Crain's Cleveland Business by Crain's Cleveland Business

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MAKING A DIFFERENCE Dear Business Leader: Make a difference. Isn’t that what we all try to do? For our families, our businesses and in the communities where we live – when we make a difference, we succeed. The 30 people featured in this special anniversary issue of Crain’s Cleveland Business made a difference. They not only succeeded, but also made this region a better place to live. The management team of your Cleveland Browns, which I am fortunate to lead, is here to make a difference. You will see it in the way we go about our business and by our service to the community. We want to earn your respect through our actions on and off the ﬁeld. We will do so with an appreciation for the great history of this beloved franchise, for all those who have come before us, and for all of you, who have long waited for a different level of Cleveland Browns success. See you on Sundays. Sincerely,

Mike Holmgren

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A TRADITION OF MAKING he Cleveland Browns have been part of the fabric of Northeast Ohio since 1946. The unique bond we have with our fans and our city is one of the great relationships in all of professional sports. We are committed not only to success on the ﬁeld, but also to making a difference in our community and in the lives of others.

Generation to Generation The Browns provide an opportunity for generations of families and friends to connect and for the cultivation of business relationships. We pledge to provide an exciting and enjoyable environment conducive to both.

“The Browns are galvanizing, unifying and electrifying in a way that keeps everyone coming back; and they will come back for generations to come. The Browns aren’t just important to Cleveland; they ARE Cleveland.” – Joe Roman, CEO of The Greater Cleveland Partnership

Major League Impact The Browns strengthen Cleveland’s image as a major league city. But we also contribute more directly to the economic health of the area and its businesses. Since 1999, total game-day and related spending is approaching $1 billion. And that’s just the beginning. We are committed to supporting and participating in public and private efforts to enhance the future of Northeast Ohio.

“When business leaders evaluate their options, quality of life is one of the major factors in their decision-making process. The Cleveland Browns are a major asset in our region’s ability to attract and retain businesses. The Browns help tip the scale in our community’s favor.” – Tom Waltermire, CEO, Team NEO

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G A DIFFERENCE The Browns Care Citizenship, education, health & wellness, and youth are the focus of The Cleveland Browns. In addition, our players, coaches, alumni and staff contribute time, energy and spirit to related causes. We care about Cleveland and Northeast Ohio and will continue to work to make it a better place.

“The Browns are more than just our football team, they are intricately woven into our heritage and our psyche. When they win, we all win; when they struggle, we never lose hope.” – Dennis Roche, President, Positively Cleveland

Cleveland and the Browns Our management, coaches and players are dedicated to long-term success. And our entire organization is committed to providing value to our business partners and a great game-day experience for our fans. But we can’t do it without your support. Please join us. Together we will continue and strengthen our proud partnership.

To learn more about Cleveland Browns partnership opportunities, please visit:

ClevelandBrowns.com / m aking -a-d ifference

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$1.50/MAY 24 - JUNE 6, 2010

Vol. 31, No. 21

Two venture funds aim to continue momentum Credited with fueling Ohio investments, now they eye capital By CHUCK SODER csoder@crain.com

By ARIELLE KASS akass@crain.com

ark Filippell, managing director of investment banking firm Western Reserve Partners, likened the increased activity he sees in the mergers and acquisitions market to the baby boom following World War II. “The numbers are going to pop. M&A deals are happening,” he said. “It’s like in 1946, when the soldiers are back for six months and someone says, ‘No babies are being born.’ Well, look down the street; you see

a lot of pregnant women.” Mr. Filippell and others who spend their days looking at deals say that as credit has loosened and bad quarters start to roll off companies’ books, the appetite of both buyers and sellers in M&A deals has risen dramatically. While that pickup still doesn’t translate into a pre-recession flow of transactions, it does mean buyers and sellers are pushing forward on deals they could not or would not entertain for the past year and a half or more. Mr. Filippell said he has seen a See M&A Page 8

M&A shoppers, today’s your lucky day!

LED plan’s execution, rollout fail Jackson By JAY MILLER jmiller@crain.com

Another so-called “fund of funds” is in the process of making its last investments as well. The $102 million Ohio-Midwest Fund has committed the last of its dollars to other investment groups, though the deals have not been finalized, said Mel Carter, the in-state investment specialist for the fund. Unlike the Ohio Capital Fund, which is financed through the sale of bonds that are backed by tax dollars should they lose money, the OhioMidwest Fund consists of a $100 million investment from the Ohio Public Employees Retirement System and $2 million from Credit Suisse, which is managing the fund. An OPERS representative contacted by Crain’s Cleveland Business did not

“Why weren’t we informed; we could have helped you?” asked Hong Kong-born immigration attorney Margaret Wong. ANALYSIS “What were you guys thinking?” Ms. Wong made the statement last Thursday evening, May 20, in the Red Room, a conference room attached to Cleveland Mayor Frank Jackson’s office at Cleveland City Hall. She was there with a group of local small business owners, clergy and other civic leaders invited by the mayor to a meeting to enlist their support in his effort to bring Chinese lighting manufacturer Sunpu-Opto Semiconductor Co. to the city. Ms. Wong was asking chief of staff Ken Silliman why the mayor, who was not present, hadn’t sought the assistance of people such as her and the others in the room sooner in his attempt to Jackson make Cleveland the U.S. beachhead of Sunpu-Opto, a maker of energy-efficient LED lighting. Mr. Silliman didn’t have a ready answer. The mayor believes he has found an innovative way to spur job growth in Cleveland — his top priority — with his plan for the city to enter a 10-year deal to buy its lighting from SunpuOpto in exchange for the company building an LED lighting plant and establishing its U.S. headquarters here. However, he may not have found the best way to test and execute this prototype of his jobs strategy. At one time, several observers to this City Hall flare-up noted, a Cleveland mayor would have avoided this controversy by reaching out to business leaders committed to a “public-private

See VENTURE Page 74

See JACKSON Page 74

Two big sources of cash for Ohio entrepreneurs have awarded almost all of their funds, but there seems to be momentum to continue at least one of them. The Ohio House of Representatives two weeks ago voted unanimously to add $100 million to the Ohio Capital Fund, which invests in venture capital groups that commit to investing in Ohio. The legislation has yet to be voted on in the Senate. The Ohio Capital Fund won’t last long without the new money. Fund manager Paul Cohn said he expects the 5-year-old fund to invest the last $25 million of its $150 million fund during the next few months.

Deals steady as credit, bottom lines improve

“I would be hard pressed to say (many venture firms) would still be on the ground without these programs.” – Mike Stubler, managing director, Draper Triangle Ventures LP

ON THE INSIDE They’re on to it ...

Law firm on the lookout ...

... and a note to readers

A Stark County trial is bringing to light what many call the insurance industry’s dirty secret: extra payments made to insurance brokers to steer more business to a certain health care provider. Page 3

Law firm Calfee, Halter & Griswold is entertaining offers for new space, and has checked out the former WKYC Building on East Sixth Street (pictured). That building has been empty for a decade; plans to convert it to residential condominiums foundered. Page 4

Crain’s Cleveland Business will not publish a regular issue on May 31, 2010, due to the Memorial Day holiday. Please visit CrainsCleveland.com daily for updates on the latest business news in Northeast Ohio.

CrainsCleveland.com/30thanniversary

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CRAIN’S CLEVELAND BUSINESS

WWW.CRAINSCLEVELAND.COM

Broker payments scrutinized 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 editors: Joel Hammond (jmhammond@crain.com) Sports Kathy Carr (kcarr@crain.com) Marketing and food Senior reporter: Stan Bullard (sbullard@crain.com) Real estate and construction Reporters: Shannon Mortland (smortland@crain.com) Health care and education Jay Miller (jmiller@crain.com) Government Chuck Soder (csoder@crain.com) Technology Dan Shingler (dshingler@crain.com) Manufacturing Arielle Kass (akass@crain.com) Finance and legal Research editor: Deborah W. Hillyer (dhillyer@crain.com)

Aultman suit raises ethical questions about health insurance industry’s extra incentives By SHANNON MORTLAND smortland@crain.com

Some call it the health insurance industry’s dirty little secret, but a trial in Stark County is bringing it to the forefront. At issue are extra payments made by Aultman Health Foundation to insurance brokers to steer more business to the foundation’s AultCare health plan, McKinley Life insurance group and Aultman Hospital. Competitor Mercy Medical Center

is suing the foundation, claiming its extra $9 million in payments to brokers drove about $200 million in revenue to Aultman and 1,740 employer groups to its insurance plans. The Ohio Department of Insurance has been asked by the Stark County Common Pleas Court to determine if Aultman Health Foundation broke any Ohio insurance rules, said Robert Denhard, a spokesman for the insurance department. But if Aultman broke the law, it

wouldn’t be alone. Some industry watchers say the payments, also known as overrides, that go beyond traditional commissions are extremely common and can be lucrative for the brokers who accept them. “Every health plan pays every broker substantial overrides,” said J.B. Silvers, chairman of the Department of Banking and Finance and a professor of epidemiology and statistics at the Weatherhead School of Management at Case Western Reserve University. Indeed, Tim Sobolewski, an independent broker who owns Integrity Benefits Network Inc. in Brunswick, said insurers approach him daily with cash incentives to sell their products to his clients.

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itting at one of the many outdoor patios at Eton Chagrin Boulevard in Woodmere Village, developer Robert Stark surveys the elegantly designed retail property and says, “Running Eton is like putting on a Broadway play.” After the economic bloodletting of the past three years inflicted multiple vacancies on the lifestyle center developed by Mr. Stark and the Milstein family, several new cast members have added star quality to a strong cast.

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Audit Bureau of Circulation

See BROKERS Page 72

By STAN BULLARD sbullard@crain.com

Graphic designer: Kristen Wilson (klwilson@crain.com)

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Many of the insurers contacted declined to comment for this article. While Medical Mutual of Ohio Inc. would not answer questions regarding payments to brokers, it issued a statement that said: “Medical Mutual does not provide unique broker incentives. Our commission structure has long been in line with industry

Woodmere lifestyle center narrows vacancy rate with key retailers

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G.D. Crain Jr. Founder (1885-1973) Mrs. G.D. Crain Jr. Chairman (1911-1996)

Game time

NEW SHOPS IN STORE AT ETON

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“The carriers offer large amounts of money to incent people to put business with them,” Mr. Sobolewski said. “The money can get quite substantial if you’re in bed with the big insurers. I know people who are making thousands.”

See ETON Page 73 STAN BULLARD

Eton Chagrin Boulevard in Woodmere Village has added some new tenants, including a Brooks Brothers and a showroom for Lululemon Athletica, a yoga and fitness attire retailer.

INSIGHT

Declining value of euro bad deal for Ohio exporters By DAN SHINGLER dshingler@crain.com

Greece is the word — and it’s a bad word for Northeast Ohio companies either exporting to Europe or facing European competition as they sell machine tools, software or anything else into the world’s fast-growing developing markets. That’s because as the European

Union has struggled to prop up Greece, which has been close to defaulting on its national debt, its euro currency has tumbled in value. The euro was worth more than $1.50 in U.S. dollars last November, but lately it has been worth only about $1.25. That’s a drop in the euro’s value of about 17%. If it doesn’t sound like much, imagine your competitor’s product just got 17% cheaper without

it lifting a finger — because that’s effectively what has happened as the dollar’s strength relative to the euro makes U.S.-made goods more expensive to buy in Europe and more costly than European-made goods in countries beyond the continent. “It’s going to hurt Ohio,” said Ned Hill, an economist and dean of the Maxine Goodman Levin College of Urban Affairs at Cleveland State

INSIDE: The euro’s value over the last six months has plummeted. Page 72 University. “Ohio builds a lot of the equipment used to build economies, and we frequently get involved in developing countries — in competition with places like Germany,” Dr. Hill said.“So the end result is, thanks to See EURO Page 72

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Calfee’s search may include old Ch. 3 site Cleveland law firm scopes out new office layout By STAN BULLARD sbullard@crain.com

Interjecting a new twist in the downtown Cleveland office market, Calfee, Halter & Griswold is undertaking a search for offices that spells a challenge for the law firm’s longtime home at 800 Superior Ave. and might provide a fresh opportunity for a long-troubled development project nearby. Calfee spokeswoman Kira Hen-

nessey said the firm is looking at multiple options, including remaining at 800 Superior, where it occupies five floors and has been for decades. “Calfee would like to stay downtown, but I cannot offer any more specifics at this time,” Ms. Hennessey said. The firm would occupy about 100,000 square feet, though its space needs would be determined by the efficiencies it can gain in a new office layout, Ms. Hennessey said. An office

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of 100,000 square feet would be less space than Calfee occupies now, as realty data provider CoStar reports Calfee is in 112,000 square feet under a lease that expires late next year. The firm has 120 lawyers and a total staff of 325 here, Ms. Hennessey said. In addition to the usual suspects — skyscrapers from Chase Bank at Tower City Center to Eaton Center and Tower at Erieview could accommodate the firm — three real estate sources who declined to be identified said Calfee has looked at the Rockwell Building, 1401 E. Sixth St. The building is best known as the former home of WKYC-TV, Channel 3. The five-story building dating from 1916 has been empty a decade as plans to convert it to residential condominiums foundered. However, Tracey Nichols, Cleveland economic development director, said she recently talked with developer Brian Intihar about a concept for rehabilitating the structure as an office building. Mr. Intihar returned a message from Crain’s Cleveland Business after business hours last Tuesday, May 18, but did not return three subsequent messages. Mr. Intihar is project manager for the Schofield Building, 2000 E. Ninth St., for which an investor group that includes real estate appraiser Steven Calabrese is seeking state historic tax credits to renovate as a boutique hotel and apartments. Mr. Calabrese recently acquired real estate developer Richard Osborne’s interests in the Rockwell Building, Mr. Osborne said last week. Mr. Osborne recovered ownership of the building from Rockwell Building Condominiums through foreclosure on May 22, 2009. The Rockwell Building has some ingredients that make it attractive to an office user and for redevelopment today: The project has received State Historic Tax Credits and is eligible for federal historic tax credits — two financing sources that have gained in value as conventional real estate debt options disappeared.

Desirable prospect David Browning, managing director of the Cleveland office of real estate broker CB Richard Ellis, said Calfee is one of the larger tenants afoot in the downtown office market. He said the Rockwell Building would be able to offer a tenant an ability to make a unique statement downtown. The structure also occupies a desirable location near the Federal Reserve Bank of Cleveland, the Cleveland Public Library and Superior Avenue. However, the low-rise building would not offer sweeping views of downtown or Lake Erie — something a high-rise property can sell as a plus. A new element of uncertainty could undercut a bid by 800 Superior to retain the law firm. In February, the Behringer Harvard real estate firm of Dallas transferred ownership of the building to LNR Partners of Miami Beach, an operator and acquirer of lender-owned commercial properties. Alex Jelepis, who leases the building for LNR, declined comment on Calfee. ■

Volume 31, Number 21 Crain’s Cleveland Business (ISSN 0197-2375) is published weekly, except for combined 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 © 2010 by Crain Communications Inc. Periodicals postage paid at Cleveland, Ohio, and at additional mailing offices. Price per copy: $1.50. POSTMASTER: Send address changes to Crain’s Cleveland Business, Circulation Department, 1155 Gratiot Avenue, Detroit, Michigan 48207-2912. (888)909-9111. REPRINT INFORMATION: 800-290-5460 Ext. 136

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

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Twinsburg welcomes expansions of communication firms Windstream, Verizon incentivized to grow within community By STAN BULLARD sbullard@crain.com

Windstream Corp. and Verizon Communications Inc. are dialing up growth plans in Twinsburg. Windstream, a telecommunications provider, plans to turn the lights back on next month at the long-dark former Cole National Corp. headquarters, 1925 Enterprise Parkway. The move will clear the way for mobile phone giant Verizon to launch a $30 million expansion effort at the 2000 Highland Road building it currently shares with Windstream; the expansion includes construction of a 20,000-square-foot addition. Twinsburg Mayor Katherine Procop said the twin moves are â&#x20AC;&#x153;good news on all fronts.â&#x20AC;? â&#x20AC;&#x153;Anytime anyone is looking for space, as Windstream was, it could mean relocation out of the city,â&#x20AC;? Mayor Procop said. â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;ve kept the employees. We hope they will expand in the future. It puts Cole into operation and allows Verizon to expand.â&#x20AC;? Larry Finch, Twinsburg planning and community development director, said Verizon weighed making the capital improvements in Twinsburg against doing them at its operations in Raleigh, N.C., and Orangeburg, N.Y. Mr. Finch said the lack of personal property tax, which was eliminated under an Ohio tax reform plan, â&#x20AC;&#x153;really helped usâ&#x20AC;? with the Verizon deal. Corporate realignments provide the back story to the moves. Alltel Inc. of Little Rock, Ark., spun off Windstream in 2006 as a public company with phone landlines plus Internet and digital TV services, then last year sold its wireless unit to Verizon. Verizon and Windstream cohabited in Twinsburg until Verizon recently asked Windstream to exit the Highland Road building that Verizon owns so the structure could be expanded as an operations center. Windstream plans to move about 125 employees from its information technology group to Enterprise Parkway by the end of June under a lease that extends to January 2019, according to David Avery, a Windstream spokesman. Meanwhile, Verizon has received city approvals to expand its Highland Road property as a stateof-the-art service center, Mr. Finch said. Verizon is eligible for property tax forgiveness for a $30 million improvement as the project is in the suburbâ&#x20AC;&#x2122;s community reinvestment area. Verizon spokeswoman Laura Merritt said the company would expand and continue to operate its

CORRECTION A May 17, Page One story about ArcelorMittalâ&#x20AC;&#x2122;s Cleveland plant contained an incorrect figure for the amount of iron ore delivered to the Port of Cleveland through April 30. The amount is 471,590 tons.

data center in Twinsburg. Verizon employs about 100 people there, she said. Ms. Merritt declined to provide more details.

Special case Windstream will receive an income tax incentive for keeping more than 90 jobs and a $6.6 million payroll in Twinsburg. The city will reimburse Windstream for 50% of the 2.25% city income tax its employees paid the prior year, or about $147,000 annually for nine years, Mr. Finch said. â&#x20AC;&#x153;This was a special case,â&#x20AC;? Mr. Finch said of the tax break for Windstream. He said it qualified for the income tax incentive despite moving

â&#x20AC;&#x153;Anytime anyone is looking for space, as Windstream was, it could mean relocation out of the city. Weâ&#x20AC;&#x2122;ve kept the employees. We hope they will expand in the future.â&#x20AC;? â&#x20AC;&#x201C; Katherine Procop, mayor, City of Twinsburg within city limits because it was moving involuntarily at Verizonâ&#x20AC;&#x2122;s request. Verizon also is eligible for an income tax incentive if it adds jobs, but its improvements are primarily mechanical rather than job-intensive, Mr. Finch said. Mayor Procop said the moves are gratifying because they both could help the city retain the companies if

they consolidate in the future. Reopening the former Cole Vision headquarters by subdividing a fourstory, 110,000-square-foot building for a tenant occupying a portion of it also indicates the door may be open to repopulate the complex, Mayor Procop said. Previously, eyeglass maker and retailer Luxottica Group of Milan, Italy â&#x20AC;&#x201D; which assumed a long-term

lease Cole Vision had on the property when it bought Cole in 2004 â&#x20AC;&#x201D; and building owner Prime Equities Inc. of New York sought only corporate tenants large enough to occupy both the larger building and a 60,000-square-foot building next door. â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;ve talked with them in the past about putting smaller tenants into the building,â&#x20AC;? the mayor said. William Saltzman, a Grubb & Ellis Co. senior vice president who has represented the property for years, declined comment. Luxottica does not provide details on corporate transactions as a matter of policy, said spokesman Luca Biondolillo. â&#x2013;

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FirstMerit targets Chicago Acquisitions by Akron bank align with interest in lending opportunities By ARIELLE KASS akass@crain.com

In just six months, FirstMerit Corp. has taken Chicago head-on. The Akron-based banking company has acquired three separate banks in the Windy City since November. The most recent of them is Midwest Bank & Trust Co. on May 14. Two of the deals — Midwest Bank included — involved failed banks in takeovers assisted by the Federal Deposit Insurance Corp. The most recent acquisition bumps FirstMerit to 54 branches and 1.46% of the deposit market share in the fractured banking market of the Chicago Metropolitan Statistical Area. While those numbers make FirstMerit the 13th-largest bank in Chicago by market share, according to data from the FDIC, the biggest banks there have hundreds more branches and a much larger share of the market. Still, FirstMerit always has been more interested in the lending opportunities in Chicago than in creating a strong retail branch network. FirstMerit president, chairman and CEO Paul G. Greig and analysts who cover the bank said the 26branch acquisition of Midwest Bank this month fit with the bank’s modus operandi. “The move is 100% consistent with what the management team has been talking about,” said Terry McEvoy, managing director and

FILE PHOTO/JANET CENTURY

Paul Greig, CEO of FirstMerit, said the recent bank acquisitions in Chicago are part of the Akron-based financial institution’s expansion goals. The most recent purchase was that of failed Midwest Bank & Trust Co. bank analyst at investment firm Oppenheimer & Co. in Portland, Maine. “There should have been virtually no surprise.” Mr. Greig said while “it’s a significant position” that the bank quickly has established in the Chicago area, the key component of the acquisition is not market share, but scale. “We’re thrilled,” he said. “It’s completely transformational for our Chicago strategy.”

Seizing an opportunity Mr. Greig said he had been in talks with Midwest Bank for more than two years. In fall 2008, Mr. Greig said, the bank lost a significant amount of its capital after investing in Freddie Mac and Fannie Mae, mortgage lenders that saw their stocks tank in the aftermath of the subprime lending fiasco. On top of bad real estate loans, the stock losses impaired Midwest Bank’s ability to raise capital on its own. “Without a question, this was the most sizable and most attractive FDIC” deal, Mr. Greig said. “We’re inheriting a real bank here.” In a research note following the acquisition, JPMorgan analyst Steven Alexopoulous said it’s too early to determine if the price FirstMerit paid for the bank — a 0.4% deposit premium is known, though he questioned whether there were other costs — is a “reasonable” one. Mr. McEvoy also said it was not clear if the transaction would have a positive impact on earnings in the near term. The acquisition added about $1.6 billion in core deposits, excluding brokered certificates of deposit and some other timed deposits, Mr. Alexopoulous wrote. He wrote that with about 30% of its deposits now in Chicago, FirstMerit made “a meaningful shift in only two quarters.” Tony Davis, managing director of investment firm Stifel Nicolaus & Co. in Richmond, Va., said the Chicago market is “materially bigger” than the Northeast Ohio market, where FirstMerit currently does the bulk of its business. He noted that Chicago tends to be broken up into many smaller neighborhood markets, and that the bank may have a good handle on many of those because of its branch network. Mr. Greig said the scale FirstMerit is building in the Chicago market puts branches in many business pockets and would appeal to many customers who choose not to use

automated services. Mr. McEvoy said the bank seems to know “exactly where the opportunity” is for them: in middle-market commercial banking in the city. “They have no intentions of being a mass retail bank with locations on every street corner, advertising heavily,” he said. “It’s a huge opportunity for them to grow in Chicago.”

Not done in Chicago Still, with three acquisitions in quick succession, Mr. McEvoy said he wanted to see that the deals are going smoothly. The Midwest Bank conversion should take place in 90 to 120 days; the other two banks — First Bank, which was purchased at the end of 2009, and George Washington Savings Bank, which was acquired with FDIC assistance in February — already have been converted. Going forward, Mr. McEvoy said, the opportunities in Chicago will be smaller. But he said he expects FirstMerit to continue to eye expansion in the market. Mr. Greig said the bank will work to absorb what already has been brought on board, but will continue to look for opportunities in Chicago and throughout the Midwest. “There’s absolutely no reason to think that we’re done at this point in time,” he said. “We have limited ourselves to good strategic acquisitions with good financial returns.” Some other acquirers are looking only for financial gain, Mr. Greig said, and are not concerned with strategy. Stifel Nicolaus’ Mr. Davis said the trouble that banks in Chicago face and FirstMerit executives’ familiarity with the market create good opportunities for growth. “Stay tuned, because there’s more for them in Chicago,” Mr. Davis said. “This is not the last we’re going to see.” Over time, FirstMerit will centralize its operations in Ohio, Mr. Greig said. The company will be based in Akron, as it is today, and Chicago bankers will report to division heads in Ohio. Mr. Greig noted that he and the bank have “unwavering support” for Ohio, and said the Chicago acquisitions take “nothing away” from the work that it’s doing in this area. “It really doesn’t change anything on a going-forward basis,” he said. “Our first objective is clearly to do a great job.” ■

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Investors bet on Barberton rubber outfit’s quality a second time Now, the trick: growth in profitable areas of low-margin industry By DAN SHINGLER dshingler@crain.com

You might not think a small rubber company tucked away in Barberton would attract the eye of East Coast private equity investors, but Watermill Group of Lexington, Mass., likes Preferred Compounding so much, it’s bought the company twice. “We’ve owned it all but two years since 1996,” said Watermill partner Tim Eburne, explaining that another private equity firm bought the company from Watermill in 1999, only to sell it back in 2001. And yes, Watermill made money on those transactions, he said. Watermill now is doubling down on its bet, investing in both Preferred Compounding’s capacity and efficiency, in the belief that U.S. industry always will need rubber and that those companies that make the best and most specialized mixtures of the stuff always will have a profitable market. “We’re not interested in commodity operations,” Mr. Eburne said. “We always look for something where we can add value.” Since buying Preferred Compounding the last time, Watermill has beefed up the company with the 2006 acquisition of Georgia-based Associated Rubber Co. and the installation of new mixers and other capital equipment. It also added a new enterprise resource management system that allows all production to be monitored and controlled from Barberton and has a new CEO in the form of Ken Bloom, hired by Watermill in 2006. The Associated Rubber acquisition gave Preferred Compounding production plants in Alabama, Georgia and Tennessee, which are important not only because of the capacity they brought, but their geographic diversity, too, Mr. Eburne said. The goal, he said, is to have plants within 500 miles of the company’s potential

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UH joins group studying care University Hospitals is one of 20 health systems across the country that have come together to form a collaborative group that aims to improve patient care. The 20 health systems have formed two accountable care organization collaboratives, which are designed to keep patients healthy instead of caring for them only after they’ve fallen ill. The idea of the accountable care organizations was created through the new health care reform bill, which passed in March. The 20 members of the collaborative will work together to design the organization from the patient’s perspective in an effort to promote better patient involvement, satisfaction and increased accountability in their own health care. — Shannon Mortland

customers east of the Mississippi. Mr. Eburne said some of the specialized compounds the company makes “have a very short shelf life — a matter of days — so you can’t leave them on the truck for too long.” Now, the wait for that investment to pay off in improved profits may be about to end.

Getting its bounce back After weathering a tough recession, Mr. Bloom says the rubber business is bouncing back for Preferred Compounding. “Our market degraded from January 2009 through May (2009),” Mr. Bloom said. “From May to June (2009), it jumped 25% and since then it’s been a slow and steady climb.”

The company, which has about 200 employees and is on track to book $85 million to $90 million in revenue when its fiscal year ends May 31, is still down about 30% from its pre-recession levels. “But it’s not a high-growth industry in the best of times,” Mr. Bloom said, and fast growth is not the key to Preferred Compounding’s strategy. It is focusing on growing the most profitable parts of its business, where added chemical engineering and quality control measures yield the highest margins, and in signing up new customers. The company no longer even bids on work where margins are razor thin and customers change suppliers

frequently to save as little as a halfcent per pound on cheap rubber. That strategy should help Preferred Compounding put its new capacity to work, because it has worked for the company in the past, according to Bill Ridenour, president of Polymer Transaction Advisors in Newbury. “It does work,” Mr. Ridenour said of the strategy. “Preferred (Compounding) has always been a higher margin business ... and the rest of the compounding industry has always regarded Preferred very highly.”

Strong capital a plus Mr. Ridenour said he’s watched as Preferred Compounding not only grew its market share in recent years, but also took business away

from other, sometimes larger competitors. Mr. Ridenour said the outlook for the compounding business is good, at least for the next one or two years, and many small or midsize players that would have been prime competitors of have been weakened by the recession. Some will lose customers’ confidence or not be able to finance the inventory they need to fill new orders, predicts Mr. Ridenour. Preferred Compounding has strong capital behind it and can fund its needs, Mr. Eburne said. “It was a pretty tough year for everyone, but I think the company emerged stronger than when it went into the recession,” he said. ■

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Lockheed wins military blimp contract 30 new people added to handle work on intelligence systems Lockheed Martin’s Persistent Threat Detection System, seen here in October 2007 at the Yuma Proving Grounds in Arizona.

By CHUCK SODER csoder@crain.com

oyster perpetual gmt-master ii

OFFICIAL ROLEX JEWELER ROLEX

Lockheed Martin Corp.’s Akron operation has won a $142 million Army contract to build 17 tethered blimps that the military will use to gather intelligence. The Akron operation, part of the defense contractor’s Maritime Systems & Sensors division, has built Persistent Threat Detection Systems in the past for the military, but never this many at once, according to Ron Browning, who leads business development related to Lockheed Martin’s lighter-than-air products. Lockheed Martin last October was awarded $133 million to produce eight of the unmanned blimps. Including the new contract, the Akron operation has taken orders to build a total of 37 of the systems since introduction of the product in 2004, Mr. Browning said. Lockheed Martin has added 30 people to help handle the new work. The company, based in Bethesda, Md., already employs more than 200 people who work on the blimps at Lockheed Martin’s Akron operation. “It certainly sustains a fair number of positions here in Akron,” Mr.

PHOTO PROVIDED

Browning said. The Akron operation includes the Lockheed Martin Airdock, a 1,175foot-long, 211-foot-high hangar that was owned by Goodyear Aerospace Corp. until Loral Corp. acquired the company from the tiremaker in 1987. Lockheed Martin bought Loral’s defense electronics and systems integration business in 1996. The military already is using the blimps for communications and intelligence purposes in Iraq and Afghanistan, Mr. Browning said. Pentagon acquisition chief Ashton Carter has said in news reports that he plans to ramp up use of airships over Afghanistan. “The Pentagon certainly recognizes the importance of persistent surveillance,” Mr. Browning said. The Persistent Threat Detection System, which has no propulsion

system, is filled with helium and can stay afloat for weeks. The blimps receive power and transmit data through a tether that is attached to a movable mooring system on the ground. The blimps are designed to float to 5,000 feet, which allows them to provide surveillance over long distances, Mr. Browning said, noting that at that height, the horizon line is 100 miles away. “These are very effective systems in theater,” he said. “They’re really helping do the job.” The Akron operation also is working on Lockheed Martin’s High Altitude Airship, an unmanned, untethered, self-propelled blimp that remains in development. The company’s Mission Systems and Sensors business employs more than 400 in Akron. ■

OYSTER PERPETUAL AND GMT-MASTER II ARE TRADEMARKS.

M&A: Equity firms jump at opportunities continued from PAGE 1

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number of letters of intent and that Western Reserve Partners “is running flat out” working on transactions, as are a number of M&A attorneys to whom he has spoken. Stewart Kohl, co-CEO of private equity firm The Riverside Co., said the momentum really picked up in March, after incrementally improving for most of the second half of 2009. Both the number of companies for sale and the quality of those companies have been on the rise. “What’s beginning as a spring thaw is becoming a summer and fall avalanche,” said Mr. Kohl, whose own firm has made seven acquisition so far in 2010. “We’re going to see more and more.” Investment firm William Blair and Co., in Chicago, also noted that activity seemed to increase in March. In an April commentary, the firm said there had been 982 transactions announced in the United States for that month, a nearly 32% increase from March 2009. Indeed, March marked the fifth consecutive month that the number of transactions increased as compared to the prior year. And the disclosed dollar volume of the announced transactions in March, $140.1 billion, was 72% higher than it was a year ago, according to William Blair. The reasons for the increase, Mr. Kohl said, include the need for other private equity firms to make exits so they can reinvest their capital; small business owners who are getting older, sicker or simply want to retire to spend more time on the beach; a pending increase in capital gains tax rates that would reward owners who sold before year’s end; and

increased bank lending that make deals easier to complete.

Tire kickers abound The deal flow is still “choppy,” said Doug Neary, corporate group chair at Cleveland law firm Calfee, Halter & Griswold, but it’s increasing at a steady pace. Mr. Neary, who also co-chairs Calfee’s M&A practice, said earnings are getting better, increasing companies’ worth, and proving to potential acquirers that the businesses are strong enough to ride out a bad economy. The general consensus, he said, is that there will continue to be an increase in activity throughout 2010; Mr. Neary said he expects a “frenzy” by the end of the year. Nonetheless, he said buyers remain cautious and are “kicking the tires more diligently, now that they see what a downturn can do.” Linsalata Capital Partners vice president and partner Michael Moran said the increased appetite is coming from all matter of sources. “After a long time in a very quiet market, we’re starting to see some re-emergence of deal activity over the past month,” Mr. Moran said.

