records to electronic records … finding ways to discard those old paper records, we are looking frequently at the paper breaches. There’s also Dumpster diving that goes on at pharmacies, for example, where the pharmacies have inadvertently discarded protected health information, which is a buzzword for us on the health care side. And some of you may not think that this impacts you, but if you are a large company that has a wholly owned health plan that you insure your employees through, you may be covered under HIPAA (Health Insurance Portability and Accountability Act), so the HIPAA HITECH (Health Information Technology for Economic and Clinical Health Act) laws may apply to you. … There are differences certainly on the health care side.”

Group forms to help nonprofits with needs In an effort to further assist Northeast Ohio’s nonprofit sector, three organizations have joined forces this year to offer additional help. “Reach Out: Legal Assistance for Nonprofits” is a collaborative effort of the Northeast Ohio chapter of the Association of Corporate Counsel — America; the Federal Bar Association, Northern District of Ohio chapter; and the Cleveland Metropolitan Bar Association. “Nonprofit organizations have the same kind of issues that commercial enterprises have,” said John Moran, general counsel at GrafTech International Ltd. and pro bono co-chairman for the Northeast Ohio chapter of the Association of Corporate Counsel. The three groups have worked together this year to expand the already existing program, offering free educational seminars to nonprofit leaders. (Continuing education credits are available to attorneys at the programs.) Two clinics already have covered the topics of nonprofit governance, as well as contract basics and real estate law. Coming clinics will touch on employment and intellectual property law (July 19); and risk management/insurance and privacy and data protection (Oct. 15). More information can be found at www.clemetrobar.org/reachout/.

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Shale: Industry could fill void in commercial real estate demand continued from PAGE 3

deals hold promise for revitalizing the industrial and office markets in the emerging oil and gas fields south of Portage and Summit counties. Observers expect the oil and gas rush to be transformative for the old steel mill towns of Ohio.

Chalking up the wins “It’s not a matter of if it will be significant; it’s a matter of how significant it will be,” said Jacob Duritsky, director of business attraction for Team NEO and point man for the nonprofit’s efforts to help companies new to the shale region with meeting their real estate needs. At this point, Team NEO counts less than 10 “wins” of out-of-state companies setting up shop in eastern Ohio due to the oil and gas boom. Some have yet to go public, but one Mr. Duritsky can cite involves Houston-based oil field service provider Exterran Holdings Inc., which is building a 65,000-squarefoot factory in Youngstown. However, Mr. Duritsky said it’s more common for the real estate rush associated with oil and gas to focus on older industrial buildings

with internal cranes that are available for immediate use. Cleveland real estate broker Terry Coyne, a Newmark Grubb Knight Frank executive vice president, said he hopes to see results soon from a six-month drive to cater to the space demands of oil- and gasrelated companies. He said he has leased a warehouse for a steel mill he said he cannot identify, and is close to inking the sale of a large parcel in Steubenville that the seller has marketed for 37 years. Mr. Coyne said he considers his efforts in the shale region well spent. Last August, he launched a website, www.uticamarcellus.com, focused on news and commercial real estate listings linked to oil and gas in Ohio and Pennsylvania. Initially, there was no action, but inquiries and hits on the site began taking off after Halloween. Now, people want to advertise on his site, he said. “The fact the URL was available showed how little interest there was,” Mr. Coyne said of the website. “Now I have had requests to buy it.”

Supporting cast in tow Chris Hondlik, a vice president in

industrial and corporate real estate at Ostendorf-Morris Co., has been collecting commissions from commercial real estate deals to oil and gas users since 2010. The largest was the sale of a 225,000-square-foot Youngstown building that became temporary warehousing associated with V&M’s expansion. He also sold a 60,000-square-foot building in Warren to a processor of brine water produced by oil and gas drillers. Mr. Hondlik said he receives calls more often about land mineral rights than his building listings in the region. However, he sees the commercial real estate rush coming. “There will be a supporting cast” behind the drillers, Mr. Hondlik said. “It’s stronger than manufacturing. They know where they want to be” and prospects do not quibble over price like most local concerns, he said. Team NEO’s Mr. Duritsky also foresees what he calls “downstream impacts.” Once production ramps up of so-called “wet gas,” which contains butane, ethane and other liquids that are used as raw materials by makers of plastics and chemi-