A ‘rising tide’ Gordon Kaiser, a partner and former head of the corporate practice group at the law firm Squire, Sanders & Dempsey, said strategic buyers with capital on hand are looking for ways to spend it, and banks are more willing to lend for private equity deals. Mr. Filippell, at Western Reserve Partners, said private equity firms also are willing to put increasing

amounts of equity into deals, fearful that they will not find sufficient opportunities before they need to return capital to investors. Stan Gorom, business practice chair at law firm Hahn Loeser & Parks, said he continues to see particular interest in distressed companies and has seen asset purchase agreements and letters of intent on the rise. However, he said people remain conservative, even as they seek to deploy unused capital. “It’s nascent, it’s just beginning,” Mr. Gorom said. “I’ve seen a few deals, which gives hope.” Likewise, Megan Mehalko, chair of the corporate and securities practice group at Benesch Friedlander Coplan & Aronoff, said she is “reasonably optimistic” that M&A activity will continue to rise as companies that have a “strong desire to invest and grow and capitalize” take advantage of the improved economic climate. For most of 2009, Ms. Mehalko said, she was struggling on a monthly basis. From the start of 2010, though, she could see the pipeline of deals going as far as three quarters in the future. James Dougherty, mergers and acquisitions partner at Jones Day, said increased confidence is a large reason for the change. When a global financial meltdown was a “legitimate concern,” he said, companies did not have a rosy picture of the future and were loath to make acquisitions. “Although now, it’s not 2006, 2007, deals make sense and financing is available,” he said. “There’s a marked improvement from last year at this time.” ■

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secretary.

GOING PLACES JOB CHANGES

SERVICE

DIABETES ASSOCIATION OF GREATER CLEVELAND: Debbie Hoffmann to chairperson.

CONSTRUCTION

BH SOLUTIONS GROUP INC.: Philip Thorne to director of business development and recruiting.

SEARCH ENGINE MARKETING PROFESSIONAL ORGANIZATION: Chris Boggs (Rosetta) to president.

THE RUHLIN CO.: Michael L. Deiwert to vice president.

EDUCATION BALDWIN-WALLACE COLLEGE: William M. Reniff to vice president, finance and administration.

KEN GANLEY NISSAN OF MEDINA: Glenn Pisani to executive manager.

FINANCIAL SERVICE CEDAR BROOK FINANCIAL PARTNERS LLC: Len Peffer to partner.

BOARDS

THE MAY GROUP: Ron Fleming to director of business development. SS&G: Kelly Molnar to manager.

INSURANCE BRUNSWICK COS.: Nichole Price to personal lines account representative. THE HOFFMAN GROUP: Theresa Riley to benefits account manager. MEDICAL MUTUAL OF OHIO: Jared Chaney to chief marketing officer.

LEGAL HAHN LOESER & PARKS LLP: Kevin M. Dunn to associate. MCCARTHY, LEBIT, CRYSTAL & LIFFMAN CO.: Michael D. Makofsky to principal; Christopher D. Adams to associate. SIKORA LAW LLC: Colleen Bennett to law firm administrator.

MANUFACTURING EATON CORP.: Shelley McGrail to director, organizational development; Joe Massey to director, organizational development, Electrical Sector.

MARKETING DONER: Mark Masterson to senior vice president, creative director; Julie Krebs to vice president, brand leader; Kelly Flower to senior project manager.

REAL ESTATE DEVELOPERS DIVERSIFIED REALTY CORP.: James J. Farrell to senior vice president, redevelopment and expansions. TRANSACTION REALTY: Mark A. Mason to sales associate.

GET DAILY NEWS ALERTS FROM CRAIN’S ! Register for free e-mail alerts and receive: ■ The Morning Roundup: A collection of the day’s business news from Ohio’s daily papers ■ Breaking news alerts: When major news happens, you’ll know ■ Daily headlines: A collection of Crain’s-produced news and blog items from the day ■ e!Cleveland: A weekly guide to arts and leisure in Northeast Ohio

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Peffer

Fleming

AWARDS

TRANSPORTATION CORPORATE CHARTERS LLC: Doug Daugherty to charter sales representative.

GREAT LAKES FINANCIAL GROUP: Ken Maksoudian to senior underwriter.

Reniff

CLEVELAND METROPOLITAN BAR ASSOCIATION: Michael N. Ungar (Ulmer & Berne LLP) to president; Barbara Roman to president-elect; Carter E. Strang to vice president;

Chaney

Dunn

Culler

Jonathan B. Leiken to vice president, membership; Albert A. Vondra to treasurer; David R. Watson to

CLEVELAND: M. Patricia Culler (Hahn Loeser & Parks LLP) received the 2010 Distinguished Estate Planner Award. LAUREL SCHOOL: Heather Roulston Ettinger (Fairport Asset Management) received the 2010 Distinguished Alumna Award; Amanda Cinalli (The Atlanta Beat) received the 2010 Young Alumna of Distinction Award.

BUSINESS ADVISERS OF CLEVELAND: Joe Cristiano (Cristiano Print Solutions) and Joni Nowak and David Van Horn (Minutes Matter LLC) received the 2009 On the Road to Success Awards.

LIFEBANC: Andy Baskin (WEWS) and Beth Baskin received the 2010 Legacy of Life Award.

CASE WESTERN RESERVE UNIVERSITY: Dr. R. William Cornell Jr. received the 2010 Distinguished Alumnus Award, School of Dental Medicine.

WESTERN RESERVE HISTORICAL SOCIETY: Gordon Ewers received the Legacy Award.

ESTATE PLANNING COUNCIL OF

SOCIETY OF PLASTICS ENGINEERS: Sadhan Jana (University of Akron) received the Education Award.

Send information for Going Places to dhillyer@crain.com.

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PUBLISHER/EDITORIAL DIRECTOR:

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

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

Scott Suttell (ssuttell@crain.com)

OPINION

It’s up to us

o you want to know what Cleveland and Northeast Ohio will look like 10 years from now? Twenty years? Thirty? Check out the caliber of people it attracts and keeps. It is people — bright people, driven people, passionate people — who make the difference in whether a company, organization or community succeeds or fails. We have seen it time and again in our 30 years of chronicling the goings on in our region. It is why we themed this, our anniversry issue, “30 Difference Makers in Northeast Ohio.” Consider the difference made by Jack Breen, longtime CEO of Sherwin-Williams Co. You might think, “The company makes paint — how hard can that be?” But Sherwin-Williams was poorly run and headed toward paintmaker heaven before Mr. Breen was hired as its head man in 1979. He brought a discipline and structure to the company that didn’t exist prior to his arrival. Under Mr. Breen’s leadership, SherwinWilliams achieved 22 consecutive years of earnings improvement and secured its place as an anchor of Cleveland’s business community. Bob Keegan accomplished much the same over the last decade at Goodyear Tire & Rubber Co. He took a struggling tiremaker known for its insular management and remade its executive ranks in a mere two years after becoming CEO. In the process, he changed Goodyear from a company focused on output to one that emphasizes innovation in tire technology and then markets the heck out of its prized products. When he relinquished the CEO reins this spring, Mr. Keegan handed off a far more stable and confident company than existed before he arrived. Then there is Victoria Bussert, who hasn’t been as visible as Messrs. Breen and Keegan but whose work and those of her protégés have touched hundreds of thousands of lives in Northeast Ohio. She serves as head of the music theater program at BaldwinWallace College and as resident director of the Great Lakes Theater Festival. Ms. Bussert’s chief product, besides the productions she stages, are the accomplished musical theater students she is exporting to theater companies from coast to coast. They add to our region’s reputation as an arts haven. These three people and the 27 others we profile in this issue have made bigger marks than most on Northeast Ohio over the last 30 years. They are undisputed difference makers, each in their own way. But there are many other people, whose stories will never be told in this newspaper or any other, who make a difference here. They are positive forces in their homes, their workplaces, their communities. They have high expectations of themselves, and they bring out the best in others. Just how well Northeast Ohio fares in coming years will be determined by the number of difference makers there are in relation to the region’s population. No one can know the hurdles the future holds. However, a region replete with resourceful, resilient and resolute people can overcome the obstacles and can succeed no matter what. Dear reader, it’s up to each of us.

FROM THE PUBLISHER

Times have changed, and so have we

hopes for what it would become. Now, hirty years is a fair amount of 25 years later, I’m both pleased with time for a business, especially what we’ve accomplished and energized when you’ve been there for 25 of by what the future holds, despite the them! My, how time flies. uncertainty and rapidly changing nature OK, so that’s as trite a cliché as just of our business. about any of them, you’re thinking. You see, it’s up to us to ask our You’re probably wondering, “What’s he customers — subscribers and advertisers going to come up with next — how fast alike — what they want and his kids have grown up?” need, and then figure out how Well, as a matter of fact, my BRIAN we can provide it. As you can kids — like yours — have grown TUCKER imagine, that formula has up all too fast, but that’s a changed a fair amount over 30 discussion for another time and years, but the basic service place. This column is about remains the same: Report news something that feels like one of and present data and analysis my kids. that business readers simply I recall vividly when I came to can’t get anywhere else. Crain’s Cleveland Business as its However, the ways in which editor in early 1985. I was we deliver on that promise has moving back home from Los not only changed, but expanded. News Angeles after six years with The Associated and information remain central, but we Press, the world’s largest news organizanow provide it in both print and a wide tion. Within days, I was told to write variety of digital products: a robust a column for this newspaper’s fifth web site and four different e-mail prodanniversary issue. ucts delivering daily statewide news I had no experience upon which to roundups, local news and blogs and draw, so I wrote about what I felt the a weekly preview of coming arts and business newspaper had been and my

entertainment offerings. How we interact with advertisers has changed as well. While the majority of our ad dollars flow into the regular newspaper, we’ve seen a steady increase in the use of our digital products, as well as the network of special events we’ve created. It’s a change I could not have envisioned when I first came to Crain’s. While change is as constant in our business as any of yours, something that hasn’t varied is the many ways Crain’s and its staff interact with the Northeast Ohio community. Last week, we were proud once again to partner with EDGE, an entrepreneur advocacy organization, to honor the mostly unsung middlemarket companies that are our region’s lifeblood. They are featured in a special insert in this week’s issue. It’s our responsibility to fairly and accurately report the news, both bad and good. But along the way, it’s great when we can join in an event like the Crain’s EDGE awards or produce something like this anniversary issue that applauds so many deserving Northeast Ohioans. ■

AND COUNTING ... What do you think Cleveland will look like in 30 years? (Asked at the Thompson Hine “Spotlight on Women” conference May 19)

Crain’s Cleveland Business is celebrating its 30th year as Northeast Ohio’s premier source of business news with this special double issue, which features profiles of the 30 most influential Clevelanders. As part of the celebration, we also are reflecting on the most memorable events of the past three decades with weekly polls — some of which can be found in this space — trivia questions, online content and video interviews. You can get in on the fun by visiting CrainsCleveland .com/30thanniversary.

ROBIN MINTER SMYERS

SHERYL KING BENFORD

CARIN ROCKIND

Shaker Heights

Cleveland

I think that Cleveland will be one of the most energetic, interesting smaller cities in the United States. I don’t think we’ll have the same population concentration, but I think by then all of the investments we are making today will have paid off.

We’re going to have a lot of people living and working on our lakeshore. I think that we are going to be a place where people come for expertise in green energy products. I think we’ll still be a center for the health care industry.

We are going to see bustling streets and restaurants overflowing. The Flats East Bank? People are going to be living there. People are going to look out at the lake and there will be a wind farm in the lake.

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Home watchdog still seeing growth

CRAIN’S CLEVELAND BUSINESS

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Safeguard Properties is showing no signs of slowing. A plateau in the number of foreclosures hasn’t impeded the 20year-old company, which conducts property inspections and performs maintenance on foreclosed homes. It has grown to 800 employees, up 22% from 655 in 2008. In 2009, it had revenues of $602.3 million, up nearly 47% from $410.8 million in 2008. And in the last few weeks it has named a new CEO, Alan Jaffa, who had been chief operating officer since 2002. “It feels like 24 months just flew by,” Mr. Jaffa said of the flurry of business Safeguard began to see as the number of foreclosures boomed. To handle the deluge, Safeguard has grown its infrastructure by rewriting its main core system and increasing its server space and has added layers of management to inject different levels of responsibility into the company, Mr. Jaffa said. It also moved into a new building a year ago, giving employees “more room to breathe” and a better working environment. Besides plenty of parking and enough room for employees to have

Is your Business Banker FILE PHOTO/JASON MILLER

Former Safeguard Properties field quality control supervisor Paul Carlozzi inspects a house on Trafalgar Avenue in East Cleveland in 2008. their own desks — at the old place, people were packed three to a cubicle — there is a cafeteria, an exercise room, an outdoor patio and a basketball court. “They love it,” Mr. Jaffa said. Mr. Jaffa, who is son-in- Jaffa law of former CEO and Safeguard founder Robert Klein, said Safeguard long has been interested in minimizing the negative impact of vacant properties in the neighborhoods where they are located. The company puts doorknob hangers on neighbors’ doors with its phone number, asking people to call if there is a problem with a house Safeguard is watching.

While the number of foreclosures has plateaued over the past four to six months, Mr. Jaffa said, he also expects to see another wave as banks realize that they are unable to modify the terms of some mortgages in a way that will allow people to stay in their homes. The company performs 1 million home inspections monthly, and Mr. Jaffa said there isn’t a ZIP code in the country where Safeguard hasn’t performed its services. “You’re going to see a little pop in the numbers,” he said. “A lot of foreclosures have been held up. The time has come to put them to an end. They have to proceed.” ■

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BRIGHT SPOTS Bright Spots is a periodic feature in Crain’s, highlighting positive business news in Northeast Ohio. To submit information, e-mail Scott Suttell at SSuttell@Crain.com. ■ Vita-Mix Corp. in Olmsted Falls and RadCon Inc. in Cleveland certainly take a global view of business. The companies received the President’s “E” Award for Exports in recognition of their achievements in supporting export growth. The award is the highest federal government acknowledgment any American firm or organization can be presented for export success. To qualify for the “E” Award, manufacturers must demonstrate a substantial increase in export volumes during a four-year period. Only 17 companies were selected to receive the award in 2010. U.S. Secretary of Commerce Gary Locke presented the awards during a ceremony May 13 in Washington, D.C. Vita-Mix makes high-performance blending equipment for home and commercial use. It currently exports to more than 80 countries, and its commercial equipment is used by restaurant chains including McDonald’s, Burger King and Jamba Juice. The company’s export sales have increased 80% since 2006. Rad-Con provides furnaces for processing steel. All its 19 employees are involved in exporting, which has grown more than 45% since 2006.

AT&T plans to open a store in the lifestyle center in August. The retailer will feature a showroom with a handson, interactive design. “Experience stations” will let customers testdrive AT&T’s wireless, broadband and wireline products and services. The Toy Tank, a 4,200-squarefoot toy store, will open over Memorial Day weekend, and offer an assortment of fun and educational toys and activities for kids of all ages and interests. The store will feature three large play areas and eventually will carry a special section of toys for kids with special needs. Sprout, a home décor store, plans an early June opening. The store will carry home accessories, garden items and gifts. Officials at Legacy Village report that more than 5 million people visited the shopping center in 2009, a new record.

■ Visitors to Legacy Village in Lyndhurst will have three more retail options to check out in the coming months.

■ Prestolite Performance in Cleveland, a performance auto parts manufacturer for brands including Mr. Gasket, ACCEL and

Hays, has launched Modern Muscle X, a sweepstakes that offers the winner a choice of an enhanced 2010 Ford Mustang, Chevrolet Camaro or Dodge Challenger. The company bought the three automotive icons and is revamping them with Prestolite parts. The cars will run with “enhanced performance, better power and more control,” Prestolite says. Eric Scheinerman, CEO of Prestolite, says the company in the next several months “is going to be installing and developing industryleading products to fine-tune these vehicles.” To win, participants must sign up on the Modern Muscle X web site, www.ModernMuscleX.com. Signups starts June 1. ■ If you want to find out how some successful Northeast Ohio companies have managed not only to survive the recession but to thrive in recent years, four of them will be telling their stories this Thursday, May 27. Executives at Corsa Performance Exhausts, GrafTech International Ltd., Keithley Instruments Inc. and Valtronics will discuss how they’ve used innovation and investment to become leaders in their fields. The four companies are part of “Saving American Manufacturing — Growth through Reinvention and Innovation,” a half-day seminar and workshop series put on in Independence by the Cleveland-based Manufacturers Advocacy and Growth Network and the Product Development Management Association. The fee to attend ranges from $50 to $125, depending on which portions of the program participants attend. For details, go to http://tinyurl.com/28b92lj.

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Well-known broker steps aside Colliers CEO Morris to start own firm By STAN BULLARD sbullard@crain.com

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Owners of Colliers OstendorfMorris, Cleveland’s largest locally owned commercial real estate brokerage, plan to leave the president and CEO’s position vacant for an indefinite period following Warren Morris’ announcement last Thursday, May 20, that he will exit the firm he joined in 1981. “I’ve always wanted to pursue a dream of running something that was my own — where I could call all the shots,” said Mr. Morris, 53, in an interview. “I feel there is a role for large firms in the real estate brokerage business. It’s been good for me personally and financially. Now I’m ready to try something else.” Mr. Morris was vague on the details of what type of firm he intends

to build. “I plan to create a firm whose purpose combines my love of this town, my passion for this town, and leverages my real estate Morris experience for the benefit of this town.” He has not set a definite date for his departure as CEO, as he needs to tie up loose ends. William West, Colliers OstendorfMorris chairman, said the brokerage would not immediately fill Mr. Morris’ position, though it will. In the meantime, Geoff Coyle, a partner in the firm, has been named managing partner of brokerage services and will work with Mr. West in serving as a coach to help the firm’s 40-some brokers cope with the economic downturn, improve training and coordinate services between different areas of expertise

within the firm. Mr. Coyle said he would continue to serve a limited number of clients, though he will focus on staff development. Colliers Ostendorf-Morris also reorganized operations last month, naming partner Rocco DiPuccio the head of office services and Barry Holtzer, a vice president, head of its industrial unit. Mr. West said the six partners who own the brokerage put the restructuring in place now but must determine how they will compensate Mr. Morris for his stake in the company. Mr. Morris’ namesake grandfather, Warren Morris, co-founded the brokerage in 1939. His father, Stephen Morris, was with the firm from 1949 to 1985. The younger Mr. Morris acquired his stake and management role in the firm as he completed more than 700 transactions there, primarily in its office unit. ■

Continental, United quietly HSA usage up tout merger to politicians in plans with Airlines: Combo will benefit economy, businesses

high deductible

By JOHN PELTZ Crain’s Chicago Business

By JERRY GEISEL Business Insurance

United Airlines and Continental Airlines have begun a behind-thescenes political campaign to win approval of their merger, which would create the world’s biggest airline and provide the first big test of how the Obama administration will scrutinize such deals. United and Continental began sending out form letters by e-mail last Monday, May 17. They are encouraging individuals and business leaders to forward those letters to their political representatives in support of the deal. The carriers declined to comment. Continental CEO Jeff Smisek, a lawyer who will lead the merged Chicago-based carrier, has said he doesn’t expect regulators to reject the deal because there’s little overlap in the airlines’ routes. But the airlines can’t take any chances. The form letters stress several themes: The combined airline will be good for the economy because of continued employment at hubs such as Chicago or Houston; the combined carriers will offer more flights to more cities, which will benefit businesses in the communities served by the two carriers; frequentflier programs will be more valuable

with more destinations, and the merged airlines will be better able to compete against rivals in an increasingly tough aviation environment. In addition, the two airlines last Wednesday, May 19, named the executives who will oversee integration of the two airlines — three from each company. The airlines said the integration process will be led by a steering committee that includes Mr. Smisek and Glenn Tilton of United parent UAL Corp. The others on the committee are chief financial officer Kathryn Mikells and chief administrative officer Pete McDonald from UAL, and CFO Zane Rowe and chief marketing officer Jim Compton of Continental. UAL’s Mr. McDonald and Lori Gobillot, an assistant general counsel for Continental, will lead integration planning and report to the steering committee, the companies said. The airlines expect integration planning to “begin in earnest” in early June, but that it can’t be completed until regulators and shareholders approve the deal, which they expect in the fourth quarter. ■ John Peltz is a reporter with Crain’s Chicago Business, a sister publication of Crain’s Cleveland Business.

CRAIN’SBREAKFASTS Crain’s Cleveland Business has partnered with respected regional business leaders throughout the year in our signature “Ideas at Dawn” breakfast series. Each event offers time for coffee and breakfast while networking, followed by a panel discussion on selected themes that could improve your organization’s performance and bottom-line results. If you have a nagging challenge in your operation, Crain’s “Ideas at Dawn” panel discussions are a great source of solutions. Visit CrainsCleveland

.com/breakfast for ticket information. Here’s a schedule of the upcoming breakfasts: ■ June 9: Safeguarding Your Business: The Ins and Outs of Protection, sponsored by Taft Stettinius & Hollister LLP, Deloitte and IBM. 7:30 a.m. to 9:30 a.m., Ritz-Carlton Cleveland. ■ June 25: Making Sense of Health Care Reform, presented by Findley Davies and sponsored by Plante & Moran, Anthem, and Bricker & Eckler. 8 a.m.-10 a.m., Ritz-Carlton Cleveland.

Enrollment in health savings accounts linked to high-deductible health insurance plans surged to 10 million people as of Jan. 1, a 25% increase in a year, according to an annual census released last week. HSA enrollment rose in all markets, according to the Washington-based America’s Health Insurance Plans. The large-employer market registered the largest percentage gain. Employers with at least 51 employees had 5 million people in HSAs as of Jan. 1, an increase of about 33% in the past year. In the small-employer market — employers with up to 50 employees — HSA enrollment increased to about 3 million people, up about 22%. Meanwhile, the individual market climbed to just more than 2 million people, a 12% rise. HSAs, authorized under a 2003 law, became available on Jan. 1, 2004, and enrollment has risen steadily since then. America’s Health Insurance Plans said 1 million people were enrolled in HSAs in March 2005, 3.2 million as of Jan. 1, 2006, 4.5 million in 2007, 6.1 million in 2008 and 8 million in 2009. The key factor driving HSA growth is that premiums for high-deductible health insurance plans, to which HSAs must be linked by law, tend to be lower than more traditional health plans. This year, the minimum deductible for single coverage through an HSA-linked health plan is $1,200. The minimum deductible for family coverage is $2,400. The America’s Health Insurance Plans census is based on 93 insurers and their subsidiaries offering HSAlinked health insurance plans. The organization said it believes its census covers almost all people enrolled in plans linked to HSAs. ■ Jerry Geisel is editor-at-large with Business Insurance, a sister publication of Crain’s Cleveland Business.

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ShoreBank rescue scrutinized Congressional members question Obama administration on motivation behind bailout By STEVE DANIELS Crain’s Chicago Business

Two top Republicans on the U.S. House Financial Services Committee have written a letter to President Barack Obama demanding records pertaining to any administration involvement in the $140 million Wall Street bailout of Chicagobased ShoreBank Corp., the lender to low-income neighborhoods that also operates in Cleveland. “Some believe that ShoreBank was really saved because of an assumption that high-ranking officials in the Obama administration favored a bailout of this failing institution with deep political ties,” said the May 19 letter by U.S. Reps. Spencer Bachus, R-Ala., and Judy Biggert, R-Ill. “The administration’s perceived involvement raises very serious questions as to whether the federal government is facilitating the rescue of a politically connected hometown bank when hundreds of others are forced to close.” Rep. Bachus is the senior Republican on the Financial Services Committee, which oversees banking laws, while Rep. Biggert is the top GOP member on the committee’s subcommittee on oversight and investigations. ShoreBank was on the brink of

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failing before a group of the nation’s largest financial players, including Goldman Sachs Group Inc., General Electric Co.’s commercial finance arm, JPMorgan Chase & Co. and Bank of America Corp., stepped forward with about $140 million in equity commitments. Those commitments should enable ShoreBank, which made its name over three decades lending profitably in low-income neighborhoods, to qualify for about $75 million in bailout funds from the Treasury Department. Obama administration representatives and the bank have denied any White House role in the capitalraising campaign. Anonymous comments from Wall Street sources to other publications have fueled a perception that Goldman Sachs and other recipients of federal aid during the financial crisis acted knowing that the administration favored a rescue of ShoreBank. ShoreBank’s leaders, most of whom live in the Obamas’ home neighborhood of Hyde Park, long have had a personal relationship with the president, going back to when he was a state senator. Reps. Bachus and Biggert requested that the White House provide all records of communication relating to the ShoreBank

ABOUT SHOREBANK The Wall Street bailout of Chicago-based ShoreBank Corp., which operates in Cleveland, is being questioned: ■ Reason: There’s a perception that close ties between ShoreBank’s leaders and President Barack Obama fueled the $140 million Wall Street rescue ■ Reaction: Obama administration officials and the bank have denied any White House role in a capitalraising campaign

negotiations, including any communications with Goldman Sachs CEO Lloyd Blankfein and Eugene Ludwig, a former ShoreBank board member and head of Promontory Financial Group, a Washington, D.C., consultancy that assisted ShoreBank. “In a year in which hundreds of banks are expected to fail, it is good news that this troubled institution has managed to survive,” the letter said. “The question that many are asking, however, is why did governmentsupported Wall Street banks decide to save ShoreBank rather than the numerous others that faced a capital shortage?” News of the letter was first reported by Fox Business Network. ■ Steve Daniels is a reporter with Crain’s Chicago Business, a sister publication of Crain’s Cleveland Business.

Cost to care for even healthy retirees may make you sick By DARLA MERCADO InvestmentNews

Want to start cutting down on health care costs? You might want to get off the treadmill — healthy retirees spend more on health care over the remainder of their lifetimes than their unhealthy brethren. Though healthy retirees face lower health care costs for the immediate term, over the course of their remaining years those costs rise and eventually exceed those of unhealthy retirees, according to a study by the Center for Retirement Research at Boston College. You can chalk it up to the cost of living — literally. For example, a couple that turned 65 last year with at least one spouse suffering form a chronic disease will face $220,000 in lifetime health care costs, including premiums for Medicare, Medigap and health insurance and expenses for nursing-home care. For couples that turned 65 last year who were free of chronic diseases, the health care tab can be as high as $260,000. And for 5% of those healthy 65-year-old couples, the lifetime cost of health care can be as high as $570,000, while their unhealthy peers pay $465,000. The study found that in any one year, healthier households spend less on average health care costs. A couple

in which the husband was between ages 65 and 69 — and in good health — would have spent an average of $6,509 on health care last year. If the husband wasn’t in good health, the cost would’ve gone up to $7,989 — exclusive of nursing home care expenses. But healthier retirees can expect to live significantly longer lives: At age 80, couples in good shape can have a remaining life expectancy that’s 29% longer than those who are unhealthy, according to the study. What’s more, those who are free of chronic disease at the moment likely will suffer from such a condition later: The healthy 80-year-olds in the simulation could expect to spend a third of their remaining lives suffering from a chronic condition. Those healthy individuals also are likely to live to extreme old age, when they’re more likely to require nursing home care, according to the study, which was sponsored by Prudential Financial Inc., a seller of long-term-care products. “Whether you’re in good or poor health, the reality is that you can expect to spend a period of years in poor health toward the end of your life,” said Anthony Webb, associate director of research at the Center for Retirement Research. ■ Darla Mercado is reporter with InvestmentNews, a sister publication of Crain’s Cleveland Business.

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E!CLEVELAND

MAY 24-JUNE 6, 2010

WHAT’S COOKING

Every Thursday, Crain’s sends to more than 20,000 readers a free arts and leisure e-mail called e!Cleveland. If you have events you’d like us to consider for inclusion, send information to managing editor Scott Suttell at ssuttell@crain.com. Here’s a taste of what makes it into the e-mail each week:

Scene on the street Event: “Urban Images” Venue: The Howson Gallery, Judson at University Circle, 2818 Ambleside Drive in Cleveland When: Now through Friday, June 25 Why you might be interested: If you see beauty in cityscapes. The show features pastel paintings of city scenes by Bonnie Dolin, whose work has appeared in solo and group exhibitions throughout the Cleveland area for nearly three decades. She’s a graduate of the Cleveland Institute of Art who earned her master’s of fine arts from Kent State University. Ms. Dolin says the city of Cleveland “has been my subject matter for the last several years,” with a particular focus on industrial areas and the houses in those neighborhoods. On the web: www.JudsonSmartLiving.org

A whole new world Event: “Another Way of Looking: Influences from Islam” Venue: Cleveland State University Art Gallery, 2307 Chester Ave. When: Now through Sunday, June 6 Why you might be interested: If you’re looking to expand your frame of reference about the Muslim world. CSU says the free exhibit is the first show in its art gallery to focus on Islam. It “brings together a collection of contemporary art influenced by Islam —

playful, personal, universal — featuring works in acrylic, textiles, video, calligraphy and mixed mediums.” In addition, the university’s Gallery C will present Islamic manuscripts from the Cleveland Public Library Collection, curated by Marian Bleeke, and “Touching the History: Photographs from the Dome of Hagia Sophia.” Exhibition curator Nama Khalil says that in the West, “It is difficult to invoke ‘Islamic’ images without calling up an entry from the war on terror. The artists of ‘Another Way of Looking’ offer us a way out of violence and mayhem.” Summer hours for the exhibit are Wednesdays and Thursdays from 10 a.m. to 5 p.m. and Saturdays from noon to 4 p.m. On the web: www.csuohio.edu/artgallery

Get your stuff here Event: “Strange Matter” exhibition and “Under the Sea,” an IMAX movie Venue: Great Lakes Science Center When: Opening Thursday, May 29 Why you might be interested: If you embrace the “study of stuff.” The “Strange Matter” show features more than a dozen interactive exhibits and gives visitors the chance to explore the world of materials science. It demonstrates how advanced materials are incorporated into everyday things such as antennas, DVD players and golf clubs. Visitors will be able to make their own slime to take home, swing a bowling ball at a pane of glass to see if it will break, submerse their hands in magnetic fluid and more. Opening the same day as “Strange Matter” is the new IMAX movie “Under the Sea,” which transports viewers to exotic and isolated undersea locations, including the Great Barrier Reef. Jim Carrey is the movie’s narrator. On the web: www.glsc.org

What’s Cooking looks at the business of Northeast Ohio’s restaurants, breweries and wineries. To submit information, e-mail assistant editor Kathy Carr at KCarr@crain.com. Long days and tight schedules leave little time for leisurely dining outings, but a local food delivery service has been capitalizing on its ability to bring the food to you. DeliverMeFood.com has gone from its early days in 1996 of delivering food from East Side restaurants in a Cutlass to present-day operations that employ 30 to 45 drivers — some of whom drive Smart Cars — and generate about $1.5 million in revenue by servicing several counties. And as Northeast Ohio’s restaurant industry grows, so too does the online operation, which is the brainchild of Dave Umina and his wife, Lisa. DeliverMeFood.com has sold franchises to operators in Lake and Summit counties, and most recently, to the Strongsville-Broadview Heights area. Mr. Umina said he expects to continue franchising the business to Northeast Ohio’s west and south sides, as well as areas in southern Ohio. He also said he is in talks with signing on more Northeast Ohio restaurants. His most recent clients include Melt in Cleveland Heights, which opened Friday. DeliverMeFood.com services more than 100 Northeast Ohio restaurants and delivers to homes and businesses located in Cuyahoga, Geauga, Lake, Medina, Portage and parts of Summit counties. The business makes about 3,500 to 4,000

deliveries a month. The DeliverMeFoods’ Smart Cars are the operation’s most notable feature, though not all drivers have them. The business currently has three, but two more of the golf cart-sized vehicles will be joining the fleet this summer. Funky focus: A Cleveland-based culinaryfocused apparel company on May 5 launched its web site, which enables restaurateurs and foodies to order any of nine funky T-shirts that bear unique graphics. Stove Monkeys, which chefs Matthew Mytro and Anthony Lynch founded in 2007, creates apparel with a whimsical, creative flair. “For an increasing number of people, food is not just a job — it’s a lifestyle,” Mr. Mytro said. “With Stove Monkeys, we’ve aimed to merge a serious dedication to the culinary arts with the spirit of ‘monkeying around’ in the kitchen — a necessary part of the daily grind. “Our designs are relatable to the food service staff in both the front and back of the house, as well as the hard-core foodie community, and can be worn in the kitchen as well as on the street.” Quick bite: A new gastro pub is coming to Lakewood. Dive Bar owner Daniel Deagan is opening Deagan’s Kitchen & Bar by late summer at 14806 Detroit Ave., the former location of Cleats Bar & Grill. The $500,000 bar and restaurant will seat 155 patrons and will offer a wide variety of beer and a menu accentuated with locally grown food. Follow Kathy on Twitter: twitter.com/ Kathy_Carr.

It’s not just the difference. It’s the result.

Distinction is always conﬁned to the few. Jones Day proudly congratulates Crain’s on 30 years of covering Cleveland business and civic issues, and the 30 people cited as Difference Makers. With roots established in Cleveland nearly 120 years ago, we’re grateful for the leadership and wisdom displayed by Crain’s and the honorees, and the difference they’ve made in Northeast Ohio. The results deserve a standing ovation. All rise!

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30DIFFERENCEMAKERS

ROBERTKEEGAN

MAY 24-JUNE 6, 2010

Chairman, Goodyear Tire & Rubber Co.

JESSE KRAMER

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By DAN SHINGLER dshingler@crain.com

f you get a chance to meet Bob Keegan, do it — there may never be another like him. After all, what are the odds that a kid today will grow up in a Major League Baseball dugout, become a math major and then have the work ethic and smarts to climb the corporate ladder and the ambition to grab the brass ring at the top? If anyone could calculate those odds, it would be Mr. Keegan, who retired this spring as CEO of Goodyear Tire & Rubber Co. after reviving the sagging tiremaker’s fortunes during his seven years in the top job. “People at the company joke with me about it and I say at least I’m still numerate,” said Mr. Keegan, who remains Goodyear’s chairman. “If you want to kick numbers around, my goal is to get there first.” And he often does. “Everyone knows that if you’re going to present to Bob, you’d better know your numbers inside and out or you’re going to get nailed,” said Rob Whitehouse, Goodyear’s director of corporate communications. Mr. Keegan’s analytic and “numerate” mind might have its roots in his remarkable childhood. The son of the Chicago White Sox pitcher for whom he was named, Mr. Keegan first saw the real world importance of numbers and analysis from his perch in the Sox’s dugout. “I grew up in Comiskey Park for a few summers,” Mr. Keegan said. “I wanted to be a professional baseball player, but talent stood in the way.” But if he did not have a mound-worthy arm, Mr. Keegan had a mind worthy of running a dugout — though by the time he was ready for college, he had decided to use his brain to crunch even more complex numbers.