Silver Grille packed for shale discussion Nearly 400 people attended Crain’s recent breakfast panel discussion of Ohio’s Utica Shale oil and its economic consequences, which could spread to many industries across the Buckeye State. The experts on the panel explained how the early stage of this boom is benefitting not just landowners negotiating lucrative leases, but the many businesses — such as steel, specialty manufacturing, logistics and more — that stand to gain for many years to come. The rich “wet” shale oil in Ohio will attract billions in infrastructure investment while simultaneously providing cheap, close-by raw materials for one of Ohio’s most important existing industrial sectors: plastics and specialty chemicals. Watch our weekly editions of Crain’s Cleveland Business for ongoing coverage and our future specialty publications that will be dedicated to this burgeoning industry.

“

Shale drilling “really will be big for Ohio, across just about every industry.” - William Beaufait

”

cals, other production operations should be added in the state and should push commercial property demand over the long haul.

Canton perks up In downtown Canton, David Comernisky, a CBRE vice president, reports that energy-linked law firms, engineering firms and others have “been a real shot in the arm” for the office market, but no panacea. “There’s still a whole bunch of space that has not been leased,” Mr. Comernisky said, such as buildings of more than 50 years old with 30% vacancy rates. However, at the 11-story Huntington Bank Building, 220 Market St. in Canton, occupancy has climbed to 97% from 88% a year ago at the 130,000-square-foot structure thanks to two leases with energy-related companies and another one that is going through final OKs. Mr. Comernisky said rents have not climbed in downtown Canton, although the energy rush means it is easier for owners to get their asking rates without offering incentives. Meantime, news of the oil and

gas rush is attracting people with speculative plans to the region. David G. Marshall, chairman and CEO of Philadelphia-based Amerimar Realty Co., said the kind of expansion linked to the Utica and Marcellus shale ranges got him to look for property here. He recently optioned for one year from the city of Akron the 1 million-square-foot former headquarters of Firestone Tire & Rubber Co., now part of Bridgestone Corp. His goal: Cater to oil and gas service providers and researchers he believes will prefer working and living in Akron to easily accessible points south where drillers operate. By contrast, the area south of Akron is not new to Mr. Coyne, who has inked deals in Wooster. Although activity is just beginning, he said he is confident oil- and gas-related uses will reshape that area’s industrial market for the next five years, especially in view of the alternative. “With no huge driver of demand in that market,” Mr. Coyne said of the period before the energy companies started to appear, “I had no idea what was going to use up the space in old industrial buildings.” ■

To view a full-length video of the discussion go to: CrainsCleveland.com/shalevideo or use your smartphone to scan the QR code

In addition to our ongoing news coverage, Crain’s is planning additional 2012 editorial projects on shale drilling. Look for a special editorial section in the Sept. 3 issue of Crain’s and a magazine supplement to be included with the Dec. 3 issue of the paper. Interested in sponsorship or advertising opportunities? Contact Nicole Mastrangelo at 216-771-5158 or nmastrangelo@crain.com

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BRIGHT SPOTS 700 W. St. Clair Ave., Suite 310, Cleveland, OH 44113-1230 Phone: (216) 522-1383 Fax: (216) 694-4264 www.crainscleveland.com Publisher/editorial director: Brian D. Tucker (btucker@crain.com) Editor: Mark Dodosh (mdodosh@crain.com) Managing editor: Scott Suttell (ssuttell@crain.com) Sections editor: Amy Ann Stoessel (astoessel@crain.com) Assistant editor: Joel Hammond (jmhammond@crain.com) Sports Senior reporter: Stan Bullard (sbullard@crain.com) Real estate and construction Reporters: Jay Miller (jmiller@crain.com) Government Chuck Soder (csoder@crain.com) Technology Dan Shingler (dshingler@crain.com) Energy, steel and automotive Tim Magaw (tmagaw@crain.com) Health care and education Michelle Park (mpark@crain.com) Finance Ginger Christ (gchrist@crain.com) Manufacturing, marketing and retailing Research editor: Deborah W. Hillyer (dhillyer@crain.com) Cartoonist/illustrator: Rich Williams Marketing director: Lori Grim (lgrim@crain.com) Marketing/Events manager: Christian Hendricks (chendricks@crain.com) Marketing/Events coordinator: Jessica Snyder (jdsnyder@crain.com) Advertising sales manager: Nicole Mastrangelo (nmastrangelo@crain.com) Senior account executive: Adam Mandell (amandell@crain.com) Account executives: Dawn Donegan (ddonegan@crain.com) Andy Hollander (ahollander@crain.com) Office coordinator: Toni Coleman (tcoleman@crain.com) Digital strategy and development manager: Stephen Herron (sherron@crain.com) Web/Print production director: Craig L. Mackey (cmackey@crain.com) Production assistant/video editor: Steven Bennett (sbennett@crain.com) Graphic designer: Lauren M. Rafferty (lrafferty@crain.com) Billing: Susan Jaranowski, 313-446-6024 (sjaranowski@crain.com) Credit: Todd Masura, 313-446-6097 (tmasura@crain.com) Audience development manager: Erin Miller (emiller@crain.com)