Shut out of a no-hitter That’s probably thanks to his mother, Lois, who insisted that the young Mr. Keegan focus on education by staying home to do homework and going to bed early on school nights. Today, Mr. Keegan says he’s thankful — except for the time her rules made him miss his dad’s only no-hitter in a 1957 night game — because the Jesuit education he received at his mother’s prodding further developed his mind.

He graduated from LeMoyne College in Syracuse, CEO, Mr. Keegan had placed new people in 23 of the N.Y., with a bachelor’s degree in mathematics in 1969, company’s top 25 leadership positions — and he still developed an interest in business, and followed it up occupied the top spot as a relative newcomer. with an MBA in 1972 from the University of Rochester. “The only way I could see to transform the culture was By then, Mr. Keegan had decided he one day would be to change the leadership of the company,” Mr. Keegan an entrepreneur — but first he wanted to work for said. “I needed to take people inside the company someone else, to wet his feet. who were receptive to change and really capable of After a couple years working as a research matheperforming. On the other hand, it was critical for us to matician for a large automotive supply company, Mr. go outside and bring in skill sets that we didn’t have, Keegan went to work for Eastman Kodak Co. in particularly in the marketing area and in the financial Rochester. But he still had his mind set on owning his area.” own, probably much smaller business someday. No ‘I’ in team “My plan was to stay there about three years, because Within short order, Goodyear’s newfound marketing I had no plans to work for a large corporation — I skills were making its new Assurance brand of automothought I was more entrepreneurial,” Mr. Keegan says tive tires a huge success. today. The company followed up on that So much for plans. “Everyone knows that if hit with its Fuelmax tires, designed “I spent most of my professional you’re going to present to to provide drivers with about 4% career at Kodak,” Mr. Keegan said, Bob, you’d better know better mileage than comparable reflecting on his 26 years there, with 12 of his earliest years spent overseas. your numbers inside and tires — just in time for the run-up in out or you’re going to get gasoline prices in 2008. Both successes Out with the old … were a combination of Goodyear’s nailed.” By the time he joined Goodyear in traditional strong engineering 2000 as chief operating officer, Mr. prowess matched with its newly – Rob Whitehouse, director of corporate communications, Keegan had a wealth of experience revamped marketing skills, Mr. Goodyear Tire & Rubber Co. with consumer products behind him Keegan said. and a big job ahead of him. But what Mr. Keegan is most “When I came to Goodyear, the company was proud of is the team he left in place when he retired struggling for a number of reasons” he said. “The main as CEO last month — and that the loyalty of the reason was that we had become a very insular company, rest of Goodyear’s employees continued throughout very manufacturing-driven; that was our orientation. the turbulent changes Mr. Keegan brought to the Add a strong orientation to the (big automakers) in company. Detroit, and that wasn’t a recipe for success.” “I’m still shocked we didn’t have the collateral Nor was it a recipe Mr. Keegan was going to follow — damage you’d have at a lot of companies,” he said. not as the sous chef in 2000 and certainly not as the “Now, people come in, meet with our team and say to executive chef, after he became CEO in 2003. me, ‘Hey, you’ve really got an outstanding group of But perhaps the chef metaphor is not the best one for leaders here.’ That makes me feel good.” Mr. Keegan in this regard, because what he did at He refuses to take credit for turning around the Goodyear was clean house. Suddenly, a company with a company — though most observers know better. His long and unwavering reputation for promoting its top deflection of praise might come from his time in the brass from within had an outsider in the corner office White Sox dugout, which Mr. Keegan said taught him who was hiring more outsiders almost as fast as their not to believe in idols, but in teams. new offices could be set up. He also moved new insiders “We’ve created a leadership team that is a good blend into more powerful positions and gave them more of people from inside and outside,” he said. “This is not responsibility. an individual sport. Individuals do not succeed — By the time he was done, two years after becoming teams succeed in business.” ■

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30DIFFERENCEMAKERS

CRAIN’S CLEVELAND BUSINESS

JACKBREEN Former chairman and CEO, Sherwin-Williams Co.

MAY 24-JUNE 6, 2010

“This country wasn’t built by Harvard Business School. It was built by hard-working people who wanted to better themselves.” – Jack Breen

JASON MILLER

By DAN SHINGLER dshingler@crain.com

ack Breen’s name sounds like it belongs on a prizefighter on a glorious day or a Marine sergeant on a bad one, dragging some bleeding soldier to safety. Instead, it belongs to a man who, in the corporate world, was a little of both. John G. Breen is the son of hardscrabble Scottish-Irish immigrants. He began his life as a CEO at paintmaking giant Sherwin-Williams Co. with a heavyweight fight that pitted him against one of the era’s most notorious corporate raiders — greenmailer and Gulf & Western chairman Charles Bluhdorn. Then, he had to drag Sherwin-Williams from the brink of bankruptcy. To those who know their local history, Mr. Breen is the man who saved SherwinWilliams. But, to those who’ve met him, he always has been just Jack Breen, or even “Jack” — and that includes almost anyone who worked for Sherwin-Williams during Mr. Breen’s 20 years as CEO. Mr. Breen was recruited in January 1979 from Gould Electronics in Eastlake to turn around a troubled SherwinWilliams as its CEO. Just as Mr. Breen got to his new office, Mr. Bluhdorn announced that he not only owned 13% of the company’s stock, but planned to buy more until he owned one-quarter of the paintmaker. Mr. Bluhdorn supposedly wanted a say in how the company would be run, but would go away if Sherwin-Williams bought him out at prices much higher than what he paid for his stake, Mr. Breen says. The new CEO wasn’t buying it, even

though it appeared to some observers that a struggling Sherwin-Williams was destined to become part of Gulf & Western on the cheap — or go broke if it didn’t. So Mr. Breen went to the famous Gulf & Western headquarters building in New York to see Mr. Bluhdorn. “I went up to see him on my third day,” said Mr. Breen, now 76, in a recent phone interview from his winter home in Florida. “I told him, ‘I don’t even know what the real book value of the SherwinWilliams Co. is — and you don’t know, either. I’m not going to work for you. So, if you’re going to take over the company, do it.’” Mr. Bluhdorn didn’t. He took a little more than he paid for his shares and went away. “I knew he wouldn’t. It wasn’t his style,” Mr. Breen said.

A fresh coat of paint But Mr. Bluhdorn was right about one thing: Sherwin-Williams was about to become a great turnaround investment. “It was a pretty good-sized company, but they lost money and more importantly, we lost our credit rating,” said Mr. Breen, who would be the architect of the turnaround. The company was in disarray, Mr. Breen said, in part because it made too many products outside of its core business, such as saccharine, printing inks and even paint cans that it sold to competitors. It had been run by another CEO who didn’t like the paint business much and diversified into areas in which Sherwin-Williams had no brand power — and as far as Mr. Breen was concerned, no business operating.

He gathered about 300 SherwinWilliams associates and they met at the Silver Grille in the old Higbee’s store in downtown Cleveland in 1979. SherwinWilliams had no conference room that would hold the crowd. “I said, ‘Who would you rather be working for, Republic Steel or SherwinWilliams?’ And I’d say 90% of the hands went up” in favor of Republic Steel, Mr. Breen said. “That was the kind of mood that was inside the company.” But Mr. Breen was undeterred. He quit making cans for competitors, focused the company on its core paint business and, perhaps most importantly, recognized and capitalized on the value of the company’s national chain of branded paint stores, which he had been advised by an outside consultant to sell. “The problem wasn’t the stores, it was the manufacturing division that was selling to the stores,” Mr. Breen said. “They were overcharging and making a huge profit, but I told them, ‘You’re killing the golden goose!’” Mr. Breen quickly determined that the paint stores were the horses, and then put them in front of the Sherwin-Williams cart. He enabled them to negotiate terms one-onone with the company and gave the stores the exclusive rights to sell Sherwin-Williams’ branded products. He also professionalized the stores, according to current Sherwin-Williams CEO Chris Connor. “He made running a paint store something that required a four-year undergraduate business degree,” Mr. Connor said. The company gained market share and profitability as a result. For 21 years under Mr. Breen’s tenure, the company reported increased profits and raised its dividend.

Mr. Breen, however, said his successor, Mr. Connor, has it tougher. “I started with a much lower base,” Mr. Breen joked. “For Chris to do that now is a lot more difficult.”

In touch with his roots But Mr. Breen is confident in the company’s future, in part because of Mr. Connor, whom he picked from Sherwin’s ranks to take over the company in 1999 and prepared for the role. Mr. Connor describes Mr. Breen as a tough-but-approachable boss who neither suffered fools nor forgot his working-class roots and the importance of even low-level, hard-working employees. He credits Mr. Breen for much of his own resilience. “The world is not always an easy place, and certainly in business you’re going to have many, many days when things aren’t going well,” Mr. Connor said. “Tough managers get through that and keep pushing forward, and that’s certainly something Jack instilled in me.” You might think Mr. Breen got his own toughness from his father, a self-taught tool maker who quit school at age 10 to make a living and, at age 18, came alone to America with little more than some faith and nerve. Not so, he says. “I think I got it from my mother, who was a feisty Irish Democrat,” Mr. Breen said. “She had a stroke when she was 38 years old and then she raised five kids with one hand.” To this day, Mr. Breen has maintained much of his working-class sensibility. “This country wasn’t built by Harvard Business School,” he said. “It was built by hard-working people who wanted to better themselves.” ■

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Spirit of Generosity Jack Breen Former Chairman & CEO, Sherwin-Williams Company John Carroll University, Class of 1956

John Carroll University is proud to honor Jack Breenâ&#x20AC;&#x201D;a man who personiďŹ es our Jesuit mission of leadership and service. Jack brought about sea change in his 22 years at Sherwin-Williams. He also is a family man who has generously shared his time and talents here in his hometown. He is a person of intellect and character who has inspired others through his ethical and thoughtful leadership. Jack shared his expertise by serving on the boards of important local businesses and organizations. He has received numerous awards in recognition of his professional and personal achievements as a visionary business leader, philanthropist, and advocate for education. John Carroll University is fortunate to have many alumni who passionately support our mission, but few who give as much of themselves as Jack Breen. Thank you, Jack, for making a difference in Cleveland and for our University.

www.jcu.edu

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CRAIN’S CLEVELAND BUSINESS

30DIFFERENCEMAKERS

MAY 24-JUNE 6, 2010

BAIJU SHAH President and CEO, BioEnterprise By CHUCK SODER csoder@crain.com

he first time Baiju Shah was asked to join BioEnterprise Corp. back in 2002, his answer was “no.” After all, Mr. Shah already had a good gig at management consulting firm McKinsey & Co. His job was to help local companies grow, which was a good fit for a community-minded guy who grew up in Mayfield Heights. Plus, McKinsey gave him plenty of chances to do pro bono work for area economic development groups such as the young BioEnterprise, a nonprofit created to help build the region’s biotech sector. But he could do more. That was the message former BioEnterprise chairman Bill Sanford instilled in Mr. Shah after he turned down the offer to join the fledgling organization. Mr. Sanford, who spent 10 years as CEO of sterilization products maker Steris Corp. in Mentor, convinced Mr. Shah it would be a long time before he would get another chance to do something so great for his hometown. “He said, ‘The opportunities to do something like this are going to be few and far between,’” Mr. Shah said. A week later, Mr. Shah joined BioEnterprise, and within two years he became president of the organization. Today, it appears Mr. Sanford was right about what Mr. Shah and his team at BioEnterprise could accomplish.

“I think he really put (BioEnterprise) on the map as an important regional organization.” – Jamie D. Ireland III, treasurer, Generation Foundation; managing director, Early Stage Partners Investments in Northeast Ohio’s bioscience companies have exploded since 2002, growing from just $33 million that year to a peak of $242 million in 2007. That number fell to $165 million in 2008 and to $68 million in 2009, but those numbers remain impressive considering how venture investing nationwide plunged during the recession. Many of the dollars are coming from outside the region or from venture investment firms that recently have opened Ohio offices. The number of companies receiving money has grown, too, Mr. Shah said. He used to be able to name all the biomedical startups that had received venture money, but now there are more than 100. And there are hundreds more biomedical companies that haven’t taken venture capital. “There’s deal flow that we can’t stay on top of,” Mr. Shah said.

Mr. Credible BioEnterprise shouldn’t get all the credit. For one, the Cleveland Clinic and Case Western Reserve University over the past decade have put a bigger focus on using the research they already do to create companies and products. And the Ohio Third Frontier Program has been pumping money into technology companies and research efforts, biomedical and otherwise, since it was created in 2002. However, BioEnterprise has done a lot to help local biomedical companies, particularly when it comes to connecting with investors or partners, and it has served as a neutral organization through which Northeast Ohio’s competing hospital systems and other major players in the regional health care scene can work together. Mr. Shah has been an important part of that effort, according to Jamie D. Ireland III, who is both treasurer of the Generation Foundation, which financed the study that led to the creation of BioEnterprise, and managing director of Early Stage Partners of Cleveland, which invests in startup companies. Mr. Ireland described Mr. Shah as a “hard-working, tenacious guy” who has attracted investment dollars to Northeast Ohio and make health care a top priority in Columbus. “I think he really put (BioEnterprise) on the map as an important regional organization,” he said. Mr. Shah also has an uncanny ability to help plot the region’s overall biomedical strategy one moment and then dive into detail the next — and still know what he’s talking about, said Ray Leach, CEO of JumpStart Inc., a Cleveland nonprofit that assists and invests in regional

JANET CENTURY

Baiju Shah at business recruitment organization BioEnterprise in University Circle startup companies. “He’s very, very credible,” Mr. Leach said.

Home is where the heart is Mr. Shah — the son of an engineer turned entrepreneur and a pediatrician who immigrated to the United States from India — might have ended up using his talents elsewhere if it hadn’t been for a piece of advice he received as a student at Mayfield Heights High School. He related a conversation he had at the time with the late Richard Shatten, a Mayfield graduate who helped guide several public-private partnerships as president of Cleveland Tomorrow, a group of local CEOs who banded together to drive the region’s economic agenda. “Rich put it in the back of my mind that this is the type of community where someone who has energy and who has talent would really be embraced and supported,” Mr. Shah said. That advice made a big difference when Mr. Shah started applying for jobs after graduating with a law degree from Harvard University. “I only seriously considered opportunities that were in Cleveland,” he said. Mr. Shah got his bachelor’s degree in history from Yale University and later worked on political campaigns in New

Jersey and Tennessee. Though he went to law school, he had no intention of practicing law. He thought the degree might help him find a career in the public sector, but he admits he didn’t have a “grand plan” back then. Not that he needed one. He thinks people should be open to taking positions outside their charted career paths. “Some of the most interesting people that I know … did not have a grand plan. Opportunities led to other opportunities that led to other opportunities, and you look back, and they’ve led an interesting life,” Mr. Shah said.

Don’t call him Shirley Mr. Shah enjoys spending time with his wife, Koyen, and their two daughters. He also likes to travel, both in the United States and overseas, but he confesses that he’s not into “deep foreign films.” “I can watch ‘Airplane!’ again and again. I can watch ‘Animal House’ again and again,” he said. Mr. Leach, of JumpStart, said he expects Mr. Shah to continue doing great work for Northeast Ohio even after he leaves BioEnterprise. For now, however, Mr. Shah is content to enjoy the job he nearly turned down eight years ago. “It was a great decision, obviously,” he said. “I’ve been very happy.” ■

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STIMULATING THE MINDS AND ECONOMIES OF NORTHEAST OHIO FOR 100 YEARS Kent Stateâ&#x20AC;&#x2122;s 8-campus system

Ashtabula Campus Geauga Campus Trumbull Campus Kent Campus Salem Campus Stark Campus East Liverpool Campus Tuscarawas Campus

KENT STATE UNIVERSITY FUELS ECONOMIC GROWTH BY DEVELOPING THE REGIONâ&#x20AC;&#x2122;S HUMAN CAPITAL, RESEARCHING NEW IDEAS AND TECHNOLOGY AND FOSTERING INNOVATION AND FO BUSINESS DEVELOPMENT. Kent State is a major employer in Ke Northeast Ohio, and creates even more jobs through capital construction projects, expenditures for goods and services and the patronage of faculty, students and visitors at local businesses.

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Thatâ&#x20AC;&#x2122;s EXCELLENCE in Action. Itâ&#x20AC;&#x2122;s happening every day at Kent State University. * Source: Ohio Board of Regents. Facts and ďŹ gures are quoted from a study conducted by Economic Modeling Specialists, Inc. based on data for 2007-08. Copyright 2009. Kent State University, Kent State and KSU are registered trademarks and may not be used without permission. Kent State University, an equal opportunity, afďŹ rmative action employer, is committed to attaining excellence through the recruitment and retention of a diverse work force. 10-0995

www.kent.edu

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CRAIN’S CLEVELAND BUSINESS

30DIFFERENCEMAKERS

DONPLUSQUELLIC

MAY 24-JUNE 6, 2010

Mayor, city of Akron

RUGGERO FATICA

Mayor Don Plusquellic at Akron Children’s Hospital By JOHN BOOTH clbfreelancer@crain.com

ince 1987, Cleveland has had four mayors. So have Canton and Columbus. Cincinnati and Toledo have had five each, and Youngstown three. Akron? Just one: Don Plusquellic. He’s the longest-serving mayor in the city’s history and has stayed in office during what arguably have been the region’s most dramatic industrial and economic shifts in more than a century. And, by making Akron’s role in economic development a priority, he has helped reshape his hometown. There have been both big-picture efforts, such as the Austen BioInnovation Institute and the Akron Biomedical Corridor, and more visible projects, such as the renovation of land that brought Advanced Elastomer Systems to the city. It has not been a road without bumps, however: In the past decade, for instance, Mr. Plusquellic caught flak in 2005 over his use of profanity toward a parking garage employee; and in 2009, he faced a recall effort that reached the ballot in June. He retained office by nearly a 3-to-1 margin among the 27,700 votes cast. Mr. Plusquellic landed Akron’s Ward 9 council seat in 1973, when he was 24 years old, representing the Kenmore area where he had grown up. Though he ran partly because of “a feeling that had existed that the city of Akron had never done right by Kenmore,” Mr. Plusquellic didn’t have designs on a long political career. “I thought I’d serve six or eight years and do my civic duty,” he said. “I didn’t trust anybody; I didn’t know anybody in the system.” Thirteen years later, he sought the mayor’s office. Though he agonized over the decision to run, Mr. Plusquellic recalled, he realized less than six months into his first term “that maybe this is what I was meant to do.” “It’s a job where you can get things done,” he said. “And I obviously feel very strongly about my hometown.”

New way of thinking That drive to improve Akron has manifested itself

“It’s a job where you can get things done. And I obviously feel very strongly about my hometown.” – Don Plusquellic mostly in the mayor’s once-unheard-of involvement in economic development. Mr. Plusquellic championed and shaped the earliest Joint Economic Development Districts in the state, promoting cooperation between neighboring communities and lessening their competition for businesses. He joined chambers of commerce to ease distrust between the business community and local government, and he led the city’s purchases of unused land in an effort to encourage development and prevent businesses from leaving as hard times fell. “Cities did not do that,” Mr. Plusquellic said. “They took care of police and fire departments and fixed potholes. The difference … over the last 15 to 20 years is that I spend over 50% of my time on jobs, either creating them or keeping them.” When questioned over the dollars spent on land to entice new builders — Akron invested $7.4 million into that Advanced Elastomer Systems project — Mr. Plusquellic’s response was a question in return: “What does it cost us if we do nothing?” “We’re losing the opportunity for that site; we’re losing the businesses that don’t want to be next to it,” he said. Rick Rebadow, executive vice president of the Greater Akron Chamber, said Mr. Plusquellic was among the first to acknowledge Akron’s need to change from a dependence on tire manufacturing and to embrace a wider approach. “He saw the transition, but he also had a passion and a fire in the belly, and he was not going to let this go unnoticed,” Mr. Rebadow said. “I have not seen a mayor in the United States that has taken such an active role in economic development.” Adele Dorfner Roth, development manager for the mayor’s Office of Economic Development, provides a unique view of Mr. Plusquellic’s approach: She worked for the city in the early 1980s, then left to run her business, Akron Tire Engineering and Machinery Co.,

before rejoining the city in 2002. “In the ’80s, when I left, economic development as a concept … was a little thing,” Ms. Roth said. “They sort of did cold calls and worked on trying to keep downtown from looking like a ghost town.”

Connecting the dots Today, the mayor’s economic development staff consists of seven workers and includes close partnerships with both the Summit County and Greater Akron chambers. Ms. Roth says cooperation also regularly takes place between Akron’s own departments. The Economic Development office’s coordination meetings regularly include the city’s law director, finance director, planning director, service director and other departmental representatives, which strengthens the approach that all these aspects of government are linked. “And the mayor is the first one to tell us that it’s a zero-sum game to go hunting for business from your neighbor,” she said. “Where we need to go to really make the gains for the community is the bringing in of brand-new businesses or bringing in companies from overseas.” George Newkome, president of the University of Akron Research Foundation, has worked with Mr. Plusquellic on overseas ventures, including trips to Israel. Dr. Newkome said the mayor often excels at seeing new ways of bringing existing pieces and groups together to benefit everyone and the community around them. He cites the Biomedical Corridor as a prime example. “The hospitals and the university, they’ve been here for years, and he connected the dots which really made the thing pull together,” Dr. Newkome said. “And the (Austen) BioInnovation Institute … really kind of added the icing over the top of the cake.” Other people have noticed Mr. Plusquellic’s work and are striving to follow his trail, Dr. Newkome said. “If you look at a lot of the communities around us, they’re starting to get into the economic development arena as well,” Dr. Newkome said. “True leaders are visionaries who are one step ahead of the pack. And he’s led an incredible pathway, a good long one, for the community.” ■

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A Bridge To Our Future

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CRAIN’S CLEVELAND BUSINESS

30DIFFERENCEMAKERS

RICHARDSHATTEN

MAY 24-JUNE 6, 2010

Former executive director, Cleveland Tomorrow

FILE PHOTO/JANINE BENTIVEGNA

By JAY MILLER jmiller@crain.com

hree years after his death in 2002 at the age of 46, people were still talking about Richard Shatten — the man who has been given credit for catalyzing the rebuilding efforts of Cleveland in the 1980s and 1990s — in Syracuse, N.Y. Sean Kirst, a columnist for the daily Syracuse Post-Herald, writing in 2005, was recalling the time in 1998 when the late Mr. Shatten had come to Syracuse. “Greater Syracuse, Shatten “Richard’s role at said, had to get past what he Cleveland Tomorrow was called ‘the war,’ or decades pivotal in that he took lost to bruising, self-defeating politics,” Mr. Kirst wrote. “He over an organization ... said leaders accustomed and helped turn it into a to creating big projects local force and a national through stubborn power model.” plays had to begin heeding the concerns of small busi– Joe Roman, CEO, Greater nesses and struggling neighCleveland Partnership borhoods.” He was invited to that overwhelmed upstate New York community in 1998 to speak to the Central New York Regional Compact — a meeting ground for business, government and other civic leaders — to tell them what Syracuse needed to do to revive itself. At the time of his visit to Syracuse in 1998, the Post-Herald described Mr. Shatten as having “earned municipal cult status in his role with Cleveland Tomorrow, an agency that helped revive an old and sagging town when it was on the skids.” The paper called him a prophet for guidelines he’d left in Syracuse about the importance of setting aside longstanding political differences within cities and between cities and suburbs, and setting a course for turning around an aging city. Of course, the ideas Mr. Shatten, a native of Mayfield Heights, brought to Syracuse began to form when he returned to Cleveland in 1981, after earning a bachelor’s degree and an MBA from Harvard University, to work for the McKinsey & Co. consulting firm. What he saw distressed him. Cleveland was reeling as the local economy was beginning a

tumultuous transition. People were leaving because of crime and a declining school system. The city was still recovering from the embarrassment of the default it suffered in 1978. “This was a community that wasn’t about renewal,” Mr. Shatten told Crain’s Cleveland Business in 2000. “There wasn’t a strategy. And there wasn’t hope.”

Everybody knows his name As fate would have it, Mr. Shatten at McKinsey worked on the studies that would create Cleveland Tomorrow, the very organization he later would run. Local business and civic leaders, with backing from area foundations, had engaged McKinsey to study the city’s problems and recommend steps to begin to turn the community around. The study set an agenda for action and recommended creating an organization that began to tackle the problems it identified. The report recommended looking at which industries offered future growth and suggested ways to help new businesses gain a foothold. In 1982, at age 28, Mr. Shatten left McKinsey to be the second executive director of Cleveland Tomorrow, an organization of corporate CEOs who went on to help refocus the regional economy and bring hope to a struggling community. For more than a decade, Mr. Shatten led the group he helped create. During that time he advocated a strategy of placing the greatest share of public and private investment dollars in those industry clusters — such as instrumentation and medical technologies — that promised to grow most rapidly. “Richard’s role at Cleveland Tomorrow was pivotal in that he took over an organization that many thought might only be experimental — it was only 2 years old — and helped turn it into a local force and a national model,” said Joe Roman, who succeeded Mr. Shatten as executive director of Cleveland Tomorrow and now is CEO of its successor, the Greater Cleveland Partnership. “Several other cities copied Cleveland Tomorrow, even in Akron,” Mr. Roman said. Under Mr. Shatten’s direction over the next 12 years, the organization played a key role in creating the much-admired public-private

partnership that Cleveland Mayor George Voinovich and succeeding mayors forged as they guided the destiny of the regional economy. Cleveland Tomorrow also sowed the seeds for organizations such as technology advocacy group NorTech and manufacturing assistance group Magnet; helped drive the renovation of the PlayhouseSquare theater district; and created the Gateway sports complex. “It would be difficult to name the one person, or even several people, most responsible for the renaissance that followed Cleveland’s 1978 fiscal default,” Crain’s publisher Brian Tucker wrote at the time of Mr. Shatten’s death. “Certain names may be on one person’s list and not on another’s. But the common name on all the lists of those who knew the details of this city’s comeback would have been Richard Shatten’s.”

‘A crystalline mind’ When Mr. Shatten left Cleveland Tomorrow in 1994, he was named executive director of the Mandel Philanthropic Program. In 1998, he joined the faculty of the Weatherhead School of Business and led the business school’s Center for Regional Economic Issues think tank, REI. However, Mr. Shatten never dove too deeply into academia. Shortly after he took over REI, he offered a Crain’s reporter his observations about some key “(Mr. Shatten) had issues that civic leaders should luminescent brilliance of never take for granted. It’s advice thought, a crystalline that still rings true today. “Make love to our entrepremind.” neurs,” he said, believing that – Hunter Morrison, former they are a key to economic planning director, city of Cleveland growth. He also implored the community to invest heavily in higher education to attract talented people to Northeast Ohio. And he hoped the community would make Cleveland’s downtown “the headquarters of Ohio” because it can offer the poor, who live nearby, a good shot at entrylevel jobs. A brain tumor cut Mr. Shatten down at 46. Among the plaudits that eulogized him was this from former Cleveland planning director Hunter Morrison: “He had luminescent brilliance of thought, a crystalline mind,” he said. And from Sen. George Voinovich: “He was an absolutely brilliant guy.” ■

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CRAIN’S CLEVELAND BUSINESS

30DIFFERENCEMAKERS

MAY 24-JUNE 6, 2010

ARTFALCO President and CEO, PlayhouseSquare Foundation By ARIELLE KASS akass@crain.com

hough he heads the second-largest performing arts center in the United States, Art Falco isn’t the type of person who likes to take center stage. Rather, the president and CEO of PlayhouseSquare Foundation for the last 19 years would rather people pay attention to what his organization is doing to contribute to the health of Cleveland’s Theater District and the region at large. “This isn’t ‘The Art Falco Show,’” he said. “I don’t need to be in the spotlight.” The man who joined PlayhouseSquare as finance director in 1985 when the organization was in the early stages of raising money to renovate the Palace Theatre is described by co-workers as a great collaborator, one who evaluates matters from many perspectives before making a move. “He is the ultimate consensus builder,” said Patty Gaul, vice president of finance and general counsel for PlayhouseSquare. “He can really bring about collaboration, listen to what people need.” Ms. Gaul said that collaborative nature is key to a lot of what PlayhouseSquare has been doing, from the creation of the Idea Center that now is home to Cleveland’s public broadcasting stations to a deal that’s bringing the Cleveland Play House into the Allen Theatre, with Cleveland State University as a partner. Those collaborations are “very unusual for a performing arts center,” Ms. Gaul said, but have evolved primarily due to Mr. Falco’s “vision, motivation and entrepreneurism.”

“(Mr. Falco) is the ultimate consensus builder. He can really bring about collaboration, listen to what people need.” – Patty Gaul, vice president of finance and general counsel, PlayhouseSquare Ms. Gaul said while her boss is fiscally cautious, he is also a risk-taker. “I think that’s a big reason for our success,” Mr. Falco said. Risks that have paid off include the development of the Wyndham Hotel — when it began, Mr. Falco was the vice president of finance and administration, but he was president by the time construction started five years later — and the creation of a property management company to handle the organization’s increasing real estate portfolio. PlayhouseSquare now gets a third of its revenue from real estate holdings, said Tom Adler, the immediate past chairman of the organization’s board. Mr. Falco also is involved in trying to create a design district along the Euclid Avenue corridor it calls home. The district would cluster members of the creative class who could design, build and market prototypes of new products, something Mr. Falco said “fits beautifully” with the arts, technology and creativity that Playhouse Square is nurturing along the corridor.

MARC GOLUB

Art Falco at PlayhouseSquare’s Palace Theatre in downtown Cleveland

A tree takes root in the arts When Mr. Falco began his career, he said, he had an appreciation for the arts but no formal involvement in them. He remembers being in some school play in fourth grade — he’s pretty sure, as a tree, that he had no lines — but had no particular interest in the theater. Mr. Falco started working in the accounting department of the former Diamond Shamrock Co., a chemical, oil and gas company, in its Fairport Harbor and Chardon offices and moved to the jewelry company Natural Impressions in Painesville before he was tapped to be the finance director at PlayhouseSquare. After three years in that role, he became vice president of finance and administration, then was selected to lead the organization when former CEO Larry Wilker left to head the Kennedy Center. “I was the one pushing for him to take over,” said Mr. Wilker, who is now founder and principal of TheatreDreams, a theater owner-operator and production company in Miami Beach, Fla. “I thought he was ready for it. He’s done a wonderful job.” Tom Einhouse, PlayhouseSquare’s vice president of real estate services, said Mr. Falco was often the one who kept Mr. Wilker in check, bringing pragmatism to some of Mr. Wilker’s ideas. It turned out, Mr. Einhouse said, that Mr. Falco had fantastic ideas as well — and the ability

to analyze them quickly to determine whether an idea made business sense. Mr. Einhouse said Mr. Falco also is exceedingly honest and forthright, and determined to make sure PlayhouseSquare’s partners are treated fairly. “That’s how we play,” Mr. Einhouse said. “It’s one of the greatest things about him.”

Who needs conflict? Mr. Wilker said Mr. Falco is “very mild-mannered and likes to give credit to others” and that he “doesn’t need to be at the forefront” to receive recognition. Added Mr. Adler, the former chairman: “He gets embarrassed when other people talk about him. We have to force him to accept awards and honors for the sake of the organization.” Mr. Falco acknowledged that the marketing staff would like him to be more visible, but said he is a “fairly private person” who simply doesn’t need the accolades to feel satisfied. Mr. Falco grew up in Painesville, the younger of two children with an older brother who was out of the house before Mr. Falco was born. He said as a kid, he didn’t know what he wanted to be when he grew up. He was pretty quiet, but played hide-and-seek and kick-the-can

with neighbors, and was involved with little league and other sports. He was a good student. He is a graduate of Bowling Green State University, where he studied accounting because of an interest in math. With his wife, Maryann — they met at Bowling Green, through mutual friends — and daughters Elizabeth and Bridget, Mr. Falco likes to travel, particularly to Italy, where the family has sometimes rented a villa in Tuscany. He is also an avid golfer, playing at least once a week in the summer. Mr. Adler described it as his passion. Mr. Falco said he wouldn’t describe himself as the life of the party — though others say he has a wry sense of humor — but noted that it’s important to him that PlayhouseSquare employees have fun at their jobs. He described the atmosphere as a family environment and said he’s proud of workers’ longevity with the organization. “We spend a lot of time together,” he said. “Better to spend time with people you like and enjoy and all of that than to have conflicts. And I know that some organizations, they like the tension because they feel that that brings out the best. Well, maybe that’s true, but I don’t think that’s true for us.” ■

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works of Art

( Art) The man behind the opulent palace theaters of PlayhouseSquare, Art Falco is Cleveland’s unpretentious and unsung hero. Over the years, he has worked tirelessly backstage to revive the five historic showplaces that are today our community’s proudest treasure. By lighting the marquees along Euclid Avenue, Art made Cleveland a world-class destination for quality entertainment. Along the way, he ushered in a new era of downtown revitalization and economic development.

Through his vision and leadership, Art has preserved and created a Cleveland legacy for all to enjoy. Westfield Insurance and Oswald Companies are pleased to support the ‘works of Art.’ Please join us in an ovation for Art Falco, his staff and the friends of Playhouse Square and ideastream. They truly deserve a hearty bravo!

Bob Joyce (Chair, CEO and Westfield Group Leader, Westfield Group) and Dave Jacobs (Chief Operating Officer, Oswald Companies) proudly serve on the PlayhouseSquare Board of Trustees.

www.westfieldinsurance.com

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30DIFFERENCEMAKERS

CRAIN’S CLEVELAND BUSINESS

MAY 24-JUNE 6, 2010

“I never thought about doing anything else. So once I started work ... I never looked up.”

PETERLEWIS

Chairman, Progressive Corp.

JASON MILLER

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By ARIELLE KASS akass@crain.com

eter B. Lewis, the former Progressive Corp. CEO known as much for his outspoken ways as for his deep pockets and leadership at one of the area’s biggest employers, has a simple outlook. “I led my life so that if anything I did made it on the front page of The New York Times, I wouldn’t be ashamed,” he said. And over the years, Mr. Lewis, 76, has often made it into that newspaper, and others. The reasons range from his disputes with the boards of Case Western Reserve University and the Guggenheim Museum, where he was chairman of the board before resigning, to substantial gifts to those organizations and others to an arrest for marijuana possession in New Zealand. And, of course, his work with Progressive. “In many ways, my life has sort of made me feel like a Lone Ranger,” said Mr. Lewis, who named his yacht after the masked man of radio and television fame and called him a childhood hero. “I think differently. And I say what I think. Most people don’t do either.” Mr. Lewis, who grew Progressive — a company cofounded by his father — from a small company with fewer than 100 employees to the nation’s fourth-largest auto insurer with around 25,000, retired as its CEO and president a decade ago. He remains chairman of the board. These days, Mr. Lewis spends a scant 30 days a year in Ohio, where he keeps a penthouse condominium in Beachwood that is decorated with modern art and overlooks an aquatics center at Menorah Park that bears his name. While he noted his deep roots in the city, he said it has not progressed — indeed, it has “retrogressed” — and that he’s frustrated by the path Cleveland has taken. “I’m done,” he said during a recent interview at his condo. “I don’t care. I do care! I do care. I’m just so frustrated, I tried so hard and shot off my mouth so much and wrote checks so often, I just got tired — I’m done. I mean, I get proposals from friends and they’re wonderful and they’re enthusiastic and nothing gets done.” Barbara Snyder, president of CWRU, said Mr. Lewis has never been anything but “extremely gracious” with her. Ms. Snyder gave him the President’s Award for Visionary Achievement in 2008, her first year on campus, to honor him for the contributions he made to the school. She said his gifts “showed how forward-thinking we can be” and that his goal in giving is “advancing the human experience.” “He is brilliant and he is funny,” Ms. Snyder said. “He has a great sense of humor. He cares deeply about Northeast

“It’s very hard to put into words the almost iconic figure he is to Progressive.”

Progressive is, effectively, Mr. Lewis’ life’s work, Mr. Renwick said. He said he crafted the company in his own image, saying his was “almost a rallying cry to the choir to be different.” “He would do things that wouldn’t otherwise seem possible,” Mr. Renwick said. Besides growing the company, Mr. Lewis put a premium on getting the best, most creative employees, including those who are “a little bit nuts.” He wants people who will “risk, learn and grow,” as he said he does, even as they age. Bob Durkee, vice president and secretary at Princeton, where Mr. Lewis is on the board, said what strikes him about Mr. Lewis is his ability to ask the right question at the right time to get to “the heart of the matter.” Mr. Durkee called him an engaged trustee, noting that Mr. Lewis often has said that the board ought to be focusing its energies on the matters of highest priority, whether those are a new science library, a genomics institute, a creative and performing arts center or an art museum — to all of which Mr. Lewis has made donations at Princeton. He also is the man who made the largest single gift in the history of CWRU and is the largest donor at the Guggenheim and Princeton.

– Glenn Renwick, CEO, Progressive Corp.

Run for the roses

Ohio and other places that have been important to him.”

Life’s work set early Mr. Lewis grew up on Dartmoor Road in Cleveland Heights, where he was the oldest of four children. He said he had an “idyllic” childhood. But in the summer between Mr. Lewis’ freshman and sophomore years at Cleveland Heights High School, his younger brother, who was a year behind him in school, was killed in a car accident. Two years later, his father died of cancer, at 48. Mr. Lewis said he had been groomed by his father to work at Progressive; he started working there when he was 12 years old. Other than a stint as an assistant camp counselor when he was 15, six weeks at an auto parts warehouse and a dozen Indians games as an usher at the old Cleveland Municipal Stadium, it’s the only job he’s had. But Mr. Lewis said he discouraged his own children — Jonathan, Ivy and Adam — from working with the company, almost as much as his father encouraged him to join it. A brother, 13 years younger, was an executive

at the company as well, and Mr. Lewis said it was “tougher” for him because he was related to the boss. Progressive succeeds because it is a meritocracy, he said, and nepotism has no place in a meritocracy. None of his children joined Progressive. Within two weeks in 1955, Mr. Lewis graduated from Princeton University, got married and started at the company. After nine years, he and his mother conducted a leveraged buyout of his father’s business partner and, at 31, he became Progressive’s CEO. “I never thought about doing anything else,” he said. “So once I started work … I never looked up.”

A love of nuts Glenn Renwick, Progressive’s current CEO and president, said Mr. Lewis laid all the significant foundations for the company, including its values. He described his mentor as a leader people wanted to work for, and said because Mr. Lewis has the courage to do things, he created a culture that “embraces trial.” “He brought out the best in people,” Mr. Renwick said. “It’s very hard to put into words the almost iconic figure he is to Progressive, even to this day.”

Progressive’s own well-known art collection — though Mr. Lewis is loathe to call it that; he said it’s only a collection “if you have a warehouse” — is something he believes helped draw the brightest minds to Progressive. “I got a kick of having it around me, so I figured … everyone else would, too,” he said. Mr. Lewis said his current pet cause is the legalization of marijuana in the United States. He was arrested for marijuana possession in New Zealand in 2000 — he said spending a night in jail “wasn’t bad,” as he didn’t have a roommate — and said that if the United States changes its laws, others will fall. Among his reasons for advocating legalization is medical use. Mr. Lewis had his left leg amputated below the knee 12 years ago because of poor arterial circulation and an infection that couldn’t be cured; he uses a prosthetic and said it’s “a continuous pain in the neck, but it’s very manageable.” While at first he was “pissed” when Progressive’s board of directors suggested he retire as CEO after he began to spend half the year on his boat — he since has sold it — Mr. Lewis said he soon realized that the suggestion was a good one, both for him and for the company. “I’ve smelled the roses and I’m not going to stop. I can’t,” he said. ■

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30DIFFERENCEMAKERS

CRAIN’S CLEVELAND BUSINESS

RICHARDJACOBS

MAY 24-JUNE 6, 2010

Former CEO, The Richard E. Jacobs Group

GREGORY DREZDZON/CLEVELAND INDIANS

Former Cleveland Indians owner Richard Jacobs celebrates in the locker room after the Indians won the 1995 American League Central Division championship. By STAN BULLARD sbullard@crain.com

Boldness on display

The reason is that the stagnant economy produces lower returns than developers typically require, yet labor n selling the 45-story BP Tower for oil giant British is costly and materials are as expensive as anywhere Petroleum in 1996, David Browning, managing else. Government subsidies are necessary to make a go director of CB Richard Ellis’ Cleveland office, drew a of big deals, but securing subsidies is tough because the tough task: Deliver bad news to Richard E. Jacobs, region’s ethnic, union and populist history often makes who already owned four skyscrapers in Cleveland and such aid politically risky. was after a fifth. “It takes someone bold, someone with fortitude, to push After getting Mr. Jacobs on the phone, Mr. Browning through that,” Mr. Wolstein said. “Until Jacobs and Forest told the wealthy mall developer and owner of the CleveCity tried it (in the 1980s), no one was willing to do so. land Indians that BP executives had passed on his richer, Capital follows opportunity, and Cleveland is a very diffilast-minute bid for BP Tower because cult place to develop.” they felt they had a verbal agreement to But with support from the adminis“To (Mr. Jacobs), there sell the building to giant Equity Office tration of former Mayor George was only one way to do Properties Trust of Chicago. Voinovich and, even more crucial, things. Either do it first “He was gracious” is the way Mr. former City Council president George Browning describes the response of the class or you don’t do it Forbes, the Jacobs brothers made man who, with brother David Jacobs, plays unlike any Clevelanders at all.” did much to transform downtown witnessed in decades. – Doug Miller, executive vice Cleveland in the 1980s and 1990s. First, they bought 100 Erieview president, Jacobs Real Estate The tale says much about Richard Tower for $33 million, refurbished it Services LLC Jacobs: His penchant for privacy made and added a glass-topped shopping tracking his bold moves and undercenter on its west side. Within a decade, the brothers standing his motives difficult. More telling, associates bought the Cleveland Indians and secure a long-overdue say, was his love of doing deals, especially entering the new ballpark for the team. fray personally at their final, crucial stages. Built with government and private funds simultaneThere were a staggering number of deals in Northeast ously with what today is known as Quicken Loans Arena, Ohio struck by the World War II Army veteran, who with the sports complex in one stroke transformed a bedragbrother David and partners had little to do with downgled, 43-acre chunk of downtown into an attractive town Cleveland for 30 years as they built one of the southern entrance to the city. Among other deals, Jacobs nation’s largest development companies with 40 regional added what is now Key Center, a complex with a 400malls. That situation changed in 1985 after Cleveland room Marriott Hotel and a 57-story office tower. economic department officials met with Jacobs execuFirst class, or not at all tives in Las Vegas at an International Conference of Shopping Centers convention and prevailed on the Through it all, Richard Jacobs preferred to let his company to undertake projects close to home. actions rather than his words speak for themselves, To appreciate the role the Jacobs brothers played in spokesman Bill Fullington told dozens of reporters Cleveland, it is necessary to put their efforts into context. dozens of times. “How many out-of-town developers are active in However, a group of close friends knew him privately for Cleveland with big projects?” asked Scott Wolstein, a a sense of keen humor and a flair for luxury that comes veteran of downtown Cleveland development and chairfrom a poor upbringing. He owned fine paintings, a man of Developers Diversified Realty Corp. He then Manhattan townhouse and a penthouse atop Lakewood’s answered his own question: “None.” plush Winton Place condominium. His generosity to his

staff bred fierce loyalty. If he found an associate or vendor and spouse dining at a favorite haunt — first Sammy’s, later Johnny’s — he sent over a bottle of fine wine. “To him, there was only one way to do things. Either do it first class or you don’t do it at all,” said Doug Miller, executive vice president of what is now Jacobs Real Estate Services LLC, a subsidiary of Jacobs Real Estate Group of Westlake. Many argue the biggest achievement — and likely best financially — for the Jacobs brothers was not Cleveland real estate but Cleveland baseball. Joseph Marinucci, president of the Downtown Cleveland Alliance marketing group, said the brothers’ ownership of the Indians and their long-term ballpark lease cemented the club in the city when “there was a very real possibility we were on the verge of losing the team.” Jack Torry, author of the book “Endless Summers” about the Indians, credits the Jacobs family’s management and pocketbook with much of the Tribe’s success in the 1990s, when the team dominated its division and went to the World Series twice. “Look at Indians history from the late ’50s to the ’80s. It was a series of well-meaning but underfinanced owners. There were not enough scouts, not enough farm teams. They had no chance to win,” Mr. Torry said. “Jacobs was smart. He hired good managers like Hank Peters and John Hart. He convinced the political leaders of that town they had to have a new ballpark.”

Graceful exit However, all that came to an end years before Mr. Jacobs died at 83 on June 5, 2009. The aging master developer masterfully orchestrated his departure. He dumped the dogs: Tower at Erieview and Galleria went back to the lender; Cuyahoga County bought his empty Ameritrust headquarters. He sold the team. And in a tortuous process, he and his advisers converted the real estate empire’s jewels — malls, hotels, the 800 Superior Ave. and Key Center office towers — into cash and stock to ease estate planning. Some big projects remain to fulfill the Jacobs legacy, but it nonetheless is fitting that Mr. Jacobs’ memory continues to be called to mind by Key Tower, which dominates the Cleveland skyline as the tallest structure between New York and Chicago. ■

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30DIFFERENCEMAKERS

MAY 24-JUNE 6, 2010

SANDY CUTLER Chairman and CEO, Eaton Corp. By DAN SHINGLER dshingler@crain.com

o one will ever accuse Sandy Cutler of fearing change or shrinking from a challenge. As chairman and CEO of Eaton Corp., Mr. Cutler has transformed Cleveland’s largest industrial company from an old-line manufacturer that was heavily dependent upon a shrinking automotive market into a broadly diversified manufacturer that is a big player in the fields of hybrid vehicles, advanced electrical systems and other growing sectors. As chairman of the Greater Cleveland Partnership, Mr. Cutler combined the Greater Cleveland Growth Association, Cleveland Tomorrow and the Council of Smaller Enterprises into the leaner and more efficient Partnership. He also pushed for what ultimately was a successful effort in getting voters to pass last fall a ballot measure to reorganize Cuyahoga County government. One wonders what Mr. Cutler might do if there was nothing left he thought he could improve. Fortunately, he still has grand plans for at least Eaton, where he remains in charge and will oversee the company’s coming move to a new corporate campus in Beachwood from its offices in downtown Cleveland. He’s already overseen a successful transformation of Eaton, say analysts and investors who follow the company. “Mad Money” host Jim Cramer calls Mr. “(Mr. Cutler Cutler “a fabulous has) really CEO,” and gave him made (Eaton) credit for his leadership of Eaton in the the ideal financial downturn company to and for positioning own at this Eaton to weather point in the the slump far better than most industrial cycle.” companies. – Jim Cramer, “You’ve really host, “Mad reformed the comMoney” pany,” Mr. Cramer said in a 2009 interview with Mr. Cutler. “You’ve really made (Eaton) the ideal company to own at this point in the cycle.” Mr. Cutler became CEO in 2000 and quickly began reshaping Eaton. He sold off about 40% of the company’s operations and replaced them with acquisitions and initiatives in the electrical, hydraulic systems and aerospace industries — businesses that today make up about 70% of Eaton’s revenues. When he took the helm, Eaton derived more than 40% of its revenue from the automotive sector. In 2009, only 12% of Eaton’s sales of $11.8 billion came from automotive. Eaton’s shareholders have already benefited from Mr. Cutler’s leadership. The company was trading at about $31 per share when he took over as CEO. Today, its shares trade for about $79 — below their peak of more than $100 in 2007, but still more than double what they were in 2000 even after being hit by the economic downturn. Northeast Ohio might benefit as well — not only from Eaton’s continued presence here as a growing industrial power, but from county government reform and other civic endeavors to which Mr. Cutler has lent his hand.

It’s in the genes What produced this sort of leadership? Influential parents who made sure their son grew up not only with a strong work ethic, but also an equally strong sense of civic duty.

PHOTO PROVIDED

Growing up in Milwaukee, Mr. Cutler watched his father build and run a successful law practice, while his mother spent much of her time volunteering in the community, including heading up the city’s United Way campaign. “One thing I knew for sure after seeing all the hours my father worked, I didn’t want to be an attorney,” Mr. Cutler said. Almost every night, he watched his dad come home from work, only to do more work at home. Those long hours and a job that never ended appealed to the young Mr. Cutler about as much as brussels sprouts and lima beans — his nemeses in the vegetable kingdom. But, like a lot of boys, Mr. Cutler had no way of knowing he’d follow more closely in his father’s footsteps than he planned. In his adult life, he follows not only his mother’s example of working tirelessly for community issues, but also takes work home with him just the way his father had done. “As fate would have it, I ended up doing something else and working the same hours,” he said. But, he added, “I am very fortunate my parents encouraged me to pursue my own interests and to do my best. I think the work ethic and community values

they instilled have helped shape my life.” Yale and then Dartmouth took over when Mr. Cutler graduated high school, and he left the latter with an MBA and a lot of ambition. In 1975, Mr. Cutler took his first fulltime job as a financial analyst with Cutler-Hammer Inc., which was then run by his uncle. He was made a group controller two years later, but the business was acquired by Eaton Corp. in 1978. That didn’t seem to slow down Mr. Cutler’s ascension, though, and he was made a division controller in 1979 and then a plant manager in 1980. By 1991, Mr. Cutler was Eaton’s chief operating officer and well on his way to the top.

Team spirit Looking back today, Mr. Cutler says his stint as a plant manager, early in his career in Atlanta, taught him much about how to manage people and enterprises. “This was a challenging assignment, because the facility was performing poorly and was about to lose its biggest customer,” he said. “A focus on common goals and the development of strong teamwork across our facility really paid dividends. The result of this teamwork was that the plant not

only kept the customer, we doubled our business with them. That was a great victory for the whole team and a learning experience for me.” He relied on that sense of teamwork — perhaps honed as a football, track and wrestling star in school — when Eaton faced the economic downturn in 2008 and 2009. The company laid off employees, as did nearly every other industrial company in the nation — but pay cuts that were shared by Mr. Cutler and every other Eaton employee allowed those layoffs to be kept to a minimum, he said. Now, Mr. Cutler hopes his community can show that same level of teamwork, as well as the willingness to take on major changes the way he’s done. Reshaping county government and rebuilding Northeast Ohio won’t be easy tasks, but Mr. Cutler is optimistic it can be done with the right attitudes in place. “Our region needs a realistic plan for winning, and needs to have the guts and fortitude to stick to the plan — we need to get back on offense and stop playing defense.” Perhaps it’s too bad that Mr. Cutler is already the star quarterback for Eaton. ■

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•

Wilmington

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MICHAELSYMON Chef/owner, Lola, Lolita, Bar Symon, B Spot, Roast (Detroit)

By KATHY AMES CARR kcarr@crain.com

he recipe for Northeast Ohio cuisine a la Michael Symon is gritty, humble and involves hard work, ingredients that represent the Rust Belt area from which the Iron Chef hails. â&#x20AC;&#x153;Then stir in a pierogi, bratwurst and pork shoulder,â&#x20AC;? he added with a laugh that could rival a group of patrons at a comedy club. Mr. Symon is a celebrity chef, and not just because the Food Network in 2007 named him an Iron Chef after he defeated John Besh from New Orleans in a onehour cooking showdown. He is beloved among Northeast Ohioans because his creative, yet methodical approach to Midwesternstyle cuisine was developed by sifting through the complexity of the flavors that define us. â&#x20AC;&#x153;My background is Greek, Sicilian and Eastern European, so Iâ&#x20AC;&#x2122;m a melting pot just like Cleveland,â&#x20AC;? he said. Mr. Symon, 40, is a critically acclaimed chef/owner of Lola on East Fourth Street, Lolita in Tremont, two other restaurants here and one in Detroit. He has played a significant role since the

early 1990s in the revitalization of the regionâ&#x20AC;&#x2122;s culinary trade, which has a national reputation for its concentration of unique, sustainable eateries. â&#x20AC;&#x153;If you take out New York, Chicago, San Francisco and L.A. â&#x20AC;&#x201D; four big restaurant cities â&#x20AC;&#x201D; Cleveland is next. No other city in the nation has the culinary scene that we do,â&#x20AC;? Mr. Symon said. â&#x20AC;&#x153;(Food Network Iron Chef) Mario Batali was just here (in late January) and said, â&#x20AC;&#x2DC;I love this place.â&#x20AC;&#x2122; Weâ&#x20AC;&#x2122;re very highly regarded.â&#x20AC;? The Shaker Heights residentâ&#x20AC;&#x2122;s five restaurants employ 300 part-time and full-time individuals and generate a combined $17 million in annual revenue. Mr. Symonâ&#x20AC;&#x2122;s culinary establishments have helped transform not only the neighborhoods of Tremont and East Fourth Street, but also Northeast Ohioâ&#x20AC;&#x2122;s affinity for meat and potatoes into a more sophisticated, diverse palate.

â&#x20AC;&#x2DC;I knew this kid was specialâ&#x20AC;&#x2122; Mr. Symon admits to being a bit of a troublemaker as a kid, riding skateboards and BMXs. But he was good in the kitchen. The son of Angel and Dennis, who are Greek/Italian and Ruthenian, respectively, food was

a central part of Mr. Symonâ&#x20AC;&#x2122;s identity as a child growing up in North Olmsted. He cooked with both his parents and his grandparents. His passion for food â&#x20AC;&#x201D; in particular his momâ&#x20AC;&#x2122;s homemade lasagna and his dadâ&#x20AC;&#x2122;s potato pancakes â&#x20AC;&#x201D; was sacrificed for awhile because he had to stay within a certain weight when he was a wrestler at St. Edward High School in Lakewood. Ultimately, he wanted to teach or coach wrestling. A broken arm severed his sports career, though, and he went to work as a rib cook at a local Geppettoâ&#x20AC;&#x2122;s, where he rediscovered his appetite for food and cooking. This part-time job was the start of a career into a field that wasnâ&#x20AC;&#x2122;t considered to be â&#x20AC;&#x153;coolâ&#x20AC;? to get into like it is now. After a brief stint at Cleveland State University, where he studied architecture, he attended the Culinary Institute of America in New York, where in 1990 he was voted â&#x20AC;&#x153;Most Likely to Succeedâ&#x20AC;? by his peers. Mr. Symon returned to Cleveland, cooking in up-and-coming restaurants such as Players in Lakewood, where he met his wife, Liz, who was the eateryâ&#x20AC;&#x2122;s manager. â&#x20AC;&#x153;And sheâ&#x20AC;&#x2122;s still my boss,â&#x20AC;? he quipped.

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Iron Chef Michael Symon at one of his well-known restaurants, Lolita in Tremont

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Mr. Symon then was a chef at Piccolo Mondo and Giovanni’s, but it was at the Caxton Café where he was able to exercise “100% creative freedom” in creating the menu. “I had been in the restaurant business longer than Mike, and when I worked with him at Piccolo, I knew this kid was special,” said Doug Petkovic, the Symons’ current business partner. “He had a great attitude, he was creative and he wasn’t afraid to break barriers that had already been broken on the East and West coasts.” In 1997, with $140,000 borrowed from friends and family, Mr. and Ms. Symon, along with Mr. Petkovic, opened Lola in Tremont, a neighborhood that, at the time, was on the cusp of gentrification. The historic neighborhood since has evolved into an eclectic area filled with eateries, galleries, shops and modern, yet small-town urban living. “It was a rough neighborhood at the time, but Tremont felt right,” Mr. Symon said.

The more, the merrier

MARC GOLUB

At Lola, Mr. Symon reinvented Cleveland comfort foods, such as the pierogi, which he stuffed with beef cheek. When Clevelanders dug in, they dug it. “The beef cheek pierogi is still one of our best dishes,” he said. “Lola exploded. Never in my wildest dreams, even based on (sales) projections, did we think we’d be so busy. “Liz and I thought if we could do $15,000 to $18,000 a week, we could make a living. We did $40,000 a week.”

CRAIN’S CLEVELAND BUSINESS The following year, in 1998, Mr. Symon was named one of the Top 10 Best New Chefs by Food & Wine magazine. Mr. Symon in 2006 converted Lola into Lolita and moved Lola into the burgeoning, food-centric East Fourth Street district, where developers Ari, Jori and Rick Maron were reclaiming downtrodden properties. “The Marons approached us in 2000 to 2001, and they were persistent,” Mr. Symon said. “They had a terrific vision, and they sold us on that vision.” It’s in the East Fourth Street area that chef Jonathon Sawyer, who helped open Lolita, introduced in 2009 the Greenhouse Tavern. “We still bounce ideas off each other all the time,” Mr. Sawyer said. “He inspires cooks from all over Ohio to become chefs.” To Mr. Symon, it’s gratifying when more locally owned restaurants crop up. “I beg chefs to open restaurants in the neighborhoods I’m in. It creates an environment,” he said. “Instead of just being a destination restaurant, you’re a destination neighborhood.” While Mr. Symon’s influence has helped change the local culinary landscape, colleagues say his notoriety hasn’t changed him. “There are a lot of people who deserve success, but none deserve it as much as Mike and Liz,” Mr. Petkovic said, noting that Mr. Symon’s accolades have changed only his schedule. “He is as humble now as he was 20 years ago.” ■

LOOKINGATLISTS A lot has changed over the past 30 years; here’s a snapshot of our business lists from that span:

1987 ■ Largest public company: Standard Oil Co., $11.7 billion market value ■ Largest non-government employer: Ford Motor Co., 17,000 people ■ Largest private company: First National Supermarkets Inc., $1.36 billion in sales ■ Largest law firm: Jones, Day, Reavis and Pogue, 217 local attorneys ■ Population of the city of Cleveland: 546,543 ■ Highest-paid CEO: E. Mandell deWindt, Eaton Corp., $1.14 million in cash compensation

1988 ■ Largest advertising agency: Nationwide Advertising Service Inc., $110 million in capitalized billings ■ Largest hospital: Cleveland Clinic, $39.1 million in net income and 1,000 beds (not including bassinets; yes, an actual footnote) ■ Largest public relations firms: Dix & Eaton and Edward Howard tied for first with 32 employees each ■ Largest accounting firm: Ernst & Whinney, 505 full-time professionals ■ Population of the city of Cleveland: 518,746 ■ Highest-paid CEO: John J. Nevin, Firestone Tire and Rubber Co., $6.35 million in cash compensation continued on PAGE A-23

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PETERBURG Former CEO, FirstEnergy Corp.

By JOHN BOOTH clbfreelancer@crain.com

or Peter Burg, what some might see as a difficult balance came naturally: While the former FirstEnergy Corp. leader was a tireless supporter of his hometown of Akron, he simultaneously preached and practiced the values of reaching beyond its borders to enrich Northeast Ohio as a whole. A graduate of St. Vincent High School and the University of Akron, Mr. Burg led FirstEnergy from its roots in Ohio Edison Co. through a decade of massive growth and expansion, and he was among the most vocal supporters of the regionalism movement that led to the 16-county business advocacy group Team NEO. He died in 2004 at age 57 of complications from leukemia treatment. Akron Children’s Hospital president and CEO Bill Considine was a lifelong friend of Mr. Burg — they met in grade school — and he recalls a man who valued his past and wanted to brighten the future. “He always remembered his roots; he knew where he came from, he knew the importance of the people that mentored and nurtured him and he wanted to be like that,” Mr. Considine said. “The vision Pete had of (the region’s) economic vitality and things of that nature, he was able to get other people to believe in,” Mr. Considine said.

He also related that quality to Mr. Burg’s football and basketball experiences in high school and college. “One of the things I saw on the athletic fields and the courts was his leadership ability and his calmness,” Mr. Considine recalled. “The thing he was best at was bringing the best out in everybody on his team. He brought that over into his management style.”

Powerful leader Mr. Burg joined Ohio Edison in 1968 as a financial analyst and worked his way up to the utility’s presidency in 1996. He was at the helm during the 1997 merger with Centerior Energy, which created FirstEnergy and doubled the company’s size. As president and CEO of the new company, he was instrumental in a power-plant swap with Pennsylvania’s Duquesne Light and then led the 2001 acquisition of New Jersey-based General Public Utilities. “Those are three pretty major events in a relatively short period of time,” noted FirstEnergy president and CEO Anthony Alexander, who worked with Mr. Burg for many years as a counsel in the company’s legal group. “To be a major player in each and every one of them ... he had the skills honed over many years of strong leadership. He was prepared to do it, and he did an outstanding job putting this company in the position that it’s in.” As a result, FirstEnergy reaches from

Ohio’s northwest corner to the east coast of New Jersey, and it is the fifth-largest investor-owned electric system in the country. Even when facing harsh criticisms, such as those that followed the 2002 shutdown of the Davis-Besse nuclear power plant because of a badly corroded containment cap and the big power blackout in 2003, Mr.

Burg handled those rough patches admirably, Mr. Alexander said. “It kind of goes back to Pete’s character,” he said. “In adversity, a man with integrity and ethics, and one who consistently applies those values, finds a way to get through it.” And in contentious situations, Peter Burg was served by his levelheadedness.

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“(Mr. Burg) understood that for his business, there were no city demarcations or county demarcations or even state demarcations. I think he understood that a little more directly and intuitively than others do.” – Luis Proenza, president, University of Akron hand reflected Mr. Berg’s manner of tackling challenges no matter what the arena. “He was a good analyst, so he was by nature thoughtful and fair,” Ms. Pera said. “I think that’s based on his athletic career; he just still applied that sense of rules to most things he got involved in.”

Regional cheerleader

Peter Burg looks out the window of his office in Akron, when he still was CEO of FirstEnergy Corp. MIKE CARDEW/ AKRON BEACON JOURNAL

“I never saw Pete lose his cool,” said Dave Osterland, who worked as Mr. Burg’s speechwriter for many years and now serves as the University of Akron’s associate vice president of community relations. “He was a good leader, and he could always kind of bring things back to earth.” Janet Pera, executive assistant to the chairman at FirstEnergy, says that steady

Mr. Burg also proved steadfast in his support for regionalism, which remained a controversial word in parts of Northeast Ohio even in the late 1990s. University of Akron president Luis Proenza believes Mr. Burg’s experience in expanding FirstEnergy helped champion the cause. “He understood that for his business, there were no city demarcations or county demarcations or even state demarcations,” Dr. Proenza said. “I think he understood that a little bit more directly and intuitively than others do.” Through such efforts as working with and loaning office space to the Team NEOpreceding Regional Business Council, Mr. Burg stepped more fully into the role of regionalism’s chief supporter. Dr. Proenza cites Mr. Burg’s involvement in the early exploration of moving the university’s football stadium from the Rubber Bowl to a spot downtown as an example of focusing on a single project while considering the big picture. “The marking characteristic is that he understood that something new was needed, and he was willing to pull together the principal players and approach things with

openness and objectivity, on a quest for not just what was practically doable, but how this might potentially impact the community and the region,” Dr. Proenza said. Don Misheff, managing partner of Ernst & Young in Cleveland, said that willingness to reach out even in the face of opposition and uncertainty was a key reason for Mr. Burg’s success. “Pete really drove the communities’ need to work together ... and not let governmental geographic boundaries get in our way of cooperation and collaboration,” Mr. Misheff said. “He appreciated good, outgoing, energetic people that were willing to jump in and take some risk. There was nothing wrong with failure to Pete, as long as you were trying your hardest and doing the right type of things.” Eileen Burg, Mr. Burg’s wife of 36 years, lives in Florida now but says “home will always be Akron,” in no small part because she remains involved with several organizations in which her late husband was active, such as the Summit County chapter of the American Red Cross, Akron Children’s Hospital, the Akron Community Foundation and the University of Akron. “After his death, I was approached to be on some of the boards that he was on, and it’s just helped to keep me close to him,” she said. “I truly feel like he has left me a fourth child called ‘the community.’” Mr. Burg’s life of diverse and widespread impact seems appropriately summed up by Mr. Considine of Akron Children’s Hospital: “He didn’t want to waste his time. He made things happen.” ■

CRAIN’S CLEVELAND BUSINESS

LOOKINGATLISTS 1989 ■ Largest public company: Goodyear Tire & Rubber Co., $10.1 billion in revenue ■ Largest privately held company: Revco D.S. Inc., $2.4 billion in revenue ■ Largest hotel: Hollenden House, 500 rooms; the corporate rate for a room was $70 ■ Largest bank: Ameritrust Co., with $8 billion in assets ■ Largest university: Kent State, with enrollment of 21,878; tuition was (ready?) $2,400 ■ Highest-paid CEO: Robert E. Merger, Goodyear Tire & Rubber Co., $1.25 million in cash compensation ■ Largest retailer: May Department Stores Co. of St. Louis, with 6,059 local employees

1990 ■ Largest corporate donor: BP America Inc., with $10.7 million in grants ■ Largest savings institution: Transohio Savings Bank, with $6.3 billion in assets ■ Daily and Sunday circulation of The Plain Dealer: 447,822 and 570,737 ■ Largest auto dealer: Ed Mullinax Ford, with 13,602 new vehicles sold ■ Highest-paid CEO: Peter B. Lewis, Progressive Corp., $1.37 million in cash compensation ■ Largest retailer: Riser Foods Inc., with 6,500 full-time equivalent employees ■ Largest advertising agency: Nationwide Advertising Service Inc., with $185.4 million in capitalized billings ■ Largest minority-owned business: C&B Management Co. of Cleveland, a fast food franchise operator, with $13.3 million in sales continued on PAGE A-25

Some leaders desire power. GREAT ones PASS IT ON.

We honor the memory and accomplishments of Pete Burg, our former Chairman and CEO. Pete was a powerful leader and man of integrity who influenced others through his humanity, impeccable ethics and hard work. Today, our company continues to grow and thrive thanks to Pete Burg’s legacy of leadership.

Pete Burg 1946-2004

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A.MALACHIMIXONIII CEO, Invacare Corp.

By SHANNON MORTLAND smortland@crain.com

urrounded by military artifacts and his Vietnam War medals in his Elyria office, A. Malachi Mixon III makes no bones about where he got his ability to lead. â&#x20AC;&#x153;I learned more about leadership in the Marine Corps than I did at Harvard,â&#x20AC;? he said. â&#x20AC;&#x153;I learned a lot about business at Harvard.â&#x20AC;? Mr. Mixon, who is CEO of medical equipment maker Invacare Corp. and a serial entrepreneur to boot, earned his undergraduate and MBA degrees at Harvard University, which he agrees set him on the path to success, though attending the school wasnâ&#x20AC;&#x2122;t even his idea. As a kid who hunted in his backyard in rural Oklahoma, Mr. Mixon wanted to attend the Naval Academy, but his father had applied for him to go to Harvard. As a member of Navy ROTC at Harvard, he was accepted to the Naval Academy, but chose to stay at Harvard instead. After all, Mr. Mixon said with a grin, there were girls at nearby Wellesley College, which is where he eventually met his wife, Barbara. Upon obtaining his undergraduate degree, he spent four years in the Marines, where he further developed his shooting skills to

become a rifle marksman. He then returned to Harvard to earn his MBA before moving to his wifeâ&#x20AC;&#x2122;s hometown of Cleveland. What has happened in the 40 years since can only be called a whirlwind life. Mr. Mixon worked for other companies for 11 years while yearning to be his own boss. He survived testicular cancer at age 37 and, two years later, bought Invacare for $7.8 million. Only about $10,000 of that total was from his own pocket; somehow he convinced others to contribute the rest, he said. He transformed Invacare from a small, struggling wheelchair maker with $19.5 million in sales into a leader in the home health care industry with $1.5 billion in annual sales, 5,700 employees, 12 manufacturing plants in the United States and 18 abroad. (The company went public in 1984.) But even as that empire was growing, Mr. Mixon had his eye on other opportunities.