Crain Communications Inc. Keith E. Crain: Chairman Rance Crain: President Merrilee Crain: Secretary Mary Kay Crain: Treasurer William A. Morrow: Executive vice president/operations Brian D. Tucker: Vice president Robert C. Adams: Group vice president technology, circulation, manufacturing Paul Dalpiaz: Chief Information Officer Dave Kamis: Vice president/production & manufacturing G.D. Crain Jr. Founder (1885-1973) Mrs. G.D. Crain Jr. Chairman (1911-1996) Subscriptions: In Ohio: 1 year - $64, 2 year - $110. Outside Ohio: 1 year - $110, 2 year - $195. Single copy, $2.00. Allow 4 weeks for change of address. For subscription information and delivery concerns send correspondence to Audience Development Department, Crain’s Cleveland Business, 1155 Gratiot Avenue, Detroit, Michigan, 48207-2912, or email to customerservice@crainscleveland.com, or call 877-812-1588 (in the U.S. and Canada) or (313) 446-0450 (all other locations), or fax 313-446-6777. Reprints: Call 1-800-290-5460 Ext. 125 Audit Bureau of Circulation

Bright Spots is a period feature in Crain’s highlighting under-the-radar, positive business developments. To submit information, email Scott Suttell at ssuttell@crain.com. ■ Gillmore Security Systems Inc., a family-owned security provider based in Oakwood Village, has expanded with the acquisition of Able Security & Automation Corp. in Chardon. “As a family business we are committed to creating growth and local employment opportunities in the Northeast Ohio region,” said Alan Gillmore IV, chief operating officer of Gilmore Security, in a statement. He said Able Security represents “a

very high-quality acquisition for us, and we are excited to welcome the Able customers and employees to our organization.” Terms of the transaction were not disclosed. Ray Laino, previous owner of Able Security, will join the Gillmore sales team as part of the acquisition to assist in a smooth transition and to further expand the company’s Geauga County presence. ■ Osborn, a Cleveland company that provides surface treatment products and high-quality finishing tools for industrial and commercial processes such as metal finishing, honing and surface polishing, has introduced a new marketing tagline and a consolidated brand identity.

CRAIN’S CLEVELAND BUSINESS The new branding was developed “to unify the company’s multiple divisions and create a focused, strategic approach in the marketplace,” Osborn said. The new brand identity “encompasses all elements of the company’s identity, from its positioning statement and website, to its internal communications and its integrated corporate database SAP system.” Osborn said the brand identity is exemplified by a new tagline, “Osborn. Finish. First.” The rebranding effort officially launched in early 2012 and will be integrated over the course of a year. Prior to this effort, different divisions of the company were operating separately, and in many cases, duplicating efforts, the company said. ■ The Academy of Medicine of Cleveland & Northern Ohio has

relaunched its website with a fresh look and a design that it says “is more focused on the needs of our members.” The site now “offers a wealth of information and extensive background about the Academy of Medicine of Cleveland & Northern Ohio, including our rich history dating back to 1824 as well as information on current board members and committees,” the academy says. It also provides detailed information about the Academy of Medicine Education Foundation, which provides medical student scholarships and supports many other Northern Ohio community activities. Among other features: links to recordings of the academy’s “Healthlines” radio program, a “Find a Physician” lookup and daily pollen counts.

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Drivers: Gas prices could change plans continued from PAGE 3

Safe haven in Euclid

York University’s Wagner School of Public Service, eight of the 10 largest U.S. metropolitan areas (except Washington, D.C., for which no data were available) were found to have experienced growth in super commuter levels from 2002 to 2009. The same was true of Cleveland, which saw its super commuter numbers climb 33% during that seven-year span, according to census data. Locally, the number of super commuters rose to 16.1% in 2009 from 12.1% in 2002. NYU’s Rudin Center attributed the increases to a number of factors, including job opportunities, workplace changes and technological advancements.