â&#x20AC;&#x2DC;Itâ&#x20AC;&#x2122;s not really workâ&#x20AC;&#x2122; Soon after buying Invacare, he was asked to help John Balch buy the former Royal Appliance Manufacturing Co. in Glenwillow and develop the Dirt Devil vacuum cleaner. Mr. Mixon and Mr. Balch had worked together at the former Technicare Corp. in Solon, which made CT and MRI scanners. Mr.

Mixon didnâ&#x20AC;&#x2122;t have any money to invest himself, but he helped put the financing deal together for Royal Appliance. He took stock in Royal Appliance instead of cash for his services and ultimately made $30 million. There were plenty more smart business decisions where that came from. In his early years as an entrepreneur, Mr. Mixon helped the business organization Cleveland Tomorrow start venture capital firm Primus Venture Capital Inc. Its most famous risk is Steris Corp., the Mentor-based maker of medical sterilization equipment that is now a global company with more than $1 billion in annual sales. He also launched MCM Capital to finance small companies and helped create BioEnterprise Corp. MCM now manages about $100 million in investments, and BioEnterprise has helped spur technology development in Northeast Ohio and bring hundreds of millions of dollars in venture capital to the region. Over the years, Mr. Mixon figures he has bought and sold at least 20 companies. Heâ&#x20AC;&#x2122;s now considering buying a bank in Florida, which he would not identify. â&#x20AC;&#x153;While some people have hobbies or read books or collect stamps, I buy companies,â&#x20AC;? he said. See NEXT PAGE â&#x17E;¤

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Though Mr. Mixon is involved with many of the area’s movers and shakers, he doesn’t shun newcomers. In a tribute to his Native American heritage, he launched venture capital firm Minorities with Vision to help minorities start businesses. Demonstrating his own confidence in the idea by contributing $1 million to start the fund, his friends chipped in another $25 million to $30 million. While government financing is available to help minorities start businesses, Mr. Mixon said it often comes with strings attached, so he felt a private fund was needed, too. “When you look at the minority movement, the initial efforts have been on jobs,” Mr. Mixon said. “I think the real solution to our innercity problems is to have black wealth and (people who) want to go back into their community.”

A renaissance man

JESSE KRAMER

Mr. Mixon is well aware that he has made a significant contribution to Northeast Ohio through Invacare’s success, but said he treasures most his opportunities for civic involvement. Sitting on company boards throughout his life, Mr. Mixon currently is in his 13th year as board chairman of the Cleveland Clinic. It’s Mr. Mixon’s likable, calm demeanor and business savvy that enable him to work so well with others — and to convince them to invest in various ventures, said Dr. Floyd Loop, retired Clinic CEO. “Mal is a tough businessman with a kind heart who serves his community with the same vigor as he leads Invacare,” Dr. Loop said.

CRAIN’S CLEVELAND BUSINESS But Mr. Mixon isn’t all business. He has a deep love of the arts, which probably wouldn’t be predicted by his no-nonsense talk. As a child, he took trumpet, piano, voice and ballet lessons, played football and baseball, and was a member of the high school orchestra. At Harvard, Mr. Mixon was in the glee club. Today, he channels his love of the arts and classical music into serving as board chairman at the Cleveland Institute of Music. The main performance space at the conservatory is called Mixon Hall. At 70, Mr. Mixon said he has plenty of energy and “would rather slide into home plate than crawl there.” However, he was forced to slow down a bit after suffering a mild stroke in late April. Though he expects a full recovery, Mr. Mixon temporarily handed over the reins of Invacare to Gerald Blouch, the company’s president and chief operating officer. The stroke likely will only shore up his vow not to do anything he doesn’t find fun. He used to feel obligated to attend black-tie parties but he didn’t enjoy them, so he doesn’t go anymore. He instead spends his time playing with his six grandchildren, shooting quail on his Texas ranch and going to dinner with friends. Mr. Mixon also likes to share his experiences with young people. He often tells them to make mistakes on someone else’s time and never consider anything a failure. “I always encourage people to go out there and try things,” he said. “You can’t get run over if you don’t go in the street.” ■

LOOKINGATLISTS 1991 ■ Largest minority-owned business: C&B Management Co., a fast food franchise and gas station operator, with revenue of $17.3 million and 600 full-time employees ■ Largest non-residential real estate broker: Ostendorf-Morris Co., with 54 licensed sales reps ■ Largest building contractor: Austin Co., with $2.2 billion in contracts booked in 1990 ■ Largest business insurance agency: Johnson & Higgins of Ohio Inc., with 108 full-time employees ■ Largest stock brokerage firm: IDS Financial Services Inc., with 110 registered representatives ■ Largest privately held company: Revco D.S. Inc., with 1990 revenue of $2.5 billion ■ Number of federal government workers in Northeast Ohio: 19,455 (it was 13,849 as of June 30, 2009) ■ Largest health maintenance organization: Kaiser Foundation Health Plan of Ohio, with 209,400 enrollees ■ Largest property manager: Zaremba of Lakewood, with 11.5 million square feet under management ■ Largest woman-owned business: E.G. Baldwin & Associates Inc. of Cleveland, a distributor of imaging supplies and equipment, with 1990 sales of $89.6 million continued on PAGE A-27

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FLOYDLOOP Former CEO, Cleveland Clinic

By SHANNON MORTLAND smortland@crain.com

r. Floyd Loop’s life is pretty calm these days. When he retired as CEO of the Cleveland Clinic in 2004, he separated himself from the health system. He sits on several corporate boards, but he prefers to spend his days tending to his greenhouse full of orchids and his orchard in Gates Mills, where he grows apples and “all kinds of berries.” Though he has an office at the Clinic, “I’m not careening from one meeting to another all day long,” said Dr. Loop, who is married to Dr. Bernadine Healy, a cardiologist and the first woman to head the National Institutes of Health. But from 1989 to 2004, Dr. Loop was the quiet backbone of the Clinic, working long hours to shore up a struggling hospital in a dying neighborhood. Twenty-one years ago, the Clinic consisted of only the main campus near University Circle and had net revenue of $582 million. “My thought was, if we don’t change, we’ll be like Halle’s Department Store,” Dr. Loop said, referring to the now-defunct, high-end retailer. “Things will start to decay around us and everyone will move to the

suburbs.” Initially, the Lafayette, Ind., native had no intention of leaving his post as head of cardiothoracic surgery at the Clinic to pursue its top job, until he heard some of the ideas from other CEO hopefuls. “I only threw my hat in the ring after I listened to 30 proposals from people who wanted to be the head of the Clinic and I didn’t like any of them,” Dr. Loop said. “So I sat in my library over the weekend and wrote a plan for the Cleveland Clinic.” The result of that plan is the behemoth health system that now spans the globe and is one of Northeast Ohio’s major health care providers and its largest employer. During his tenure, Dr. Loop grew the Clinic to 12 hospitals in Ohio and Florida, 14 family health centers, 2.6 million annual patient visits and $3.5 billion in annual net revenue. Research grants also skyrocketed, to $110 million in 2004 from $22 million in 1989. Dr. Loop also is credited with launching the new heart hospital that now stands on Euclid Avenue as the Clinic’s main entrance and serves as its flagship institute. And hospitals that became affiliated with the Clinic were refurbished even as the medical giant increased the size

See NEXT PAGE ➤

Dr. Floyd Loop at the Cleveland Clinic’s Lyndhurst campus

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and scope of its research, eye and cancer institutes. “He had a solid vision for growth for the Clinic’s health system,” said Dr. Delos “Toby” Cosgrove, who succeeded Dr. Loop at the Clinic’s CEO. “He pushed the organization in the right direction that was fundamental to achieving our current status.”

The value of teamwork

JANINE BENTIVEGNA

But if Dr. Loop had to choose a favorite project, it would be the Cleveland Clinic Lerner College of Medicine of Case Western Reserve University. He launched the medical school as a partnership with CWRU, which welcomed its first class in 2004. The medical school is designed to train physician scientists. Dr. Loop attributes the success of the medical college to his employees. “I couldn’t have done it without a great staff,” he said. “Of all the things I learned in 15 years, it is great physicians and great scientists that make great medical centers.” Dr. Loop said he relied on his administrative staff to bounce ideas off one another in luncheons that usually occurred four days a week for two hours. Observers often referred to the loud and unstructured meetings as “Viking dinners,” and some leaders thought the chaotic gatherings were a waste of time. But, Dr. Loop said, “We knew what was going on.” “No one was as smart as everyone,” he noted. “Great ideas came from those discussions.” Dr. Cosgrove was one of those top physicians at the hospital who took

“(Dr. Loop) had a solid vision for growth for the Clinic’s health system.” – Dr. Delos “Toby” Cosgrove, CEO, Cleveland Clinic cues from Dr. Loop. “He taught me the critical importance of measuring quality metrics in health care,” Dr. Cosgrove said. “We take that very seriously here today and are very transparent about our clinical outcomes to the public.”

Mistakes? Bring ’em on But innovative ideas weren’t limited to the executives. As the kind of leader who likes to listen, Dr. Loop said he encouraged Clinic employees at all levels to offer solutions and ways to improve operations. “We’re sitting up here on ‘Mahogany Row’ shuffling papers, but it’s the people doing work in the engine room that know how to fix things when they’re broken,” he said. And when the ideas came in, Dr. Loop didn’t look for reasons why they wouldn’t work. He instead took the attitude of, “Why not?” “We were never afraid to make mistakes. Mistakes are a part of life,” he said. One of Dr. Loop’s most influential ideas was to integrate technology throughout the Clinic. He led the charge to computerize all medical records long before it became fashionable, and he helped create eClevelandClinic, where patients can view their medical charts, get second opinions online and pay bills. The Clinic’s eRadiology services enable Clinic doctors to view X-rays

CRAIN’S CLEVELAND BUSINESS from anywhere in the world and provide feedback almost immediately. But nobody likes change, and Clinic employees initially balked at the idea of electronic medical records, Dr. Loop said. “The doctors resisted it for six months and, after six months, they couldn’t live without it,” he said.

Staying in the loop Dr. Loop is still connected to the health care industry by sitting on various corporate boards such as Dallas-based Tenet Healthcare Corp., biopharmaceutical firm Athersys Inc. in Cleveland, and Intuitive Surgical Inc., a robotic surgery manufacturer in Sunnyvale, Calif. As a result, he can’t resist staying informed. He worries about the unintended consequences of the recently passed health care bill and wonders how it will change access to care or if it will increase union activity in the medical fields. “Most of all, I’m afraid of the fiscal responsibilities we’ll incur” as a nation, he said. But for health care administrators running hospitals now, Dr. Loop has plenty of advice, as noted in his book “Leadership and Medicine,” published last year. “Power should be invisible,” he said. “Lead from the back and make people think they are out in front, and they are.” But above all, don’t be afraid to take chances, he said. “This business we’re in is not still life. You have to take risks to advance,” he said. “If you’re weak or indecisive, this will kill you.” ■

LOOKINGATLISTS 1992 ■ Employees of the Cleveland Clinic: 8,790, good for fifth on the largest employers list; it had about 32,000 as of June 30, 2009, making it the largest Northeast Ohio employer today ■ Highest-paid CEO: William P. Madar of Nordson Corp., with cash compensation of $1.454 million ■ Largest money manager: Society Corp., with $28 billion under management ■ Largest division of a non-local company: Ford Motor Co., with 14,000 employees. LTV Steel was second on the list, with 7,500 employees

1993 ■ Largest bank: Society National Bank, with $17.8 billion in assets as of Dec. 31, 1992, more than double the previous year as a result of its July 1992 merger with Ameritrust Corp. ■ Highest-paid CEO: Peter B. Lewis of Progressive Corp., with $1.97 million in cash compensation. It was the first time Mr. Lewis topped this list ■ Position of insurance company Westfield Group on the Largest Private Companies list: 4, which is exactly the same position it occupies in the 2010 Book of Lists. Back then, though, revenue was $566 million; now it’s $1.64 billion continued on PAGE A-29

After a lifetime of work, only one word will do. Congratulations. For over 30 years, Dr. Floyd Loop has devoted himself to others, impacting thousands of lives. His talent, hard work and service as both an internationally recognized cardiac surgeon and former CEO of Cleveland Clinic have been deeply instrumental in our growth and success. Congratulations, Dr. Loop, on being named to Crain’s list of most inﬂuential individuals.

clevelandclinic.org

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FREDNANCE General counsel, Cleveland Browns; partner, Squire Sanders & Dempsey By JAY MILLER jmiller@crain.com

red Nance was a young associate at the Squire Sanders & Dempsey law firm in 1980, just two years out of University of Michigan Law School, and he wasn’t sure how much longer he’d be there. Mr. Nance, now general counsel of the Cleveland Browns and a partner at Squire Sanders, saw himself then as a trial lawyer, and Squire Sanders was a corporate firm and a specialist in public finance. “I didn’t think I was going to fit into a large, institutional law firm,” he said recently. “I figured I’d be here a very short time.” But he soon found himself as the junior member of the legal team that would defend Cleveland City Council president George Forbes in 1979 against charges of intimidation and bribery for allegedly taking at least $4,000 from the operators of temporary street carnivals who needed city permits to set up their rides and games. “It was my first exposure to highstakes public interest legal matters, the disposition of which would impact the future of the city because, I dare say, Cleveland would have been a different place without

George Forbes around,” Mr. Nance said. Mr. Forbes was acquitted on all charges before it went to the jury. “Which is how, 10 years later, Mike White came back over here — he was the target of a grand jury investigation,” Mr. Nance recalled. Actually, Cleveland Mayor Michael R. White was calling on Squire Sanders senior partner Charles Clarke, who had invited Mr. Nance onto the Forbes defense team. Mayor White wanted Mr. Clarke to represent him as a grand jury was investigating the sale of closed school buildings to private developers, including one that Mr. White had invested with and which had employed Mr. White before he became mayor in 1989. Mr. Clarke accepted the case, but he gave Mr. Nance the lion’s share of the work. “He was anxious and eager; he wanted to be a good lawyer.” Mr. Clarke said in recalling Mr. Nance’s work on what became known as the Carnival Kickback case. In May 1991, the grand jury indicted Mr. White’s former employer but not the mayor. “We had such a relationship of confidence and trust that he started taking me beyond my field of expertise,” Mr. Nance said of Mayor

White. “Basically, he trusted me, and he trusted only a small number of people.”

In the circle of trust As a member of Mayor White’s inner circle, Mr. Nance became the city’s go-to outside lawyer. So, in early 1995 Mayor White called on Mr. Nance to handle negotiations between the city and Arthur Modell, owner of the Cleveland Browns, over improvements to Cleveland Municipal Stadium, which the Browns leased from the city. Those negotiations dragged on into the fall as the two sides tried to figure out who would pay for what would have been a $150-million-plus renovation of the aging lakefront stadium. To help cover the cost, Cuyahoga County officials put on that year’s November ballot a tax increase on cigarettes and alcohol to provide proceeds for the renovation. But in the days before the vote, the community learned that Mr. Modell had a change of plans — he was moving the team to Baltimore. Quickly, Mr. Nance was in Cuyahoga County Common Pleas Court filing a lawsuit on the city’s behalf against the Browns, Mr. Modell and Baltimore officials for $300 million See NEXT PAGE ➤

Fred Nance at the Browns’ headquarters in Berea

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FRED NANCE Making a difference on the business community of Northeast Ohio over the past 30 years

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in damages. The lawsuit accused them of conspiring to violate the teamâ&#x20AC;&#x2122;s lease with the city. In past sports team relocation squabbles, the abandoned city usually walked away empty-handed. But this case was different. Mr. Nanceâ&#x20AC;&#x2122;s case forced the National Football League to intercede and make concessions to Cleveland to free Mr. Modellâ&#x20AC;&#x2122;s team from Mr. Nanceâ&#x20AC;&#x2122;s legal headlock. To avoid protracted litigation, the NFL promised the city a new team by 1999 and agreed that team would be called the Cleveland Browns. For the next three years, Mr. Nance was by Mayor Whiteâ&#x20AC;&#x2122;s side as the old stadium was torn down, a new team owner was found and a new stadium built. â&#x20AC;&#x153;He wasnâ&#x20AC;&#x2122;t just a good lawyer, but he was very intelligent beyond the law,â&#x20AC;? Mr. White said. â&#x20AC;&#x153;He could balance the law against the needs of the community, which is not always an easy thing to do.â&#x20AC;? Soon, Mr. Nance was working with the mayor to release the Cleveland schools from years of courtordered busing, then he spent at least four years negotiating deals that allowed Cleveland Hopkins International Airport to add a runway and anchor Continental Airlines at a new, $100 million concourse.

LeBron and beyond

RUGGERO FATICA

In 2003, Alexandria Boone, president and CEO of GAP Communications Group, introduced Mr. Nance to a young high school athlete who, he was told, could use some legal advice: LeBron James. Mr. Nance helped Mr. James

CRAINâ&#x20AC;&#x2122;S CLEVELAND BUSINESS avoid suspension from his high school team â&#x20AC;&#x201D; and lead the team to a state championship â&#x20AC;&#x201D; for accepting a gift of two expensive, vintage basketball jerseys. After that, in 2005, he led an effort to retain in Cleveland more than 1,000 federal Defense Finance and Accounting Finance jobs that the Defense Department planned to relocate in a consolidation. In 2006, he was elected to a twoyear term as chair of the Greater Cleveland Partnership, the regionâ&#x20AC;&#x2122;s chamber of commerce. In 2007, he became Squire Sandersâ&#x20AC;&#x2122; regional managing partner for its Ohio offices and a member of its sevenmember management committee. That same year he was enlisted by Cuyahoga County commissioners to ramrod forward the development of a new convention center and medical merchandise mart. He has relinquished his role in the convention center as heâ&#x20AC;&#x2122;s taken on his job with the Browns, but he still keeps his hand in civic affairs. Before current Cleveland Mayor Frank Jackson began his campaign to keep the Continental Airlines hub at Hopkins, he consulted Mr. Nance. â&#x20AC;&#x153;I have gotten tremendous satisfaction out of being able to have some impact in my hometown, where I grew up, where I stood on the corner of East 55th Street and Kinsman Avenue as a kid while the riots were going on,â&#x20AC;? he reminisced. â&#x20AC;&#x153;Thatâ&#x20AC;&#x2122;s when I decided, I was like 12 years old, that I wanted to be a lawyer. â&#x20AC;&#x153;But I didnâ&#x20AC;&#x2122;t know I would get to be involved in so many things and have an impact in some many different directions,â&#x20AC;? Mr. Nance said. â&#x2013;

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LOOKINGATLISTS 1994 â&#x2013; Largest non-government employers by county: Summit, Goodyear Tire & Rubber Co., 5,550 employees; Cuyahoga, Cleveland Clinic Foundation, 9,208; Lake, Lubrizol Corp., 2,023; Medina, Westfield Cos., 1,198 â&#x2013; Largest public company: KeyCorp, with market value of $7.64 billion â&#x2013; Largest private company: Sealy Corp., with 1993 revenue of $683 million â&#x2013; Number of the 20 highestpaid CEOs still in that position in 2010: 1 (A. Malachi Mixon of Elyria-based Invacare Corp.)

1996 â&#x2013; Largest privately held company: Milk Marketing Inc., a dairy marketing cooperative based in Strongsville, with revenue of $725 million â&#x2013; First $4 million CEO in Northeast Ohio: Joseph T. Gorman of TRW Inc., who became the first chief executive to top that mark with total cash compensation of $4.003 million â&#x2013; Largest business insurance agency: Acordia of Ohio, with 144 local employees; Marsh & McLennan Inc. was second with 122 local employees â&#x2013; Largest full-service investment broker: McDonald & Co. Investments with 300 registered representatives; In second place was Smith Barney Inc., with 107 continued on PAGE A-31

Making a Difference 'PS NPSF UIBO ZFBST 'SFE /BODF IBT IBE UIF QSJWJMFHF PG QSPWJEJOH TFSWJDF BOE MFBEFSTIJQ UP UIF $MFWFMBOE DPNNVOJUZ 4RVJSF 4BOEFST JT QSPVE PG 'SFE T TFSWJDF BOE XJMM DPOUJOVF UP TVQQPSU /PSUIFBTU 0IJP XIFSF PVS HMPCBM MBX GJSN XBT GPVOEFE ZFBST BHP

$*/$*//"5* t $-&7&-"/% t $0-6.#64 t )06450/ t -04 "/(&-&4 t .*".* t /&8 :03, t 1"-0 "-50 t 1)0&/*9 t 4"/ '3"/$*4$0 t 5"--")"44&& t 5".1" t 5:40/4 $03/&3 8"4)*/(50/ %$ t 8&45 1"-. #&"$) ] #0(05ÂŤ+ t #6&/04 "*3&4+ t $"3"$"4 t -" 1";+ t -*."+ t 1"/".ÂŤ+ t 3*0 %& +"/&*30 t 4"/5*"(0+ t 4"/50 %0.*/(0 t 4Â°0 1"6-0 ] #&*365+ t #3"5*4-"7" #3644&-4 t #6$)"3&45+ t #6%"1&45 t '3"/,'635 t ,:*7 t -0/%0/ t .04$08 t 13"(6& t 3*:"%)+ t 8"34"8 ] #&*+*/( t )0/( ,0/( t 4)"/()"* t 50,:0 ] +*/%&1&/%&/5 /&5803, '*3. SQUIRE, SANDERS & DEMPSEY L.L.P.

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LEBRON JAMES Cavs player; two-time NBA MVP By JOEL HAMMOND jmhammond@crain.com

AARON JOSEFCZYK/REUTERS

LeBron James, accepting the NBA’s Most Valuable Player award at the University of Akron

eBron James has had a profound impact on Northeast Ohio in his seven years as the face of the Cleveland Cavaliers. There’s the obvious: He’s revitalized a moribund franchise and an often-listless Gateway District, lined the pockets of owner Dan Gilbert, ticket scalpers and even teammates overpaid in the Cavs’ effort to win a championship, and brought immeasurable national — and even global — exposure to the city. But where Mr. James has had the biggest impact may be behind the scenes, where, various business leaders have said, he’s instilled in Clevelanders and Northeast Ohioans — so famous for their unrelenting pessimism — something not always found here: confidence.

Teamwork

Ulmer & Berne LLP salutes all of the Difference Makers for your contributions to Northeast Ohio. We appreciate your commitment to helping revitalize our region’s economy. Kip Reader 216.583.7380 kreader@ulmer.com Peter A. Rome 216.583.7124 prome@ulmer.com www.ulmer.com

Cleveland

Columbus

Cincinnati

Chicago

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Forbes dubbed Cleveland the most miserable city in the country. In wooing Mr. James, New Yorkers have made clear their thoughts on our second-class city. The Chicago Bulls’ Joakim Noah thinks it’s “bad,” here, “man.” Yet through it all, Mr. James remains a staunch advocate of his embattled home turf, warts and all, as evidenced by his comments May 2 at the University of Akron, where he was presented with his second consecutive NBA Most Valuable Player award. “Every day I wake up, I’m not only carrying myself, I’m also carrying this city to bigger and better heights,” Mr. James said. “Ever since I was a kid, I said I was going to find a way to put this city on the map, and I’m going to continue to do that.” That embrace has helped prove to kids, entrepreneurs and others that being a Cleveland-area native is OK, that you can accomplish your goals from inner-city Akron or a farm in Geauga County. “Our personal identities and social identities are built around self-image; how we view ourselves is important,” said Paul Levy, chairman of the psychology department at the University of Akron, who in addition to his day job has watched Mr. James’ career closely and has three sons, ages 17, 14 and 11, who are big fans. “We get a sense of positive selfesteem from our community, and LeBron drives that,” Dr. Levy said.

Firsthand experience Cavaliers general manager Danny

“(Mr. James) cares about those around him, and understands promoting their well-being along with his. ... He projects himself as prideful in his surroundings.” – Robert Kleidman, sociology professor, Cleveland State University Ferry knows how closely fans can connect to their favorite team and superstar: After playing on six playoff teams (and 32- and 22-win teams) in his 10 years with the Cavs, he joined the Spurs, where he played for three years before joining the front office in 2003. In his five years, the Spurs won two NBA titles and advanced to another conference final; they also boasted two down-to-earth, prideful superstars, Tim Duncan and David Robinson. “Sports can often change the outlook of a community, not just with fans but the corporate community and from a charitable perspective as well,” Mr. Ferry wrote in an e-mail. “LeBron embraces his leadership role and excels at it. He has a huge impact on and off the court and he enjoys making a difference. We never take that for granted.” Plain Dealer columnist Terry Pluto, who, first at The Akron Beacon Journal, has covered Mr. James since the latter burst onto the scene at St. Vincent St. Mary High School in Akron, related a story of Nike planning to fix playgrounds in Akron (a project that later was delayed). As Mr. Pluto remembers it, LeBron was criticized because he wasn’t going to wield a shovel and hammer and lead the project. “People said, ‘but Nike (was

going to do) all the work,’” Mr. Pluto asked. “I don’t really care who did it. If LeBron wasn’t here, is Nike going to pour money into playgrounds in Akron? “He doesn’t belong in the same group of professional athletes who live in a bubble,” Mr. Pluto said. “When he talks about wanting to represent himself well, his hometown well, there’s something in him that drives that.” Robert Kleidman, a professor in the sociology department at Cleveland State University whose duties include a Sociology of Sports course, said Mr. James’ ability to relate with fans as a Boy Next Door type has added to their faith in and connection to him. “He certainly seems to have a sense of community,” Mr. Kleidman said. “He cares about those around him, and understands promoting their well-being along with his. You can’t dismiss him as another spoiled, rich athlete, because he projects himself as prideful in his surroundings.”

What about the boss? Mr. Gilbert, the Cavs’ owner, has had a front-row seat for Mr. James’ ascension to his lofty perch as perhaps the best-known athlete in the world. Along the way, Mr. James has been the primary reason for the Cavs’ value rising by nearly $200 million, according to Forbes;

CRAIN’S CLEVELAND BUSINESS Mr. Gilbert soon will build a casino a jump stop away from Quicken Loans Arena, now a thriving area thanks to Mr. James and the team’s resurgence. Yet Mr. Gilbert rather would trumpet Mr. James’ contribution to the community, where he “has carried the Akron and Cleveland names across the country and around the world and done it successfully and with class. “He changes the playing field for the entire region,” Mr. Gilbert said. “He’s creating such a special story and impact by representing it and helping the region feel good about itself in a time where many challenges have hit it.” There is, of course, the small matter of Mr. James’ impending free agency, which has been the talk of Cleveland and the rest of the NBA since, oh, he signed a threeyear contract extension (instead of five) in 2006. Teams from all corners of the country have cleared salary-cap space for Mr. James, some going so far as to make room for Mr. James and one of his pals, such as Toronto’s Chris Bosh or Miami’s Dwyane Wade. Mr. James, to much criticism, long has been coy about his plans. No one, save for perhaps him and his inner circle, know what the future holds on the court. But Mr. James always will remain an advocate of Akron and Northeast Ohio and help however he can. “No matter where my life may take me, I’m never gone from here,” Mr. James said at his MVP ceremony. ■

LOOKINGATLISTS 1997 ■ Number of privately held companies in the 1997 Book of Lists with revenue above $1 billion: 1 ■ Number of privately held companies in the 2010 Book of Lists with revenue above $1 billion: 9 ■ Cash compensation of the highest-paid CEO in the 1997 Book of Lists: $4.815 million (TRW’s Joseph T. Gorman) ■ Total compensation of the highest-paid CEO in the 2010 Book of Lists: $16.82 million (Goodyear’s Robert J. Keegan) ■ Number of local CPAs at the largest accounting firm in the 1997 Book of Lists: 304 (Ernst & Young) ■ Number of local CPAs at the largest accounting firm in the 2010 Book of Lists: 234 (Ernst & Young) ■ Enplaned passengers in Cleveland for Continental Airlines in the 1997 Book of Lists: 2.503 million ■ Enplaned passengers in Cleveland for Continental Airlines in the 2010 Book of Lists: 1.760 million ■ Cash compensation of the highest-paid non-CEO in the 1997 Book of Lists: $2.61 million (TRW’s Peter S. Hellman continued on PAGE A-35

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VICTORIA BUSSERT Head of music theater program, Baldwin-Wallace College; resident director, Great Lakes Theater Festival By KATHY AMES CARR kcarr@crain.com

ictoria Bussert was 8 years old when she began directing her own shows with kids from her neighborhood in Munster, Ind. But the likelihood that children’s plays would turn out to be anything more than child’s play in the life of the ambitious, young impresario seemed extremely remote. That’s because women who pursued a career in theater did so acting in front of the curtain, not leading the proceedings from behind it. Or so she was told. Well, Ms. Bussert acted, all right — on her passion to be a director. She did so by attending an allwomen’s college in Illinois — the now-defunct Barat College — where she earned in 1980 her undergraduate degree in theater and dance. “An all-women’s college wouldn’t be able to tell me I couldn’t direct,” she said. That move was the steppingstone on a path that has led Ms. Bussert to leave an indelible mark on musical theater in Cleveland. In her current roles, Ms. Bussert

serves as head of the music theater program at Baldwin-Wallace College in Berea and as resident director of Great Lakes Theater Festival at PlayhouseSquare. Her impressive résumé also includes 17 years as artistic director at Cain Park in Cleveland Heights, along with directing stints at other theaters here, off Broadway and abroad. Richard Durst, president of B-W, said Ms. Bussert is a common denominator even in the international theater community. “I’m a scenery designer for theater, and about three years ago I was walking through an international exhibit of scenery design. One show after the other, Vicky’s name was listed as the director,” said Mr. Durst, whose background is in theater. Still, while Ms. Bussert is a brand name in the national theater community, she is at home in Cleveland. “I’ve had the opportunity to leave Cleveland and B-W, and I’ve always said no,” she said.

Becoming a star Ms. Bussert’s foray into professional See NEXT PAGE ➤

Victoria Bussert at the Hanna Theatre at PlayhouseSquare

A plan for every student Baldwin-Wallace College knows that education is not limited to classrooms and books. We also know that every student is an individual with a unique mixture of talents, interests and goals. That’s why we encourage every student to develop a personal action plan that integrates all parts of his or her life—courses, projects, experiences, activities, even that part-time job—to become the person he or she hopes to be. The B-W Action Plan begins with traditional liberal arts learning—supported by a faculty dedicated to exceptional teaching—and adds opportunities for practical experience and off-campus learning as well as leadership development through campus activities. It’s a four-year plan for success.

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theater began as an undergrad at Barat College with a job scraping gum off the stage with a screw driver at the Academy Festival Theatre in Lake Forest, Ill. “I was the happiest gum digger because I was working in professional theater,” she said. In 1979, the summer before her senior year, Ms. Bussert worked as a production assistant on “Mornings at Seven” under Academy Festival artistic director Vivian Matalon. In the spring of 1980, the show moved to Broadway and won a Tony Award, though Ms. Bussert did not move with it because she was finishing her senior year of college. However, when she graduated, she finally made it to the Big Apple; Mr. Matalon asked her in 1980 to help direct “Brigadoon” on Broadway. Ms. Bussert in 1982 earned a master’s degree in theater from Northwestern University in Chicago, and went on to receive in 1984 a master’s of fine arts in directing. She was the only woman accepted into that Northwestern program.

Setting the stage

RUGGERO FATICA

Gerald Freedman, who was Ms. Bussert’s mentor at Northwestern, introduced her to Cleveland when he recruited her in 1987 to be his associate director at Great Lakes Theater Festival. “Never in my wildest dreams did I think I’d make my home in Cleveland,” Ms. Bussert said. Mr. Freedman, current dean of the North Carolina School of Arts, needed someone to assist him in

CRAIN’S CLEVELAND BUSINESS

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“I’ve had the opportunity to leave Cleveland and B-W, and I’ve always said no.”

He flew down from Alaska to audition,” Mr. Durst said.

– Victoria Bussert

Competitive spirit

casting, and Ms. Bussert had the ability to grasp the entirety of a project according to the artistic director’s needs, qualities that were “rare and wonderful,” he said. “She doesn’t let her ego get in the way of her creativity. That’s rare in this field,” Mr. Freedman said. Charles Fee said he has watched Great Lakes Theater Festival grow artistically since he became producing artistic director in 2002 and began working with Ms. Bussert. They revived the revolving repertoire way of producing shows, which Great Lakes Theater hadn’t done in 15 years. In revolving repertoire, an acting company rehearses and performs in two large-scale shows with dramatically different themes within the same day or week; in Great Lakes’ case, the shows fused Shakespeare and various American classics with musical theater. Ms. Bussert also began working with Cain Park when she moved to Cleveland and spent the next 23 years with the performing arts center before leaving last summer as artistic director. “Cain now has a real legacy of doing Ohio premieres of musicals,” she said.