For Scott Westcott, the decision to live among the ranks of the super commuters involved a combination of all three. Mr. Westcott, who is vice president and executive writer of internal communications for Cleveland-based KeyCorp, logs 85 miles one way in his commute to downtown Cleveland from Erie, Pa. But he only makes the drive three or four days a week. In accepting the job at KeyCorp nearly four years ago, Mr. Westcott made arrangements with the company to work remotely a few days each week. As a communications professional, he’s in the office to meet with people and to attend

events, but works from home on days when his primary task is writing. “Key is really enlightened in terms of work force mobility in situations where it’s feasible,” Mr. Westcott said. “If it was five days per week, it would be tough.” Thus, Mr. Westcott can reside in Erie, where his wife is employed and his 14-year-old son and 11year-old daughter are acclimated. As for weather issues, Mr. Westcott stays with an aunt who lives in Euclid those times during the winter when driving becomes treacherous.

Hard to uproot When Richard Roldan assumed the role of director of dining services at Kent State four years ago, he didn’t

intend to be a super commuter. He and his wife planned to relocate to the Kent area from Huron. But, as the economy soured and the housing market collapsed, the two re-evaluated the decision to sell their home. Now, as the economy recovers, Mr. Roldan has had to weigh his options. And, he has decided to make the daily, 82-mile trek to Kent State. Mr. Roldan’s children now are ages 8 and 10 and are established within their schools and groups of friends. And his in-laws live in Sandusky. He passes the two hours on the road listening to podcasts and books on his iPod. “I think I’m pretty much set. I’m used to the drive,” Mr. Roldan said. “Right now, the drive’s a very easy drive. There’s no traffic.” While working at John Hopkins University in Baltimore, Mr. Roldan’s 20-mile commute took an hour. His

current commute, though, is probably the top of the scale as to what he would handle, he said.

Settling for a Suzuki The one factor that could alter Mr. Roldan’s situation is gas prices. Four years ago, he paid less than $2 a gallon for gas. Now, he pays close to $4 a gallon and fills up his tank two to three times per week. Gas prices coupled with a lengthy commute convinced KeyCorp’s Mr. Westcott to swap cars. When he first started at Key, he drove a Volkswagen Passat, which got about 18 miles a gallon. To cut costs, he switched to a Honda Civic Hybrid, which averaged 40 miles a gallon. Now, he drives a Suzuki Kizashi, which gets about 30 miles a gallon and blends the mileage of the Civic hybrid with the comfort of the Passat. ■

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APRIL 30 - MAY 6, 2012

CRAIN’S CLEVELAND BUSINESS

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THEINSIDER

THEWEEK APRIL 23 - 29

Benz

The big story: The successor to Mike Benz as head of United Way of Greater Cleveland has been found. Bill Kitson, who currently serves as president and CEO of United Way of Greater Toledo, will become the new president and CEO of United Way of Greater Cleveland. He will begin his new position on June 4. Mr. Benz announced his plans to retire last September; he has led the United Way organization in Cleveland for 17 years.

That’s cool: Parker Hannifin Corp. is buying Olaer Group, a U.K.-based manufacturer of advanced hydraulic accumulator and cooling technologies. Parker did not say what it would pay for Olaer, which has annual sales of about $200 million and employs 550. Olaer has manufacturing and sales operations in the United Kingdom, France, Sweden and China, and sales companies in 14 countries. It would be integrated into Parker’s Hydraulics Group as part of the Industrial Segment. Kitson

Distributed value: Applied Industrial Technologies agreed to acquire SKF Group’s companyowned distribution businesses in Australia and New Zealand. The Cleveland-based distributor of bearings and industrial parts did not say what it would pay for the acquired business, which supplies bearings, seals, lubrication products and power transmission products through 29 Australian service centers and eight New Zealand locations. SKF Distribution employs 225 people and had 2011 pro forma sales of $82 million.