B-W performs Another of Ms. Bussert’s claims

to fame is the notoriety her musical theater students at Baldwin-Wallace have gained since she took over the program in 1996. Back then, the musical theater program was composed mostly of students located within a 90-mile radius of the campus, with few making a sustainable career in theater upon graduation. The year she arrived, 40 to 50 students auditioned for the program. Earlier this year, 250 students auditioned for 15 program openings. And just about every graduating senior — the 2009 class had 14 — has signed with a New York agent and gone on to perform on Broadway, off Broadway or in national tours and regional theater productions. “Agents are on the tails of our students,” she said. Ms. Bussert and the program’s reputation also have been key marketing tools for B-W. While 84% of B-W’s students are Ohio residents, with most of those coming from Northeast Ohio, the college attracts 52% of the freshmen in the Conservatory of Music from other states. The bulk of those students are in musical theater. “I was walking by this year’s (program) auditions, and I heard a giddy student who was an Inuit Eskimo talking about the program.

While Ms. Bussert toggles between regional, national and college shows — and balancing a marriage with her husband, Dale Rieling, who is a Broadway music director living in New Jersey — her mind also in on a coming project at B-W. In February 2011, the Conservatory of Music will become the first — Ms. Bussert thinks in the world — to perform in repertory Giacomo Puccini’s “La Boheme” and Jonathan Larson’s “Rent.” “It will be a destination event,” she said, much like B-W’s 2007 performance of “Phantom of the Opera.” B-W that year was one of six institutions nationwide selected to perform the first nonprofessional version of “Phantom,” which played to sold-out crowds over 12 performances and even had scalpers looking for tickets. Ms. Bussert also has pushed the envelope with subject matter at the private Methodist college, but says she’s never been censored. “I have complete trust in Vicky that what she’s doing isn’t gratuitous, but that it’s for the greater good of the students and the audience,” Mr. Durst said. Moving forward, Ms. Bussert has high expectations for B-W and the regional theater community. “In my other life I was a football coach,” she said. “I’m very competitive. I want us to be No. 1 in the country.” ■

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STEVEMINTER Former executive director/president, The Cleveland Foundation By JENNIFER KEIRN clbfreelancer@crain.com

he fingerprints of Steve Minter can be uncovered almost everywhere one looks in the Cleveland of

today. For nearly 20 years, Mr. Minter, 71, sat at the helm of The Cleveland Foundation, overseeing a shift in the organization’s mission and growth in its assets and grant-making. Those changes had far-reaching implications for an untold number of civic initiatives in Greater Cleveland, ranging from school reform and neighborhood development to arts and culture and public health. “It’s easier to say which things we shouldn’t associate his name with,” said Diana Tittle, author of “Rebuilding Cleveland: The Cleveland Foundation and Its Evolving Urban Strategy.” “It would be hard to find any positive development of the last 25 years that he wasn’t associated with in some way,” Ms. Tittle said. In 1984, Steve Minter stepped into the role of executive director and president of The Cleveland Foundation after a five-year stint as its associate director. Within his first year as director, he took the step of initiating a strategic plan-

worked in the 1980s to secure financing for Lexington Village, the first market-rate rental property to be built in Cleveland’s Hough neighborhood since its 1966 riots. He worked tirelessly on initiatives to improve public education in Cleveland, and in 1984 he made Cleveland the first city between the coasts to commit grants toward AIDS awareness. He also played an integral role in saving the old vaudeville theaters at what is now PlayhouseSquare from demolition and helped found Cuyahoga Arts and Culture, which uses money from a cigarette tax to distribute grants to the county’s arts organizations. “The Cleveland Foundation was a great early supporter of PlayhouseSquare and continues to be so,” said Art Falco, president and CEO of PlayhouseSquare Foundation. “Steve saw PlayhouseSquare as not only an arts organization but also as an economic development catalyst. That’s the best of both worlds.” While Mr. Minter himself looks back on these accomplishments and others with a great deal of satisfaction, “in no case do I believe it is possible to say The Cleveland Foundation alone or Steve Minter alone” was responsible for these

ning process to direct grants toward the city’s greatest needs. “He began to position the foundation in a way that it was less a responsive funder and more of a leader,” said Bob Eckardt, a 28-year foundation veteran who’s now senior vice president for programs and evaluations. “It became a foundation that took on initiatives rather than just responding to (requests) that came in.” Collaborating with then-chairman Dick Pogue, Mr. Minter transitioned the foundation’s “distribution committee” into a true board that was “encouraged to think of their role in terms of setting strategy (and) taking an active role in fundraising,” Mr. Eckardt said. That new era ushered in an activist Cleveland Foundation, aided by Mr. Minter’s dedication to enhancing Clevelanders’ quality of life, an expansive network of contacts and a quiet, compassionate leadership style. “Philanthropy for a long time was directed at symptoms of societal problems,” Ms. Tittle said. “He wasn’t satisfied to continue with philanthropy as a bandage applier.”

A legacy of inclusion As an early champion of neighborhood revitalization, Mr. Minter

See NEXT PAGE ➤

If you want to be remembered, do something memorable Congratulations to Steven A. Minter on being named a Crain’s Cleveland Business “Difference Maker.” Over a 29-year career with the Cleveland Foundation, including 19 as president and executive director, Steve made an impact that could be felt in almost every facet of life in Cleveland, from neighborhoods and education to health care and human services. The foundation is proud of Steve’s legacy and we applaud his efforts to make life better for everyone in Greater Cleveland.

Steven A. Minter

216.861.3810 www.clevelandfoundation.org

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JASON MILLER

accomplishments, he said. “In every case, we were partners.” It was under Mr. Minter’s leadership that The Cleveland Foundation began touting donor-advised funds, which permit individuals and families to establish their own funds within The Cleveland Foundation umbrella. This allowed younger donors to be engaged with their philanthropy, as opposed to dictating from the grave, he said. That inclusive approach also extended to lower-net-worth individuals and those living outside Cleveland and Cuyahoga County. “We began to say, ‘You can be a donor, and you don’t have to be a millionaire,’” Mr. Minter said. “That made it possible to go to the African-American community and say, ‘Everyone can be a part of this.’” As a result, The Cleveland Foundation — the nation’s oldest and third-largest community foundation — evolved into a truly inclusive organization, encouraging engagement in what Mr. Minter calls Cleveland’s “enduring issues” — public education, jobs, housing and health care. “He was a person who could walk comfortably in two worlds, in the business and philanthropic world, but also in the AfricanAmerican community,” Mr. Pogue said. “In those days, there were few people who could bridge that gap.” By the time Mr. Minter retired from The Cleveland Foundation in 2003, total assets topped $1.5 billion, up from just over $225 million when he became director in 1984. Annual grants paid increased 27% in that time to nearly $76 million.

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Sustained leadership

LOOKINGATLISTS

Today, Mr. Minter sits in an office just across the street from the PlayhouseSquare complex he helped rescue from demolition. He’s an executive-in-residence at Cleveland State University’s Maxine Goodman Levin College of Urban Affairs and a fellow in the school’s Center for Nonprofit Policy and Practice. He remains chairman of Cuyahoga Arts and Culture, and he is an adviser to Neighborhood Progress Inc., a Cleveland neighborhood revitalization group that credits its very existence in part to Mr. Minter. “He helped legitimize the work of neighborhood practitioners,” said Eric Hodderson, Neighborhood Progress’ president and CEO. “As a result, Cleveland has a national reputation as a place where urban renewal and community initiatives have yielded significant results.” Much progress has been made on Cleveland’s “enduring issues,” but one remains a source of disquiet for Mr. Minter: “Our community’s inability to transform the Cleveland public schools represents a major disappointment,” he said. After 50 years of public service, Mr. Minter’s impact on Cleveland defies measure. “When there was a project that needed leadership, my father was the first person to raise his hand,” says Robyn Minter Smyers, Mr. Minter’s daughter and a Thompson Hine attorney. “He has raised his hand on so many important projects, it’s hard to count the measure of his contributions.” ■

1998 ■ This was the first year the Cleveland Clinic Health System surpassed the U.S. government as the largest employer in Cuyahoga County. (19,135 for the Clinic vs. 17,585 for the feds) ■ One company that’s no longer here — TRW Inc. — had the highestpaid CEO and the three highest-paid non-CEOs on those respective lists. ■ The Cleveland Foundation and the George Gund Foundation accounted for $54.6 million in grants. The next 14 foundations on the Largest Grantmaking Foundations list accounted for $56 million in grants. ■ The vacancy rate of the largest suburban office property — Crown Centre I in Independence — was 0%.

1999 ■ Eighteen CEOs topped $1 million in cash compensation, and five others were above $900,000. ■ Seven non-CEOs topped $1 million in cash compensation, and four others were above $900,000. (Three of those “others” — Alexander M. Cutler of Eaton Corp., Henry L. Meyer III of KeyCorp and Glenn Renwick of Progressive Corp. eventually became CEO at those companies.) ■ The average value of a Crain’s Cleveland Business subscriber’s non-real estate portfolio was $974,000. continued on PAGE A-43

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DAVIDGILBERT President and CEO, Greater Cleveland Sports Commission By JOEL HAMMOND jmhammond@crain.com

JESSE KRAMER

Greater Cleveland Sports Commission president and CEO David Gilbert at Tower City Center

“We are a standout nationally, among other sports commissions, by offering more services to customers than other communities,” said Mr. Gilbert, who long has had a passion for sports, stemming from his early days as a tennis player and now as an avid longdistance runner. “Other communities may have shinier things, but we do better events here,” Mr. Gilbert said.

aith Gilbert says she knew, in the formative years of her relationship with husband David Gilbert, where their future lay. “I knew, if we were going to be together, that I’d be moving to Cleveland,” said the native of suburban Washington, D.C. “He’s always been very devoted to the city.” Hang your hat As president and CEO of the Greater Cleveland Sports Commission, Mr. Gilbert David Gilbert got the NCAA to change, has turned that devotion into an organization which is no small feat. The stodgy governing that has made a $300 body of intercollegiate million impact on Northathletics was so impressed “We are a standout east Ohio, enhanced the with the sports commisnationally ... by offering sion’s bid for the 2007 city’s profile worldwide and proven Cleveland can play more services to NCAA Women’s Final Four, host to national and interand in turn its execution of customers than other national sporting events. all it promised, that it communities.” But it didn’t happen changed its bid packages – David Gilbert overnight. Mr. Gilbert going forward. chuckled when remembering Employing local and how the sports commission nationwide contacts, Mr. got its restart in 2000, after a previous Gilbert assembled a program that relegated attempt, in 1993, fizzled: He and current vice the championship action on the court to president of sports development Rob secondary status. The program, headlined Marron, nestled in a tiny office in the “Women Rock,” featured a symposium on Terminal Tower with two tables from Sam’s Title IX, the 1972 legislation guaranteeing Club, two computers — whose boxes equal access to education for women; a doubled as desks — and two phones. mentoring program for high school girls, Since then, he and his staff have scored featuring female business professionals in victories with unrelenting hard work and the the city; and an effort to connect female right mix of marketing savvy, trial and error, scholar athletes to athletic administrators See GILBERT Page A-38 and innovation.

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Going places.

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BILLSANFORD

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Founder, Steris Corp. By SHANNON MORTLAND smortland@crain.com

MARC GOLUB

f Bill Sanford had continued on his intended path, he might still be tossing the pigskin rather than hitting the links in his retirement. The self-proclaimed sports fanatic initially wanted to be a college football coach, but while home in Kansas on spring break of his senior year at Kansas State University in 1965, the zoology major saw an ad for a management training program at American Hospital Supply Co., which was headquartered in Evanston, Ill. Though he was offered a job as a coach at a division III college paying $350 a month, Mr. Sanford entered the management training program in Kansas City because it paid $525 a month. That early move set the stage for him to later help launch, oversee and grow Steris Corp., the Mentor-based sterilization and medical device company, into a global enterprise. Mr. Sanford’s career has been nothing short of fast-paced. As a young go-getter, he described himself as someone who always “attempted to do the best job possible for the customer.” That hard work paid off, and he moved up quickly at American Hospital Supply, ultimately becoming its youngest vice president at the age of 29. The self-described “corporate vagabond” eventually

“We went from a startup to a public company to a world leader in a very short amount of time,” says Steris founder Bill Sanford.

See SANFORD Page A-38

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THIRTYYEARSOF...SPORTSMOMENTS

DAVIDGILBERT

Here are our picks for the most memorable sports moments of the last 30 years.

continued from PAGE A-36

settlement kept the Browns’ name, logo and history here for the arrival of a new team in 1999. ■ Oct. 15, 1997: The Indians beat Baltimore, 1-0, in Game 6 of the American League Championship Series, to advance to second World Series in three years.

The 1980s ■ Dec. 21, 1980: NFL Most Valuable Player Brian Sipe leads the “Kardiac Kids” to wins in nine of the team’s final 11 games — including a handful in dramatic fashion — the last of which is a 27-24 win over Cincinnati. ■ May 15, 1981: Indians pitcher Len Barker throws a perfect game, striking out 11 Toronto batters in front of 7,290 people at Cleveland Municipal Stadium. Only 17 perfect games have been thrown to this day. ■ July 4, 1982: Open-wheel racing runs at Burke Lakefront Airport for the first time, and continues for 26 years overall before turmoil in the sport shortens its schedule in 2008. The winner’s circle has included names such as Rahal, Andretti and Unser, and was a major summer tourism draw for the center city. ■ July 3, 1985: After months of legal wrangling and maneuvering, the Browns draft Boardman native Bernie Kosar in the NFL’s Supplemental Draft; Kosar wins 53 games in 8½ years with the Browns before being unceremoniously dumped by Bill Belichick in 1993. ■ Nov. 25, 1985: Cleveland State starts a 29-4 season with a 105-65 win over Clarion (Pa.) at Woodling Gym, a year that ended with a one-point loss to Navy in the Sweet Sixteen. The Vikings won 14 straight games at one point, including wins over Indiana and St. Joseph in the first two rounds of the NCAA tournament. CSU averaged 88.9 points per game behind acclaimed freshman Ken “Mouse” McFadden and coach Kevin Mackey. ■ Jan. 6, 1989: You see a curse, we see a nice feat: The Browns advance to their second AFC championship in three years, losing the next week to the hated Denver Broncos — yes, again. This makes the list because of what followed: only 39 wins in the next six seasons before

2000 to today PHOTO PROVIDED

Kent State fans celebrate the team’s 2002 run to the Elite Eight Art Modell packed up for Baltimore.

The 1990s ■ May 1990: Voters pass 15year sin tax on cigarettes and alcohol, paving the way for development of the Gateway sports and entertainment complex. Jacobs Field opens to sellout crowds in April 1994 — and sells out 455 consecutive games — and Gund Arena opens to a Billy Joel concert six months later. ■ March 23, 1993: Steve Olin, 27, and 31-year-old Tim Crews, both relievers for the Indians, die in a boating accident on Little Lake Nellie in Clermont, Fla. Olin was the Indians’ top reliever, appearing in 88 games the season before, with 29 saves and a 2.34 earned run average. ■ Oct. 1, 1995: Indians win 100th game, 17-7 over the Royals, in strikeshortened season, finishing with a .694 winning percentage. Only two teams since have eclipsed that mark, Seattle (116-46, .716) in 2001, and the Yankees (114-48, .704) in 1998. ■ Oct. 3, 1995: Tony Pena hits a game-winning home run in the bottom of the 13th inning as the Indians beat the Boston Red Sox in Game 1 of the American League Division Series, 5-4. ■ Oct. 17, 1995: Indians beat Seattle, 4-0, in Game 6 of the American League Championship Series to advance to their first World Series since 1954. ■ February 1996: Cleveland earns a small victory in Art Modell’s move to Baltimore, in which a legal

■ March 2002: Kent State advances to the NCAA men’s basketball tournament’s South Region final as a No. 10 seed, still the furthest any Mid-American Conference team ever has gone. ■ May 22, 2003: The Cavaliers win the NBA Draft lottery, giving them rights to draft local product LeBron James, already a nationwide celebrity. Over James’ first six seasons, he averages 27.5 points per game, wins a league Most Valuable Player award and transforms the franchise from a laughingstock to a league power with one of the hottest tickets in professional sports. ■ June 2, 2007: Thanks to 31 points from young guard Daniel Gibson, the Cavs finally slay their nemesis, the Detroit Pistons, with a 98-82 win in Game 6 of the Eastern Conference Finals. ■ Nov. 13, 2007: Former Indian CC Sabathia wins the American League Cy Young Award in leading the Indians to 96 wins and one win away from World Series; Sabathia is the second Cy Young winner in franchise history and first since Gaylord Perry in 1972. ■ Dec. 10, 2009: The Browns, in the midst of one of the worst seasons in franchise history, end a 12-game losing streak to the Pittsburgh Steelers with a 13-6 win on a frigid night at Cleveland Browns Stadium. It was the first victory in a four-game winning streak to end the season, saving embattled coach Eric Mangini’s job. ■ May 13, 2010: The Cavaliers collapse in a stunning second-round playoff loss to the Boston Celtics, leaving LeBron James’ future very much in doubt. — Joel Hammond

about opportunities after college. “It was extraordinary,” said Sue Donohoe, vice president of Division I Women’s Basketball at the Indianapolis-based NCAA. “We have tried to use some of those concepts they put forward to carry on some of that focus within the community that focuses on women and young girls.” That type of outside-the-box thinking embodies the sports commission’s rise. Sure, it has brought in major economic drivers, such as the women’s Final Four ($22 million in economic impact), January 2009’s U.S. Figure Skating Championships ($20 million impact), last May’s Senior PGA Championship at Canterbury Golf Club ($20 million impact) and the AST Dew Tour ($10 million impact), a festival for extreme sports such as skateboarding. Those events, so-called “oneoffs,” create exposure for the city and give the commission an opportunity to showcase its skills. But they don’t generate much revenue for the commission itself, as it must cover certain costs such as marketing; those events’ organizing bodies — USA Wrestling, for instance — keep proceeds. Mr. Gilbert & Co. are aiming to change that scenario by creating some of their own events. In 2006, the commission developed the Continental Cup, an international youth soccer tournament. It started with 32 teams; it’s now up to 170 teams and is sponsored by A.C. Milan, one of the top club soccer teams in the world. By owning and operating events, the commission — which operates on a slim $1.1 million annual budget already — doesn’t need to commit $100,000 in bid fees and other costs to secure events. This summer, baseball and basketball events will be introduced. The three Continental Cup events combined will bring in 3,500 athletes, 4,000 hotel nights and $4 million in economic impact, Mr. Gilbert estimates. “We lost our shirt the first year

“He’s willing to take other people’s ideas and work with them.” – Dennis Lehman, board member, Greater Cleveland Sports Commission with the Continental Cup,” Mr. Gilbert said. “Now we own it; we’re not paying ourselves. It’s annual, and always will be in Cleveland. It’s much easier to improve, also — we’re not reinventing the wheel every year.”

Par for the course The creativity Mr. Gilbert showed in the Final Four and Continental Cup processes meshes well with his collaborative mentality, peers say. That goes not only for public entities, such as the city of Cleveland, but also with his staff and by surrounding himself with a diverse board of directors. “He’s willing to take other people’s ideas and work with them. He doesn’t have to create his own, a nice feature for someone in his position,” said Dennis Lehman, a member of the commission’s board since it re-started in 2000 and the vice president of business operations for the Cleveland Indians. Of course, it’s one thing to have ideas and passion. It’s another to pull those ideas off, said Don Schumacher, executive director of the Cincinnati-based National Association of Sports Commissions and an East Cleveland native and Lakewood High School graduate. He said Mr. Gilbert is highly regarded among his organization’s 600 members, and the Greater Cleveland Sports Commission is “operating at the highest level of our business.” “Sure, he thinks outside the box,” Mr. Schumacher said. “But he has a great set of sales and marketing skills. It takes an awful lot more to make a sale than talking a good game. He’s already worked hard to cultivate the relationship long before a presentation is made, and understands how to plow the earth and prepare it for seed.” ■

BILLSANFORD continued from PAGE A-37

became president of a large chemical lab, traveled and moved around a lot for various jobs — until he landed in Columbus. “It was an all-American city,” Mr. Sanford said. “I’m a sports nut, so I loved Ohio State.” He loved Columbus and Ohio so much that, after he was transferred to Portland, Ore., he quit his job and moved back to the capital city “cold turkey, with no business contacts.” Ohio was where he wanted to settle down, he said. Mr. Sanford launched Symark LLC, a technology commercialization firm now headquartered in Naples, Fla., in 1979 and remains its chairman. But his biggest involvement in a business came when he was asked to evaluate a startup called Innovative Medical Technologies Corp. Raymond Kralovic and Ed Schneider, who started Innovative Medical Technologies to develop medical sterilization equipment, had contacted a small venture fund called Primus Venture Capital for help in launching the

company. Primus wasn’t so sure about the idea, so it asked Mr. Sanford to evaluate the company. Mr. Sanford advised Primus to invest in Innovative Medical Technologies, but it would do so only if Mr. Sanford ran the company. He agreed, and the company’s name promptly was changed to Steris, “because you couldn’t fit Innovative Medical Technologies on a business card,” Mr. Sanford said with a grin. Ultimately, Steris received a total initial investment of $1.2 million from multiple investors, who in turn received a combined ownership in the company of 30%, said Mr. Sanford, who eventually moved to Cleveland to head up the company. Five years later, in 1992, Steris went public. What began as a five-employee company grew quickly by selling its inventions and acquiring other companies. By 2004, Steris achieved $1 billion in annual revenue and now employs 5,000 in 60 countries. “We went from a startup to a

public company to a world leader in a very short amount of time,” Mr. Sanford said. “It was absolutely a very stimulating time. It was the go-go years.” But it wasn’t without dedication and lack of sleep. “It was all made to happen through 30-hour days, eight days a week,” Mr. Sanford recalled. That work ethic, Mr. Sanford said, probably came from his mother, a farmer who worked hard and stressed to him that he could compete with anyone. Mr. Sanford took that idea one step further and also realized that Steris, regardless of how big it became or how much market share it controlled, always had competitors nipping at its heels. As a result, customer service was king at Steris. Humans always answered the phones, and no customer was ever told something couldn’t be done. The mantra was to figure out the answer, now. If he was in a meeting and a customer wanted to speak to him, he was pulled out of that meeting. “We were doing things beyond

what people ever thought we could do,” Mr. Sanford said. “People can always perform at a higher level than they now perform. None of us have ever reached our peak.” Mr. Sanford officially retired from Steris in 2000 and now lives in Naples, where he plays as much golf as possible while escaping the snow. However, he’s still a huge fan of the Buckeyes, Cavaliers, Indians and Browns. He claims he’ll never really retire. He still invests in startups and sits on corporate boards such as the Kansas Bioscience Authority, KeyCorp and the Cleveland Clinic. He recently flew back to Cleveland for a board meeting and to stop at the preschool his grandchildren attend to read to the class. A. Malachi Mixon III, CEO of wheelchair maker Invacare Corp. and an early investor in Steris, is thankful for Mr. Sanford’s involvement in Northeast Ohio. “He’s a very outgoing person, he’s very take charge. He’s not a shrinking violet,” Mr. Mixon said. “Bill is very self-confident, very

knowledgeable of the medical field and a quick study.” Mr. Sanford also possesses an inordinate amount of courage as he puts his money into startups and takes risks, which many people aren’t willing to do, Mr. Mixon said. Mr. Sanford is especially fond of biotechnology, and said his involvement in that sector has been more significant than his leadership at Steris. Among his many technology efforts, Mr. Sanford was one of the founders of BioEnterprise Corp., which helps form, recruit and grow bioscience companies, and the Northeast Ohio Technology Coalition, or NorTech, which assists in the growth of local technology companies. Those experiences have fed his belief that the commercialization of bioscience and technology inventions is a means for economic development. “It’s really important to have science and technology advance to help humankind,” Mr. Sanford said. ■

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President, Cuyahoga Community College

By SHANNON MORTLAND smortland@crain.com

erry Sue Thornton keeps a dream catcher in her office to signify her feelings about community colleges. “I think community colleges are dream catchers,” said Dr. Thornton, president of Cuyahoga Community College. “I think a lot of people have dreams and things they would like to do but, without a college education, they can’t do them.” Dr. Thornton found her own dream in a community college in 1971. She had earned her master’s degree from Murray State University in Kentucky the year before and was teaching in a high school when, she said, “this new thing called community college was popping up in states around the country” to further educate Vietnam War veterans. Acting on a friend’s encouragement, Dr. Thornton applied for a position teaching English at Triton College in River Grove, Ill., and got the job. That move set the course for the rest of her career. She moved up the ladder at Triton, eventually becoming dean of arts and sciences before leaving See THORNTON Page A-41

RUGGERO FATICA

Tri-C president Jerry Sue Thornton in a classroom at Tri-C’s main campus in downtown Cleveland

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MILTONMALTZ Founder, Malrite Co.

By STAN BULLARD sbullard@crain.com

t was an upset Milton Maltz who attended the National Association of Broadcasters convention in 1972. Though Mr. Maltz had his financing lined up, a deal to buy a small AM and even smaller FM radio station in San Diego, Calif., had just fallen through. It was at the newsstand outside a Washington, D.C., hotel, that Mr. Maltz saw John Kluge, an acquaintance who owned Metromedia Corp. “I said, ‘I understand you are going to sell Cleveland. But you want too much money,’” Mr. Maltz recalled recently. Metromedia wanted to sell WHK-AM, 1420, and WMMS-FM, 100.7, here so it could buy other stations under what is now a defunct Federal Communications Commission rule that limited radio owners to seven stations. Within 15 minutes, the two struck a deal. Mr. Maltz had not planned to come to Cleveland from Mt. Clemens, Mich., where he ran Malrite Communications Group, an assemblage of small-market radio stations. More important, his beloved wife of what is now 55 years, Tamar, had family in

California and had looked forward to moving there. After the deal closed, Mr. Maltz said, “I realized it was a big doo doo. WHK was sliding and WMMS was losing money left and right. I told my wife, ‘I’m going to have to go to Cleveland to fix this thing.’ She resisted moving. For the first few months, I flew Wright Airlines between Detroit and Burke. That is how we wound up in Cleveland.” And so, the one-time kid actor in radio dramas originating out of Chicago and journalism major at the University of Illinois who cast his career on the business side of broadcasting became a Shaker Heights resident. The move brought to Cleveland the ownership that would create the WMMS radio dynasty and would see the growth of Malrite into a publicly traded chain of radio and TV stations that, after its 1998 sale to Raycom Media for an undisclosed sum, left Mr. Maltz a wealthy man who showers philanthropy in his wake. Things iconic to Cleveland, from its role vaulting deejay Don Imus to fame to the first flight of the WMMS Buzzard, emerged under his rein. Though a lover of classical music, Mr. Maltz sought to reformat WMMS to a country music station.

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That set up his first fight with Dennis Kucinich, then a Cleveland city councilman, who signed on with a grassroots effort to keep the rock format at WMMS. The result was an agreement with the FCC to keep the rock format in place a year. By the time a year was over, things were looking up, especially at WMMS at a time many in radio scorned FM’s paltry ad revenues by calling it “Free Music.” “I knew that WMMS owned the wave,” he said of the fervent affection of baby boomers for rock and roll. Though not everything went smoothly, Mr. Maltz made far more moves that were right than were wrong.

Away with beautiful voices “One of the first things that happened was that the U.S. Army was running recruiting spots on the stations,” Mr. Maltz said. “I told the radio reporter at The Plain Dealer, ‘We are not going to carry those commercials. I do not support the war in Vietnam.’ That played as well with the anti-war generation as Bob Dylan.” Meanwhile, students from Cleveland State University, such as “Kid Leo” Travagliante, Ed “Flash” Ferencand others, showed up looking for jobs on the air. “We did away with announcers with beautiful voices,” Mr. Maltz said. “We hired kids who knew the music.” WMMS earned a reputation as a strong station, epitomizing the city’s rough-and-tumble culture for a generation. WMMS gained the power to make recording artists. See NEXT PAGE ➤

Milton Maltz, founder of Malrite Co., at the Maltz Museum of Jewish Heritage

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MARC GOLUB

Big money replaced FM’s free music moniker. Such success burnished Malrite’s reputation. Successes at various radio and then TV ventures followed. The image of Mr. Maltz in “The Buzzard: Inside the Glory Days of WMMS and Cleveland Radio” by John Gorman, who was operations manager of WMMS and WHK, is somewhat unflattering: a man squeezing pennies amid free spirits at a time ruled by idealism. Part of the genius behind Malrite and WMMS was that of then-president Carl Hirsch, Mr. Gorman said in a recent interview, though he readily acknowledged that Mr. Maltz

deserves credit for the undertaking’s character. “People forget that when you go back to the 1970s, there was a definite generation gap,” Mr. Gorman said. “We were putting on a format left of center, considered radical, with political overtones. (Mr. Maltz) allowed it to happen. That wasn’t the case at other stations.” Malrite also sizzled before people thought of buzz in business. “It had all the creativity you hear about today when you read about Apple or Google,” Mr. Gorman said.

Motivated by museums Those days are more than a

decade behind Cleveland and Mr. Maltz. Now he has a new role, as a philanthropist, in everything from theater to higher education. Part of that drive stems from his involvement in the 1980s effort that planted the Rock and Roll Hall of Fame and Museum in Cleveland. “He needed no convincing,” said K. Michael Benz, president and CEO of the United Way of Cleveland who did two stints as the rock hall’s executive director. “He wanted it really bad. He helped us enlist people he knew in the radio and record industry. His stations and people were pivotal in promoting it.” One of Mr. Maltz’s takeaways from that effort was a feeling for museums. The Malrite Co. he owns today is dedicated to producing forprofit museums, with the International Spy Museum in Washington, D.C., and the Maltz Museum of Jewish Heritage to its credit. Like the rock hall, the Beachwood museum adds another attraction to the region. “Having the Museum for Jewish Heritage is a great calling card for us,” said Tamera Brown, vice president of marketing for Positively Cleveland, the region’s tourism and convention bureau. “We had assets in Jewish history, but anytime you are competing for a motor coach group, from synagogues or churches, a public attraction that people can visit is a plus. When you can offer a group an evening gathering somewhere besides a hotel, such as the museum, it’s an additional way to attract people to the region.” For Mr. Maltz, the museums are in keeping with his broadcasting roots. “To me a modern museum is a programmatic experience not unlike radio programming,” Mr. Maltz said. “I thought a lot more could be done with them. The back story at the Spy Museum is the truth about what is happening in intelligence around the world. One portion of the museum in Beachwood is Jewish history. But another mission is to promote tolerance and understanding.” Though Mr. Maltz remains busy, he said he misses the radio and broadcast business — at least the one he grew up in. “I miss what it used to be, not what it is today,” he said. “Nothing is forever. Change is the way of the world.” ■

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THIRTYYEARSOF...NEWBUILDINGS Quality over quantity. That phrase describes the major buildings constructed in Northeast Ohio during the last 30 years, as the region made up for a relative paucity of new structures with some striking designs. A caveat here: We’re not architecture critics. This list is based on impressions of a novice, under the “We know what we like when we see it” ethos. Here’s our list, presented alphabetically: ■ Akron Art Museum addition (2007) and Cleveland Museum of Art addition (2009): Both of the region’s big art museums reinvented themselves with bold additions. The Akron addition by Coop Himmelb(l)au of Vienna was the product of an international competition. It’s a bit of a crazy design, to be sure, but it enlivens downtown Akron and offers a great discussion piece. The new East Wing at the Cleveland museum is simply beautiful. It houses elements of the Impressionist, Contemporary and Modern art collections. ■ Carl B. Stokes Federal Court House Tower (2002): This is the newest major building in downtown Cleveland. It’s distinctive for a curve greeting the Cuyahoga River and a cornice that’s illuminated at night. The building gets bonus points for displaying a bold sculpture by artist Jim Dine by the Huron Road entrance. ■ Cleveland Clinic Crile building (1985): The ziggurat-shaped tower designed by Cesar Pelli won an award from the Cleveland chapter of the American Institute of Architects upon its completion, according to ClevelandSkyscrapers.com. After 25 years, it still stands out on a campus that’s constantly growing. ■ Key Tower (1991): It’s the tallest building in Cleveland (and Ohio), and is visible from as far as 20 miles outside downtown, according to ClevelandSkyscrapers.com. The Cesar Pelli-designed tower was developed by the Richard E. Jacobs Group and originally was called Society Center. It was renamed following the merger of KeyCorp and Society Corp. ■ One Cleveland Center (1983): This building could make the list on

the basis of its nickname alone — The Silver Chisel. Most athletes don’t have nicknames that good. It’s an elegant, 31-story tower, the fifthtallest building in downtown Cleveland. To go with the cool nickname, the building had an infamous tenant: investment banker Frank Gruttadauria, who served time in jail for one of the biggest financial frauds in Cleveland history. ■ Peter B. Lewis Building at the Weatherhead School of Management (2002): It’s the most talked-about building on the Case Western Reserve University campus, without question. Designer Frank Gehry’s $62 million modernist building resembled his masterpiece — the Guggenheim’s branch in Bilbao, Spain. No two classrooms inside are alike. Just watch out for snow sliding off the building on sunny days in the winter ■ Progressive Field (1994): Of all the sports facilities built in the region — Cleveland Browns Stadium, Quicken Loans Arena, InfoCision Stadium at the University of Akron among them — in the last three decades, the home of the Cleveland Indians still stands out as the warmest and most reflective of Northeast Ohio’s heritage. Now if only the team could meet the high standards of the ballpark ... ■ Rock and Roll Hall of Fame and Museum (1995): Does it matter if star architect I.M. Pei ripped off his own design for the pyramid at the Louvre? It’s still Cleveland’s most recognizable building. No sports telecast can resist featuring it, and it makes the lakefront look grand. ■ 200 Public Square (1985): You probably know it better as the BP Building, or BP Tower. That’s what many people still call this 45story tower, designed by Hellmuth, Obata and Kassabaum (the firm responsible for Progressive Field), as the headquarters for Standard Oil of Ohio, which later merged with British Petroleum. It’s a centerpiece of Public Square, and the eight-story atrium is the most striking in the city, even if the retail space has struggled for many years. — Scott Suttell

the shipment of more goods to the Great Lakes to be distributed throughout the country. In keeping ahead of those trends, Tri-C has created a truck driving school and a wind energy program. “We want people to stay here and be close to their families, but they have to have meaningful work that pays a decent wage,”Dr. Thornton said.

a part of the fabric of the community at large, in helping shape our direction through programs and initiatives,” Dr. Thornton said. K. Michael Benz, president and CEO of United Way of Greater Cleveland, said a lot of words — visionary, thought leader, ahead of the curve — come to mind when he thinks of Dr. Thornton, and he’s grateful for her participation in groups across Northeast Ohio. “If it takes leadership, Jerry Sue Thornton is involved,” Mr. Benz said. “She leads Tri-C with grace and passion and extensive knowledge of closing the gap for people in education.” But it’s not all about work for Dr. Thornton. She’s an avid sports fan who loves jazz and the arts in general. She and her husband buy an eight- to 10-game package of tickets to the Cavs each year. They also go to plays, concerts and Indians and Browns games. “There’s more to do than I have time to do,” she said. ■

JERRYSUETHORNTON continued from PAGE A-39

in 1985 to become president of what is now called Century College in White Bear Lake, Minn. After a six-year stint there, Dr. Thornton was hired for the top job at Tri-C. As one of five children growing up on a farm in Kentucky, Dr. Thornton was encouraged to pursue higher education by her parents, who didn’t finish high school themselves. “They very much valued higher education and what it could do for you,” said Dr. Thornton, whose coal-mining father named her Jerry because he initially had hoped for another boy to work the farm.