State stimulus: The state of Ohio awarded about $950,000 in grants designed to help companies and colleges throughout the state turn university technologies into high-tech products. The Ohio Third Frontier Commission, which oversees an economic development program aimed at stimulating Ohio’s economy through investments in technology, awarded seven grants totaling about $450,000 to universities and startups in Northeast Ohio. Their wish is granted: Great Lakes NeuroTechnologies of Valley View secured three federal grants totaling $4.5 million that it will use to develop and test neurotechnology products. The company will use two of the grants — from the National Institutes of Health’s Small Business Innovation Research program — to develop technology related to monitoring and treating Parkinson’s disease. A third NIH grant will be used to develop tools for high school neuroscience courses.

Go with the flow: Kinetico Inc. of Newbury Township, a maker of residential and commercial water treatment systems, named a new president and CEO. Toby Thomas, who joined Kinetico in 2009 as chief marketing officer, is taking the top job, replacing Shamus M. Hurley. Mr. Hurley is becoming president and CEO of Parkson Corp., a Florida provider of engineered components and systems for the industrial and municipal water and wastewater treatment markets. Both Kinetico and Parkson are part of Axel Johnson Inc.

Big new boss: Novolyte Technologies of Independence, a maker of electrolyte formulations for lithium-ion batteries, was bought by BASF, the German chemicals giant. The seller was Arsenal Capital Partners, a New York private equity firm. Terms weren’t disclosed. Novolyte has 167 employees at sites in the United States and China.

REPORTERS’ NOTEBOOK BEHIND THE NEWS WITH CRAIN’S WRITERS

See how this seat selector suits you

■ Connecting with the dean of ClevelandMarshall College of Law now can begin with a Facebook login. Craig M. Boise launched his public Facebook page in late February in an effort to

connect more closely with students and alumni. As of last week, the page had attracted nearly 200 likes. On it, he’s posting about law school news, both general and specific to Cleveland-Marshall, and responding to users’ questions and comments. In a March 30 post, for example, he wrote, “Capital University law prof Jason Dolin argues that some Ohio public law schools should be closed to address the debt/jobs problem. Capital’s tuition (they’re a private school): $32,683. C|M|LAW’s tuition: $18,350. Capital’s 2010 full-time JD-required job placement: 47%. C|M|LAW’s: 67%. Hmmm …” Mr. Boise also told followers last week that he’d been interviewed by yours truly regarding summer associate opportunities, and asked how students are feeling about their own prospects. One presumed student replied, “They could be better, but they could be worse.” Mr. Boise also has a Twitter account. So does the dean of Case Western Reserve University School of Law, Lawrence E. Mitchell. “I think that this is the way that a lot of students communicate, get their news,” Mr. Boise said of social media. “I’ve gotten a lot of people telling me, ‘I saw you posted this.’ I get a lot more smiles and people saying things in the hall, so I think there’s that recognition.”

MILESTONE

BEST OF THE BLOGS

■ Looking to compare seats at Cleveland Browns Stadium before you buy? Or do you want to know how far a seat is from the aisle? It’s now much easier. The Browns have partnered with Minneapolis-based Sportsdigita on an interactive seat map the company calls DigitaAR, which offers fans 360degree, panoramic views of every seat in the stadium. Sportsdigita says it takes a few weeks to compile the necessary images to develop into the virtual map, which allows users to compare up to four different seats or sections at once. The system also features a live chat option, and links directly to TicketMaster with a “buy now” function. “The Browns understood the value of an interactive seat viewer,” said Sportsdigita president and founder Angelina Lawton. For a preview of the system, visit http:// tinyurl.com/7e72n6b. — Joel Hammond

Need a Facebook friend? Try Cleveland-Marshall’s dean

Excerpts from recent blog entries on CrainsCleveland.com.

THE COMPANY: Van Auken Akins Architects LLC, Cleveland THE OCCASION: 20th anniversary

Lubrizol CEO gets comfy in Warren Buffet’s world

Jill V. Akins

Jill V. Akins launched the firm by herself in May 1992 to design what she called “inspiring environments.” Two decades later, the firm has 24 employees and offers services ranging from architectural design and planning to interior design and construction management. The firm, known as VAA, works with clients in both the public and private sectors. On the public front, it’s heavily involved in Cleveland waterfront development and is providing LEED certification and construction management services on the Cleveland Medical Mart & Convention Center. Its extensive list of commercial clients has included the Cleveland Browns, HMI Industries Inc., Parker Hannifin Corp. and Sand Ridge Golf Club. In August 2011, the firm moved its office from Pepper Pike to the PlayhouseSquare district in downtown Cleveland. Since then, Ms. Akins said, she has been touting her move to suburban business owners. “It’s the best decision I ever made,” she said. In conjunction with its 20th anniversary, VAA also has relaunched its website, which can be found at www.vaakins.com. Send information about milestone corporate anniversaries to managing editor Scott Suttell at ssuttell@crain.com.