Learning from experience She also came to understand the need to have skills that would enable her to land a job. She knew how to sew, so she made period costumes for plays to work her way through Murray State while earning her bachelor’s degree. She also worked a second job in a cafeteria.

As a result, Dr. Thornton understands how hard it can be to afford tuition, which is why she has worked to build the college’s scholarship endowment to more than $20 million and holds an overall affinity for community colleges. They’re closely tied to the community, more affordable than a traditional 4-year institution and serve as the access point to higher education, she said. Dr. Thornton also believes Tri-C can be a gateway to the area’s top industries, which is why she works with local businesses to determine what they need in future employees and creates programs around those recommendations. “As a community college, we must change with the local community,” she said in her usual determined yet upbeat voice. “If the economy changes and the old jobs don’t exist, we have to change. We have to be really tuned into what’s happening.” She keeps in touch with local chambers of commerce, profes-

sional associations, economists and leaders to always know where Cleveland’s economy is headed. Her forward-thinking leadership has lead to some interesting new programs at Tri-C. Though health care already is Northeast Ohio’s largest industry, it will become even bigger when the planned Cleveland medical merchandise mart opens, she said. So, Tri-C is exploring what kind of jobs will be created to serve the medical mart. One associated area that is expected to soar is tourism and hospitality as more people visit Cleveland to attend the medical mart, she said. “People are going to need chefs, maitre d’s, meeting planners,” Dr. Thornton said. “They’re going to need all kinds of people who work in back office operations.” She also is mindful of world events, such as the creation of alternative energy and the $5 billion expansion of the Panama Canal, which she said will result in

Life beyond the classroom Of all her accomplishments, Dr. Thornton said she believes her biggest impact on Cleveland has been in “creating an environment through policies and practices that helped to ensure student success.” Though her work with Tri-C keeps her busy enough, she sits on numerous community boards, such as the Rock and Roll Hall of Fame and Museum and the United Way of Greater Cleveland. “It really gives me a wonderful opportunity to not only serve as the president of the college, but be

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GEORGE VOINOVICH U.S. senator; Former mayor, city of Cleveland By JAY MILLER jmiller@crain.com

n April press release from the office of U.S. Sen. George Voinovich described an appropriation to a Cincinnati social service center from the Senate Committee on Appropriations’ Subcommittee on Homeland Security, which the Ohio senator chaired, for a program to prevent child abuse. The program, the release said, would be supported by a “publicprivate partnership.” Mr. Voinovich should have copyrighted that phrase 30 years ago when, as mayor of the city of Cleveland, he convinced dozens of business people and philanthropists to get their hands dirty in government by bringing their business expertise, and sometimes their business enterprises, to City Hall. Mr. Voinovich will leave the Senate at the end of this year and, most likely, retire from politics at age 74 after holding public office for most of the last 43 years, starting with two terms as a state representative from 1967 to 1971. He then served as Cuyahoga County auditor from 1971 to 1976 and a county commissioner from 1977 to 1978,

when he was chosen as running mate, lieutenant governor, to incumbent governor James A. Rhodes. He returned to Columbus to serve two terms as governor, from 1991 to 1998, before being twice elected to the U.S. Senate. But in Northeast Ohio, and Cleveland in particular, he will be best remembered for his 10 years as mayor, from 1979 to 1989, when he dug the city of Cleveland out of financial default and laid the groundwork for civic projects such as the Gateway sports complex and the Rock and Roll Hall of Fame and Museum. In the process, Cleveland would earn the nickname, “The Comeback City.” Mr. Voinovich was lieutenant governor to Gov. Rhodes in 1979 when a group of business leaders led by E. Mandell deWindt, then CEO at Eaton Corp., approached him about running for mayor against incumbent Dennis Kucinich. The latter’s fights with the business community had led Cleveland in 1978 to join New York City as the only American cities since the Depression to go into default — in Cleveland’s case, on $110 million of public debt (New York technically avoided using the word “default,” instead calling its

George Voinovich (at microphone) on the night he was elected as Cleveland mayor, Nov. 6, 1979. failure to make its debt payments a “moratorium”). After some hesitance, Mr. Voinovich agreed to run, but only once he had a commitment from the business community that they would pitch in to help him set the city back on a solid course.

Recalling that time, Mr. Voinovich told Crain’s Cleveland Business in 1990 that that cooperation was critical to his efforts as mayor. “I just kept involving people,” he said. “I don’t believe government solves any problems. My contribution was to empower the

private sector and all the people of the city to take their destiny in their own hands.”

Still waters run deep As he would throughout his career, Mr. Voinovich downplayed his own role.

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thorough audit of the city’s finances. They found the city in a $111 million hole. Most of the business recruits worked on Operations Improvement Task Force, a top-to-bottom review of city government. They would come up with 650 recommendations to improve city government and make it more efficient. Most of those recommendations were implemented and they saved the city $200 million during Mr. Voinovich’s decade as mayor, according to Norman Krumholz, a professor of urban studies at Cleveland State University, who served as Cleveland’s planning director and later community development director from 1969 to 1979. All of this clawing back worked. In October 1980, less than a year after he took office, eight local

banks, with the help of a state guarantee, lent Cleveland $36.2 million. That allowed the city to cure its default. With the help of an income tax increase Mr. Voinovich campaigned for and won in 1981 on his second try, the city was able to go back into the bond market in 1983, and before he left office, the city’s bonds returned to investment grade.

The personal touch James Bennett, who came to Cleveland in 1982 to run the local office of the McKinsey & Co. management consulting firm, spent countless hours working pro bono for the city, as did others in his office. Now a senior adviser with the Dix & Eaton public relations firm, Mr. Bennett said he believes Mr. Voinovich’s eight years as mayor have not been

CRAIN’S CLEVELAND BUSINESS matched since. “His ability to mobilize the resources of the community in the private sector — business and philanthropic — was distinctive,” Mr. Bennett said. “The total amount of help for good purpose that he was able to muster was quite extraordinary. No one else has been able to do that.” The improvement in the city’s finances gave local businesses optimism, which led to a downtown renaissance that lasted beyond the Voinovich years in City Hall. After his decade as mayor, Mr. Voinovich set his sights on the Statehouse, where as governor, he used the playbook that he developed while mayor. He even created a state-level Operations Improvement Task Force to slim down state government. As governor from 1990 to 1998, he

reduced state spending, including Medicaid spending, though he sought and won an increase in the state sales tax to help retire debt and build a state surplus. He continued that focus during 12 years in the U.S. Senate, becoming one of the early advocates of a federal commission on fiscal responsibility that began meeting earlier this year. He introduced a bill that would have created such a commission in October 2007. Mr. Bennett said that one of the keys to Mr. Voinovich’s ability to attract business talent was that he genuinely appreciated the help and he showed it. “I always felt thanked and appreciated, and it was those human qualities and the trust that made it work, that made us respond,” he said. ■

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In an interview, Mr. Voinovich said that because of the willingness of people in the business community, “I never had to hire a consultant.” He said he just called on someone with the right expertise who was ready to volunteer. “Many things made a difference,” he said, ticking off the names of groups and programs created during his years as mayor, such as Cleveland Tomorrow and the New Cleveland Campaign. But Richard Pogue, a partner and later managing partner of the Jones Day law firm who was one of Mr. Voinovich’s most active recruits from the business community, remembers a mayor in charge. “He’s low key in his style but his determination is fierce,” Mr. Pogue said recently. “Once he made up his mind, he was hard to stop.” The new mayor took a group of loaned executives from across the city’s business community and got them to work on solving the city’s financial and management problems. A group of accountants did on a

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LOOKINGATLISTS 2000 ■ Ohio ranked 19th nationwide with 44 venture capital investments in calendar year 1998, though it ranked 17th by dollars invested, at $209 million. ■ There were seven Northeast Ohio banks with local deposits exceeding $1 billion. In the 2010 Book of Lists, there were nine such banks. ■ There were 737,143 people employed in Cuyahoga County by 38,698 establishments, according to data from the U.S. Census Bureau’s County Business Patterns report. Summit County had 241,495 employees in 14,415 establishments; Lorain County had 91,945 employees at 5,671 establishments; Lake County had 90,056 employees at 6,424 establishments. ■ Medical Mutual became the first company on our Largest Privately Held Companies List to top $2 billion in revenue. continued on PAGE A-45

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RICHARD BOGOMOLNY Former president, Musical Arts Association By JENNIFER KEIRN clbfreelancer@crain.com

n 2003, Richard Bogomolny accompanied the Cleveland Orchestra to its first residency at Vienna’s famed Musikverein, home of the Vienna Philharmonic. Walking to the hall to watch rehearsal, he got lost and stopped to ask an English-speaking Viennese couple for directions. They happily obliged, then added in excited tones, “The Cleveland Orchestra is playing there today!” Little did the couple know they were speaking to the man many credit with sustaining the Cleveland Orchestra’s world-renowned reputation and its successes over the last 15 years. As president of the Musical Arts Association — the Cleveland Orchestra’s nonprofit parent — from 1995 to 2002, and its chairman for the last six years, Mr. Bogomolny led the organization through an era of record-setting fundraising that allowed for the renovations of Severance Hall and Blossom Music Center. He oversaw the transition from Christoph von Dohnányi to Franz Welser-Möst behind the baton and set a new course for the orchestra’s outreach efforts. “The orchestra or any important

civic institution is the product of its leaders and supporters in the community,” said Gary Hanson, the orchestra’s executive director. “He has contributed enormously to sustaining this institution.”

Musical beginnings From his childhood in University Heights, Mr. Bogomolny counts visits to the Cleveland Orchestra with his parents among his most treasured memories. “This was the place that got me enamored with the violin,” said Mr. Bogomolny, who has played violin and viola since his early teens. “I had a real appreciation of the level of play that was going on on the stage here.” A career that started in the 1950s at his family’s ice cream business eventually led Mr. Bogomolny to become chairman and CEO of First National Supermarkets — which operated here as Finast — from 1975 to 1992. Upon his 1992 retirement, Mr. Bogomolny devoted himself full time to civic involvement. His first assignment for the Musical Arts Association was to chair its fundraising committee, but he quickly met with difficulty. None of its donor records were computerized, and “we were soliciting people who

JANET CENTURY

Richard Bogomolny at Severance Hall, home of the Cleveland Orchestra had been dead for years,” Mr. Bogomolny said. After that first annual appeal, “I went to (then-executive director) Ward (Smith) and said, ‘I’m not

going to do this again unless we professionalize the campaign,’” he recalled. Under Mr. Bogomolny’s direction, the Musical Arts Association reor-

ganized its fundraising function, hired a professional fundraiser and computerized its donor rolls. Within two years, the association had balanced its budget, and

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people into the fold.” But Mr. Bogomolny’s easy way with people has reaped benefits for the Cleveland Orchestra far beyond its fundraising function. He was a key force in bringing and keeping Mr. Welser-Möst as the orchestra’s musical director, enabling what Mr. Hanson said was the first seamless transition between conductors in the orchestra’s last 50 years. “Without my seeing that very strong board leadership, I may not have considered being in Cleveland such a long time,” said Mr. WelserMöst, “but I believe strongly in the commitment of our trustees, thanks to him.”

civic energies toward other organizations as well, ranging from Shoes & Clothes for Kids to the Negev Foundation, an organization he founded to support agricultural development in Israel’s Negev Desert. In 2004, he was honored with the Jewish Community Federation of Cleveland’s Charles Eisenman Award for Exceptional Civic Contributions. “I think he’s a Renaissance man,” said JCF president Stephen

CRAIN’S CLEVELAND BUSINESS Hoffman. “He moves in the affairs of business and the affairs of the arts and promotes the artistic achievements of others. It isn’t just about civic pride and do-good. He is a man of the arts.” At 75, Mr. Bogomolny is showing few signs of slowing down. Before he considers a full retirement from the Musical Arts Association, “we have to fix this once and for all,” said Mr. Bogomolny, referring to the orchestra’s current

financial troubles. He’s now chairing what he called a quiet but very large fundraising effort to build the endowment. He declined to share his goal. The stakes are high, not only for the orchestra, but also for Northeast Ohio. “There is no institution in this community,” said Mr. Hanson, “that is more important to our collective Cleveland pride than the Cleveland Orchestra.” ■

Positioned for the future

JANET CENTURY

continued to do so for the next nine. This fundraising feat peaked with the association’s four-year TwentyFirst Century Campaign, which raised nearly $116 million between 1996 and 2000 to support operating expenses, the orchestra’s endowment fund and Severance Hall’s renovation, which was completed in 2000. “Dick has a unique ability to make his passion contagious, and that plays out ... in his tireless and effective fundraising,” Mr. Hanson said. “He has the ability to bring

Since its high-flying years in the late 1990s, the Cleveland Orchestra has weathered both the post-9/11 drop in nonprofit support and the current recession. Mr. Bogomolny remains on the front lines of ensuring a sustainable future for the orchestra. “He recognized that the world was changing in performing arts, and you have to figure out what your business plan and artistic plan is going forward,” said Dennis LaBarre, a longtime board member and now president of the Musical Arts Association. Along with retired Progressive Corp. executive Daniel Lewis, Mr. Bogomolny co-chaired a committee of business and community leaders in the early 2000s to generate new revenue-producing ideas for the orchestra, which led to such initiatives as the orchestra’s successful annual residency in Miami. “I’ve learned a lot from Dick,” said Mr. Lewis, who now chairs the Musical Arts Association of Miami, which serves as the Cleveland group’s Florida counterpart. “The most significant (is that) ... just because it’s a nonprofit, you shouldn’t lower your expectations of the performance of the organization or its staff and board members.” Mr. Bogomolny has directed his

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■ The largest public company, ranked by market value, was National City Corp., at $10.3 billion — just $1.6 billion less than the largest public company in the 2010 Book of Lists, FirstEnergy Corp., at $11.9 billion. (FirstEnergy’s market value in the 2009 Book of Lists was $23.4 billion.) ■ Six privately held companies topped $1 billion in annual revenue: Medical Mutual of Ohio, TravelCenters of America, Republic Technologies, IMG, Nesco Inc. and Swagelok Co. In the 2010 Book of Lists, Medical Mutual and Swagelok still are on the $1 billion-plus private companies list. ■ Nineteen CEOs topped $1 million in cash compensation, and three others topped $900,000. ■ The largest credit union, Firestone Office Federal Credit Union, had assets of $144.6 million. Crain’s March 15, 2010, list of credit unions showed the largest credit union in the region, Seven Seventeen Credit Union in Warren, had assets of $765.3 million; 17 institutions topped $100 million in assets. ■ The Cleveland Foundation, with $1.6 billion in assets, made $84 million in grants. The foundation, with $1.62 billion in assets, made $76.3 million in grants according to Crain’s.

■ Three of the eight largest public companies ranked by market value — National City Corp., Charter One Financial Inc. and TRW Inc. — no longer exist as standalone public companies. ■ The two largest employers in Cuyahoga County — the Cleveland Clinic and University Hospitals Health System — employed a combined 36,203 people. The third-largest employer — Cuyahoga County government — had just under 10,000 workers. ■ Of 1,315 partners at the 44 law firms on our Largest Law Firms list, there were 30 minorities, or just under 2.3%. Of 1,561 partners at the 52 law firms on our 2010 Largest Law Firms list, there were 49 minorities, or 3.1%. That’s progress, but not much. ■ There was a time, believe it or not, when Hyland Software wasn’t the region’s largest software developer. It ranked third that year, with 134 employees. (It had 742 in the 2010 software developers list.) ■ The largest union local was the United Food & Commercial Workers Union, Local 880, with gross receipts of $12 million and 26,053 members. continued on PAGE A-49

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BARBARA ROBINSON Local and national arts and culture advocate By AMY ANN STOESSEL astoessel@crain.com

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here is a part of Barbara Robinson that has regrets about quitting the piano. But the decision just might have been what helped Mrs. Robinson find the harmony she needed to focus on the arts advocacy that has been her lifeâ&#x20AC;&#x2122;s work. â&#x20AC;&#x153;All the things I love that Iâ&#x20AC;&#x2122;m doing now â&#x20AC;Ś I wouldnâ&#x20AC;&#x2122;t be doing,â&#x20AC;? she said of deciding at one point to go â&#x20AC;&#x153;cold turkeyâ&#x20AC;? from playing the piano for a while. Today, itâ&#x20AC;&#x2122;s almost impossible to define Mrs. Robinson by just one of her accomplishments. The onetime piano soloist with the Boston Pops Orchestra has spent her life both behind the scenes and in the forefront of efforts to promote and support arts and culture in Northeast Ohio and on the national stage. Asked to list her artistic passions, Mrs. Robinson hesitates: Music, dance and theater. Then, she notes, sheâ&#x20AC;&#x2122;s been called a voracious reader as well. â&#x20AC;&#x153;Literature is a love,â&#x20AC;? she said. The responses are not surprising coming from a woman whose work has taken her from the classroom to the Statehouse to Washington, D.C. Not to mention, sheâ&#x20AC;&#x2122;s the widow of jewelry magnate Larry â&#x20AC;&#x153;J.B.â&#x20AC;? Robinson, whose voice became a household standard in the retail chainâ&#x20AC;&#x2122;s advertising heyday. Even so, the mother of three and grandmother of six considers her family to be her lifeâ&#x20AC;&#x2122;s greatest

Arts and culture philanthropist Barbara Robinson at her Bratenahl home accomplishment. Her arts advocacy work, she humbly notes, has evolved with her interests and circumstances. Marcie Bergman, executive director of the Cleveland Art Prize, sees Mrs. Robinsonâ&#x20AC;&#x2122;s involvement a bit more pointedly, describing her as a â&#x20AC;&#x153;great standard-bearer.â&#x20AC;? In 2001, Mrs. Robinson was awarded the Cleveland Arts Prizeâ&#x20AC;&#x2122;s Special Citation for Distinguished Service to the Arts, one of the many accolades and honors that have been bestowed upon the Bratenahl resident through the years. Today, Mrs. Robinson is board co-chair for the organization, which is celebrating its 50th anniversary of recognizing the work of Northeast Ohio artists. â&#x20AC;&#x153;Sheâ&#x20AC;&#x2122;s so involved in the community, and sheâ&#x20AC;&#x2122;s such an advocate for the arts,â&#x20AC;? Ms. Bergman said.

High notes A love of music that was

engrained in Mrs. Robinson at a young age helped ignite a lifelong interest in the arts. Mrs. Robinsonâ&#x20AC;&#x2122;s father was an amateur musician with the Cleveland Philharmonic Orchestra, and she began classes at the Cleveland Institute of Music at the age of 3Â˝, eventually learning to play the violin, flute and piano. â&#x20AC;&#x153;Saturdays were spent at music lessons,â&#x20AC;? Mrs. Robinson recalls of her childhood. Eventually deciding that music was not something she wanted to pursue professionally, Mrs. Robinson attended Wellesley College near Boston and the Harvard-Radcliffe Program in Business Administration. (Harvard was not directly admitting women at the time.) She had varied interests and changed majors several times, with her studies ranging from psychology and marketing to strategic planning. â&#x20AC;&#x153;It really turned into what Iâ&#x20AC;&#x2122;ve been doing ever since,â&#x20AC;? she said of

THIRTYYEARSOF...MOVIESANDTV Over the past 30 years, Northeast Ohio has been featured numerous times on the big screen. Here are some of the most memorable depictions in the movies: â&#x2013; Those Lips, Those Eyes (1980): Youâ&#x20AC;&#x2122;ll see a lot of Cleveland Heightsâ&#x20AC;&#x2122; Cain Park in this movie about a summer at a musical theater in the 1950s, written by Cleveland native David Shabar. â&#x2013; The Escape Artist (1982): Shot all around Cleveland, including downtown near City Hall and in the Flats, this was a Francis Ford Coppola production about the son of a great escape artist trying to follow in his fatherâ&#x20AC;&#x2122;s footsteps and learning much along the way. â&#x2013; A Christmas Story (1983): Do we need to say anything about this beloved Cleveland classic? â&#x2013; Stranger than Paradise (1984): Willie (John Lurie) and Eddie

(Richard Edson) go to Cleveland to track down Willieâ&#x20AC;&#x2122;s cousin Eva (Eszter Balint), who is visiting from Hungary and has left Eddie in New York to see an aunt in Cleveland. Filmed here, in part. â&#x2013; Light of Day (1987): Michael J. Fox and Joan Jett starred as members of local band the Barbusters in a plot that had them dealing with their motherâ&#x20AC;&#x2122;s illness. It was shot, in part, in Cleveland. â&#x2013; Major League (1989): Every discussion of Cleveland-themed movies must include Major League, a sendoff of the pennant-less Indians that features Rick â&#x20AC;&#x153;Wild Thingâ&#x20AC;? Vaughn (Charlie Sheen), Pedro Cerrano (Dennis Haysbert) and Willie Mays Hays (Wesley Snipes) in the best American Express commercial ever seen. â&#x2013; Air Force One (1997): This Harrison Ford thriller made good use of Cleveland locations. The outdoor nighttime shots of the military invading a palace were filmed at Severance

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her educational path, in particular Ohio Arts Council, who has known her focus on strategic planning. Mrs. Robinson for 26 years. Perhaps the most striking notes Locally, Mrs. Robinson put her in Mrs. Robinson’s repertoire have advocacy experience to work in come as a result of her tireless pushing for the passage of Issue 18, efforts in promoting the arts in the a ballot issue that was approved in political sphere. 2006. Mrs. Robinson served as Mrs. Robinson co-chair of the “Barbara has dedicated group that advoserved four terms as chairwoman her time and attention ... cated for the of the National to supporting and nurturing 30-cents-perAssembly of State pack cigarette the arts infrastructure in tax, which is Arts Agencies, Ohio and the nation.” the umbrella expected to organization for generate up to – Julie S. Henahan, executive state arts agen$20 million per director, Ohio Arts Council cies. She also year over 10 years served 13 years as chairwoman of to support the area’s arts and the Ohio Arts Council and continues culture. as chair emeritus, and she served Varied repertoire as chair of Arts Midwest, a regional For Mrs. Robinson, her keen arts and culture organization serving understanding of the arts has a nine-state region. translated into work with a never“Barbara has dedicated her time ending list of organizations, and attention … to supporting and including the Cleveland Institute nurturing the arts infrastructure in of Music and the Cleveland Orchestra, Ohio and the nation,” said Julie S. for which Mrs. Robinson serves as Henahan, executive director of the

Hall. In some shots you can see part of adjacent Case Western Reserve University’s Thwing Center. Scenes depicting the interior of the palace were filmed inside the Cuyahoga County Courthouse. ■ Welcome to Collinwood (2002): The movie about the perfect heist gone terribly wrong was shot on location. ■ Antwone Fisher (2002): Based on a true story, Antwone Fisher (Derek Luke) works through a difficult Cleveland childhood with his psychiatrist as the title character begins his first romantic relationship and learns to deal with his anger. It was directed by, and also starred, Denzel Washington. ■ American Splendor (2003): The prize-winning film about Cleveland native and comic book writer Harvey Pekar (Paul Giamatti) shows how Mr. Pekar went from a file clerk at the V.A. Hospital to a guest on “Late Night with David Letterman.” It was filmed here.

■ Spider-Man 3 (2007): Lots of the webbed hero’s scenes swinging through the streets of New York actually were filmed on Euclid Avenue. ■ The Rocker (2008): Robert “Fish” Fishman (Rainn Wilson), drummer for the Cleveland band Vesuvius, is kicked out right when Vesuvius gets signed. But his nephew, who is playing at the prom, needs a drummer for his band, A.D.D. Eventually, A.D.D. ends up opening for Vesuvius. But a TV show was our big moment in pop culture: ■ The Drew Carey Show (19952004): “Moon over Parma, send your love to me tonight …” Clevelanders tuned in to see the antics of Drew and Mimi over the nine years the show was on the air as the gang brewed Buzz Beer and dealt with Cleveland winters. “Cleveland Rocks,” as a theme song, didn’t hurt, either. — Dan Shingler, Arielle Kass

a member of the Musical Arts Association’s executive committee, board of trustees and is chair of its government relations committee. “Some people join boards because it looks good,” said Dennis W. LaBarre, a partner at Jones Day who was elected in November to serve as president of the Musical Arts Association, the governing board of the Cleveland Orchestra. “Barbara is on the board because she loves the orchestra.” Indeed, it was Mrs. Robinson’s love of music that drove one of her earliest initiatives, now known as Young Audiences of Northeast Ohio. When her children were in school, Mrs. Robinson realized that there simply wasn’t much music education in the schools. So Mrs. Robinson — active at the time with the Cleveland Chamber Music Society — worked to help establish the program, which focuses on arts education in the schools. Make no mistake, however, Mrs. Robinson does not limit herself to working on behalf of the arts. Dr. Fred Rothstein, president of University Hospitals Case Medical Center, uses words such as “dedicated,” “thoughtful,” “tireless” and “humble” in describing Mrs. Robinson and her work on behalf of his organization. “Her gentle way of doing things really brings a lot to the equation,” Dr. Rothstein said. UH is recognizing Mrs. Robinson and her family’s generosity with the Robinson Family Pavilion on the second floor of the new UH Cancer Hospital. The pavilion will house a suite of offices and treatment rooms for patients to see their physician throughout their cancer care. “When I first met Barbara, I had no idea how involved she is,” Dr. Rothstein said. “She’s an exceptional individual.” ■

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JIMCOOKINHAM

“(Mr. Cookinham) recognized the potential impact that the IT industry could have on Northeast Ohio.”

Founder, Northeast Ohio Software Association

– Dan McMullen, intellectual property attorney, Calfee, Halter & Griswold LLP

By CHUCK SODER csoder@crain.com

5/21/2010

few years ago Jim Cookinham and his wife were waiting for a table at Gamekeepers Tavern in Chagrin Falls when they overheard a fellow patron going on and on about all the things wrong with Northeast Ohio. He had to step in. “It got just plain ugly,” Mr. Cookinham said with a smile. OK, maybe not that ugly. This is, after all, a guy local writer John Ettorre described as a Moses lookalike with a “pastoral presence.” But Mr. Cookinham had to make his point: Too many people wait for the government or some organization to solve the region’s problems when they should be pitching in themselves. “I think people need to take responsibility and just go do something,” he said. Mr. Cookinham has done plenty of doing over the years, most notably through the Northeast Ohio Software Association. Mr. Cookinham founded NEOSA in 1998, sparking untold numbers of partnerships, friendships and conversations on how to improve the region’s information technology industry. Heck, the very existence in Northeast Ohio of a group for IT companies was a big deal for a region often associated with the decline of industrial America. That’s why one of Mr. Cookinham’s

first goals was to put together a directory of all the IT companies in the region. He found 3,000 of them and put them in book form. Then he had 11,000 of those books printed. Funny that a group rooted in technology would bother with printing directories, but the online directory just didn’t have same impact as the physical one. “When you said ‘3,000’ you could go, ‘plunk,’” he said. “It was a thick book.”

Connector of the dots Mr. Cookinham’s goal was to do anything he could to help the region’s IT companies do better business. The group under his leadership hosted popular networking events, seminars and all sorts of other programs. It even sponsored a debate between Jane Campbell and Ray Pierce back when they were running for Cleveland mayor, which inspired the city to create a staff position focused on technology-based economic development. Top-down management, however, won’t be what builds the region’s IT industry — or any industry, for that matter, Mr. Cookinham said. The real work, he said, is done by individuals with ideas and the will to implement them. People such as A.J. Hyland, CEO of document management software firm Hyland Software in Westlake, and Phil Alexander, CEO of marketing technology firm BrandMuscle in Beachwood.

“If you have a bunch of A.J. Hylands and Phil Alexanders doing great stuff, that’s going to solve our problems,” Mr. Cookinham said. One of Mr. Cookinham’s biggest strengths is that he understands the power of grassroots economic development and helping individuals with common goals connect with one another, said Mr. Ettorre, who owns a freelance writing practice called Working with Words. “He did a lot of that dot connecting,” Mr. Ettorre said. A lot of it. So much that his name became synonymous with IT in Northeast Ohio, said Dan McMullen, an intellectual property attorney at Calfee, Halter & Griswold LLP of Cleveland. “Jim literally became the face of the IT industry here,” he said.

Santa and his gadgets Mr. McMullen said something similar onstage at a roast held in Mr. Cookinham’s honor at Corporate College East in February 2008, shortly after Mr. Cookinham retired from his position as vice president of member networks and programs at the Council of Smaller Enterprises. Mr. Cookinham took the position in 2005 a year after NEOSA became part of COSE. Mr. McMullen and other members of the region’s IT community lambasted Mr. Cookinham for his fondness of puffy down vests and his frequent inability to get the

gadgets he loves so much to work. The crowd all put on fake white beards as Mr. Cookinham — known for his Santa Claus-esque facial hair — walked into the ballroom. Despite the jokes, speakers made sure the crowd knew how serious he was about information technology. “He recognized the potential impact that the IT industry could have on Northeast Ohio,” Mr. McMullen said. It took Mr. Cookinham a while to find his way here. He was born in Kansas in 1945 and moved several times as a child, eventually ending up on the island of Mallorca, just east of Spain, after his father was assigned to a naval fleet in the Mediterranean. He was home schooled from grades three through seven, though he did attend school in Madrid in eighth grade before his family headed back to Topeka. Mr. Cookinham still visits friends in Spain and considers himself half Spanish. He likes the “mass socialization” that he said permeates Spanish culture. By contrast, he said, the growing size of U.S. yards and televisions tends to promote isolation.

A Navy man drops anchor Like his father, Mr. Cookinham joined the Navy, graduating from the U.S. Naval Academy in 1968. He worked on a nuclear submarine in Hawaii, where he married his wife, Cindy, before leaving the Navy in 1973. Then he did some soul searching with the help of a new Volkswagen camper: He and his wife drove across North America, then they shipped the camper to Europe to complete their tour of the Western world. In the process, they swung by the Brussels office of nuclear giant Westinghouse. The company happened to be desperately searching for someone with experience running nuclear reactors who they could send to a power plant in Spain on short notice. “I got the job, like — boom!” he said. The company a few years later sent him back the United States, but he decided to leave the industry shortly after the Three Mile Island incident in 1979. It was a Westinghouse project, however, that drove him to study

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computers. That knowledge soon turned into a love for the machines: In 1981 he started a popular newsletter that he believes was the first publication focused on IBM’s new personal computers, which

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transformed the young PC industry. Mr. Cookinham moved to Northeast Ohio in 1984 and in 1989 was named president of Cleveland Thermal, which heats and cools downtown buildings. He eventually became an executive with the firm’s parent company

but left to start NEOSA because of a desire to do something good for the community. Just don’t wait for NEOSA — or any organization, for that matter — to fix Northeast Ohio. “The ideas have to come from below,” he said. ■

LOOKINGATLISTS 2003

23,360 FTEs.