■ James Hambrick, CEO of Lubrizol Corp., is thinking big now that the Wickliffe-based specialty chemicals company is owned by Warren Buffett’s Berkshire Hathaway Inc. “There’s no reason in my mind why we shouldn’t be a $10 billion company,” Mr. Hambrick told Bloomberg. “Warren and I talked about that.” Since Mr. Hambrick became CEO in 2004, Lubrizol’s annual revenue has tripled to about $6.2 billion. Bloomberg reported that in February, Mr. Buffett said Lubrizol will have “many opportunities for bolt-on acquisitions.” Indeed, Mr. Hambrick “has already struck at least three deals since the chemical maker was acquired by Omaha, Nebraska-based Berkshire in September for about $9 billion,” according to Bloomberg. Mr. Hambrick said the acquisition strategy to reach $10 billion of annual sales will put an emphasis on acquisitions for Lubrizol’s advanced-materials unit. It also seems like things are going pretty well with the highprofile new boss. Mr. Hambrick said he and Mr. Buffett talk “a couple times a month” over the phone and in person and have “good, robust discussions.” “Warren makes it pretty easy,” Mr. Hambrick told Bloomberg. “It didn’t take very long for either one of us to get right into a good dance step.”

Peter Lewis remains high on legalizing marijuana ■ Progressive Corp.’s non-executive chair-

Finding another way to connect with alumni is important, too, given how budgets are being cut, he said. — Michelle Park

Two law firms talk the same language ■ From here on out, when clients have a need that one of these law firms can’t fill, the firms will lean on each other. Painesville-based Dworken & Bernstein Co. L.P.A. and one-lawyer firm Alabasi & Associates Co. have established a “strategic alliance” wherein Kim Alabasi, an immigration attorney, will provide immigration legal services to Dworken clients who need it. Conversely, Dworken, a 26-attorney firm, will meet the non-immigration legal needs, such as criminal defense and family law, of Ms. Alabasi’s clients. The firms’ collaboration began a month ago and is structured as an independent contractor relationship. “We had a hole in our practice where we could not offer that service,” said Irving Rosner, a Dworken partner. “We have filled that hole.” He anticipates that Ms. Alabasi, who speaks Spanish, will serve both individual and business clients. Lake County, he noted, has a fast-growing population of immigrants, particularly Hispanics. Forming an alliance provides Dworken the opportunity to gauge demand for such services, Mr. Rosner said. If the firm finds that the demand justifies adding resources and professionals at Dworken itself, “we will evaluate that down the road,” he said. — Michelle Park

man, Peter B. Lewis, clearly isn’t afraid to put his money where his mouth is. Forbes.com reported that a medical marijuana legalization measure looks likely to make the ballot in Massachusetts in November. The effort to date is mostly a one-man show, as Mr. Lewis has “put forward almost every penny being spent on pro-legalization lobbying.” In January the group behind the Massachusetts bill, the Committee for Compassionate Medicine, reported raising $526,000 — $525,000 of which came from Mr. Lewis. He’s also backing marijuana reform initiatives in Ohio, Colorado and Washington state. Forbes.com noted that the National Organization for the Reform of Marijuana Laws estimates Mr. Lewis “has spent between $40 million and $60 million funding the cause since the 1980s.”

For Indians’ pitchers, time is of the essence ■ The Cleveland Indians might not always be good, but say this for their pitchers — they work fast. The Wall Street Journal said the Indians “have two of the fastest-working pitchers in baseball, with Derek Lowe (17.1 seconds between pitches) and Justin Masterson (17.2) rating behind only Phillies ace Roy Halladay in pace between pitches.” The slowest member of the Indians rotation — Josh Tomlin (19.2) — is still two seconds faster than the league-average starting pitcher so far in 2012. As a group, “the Indians staff has worked faster than any team in baseball this year,” the newspaper notes. “The Halladay-led Phillies are No. 2, while the Marlins (who added quick-working Mark Buehrle over the winter) are just behind in third.”

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