■ Morry Weiss, then CEO of American Greetings, topped the Highest Paid CEOs list for the first time, with cash compensation of $2.52 million. ■ Just 14 CEOs topped $1 million in cash compensation, down from 19 two years earlier. ■ Progressive Corp. reported a Cuyahoga County work force of 6,468 full-time equivalent employees, up 18% from the prior year. Only one other employer saw its Cuyahoga County work force increase by a double-digit percentage: the Cleveland Clinic, up 11.8% to

■ National City Corp. was the largest bank by market value, at $18.9 billion, topping No. 2 KeyCorp, which had a market value of $11.9 billion. But KeyBank outranked National City on local deposits, $13.35 billion to $11.65 billion. ■ The largest savings institution, Third Federal Savings & Loan Association, had $4.88 billion in local deposits — more than the combined total of the next three savings institutions (Ohio Savings Bank, Dollar Bank FSB and Metropolitan Bank & Trust Co.) on the list. continued on PAGE A-50

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FREDKRUM Former director, Akron-Canton Airport By JOHN BOOTH clbfreelancer@crain.com

he days of slipping a dime into a turnstile to hang out on the observation deck and watch the almost lazy movement of planes in and out of Akron-Canton Airport seem impossibly idyllic and distant. And yet that’s how life was when Fred Krum was hired as the airport’s director in 1981 at the age of 29. By the time he retired from the post in 2008, Akron-Canton had added 750 acres and undertaken two runway expansions to occupy more ground than Cleveland Hopkins International Airport. Annual passenger traffic during Mr. Krum’s tenure skyrocketed to 1.47 million from 258,000, with a dozen nonstop destinations available. Mr. Krum died in March 2009 at age 57 from complications of a brain tumor, leaving a legacy that reaches beyond facts and figures and illustrates a regional air transportation landscape wholly transformed. Born in Buffalo, Mr. Krum moved to Canton at the age of 6 and grew up around what was then known as Akron-Canton Regional Airport, where his father was a United Airlines operations manager. Mr. Krum later worked in the airport’s restaurant and bar and became an airport accountant in 1975 after graduating from John Carroll University. He also earned a law degree from the University of Akron before his promotion to

airport director. Dick Kempthorn, an airport board member whose tenure dates to the 1970s, makes an improbable comparison that somehow rings accurate, likening Mr. Krum’s drive to that of legendary Cleveland Browns running back Jim Brown “who’s going to get you three yards when you just need two.” “That was Fred,” Mr. Kempthorn said. “He always gave you more than what you bargained for.”

Getting off the ground Between airline deregulation and the air traffic controllers’ strike in the summer of 1981, Mr. Krum’s tenure as airport director got off to a rough start. “Fred’s response to all that was to go out and find some additional service,” says current airport director Rick McQueen, who worked with Mr. Krum for more than 20 years before succeeding him. “Piedmont Airlines started service here in July of 1982. That actually started the turnaround for this airport.” Unafraid to play ball with the airlines, Mr. Krum engaged them in dialogue and, supported by his accounting background, pulled together facts and figures to make his pitches. “The big thing was getting the (flight) slots at the airport we wanted,” Mr. Kempthorn said. “He wound up getting slots at New York and Boston and Orlando. People used to go to Pittsburgh or Cleveland to get the flight they really

wanted, but he made it possible for people to jump on an airline here in Canton and go nonstop to their destination.” Dennis Saunier, president and CEO of the Canton Regional Chamber of Commerce, has been with the chamber since 1980 and was a college acquaintance of Mr. Krum. “Fred’s greatest asset was his

vision,” Mr. Saunier recalled. Lots of people knew there was the potential for the Akron-Canton Airport to be a great asset, he said, but Mr. Krum inspired the action to make it so. “He incorporated great business knowledge and great vision with treating people in a very special way, and that combines for a great deal of success,” Mr. Saunier said. Further evidence of the airport’s impact, Mr. Saunier said, stretches along Interstate 77 north from Canton and south from Akron, where extra exits and extensive development cropped up in what was once a largely empty stretch of freeway with the airport at its center.

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The early 1990s were a tough time for smaller airports such as

Akron-Canton, which saw more airlines focusing their resources toward the major airports. Mr. Krum, with his characteristic knack for recognizing an opportunity, used the environment to entice Florida-based AirTran Airways into actually raising its profile at the airport known by the airline symbol CAK. That effort included one of Mr. Krum’s almost-instinctual leaps, according to Kristie Van Auken, the airport’s senior vice president and chief marketing and communications officer. At a meeting in Orlando, Ms. Van Auken said, “(AirTran) asked him, ‘Do you guys have anybody that can help us in sales and marketing?’ He said, ‘We don’t, but we’re hiring one.’” Naturally, Mr. Krum began the process as soon as he returned to Northeast Ohio,

LOOKINGATLISTS 2004

2005

■ The apartment market enjoyed a strong 2003, with vacancy falling from more than 11% in January of that year to just over 9% at year’s end.

■ The largest business insurance agency, Marsh USA Inc., had 132 licensed employees, with 112 people in property/casualty and 20 in employee benefits. Two other firms — Dawson Cos. and Oswald Cos. — topped 100 licensed employees.

■ Progressive Corp. just kept on growing, as the auto insurer based in Mayfield Village saw its Cuyahoga County work force rise 16.8% to 7,557 full-time equivalent employees. ■ There were 84,991 boats registered to residents of Cuyahoga, Geauga, Lake, Lorain, Medina, Portage and Summit counties. (OK, maybe this isn’t a “significant” fact as advertised, but that’s a lot of boats!) ■ There were 8,872 physicians in those seven counties licensed to practice — or 76,119 less than the number of boats. ■ Geauga County had the highest percapita income in the seven-county area, at $35,903. The lowest was Portage County, at $25,703.

■ Six law firms — Jones Day; Baker & Hostetler; Calfee, Halter & Griswold; Squire, Sanders & Dempsey; Thompson Hine and Porter Wright Morris & Arthur — offered salaries exceeding $100,000 to associates hired from law school. ■ Ernst & Young was the largest accounting firm, with 830 degreed professionals. It still was in the top spot in the 2010 Book of Lists, but with a lot fewer degreed pros — 234. ■ The operating budget of the largest Northeast Ohio college or university, Kent State University, was $259 million. By 2010, Kent’s operating budget was $491 million.

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AKRON-CANTON AIRPORT

and he wound up bringing Ms. Van Auken aboard as the airport’s first marketing director. “He had the uncanny ability to come up with the right answer at the right time,” she said. “So much of this goes back to Fred being a very intuitive leader. He would know what move would need to be made and when a risk needed to be taken.” CAK’s marketing went on the offensive with television and print ads that played its small-airport feel against the crowded, hectic pace of larger neighbors and created a regional advertising celebrity in the form of a clown-faced inflatable “punch dummy.” The character and campaign stuck in the minds of consumers — and in the craw of Cleveland Hopkins officials to the point where billboards for AkronCanton were banned within a mile of its Interstate 71 counterpart.

That competition helped change the region’s air travel even more.

Sky’s the limit Thomas Waltermire, CEO of regional business attraction group Team NEO, said there’s no doubt that Mr. Krum’s work and the growth of CAK substantially altered Northeast Ohio’s economic landscape. “What Fred built was a credible second airport for the region, and it brought alternatives,” Mr. Waltermire said. “It brought airline competition, and that has led to a combination of service and reach at a cost level that makes the region more attractive to live in as well as to work. The cost of airline travel is less for businesses and for tourists in Northeast Ohio than it is in other places, and it’s lower because Fred turned Akron-Canton into a place that people wanted to use.” ■

2006

2007

■ A record 24 CEOs topped $1 million in cash compensation, led by Robert J. Keegan of Goodyear Tire & Rubber Co. at $3.65 million.

■ Truck stop operator TravelCenters of America became the first Northeast Ohio-based private company to top $4 billion in annual revenue.

■ The getting was good for non-CEOs as well, with 20 of them topping $1 million in cash compensation. The leader was KeyCorp senior executive vice president Thomas Bunn, at $2.5 million.

■ For the first time, two CEOs topped $4 million in cash compensation: Henry L. Meyer III of KeyCorp ($4.45 million) and Robert J. Keegan of Goodyear Tire & Rubber Co. ($4.08 million).

■ For the first time since Crain’s began compiling the Book of Lists, both the Cleveland Clinic and University Hospitals Health System saw their Cuyahoga County employment fall, by 1% and 1.6%, respectively. ■ Catholic Charities was the largest nonprofit, with expenses of $90 million. Western Reserve Area Agency on Aging, was No. 2, at $82.3 million. ■ The largest airline serving Cleveland Hopkins International Airport, Continental, reported 1.69 million enplaned passengers.

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■ On our Largest Nursing Homes list, St. Augustine Health Campus in Cleveland had the highest daily room rate, at $422. (It had a wide spread, though, with its lowest room rate at $175.) ■ Among assisted-living centers, the highest monthly rate was at The Weils in Chagrin Falls, with a range of $3,225 to $5,300. ■ The largest industrial park, Strongsville Business and Technology Park, had 1,693 acres, nearly three times the size of the No. 2 park, Twinsburg Industrial Park, at 571. continued on PAGE A-52

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TOMTYRRELL Founder, American Steel & Wire

By DAN SHINGLER dshingler@crain.com

t would be easy to meet Tom Tyrrell and not realize he has been a successful corporate executive, entrepreneur, civic activist and captain of industry. Not that the 65-year-old Mr. Tyrrell lacks the sharp mind, ambition or vision required for those endeavors — they shine from him like twinkling stars, whether the conversation turns to the steel industry he mastered, the Towpath Trail he has championed and traversed or the new companies he still hopes to build. It’s just that Mr. Tyrrell exhibits a warmth not often on display among people who have climbed corporate ladders, bulldozed through red tape or worked alongside the likes of David Stockman and other high rollers. His demeanor and values have made him wealthy while lifting up those around him, as demonstrated by his best-known business success. That would be American Steel & Wire, a company Mr. Tyrrell put together in 1986 by convincing investors to help him buy three U.S. Steel plants, including the then-closed Cuyahoga Works. Mr. Tyrrell already had two decades of management experience at some of the nation’s largest steelmakers when he conceived the deal, which was founded in a belief that customers would buy his customized steel and wire

products over standard products offered by competitors. He was right, and the company was a success right up until and after it was bought by Birmingham Steel in 1994. But that’s not the interesting part of the story. The part that shows how Mr. Tyrrell thinks is the story of how he treated the employees. To work at American Steel & Wire, all new employees had to buy $100 of stock. That stock came from Mr. Tyrrell, but he didn’t sell it to them. He donated the shares to the company treasury and it sold the employees the stock for 10% of what it was actually worth. “That means they had to come up with $100 — which doesn’t sound like much, but it was 1986. A lot of them had to go borrow the money,” Mr. Tyrrell said. There were two reasons for requiring employees to make that investment. He wanted them to work as if they were working for themselves, which he says they did. He also wanted them to profit from their work — and when the company was acquired, each employee’s $100 stake was ultimately worth $16,000. Did Mr. Tyrrell leave a lot of money on the table? Absolutely, he said. But he made his fair share, and he’d do it again the same way. Rob Heiser, CEO of two technology companies in Akron — Segmint and WiredViews — has known Mr. Tyrrell since 2002. At

that time, Mr. Heiser was chief technology officer at a Clevelandbased technology startup called SupplierInsight, and Mr. Tyrrell was brought in by private investors to serve as president. “He’s a tough guy,” Mr. Heiser says, when asked whether Mr. Tyrrell is as nice as he seems. “Don’t take me the wrong way, he sets expectations high and strives to meet them — but he doesn’t step on anybody to get there.” Mr. Heiser said he’s taken much time and knowledge from Mr. Tyrrell, who helped convince him to become a CEO. But he said that’s not unusual for Mr. Tyrrell, even with employees who sit far from the executive suites. “He’s always about teaching and educating and he’s big about giving back,” Mr. Heiser said. “He’ll take interns to meetings with innovation funds or arch angels, just so they can get that kind of experience.”

In touch with his roots Mr. Tyrrell seems not to have forgotten where he came from, or what it’s like for someone to be low enough on the ladder to catch most of the falling debris. Mr. Tyrrell grew up in Chicago, with roots that were modest at best. He remembers a family story about how his grandparents got power to their apartment by tapping into the building next door — the hard way. “My grandfather held my father out the window, and he wired the

The faculty and staff of Cuyahoga Community College thank Dr. Jerry Sue Thornton for all you do to promote individual development to improve the overall quality of life in a multicultural community, and for being the College’s dream catcher for the past 18 years.

Jerry Sue Thornton, Ph.D. President

Where futures begin SM

Tom Tyrrell sits in an area of the Towpath Trail, along the old Ohio Canal, where he used to go for his morning run when the property was owned by American Steel & Wire, a company Mr. Tyrrell founded. house to a neon sign,” Mr. Tyrrell said. When Mr. Tyrrell came along, the family was still working class. Life was tough, and there was no effort to shield young Tom from that fact. On car trips, his father would tell him to pay attention to the street signs and the directions they were traveling — because if he had a heart attack and died, the boy would need to be able to find his own way home. His mother was a schoolteacher and his father worked days at a company that made cans, nights at Sears, Roebuck & Co. and weekends at a gas station. His dad took the third job in part to help his son with college, as young Tom was struggling to work and attain good grades in his final year. “We would visit my father by driving out on Sunday evening to get gas,” he said. Mr. Tyrrell also found another

way to spend time with his father — by working at the same can company. There, he learned lessons of how to treat people and employees — by realizing they are one and the same.

Don’t do as they do The bosses at the can plant were cruel and unsympathetic to their employees, he said. Supervisors abused and yelled at them, knowing they could not afford to lose their jobs. “People were actually crying at times,” Mr. Tyrrell said. “I thought, ‘You’re running a business, you’ve got these good people and you’re not using them right.’ I began to build a bank (of principles) in my mind and I said, ‘I’m going to run a business someday and I’m not going to treat people this way.’” Since leaving American Steel & Wire after its sale, Mr. Tyrrell has continued to be a force in the

LOOKINGATLISTS 2008 ■ National City Corp. loses its longtime position as the region’s largest company ranked by market value. FirstEnergy takes the top spot, with market value of $21.8 billion vs. National City’s $21.7 billion. ■ The largest foreign-owned company in Northeast Ohio was Sterling Jewelers Inc., part of Signet Group PLC of London, with 2,244 full-time equivalent employees.

Northeast Ohio-based company was Developers Diversified Realty Corp.’s $6.2 billion acquisition of Inland Retail Real Estate. ■ The SEC changed requirements for how executive pay was calculated. The top-paid CEO was Robert J. Keegan of Goodyear Tire & Rubber Co., with a compensation package valued at $17.3 million.

2009

■ Northeast Ohio’s most affluent community was Hunting Valley (pop. 706), with median household income of $291,667. The median value of an owner-occupied house there is … $1.16 million.

■ The number of manufacturing jobs in the seven-county area of Northeast Ohio — Cuyahoga, Geauga, Lake, Lorain, Medina, Portage and Summit — was 184,945, down 6.7% from 198,347 in 2004.

■ The largest deal completed by a

■ The two largest advertising

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business community. He worked at investment firm Blackstone Group for famed financier David Stockman in the late 1990s, building and then resigning from Fairlawnbased Republic Technologies International, another steel company, in the process. He has tremendous respect for Mr. Stockman still, but says the two weren’t a good fit. “David Stockman was the smartest person I’ve ever met,” Mr. Tyrrell said, “But he was the kind of guy who would go grocery shopping when he hadn’t eaten in three days.”

High praise, indeed Mr. Tyrrell hasn’t slowed down since the two parted ways a decade ago. He serves on three college boards and works with nonprofits ranging from the Cuyahoga Valley Initiative, which is pushing for improvements to the Cuyahoga Valley National Park such as the Towpath Trail recreational pathway along the old Ohio Canal, to

agencies in Northeast Ohio were in Akron. No. 1 is Malone Advertising, with 215 full-time local employees, and No. 2 is Hitchcock Fleming & Associates Inc., with 110. ■ The largest cultural attraction in Northeast Ohio, PlayhouseSquare, drew 849,000 to its performances. ■ Office vacancy in downtown Cleveland was 19.9%. The rate was 17.0% in the suburbs. Both rates were better than 2004, when downtown vacancy was 23.6% and suburban vacancy was 19.5%.

2010 ■ The largest management consulting firm, Accenture, had 200 local consultants. Two other firms had at least

the environmentally conscious Entrepreneurs for Sustainability. He also is co-owner of Segmint, a new startup in Akron that is engaged in data mining partnerships with financial institutions. Plus, he is a principal with the Cleveland venture capital fund Glengary LLC, where he coaches up-and-coming entrepreneurs. Mr. Tyrrell can’t seem to help working. The one time he found himself with time on his hands, after leaving Blackstone in 1999, he spent his free time digging ponds on his property in Munson. Working hard has made Mr. Tyrrell a wealthy man, he said, in more ways than one — and financial wealth seems to satisfy him the least. “Money is nice, but if someone comes up 15 years later and says, ‘You’re the best person I’ve ever worked for’ — that’s what it’s all about,” he said. Apparently, sometimes nice guys do finish first. ■

100 local consultants — Deloitte Consulting LLP, with 176, and Watson Wyatt Worldwide (say that three times fast) with 100. ■ Of the 10 largest Northeast Ohio employers, ranked by full-time equivalent local employees as of June 30, 2009, three were health care institutions — the Cleveland Clinic, University Hospitals and Summa Health System — with a total of 53,049 employees. ■ Jones Day offered the highest salary for an associate hired from law school, at $145,000. ■ The largest office lease recorded in Northeast Ohio was a 96,721-squarefoot lease for Huntington National Bank at 200 Public Square in Cleveland.

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A.J.HYLAND CEO, Hyland Software Inc.

By CHUCK SODER csoder@crain.com

onsidering all A.J. Hyland has accomplished, you wouldn’t guess the guy in charge of a company widely considered the poster child of Northeast Ohio’s information technology industry was just 29 years old when he became CEO. Although still two years shy of 40, the head man at Hyland Software Inc. already has spent nearly a decade guiding the producer of document management software through year after year of growth. How much growth? Well, the company had 150 employees when co-founder Packy Hyland Jr. turned the reins over to his younger brother in 2001. Since then the company rarely has stopped hiring. Hyland employs 753 in Northeast Ohio, and more than 150 at seven other offices across the United States and overseas. That explosive growth continues today. Private equity firm Thoma Bravo LLC bought a majority stake in the company for $265 million in mid-2007, and since then Hyland Software has made a few acquisitions and intends to make more in an effort to become a force in the document management software market. Mr. Hyland was just 35 when Hyland Software announced the sale. The private equity firm never replaces management teams when it makes investments, so the

simple fact that it bought the company speaks well of Mr. Hyland, said Seth Boro, Thoma Bravo partner. “We just saw someone who was incredibly passionate. A great leader,” Mr. Boro said. Mr. Hyland is a quick learner, said chief operating officer Bill Priemer, who has known him since childhood. His accomplishments are made all the more impressive because he is still so young, Mr. Priemer said. “It’s not like he was an executive at some other firm before he did this,” he said.

It’s a family affair Mr. Hyland knows, however, that he’s not the only Hyland deserving credit. Packy Hyland Jr. started the company back in 1991, creating the foundation upon which the younger Hyland built. A.J. Hyland described his oldest brother as a great salesman who knows how to gain people’s trust — one reason why the elder Hyland was able to recruit his younger brother to join Hyland Software’s quality assurance team after he graduated from Georgetown University with a degree in business administration. Mr. Hyland has another older brother, Chris, who is the company’s chief financial officer and a “steady hand” who helps him guide the company to this day. Their father, Packy Hyland Sr., who served as company president through much of the 1990s, raised

enough money from friends, family and associates to help Packy Jr. get the company off the ground — and keep it going. He passed away about a year ago. “That man kept this company afloat by just finding ways to make payroll,” A.J. Hyland said of his

father. “He just made it happen.” The opportunity to work with his family over the years has been a blessing, he said, adding that his sister, Kate, and her husband, DeWayne Ashcraft, have worked at the company as well. The Hyland family spent a lot of time moving when Mr. Hyland was young, which made them closer. “When you move around and change schools a lot, you lean on your siblings probably more,” he said.

No shame in trying Mr. Premier, who was friends with the Hyland boys while growing up in University Heights, described Packy Jr. as the one

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always coming up with crazy ideas and Chris as the voice of reason who played along but wouldn’t get in trouble. A.J. was younger, but he was a “tough, competitive little kid,” Mr. Priemer said. Mr. Hyland carried that competitiveness with him as he grew older, eventually joining the St. Ignatius High School basketball team, but it wasn’t enough to get him much playing time. “I contributed well in practice,” he said with a laugh. Mr. Hyland had wanted to eventually become a sports broadcaster — “I probably was just going to drive to Bristol (home of ESPN’s studios) and camp out until I got a job” — before he was wooed by his

THIRTYYEARSOF...UNBUILTPROJECTS In 1903, the celebrated urban planner Daniel Burnham mapped out a grand plan for downtown Cleveland that included a monumental train station overlooking Lake Erie between Cleveland City Hall and the Cuyahoga County Courthouse. It was to be the capstone of the Mall. It never happened. Whether it’s lack of money, a preempting competitor, politics or bad timing, public and private developments get shelved all the time. It has happened many times in the last 30 years.

Progress report ■ In 1987, Progressive Corp. unveiled a development plan for, coincidentally, the site of the train station on the Mall. It was called the North Mall project, and at its center was a 60-story corporate headquarters for the insurance company, to be surrounded by a hotel, a library and an art gallery. The project plan for the $300 million complex also included a link from the Mall to the lakefront. Progressive’s chairman, Peter B.

Lewis, a connoisseur of contemporary art, hired up-and-coming Los Angeles architect Frank O. Gehry to design the sleek skyscraper. In 1991, however, Mr. Lewis declared the project dead on arrival for financial and other reasons.

Square pegs ■ The northwest quadrant of Public Square, too, has been the site of repeated attempts at monument building. In 1988, developer Richard Jacobs, who had Society Center (now Key Tower) under construction across the square, proposed a new, $500 million mixed-use complex highlighted by a 70-story office tower that would be the new headquarters of the Ameritrust Corp. banking business, then at East Ninth Street and Euclid Avenue. Ameritrust fell on hard times, however, and in 1992 it agreed to merge with Society Corp., killing plans for a new headquarters. Mr. Jacobs decided in 2008 to take another crack at a project at the site — Public Square Tower, as it was

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the first time they start a business. “I think we should be more excited that somebody tried and we should build them up to try again,” he said.

Now you’re cookin’

JANET CENTURY

older brother’s overtures. Though he didn’t pursue his original dream, it seems this career path has turned out more than OK for him. Not only does running Hyland Software play right into his competitive nature, but Mr. Hyland gets to lead a company that has created a heap of new jobs and a lot of hope for Northeast Ohio’s IT community. It’s a banner he doesn’t mind carrying. “I think it matters to the region to have a success story,” he said. That’s not to say people who want to run their own shows should fear failure. Mr. Hyland said the region needs to do more to encourage entrepreneurs and to understand that they won’t always be successful

Mr. Premier described Mr. Hyland as an enthusiastic, optimistic leader who knows the value of his employees. It’s typical for him to know a given employee’s name, his or her background and what projects he or she is working on, Mr. Premier said. Mr. Hyland also has a good sense of humor, as evidenced by the fact that he did standup comedy in college and his penchant for quoting movies. “I think he can probably recite the entirety of ‘Spinal Tap’ from start to finish,” Mr. Priemer said, citing the 1984 movie about a fake rock band. He’s a community-minded guy as well, allowing Hyland Software employees to do volunteer work on company time. Mr. Hyland himself is involved in the community, too. He serves on the board of the United Way of Greater Cleveland and he is a member of St. Angela Merici parish in Fairview Park, where he also is an assistant coach for his daughter’s basketball team. Jim Cookinham, founder of the Northeast Ohio Software Association, described Mr. Hyland as an honest, likeable guy who has performed “way beyond his years” in running Hyland Software. Mr. Cookinham also lauded Mr. Hyland’s practice of taking time out for his family and encouraging employees to do the same. “He wants people to have a workfamily balance,” Mr. Cookinham said. Mr. Hyland said he spends most of his free time hanging out with his wife, Tricia, and their kids, ages 2, 6, 8 and 10. He still plays a bit of basketball, he said back in February, just after he injured his left leg while going up to block a shot at a local YMCA. Fortunately, he has other, less physical hobbies, like spending time in the kitchen. He particularly enjoys making — and eating — Seven Layer Bars, which are made with chocolate and butterscotch. “I like to bake. I really do,” Mr. Hyland said with a smile. ■

Based in Cleveland With a Window to the World 19 offices 13 countries

called — because of what appeared to be an improving downtown office market. That upturn never truly materialized, though, and the property remains a parking lot today.

fortable place, they were saying, when Cuyahoga County commissioner Vince Campanella in January 1984 proposed a $150 million domed stadium southeast of Public Square on what is now the Gateway site. The 70,000-seat, publicly owned stadium would be paid for by a 0.9-mill county sales tax. Voters in May 1984 rejected the sales tax levy by a nearly 2-to-1 margin.

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Lots of hubbub FILE PHOTO/RUGGERO FATICA

Municipal Stadium during demolition in 1996

Home sweet dome ■ Before the Gateway stadium and arena project, there was a plan for a domed stadium at the same location. By the early 1980s, the owners of both the Cleveland Indians and Cleveland Browns were grumbling about aging Cleveland Municipal Stadium. It was 50 years old and a cold, uncom-

■ Another major public works project began to take shape in the mid-1980s. The Dual Hub Corridor subway, as it was called when the push began to seek federal money, would link University Circle and Public Square by a new rail line under Euclid Avenue. It would have cost at least $700 million. Supporters saw it as a way to revitalize the East Side of Cleveland. Critics saw it as an expensive toy that would not draw sufficient riders. In the end, the decision was made by federal transit officials, who refused to fund — Jay Miller the subway project.

5 0 P u b l i c S q u a r e , 2 9 th f l o o r, C l e v e l a n d , O H 4 4 1 1 3

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JONATHANFORMAN By SCOTT SUTTELL ssuttell@crain.com

n March, more than 71,000 people made their way to Tower City Center downtown for the 34th installment of the Cleveland International Film Festival. During the 11 days of the festival, they watched 153 feature films and 152 short subjects from 84 countries. Jonathan Forman remembers a very different set of numbers. The native New Yorker, then 22 and not long out of Case Western Reserve University, organized the first Cleveland International Film Festival in 1977, and it was a decidedly more modest affair. It was spread over eight weeks from April to June, and it featured eight films, all shown at the Cedar Lee Theatre, which Mr. Forman rented for his fledgling fest. There’s no record of attendance, but it was, well, nowhere close to 71,000. “It’s absolutely phenomenal to see what it has become,” Mr. Forman said of the fest, now led by executive director

MAY 24-JUNE 6, 2010

Creator, Cleveland International Film Festival

Guentzler. His job is to tend to nuts and bolts, such as making sure the films are exhibited properly and the concession stand is well stocked. It’s just as well. Mr. Forman, driven by attention to details, rarely watches movies at his own theaters. “I can’t watch movies when there are that many people there,” he said. “It makes me nervous.”

Losing it at the movies Mr. Forman has made a life in the movie exhibition business, but it’s not the life he envisioned. He liked movies just fine as a kid, but they weren’t an obsession. His dad, an engineer, “didn’t get why anyone would go to the movies on a nice day,” Mr. Forman said. Mr. Forman came to Cleveland to attend CWRU as a pre-architectural student, but his timing wasn’t excellent; the university cancelled the program when he was a freshman. He changed his major to communications and began spending

for specialty films. The Cedar Lee, which opened its doors in 1926 as an 1,100-seat, single-screen theater, has undergone big changes as part of Cleveland Cinemas, and not without some upset from fans. In 1983, Mr. Forman bowed to realities of a changing movie exhibition marketplace that made it increasingly difficult to succeed without multiple screens and turned the Cedar Lee into a two-screen theater. It seems unremarkable today, but at the time, “It made a lot of people upset,” Mr. Forman recalled. “They loved the theater as it was,” he said. “But it couldn’t have survived without that change.” Two Hollywood-style screening rooms were added in 1991, and in 1994 two stadium-style theaters joined the lineup, bringing the current screen count to six. Over the years, Cleveland Cinemas took over operations at other well-known local theater spaces: Tower City Cinemas in 1998, Shaker Square Cinemas in 2000, and Chagrin Cinemas in 2004. Last year brought two key additions with the Apollo Theatre in Oberlin and the Capitol Theatre in Cleveland’s increasingly vibrant Gordon Square Arts District. The Apollo has found a loyal audience in Oberlin, especially among the college set, he said. The Capitol, re-opened last October after a big renovation that converted the 1921 single-screen cinema into an all-digital operation with three screens, is performing “above our expectations,” Mr. Forman said.

It’s show business

JANET CENTURY

Jonathan Forman, creator of the Cleveland International Film Festival, at the Cedar Lee Theatre in Cleveland Heights

Marcie Goodman, and before that by David Wittkowsky. “I’m proud to have brought to market something that David and Marcie and everyone who has worked there turned into such a major cultural event for Cleveland,” Mr. Forman said. “It’s become an event that rivals the best festivals around the world.” That’s what Time magazine said in 2006, when it included the Cleveland festival in a list of 10 notable U.S. film festivals. Now, the festival is the largest between New York and Chicago. The festival grew steadily, and by 1986, it moved its opening night to the Ohio Theatre in PlayhouseSquare, which began the process of regionalizing the event. Since 1991, the festival has been staged at Tower City Cinemas in Cleveland, part of Mr. Forman’s Cleveland Cinemas chain of eight theaters in Northeast Ohio and one in Pennsylvania. Mr. Forman no longer has a role in programming the fest; that’s the terrain of Ms. Goodman and artistic director Bill

much of his time at the student-run CWRU Film Society. He also wound up taking film classes taught by famed film professor Louis Giannetti, whose book “Understanding Movies” is now in its 12th edition and has been translated into more than 70 languages. Just as thousands of readers have found insight about movies from Dr. Giannetti’s book, Mr. Forman said the classes deepened his appreciation of movies and eventually sparked the notion of renting theater space for a film festival. “After you took his courses, it was like losing your virginity,” Mr. Forman said. “You were never able to see movies in the same way again.” Friends thought he might lose his shirt in 1977, the festival’s first year, but he broke even. Later that year, Mr. Forman was able to put togeher the financing to buy the Cedar Lee.

Remaking old space The theater since then has served as one of the primary outlets in Cleveland

The movie theater business Mr. Forman entered in the 1970s is barely recognizable today. Technological advances — DVDs, then Netflix, now pay-per-view and streaming — have made it more challenging for theater owners to fill seats. Nonetheless, John Fithian, CEO of the National Association of Theatre Owners, said North American box office rose nearly 11% last year, to $10.6 bil-

lion. “To be successful, an operator has to have a commitment to making the technological changes that the market is demanding,” Mr. Fithian said. To a large extent these days, Mr. Forman said, that means investing in 3D screens that accommodate hits such as “Avatar” and “Alice in Wonderland,” which typically come with a $3 to $4 upcharge. The investment runs $100,000 per screen, Mr. Forman said. “It’s an incredible expense, but without it, you might as well decide which theaters you’re not going to operate,” he said. Technological changes aside, the business still relies on finding movies audiences want to watch, whether it’s American independents for the Cedar Lee or more mainstream fare at Tower City. “There’s no science to what we do,” Mr. Forman said. “It’s always a roll of the dice. Fortunately, we’ve been pretty good at it over the years.” ■

FANNIE LEWIS Former Cleveland city councilwoman By AMY ANN STOESSEL astoessel@crain.com

leveland City Councilman Joe Cimperman chuckled when asked about his experience going up against the larger-than-life Fannie M. Lewis. “She beat me to a pulp,” he said. “She would just kill me on the council floor.” It’s no secret that politics can get ugly at times, especially in Cleveland, but Fannie Lewis was about more than politics in her almost three decades as a councilwoman: She was about fighting for the people and her beloved Hough neighborhood — at almost all costs. She was about justice, fairness and equality. She was tenacious and inquisitive. She was honest. “I think about her all the time … I really loved her,” Mr. Cimperman reflected. (And that’s coming from someone who also reminisced about being called the “white devil” by Ms. Lewis in one of her famous tongue-lashings.) Fannie Lewis died Aug. 11, 2008, at the age of 82. She was the longestserving female council member, having been in office since 1980. For those who didn’t know Ms. Lewis personally, there’s an entire neighborhood that stands as a living legacy to her lifetime of service. “There would be no Hough without Ms. Lewis,” Cleveland Mayor Frank Jackson said. “She had a vision for Hough … everything she did was to work that vision.” But for those who knew and worked with the councilwoman — described as “tenacious,” “complicated,” “passionate” and “caring” by council President Martin Sweeney — the loss of Ms. Lewis has left a hole that will never be filled. “There’s not going to be anyone like her in the future,” Mr. Sweeney said.

Commitment to community Steven Minter, executive-in-residence and a fellow in the Center for

THIRTYYEARSOF... FAST-GROWING SUBURBS In a region that has grown at a slower pace than the nation, these suburbs are among those that have fared well since 1980: ■ Hudson/Streetsboro: These neighboring southeast suburbs have grown exponentially in population, with Hudson seeing a nearly 400% boom since 1990. In Streetsboro, the headquarters city of Step2 Co., the population has jumped nearly 46% in the last 20 years, according to U.S. Census Bureau estimates. ■ Mentor: This city has placed an emphasis on economic development, and ranks in the top 10 in Ohio in

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Nonprofit Policy & Practice at Cleveland State University, first met Ms. Lewis when he became a supervisor in the Hough district office of the Cuyahoga County welfare department. “She was an example of someone who could go from receiving public assistance to being a political, grassroots leader in Cleveland,” said Mr. Minter, who also led The Cleveland Foundation for more than 20 years. Fannie Lewis was born in Memphis, Tenn., and lived in the South during the height of racial segregation. Ms. Lewis and her husband moved north to Cleveland in search of a better life. Eventually divorcing from her husband, Ms. Lewis was “really totally committed to trying to change her community,” Mr. Minter said, noting that much of her involvement was due to her five children. “She really wanted to do things that would help her own children be successful,” he said. Mr. Minter and Ms. Lewis both worked on Lexington Village, a market-rate, middle-class housing development in Hough, for which ground was broken in 1984. The project still is held up as a turning point for Hough, which for years existed in the shadow of the 1966 race riots that ravaged the neighborhood. Lexington Village is just one of the many initiatives attributed in part to Ms. Lewis’ efforts. Also on that list is the upscale housing that now dots the councilwoman’s East Side neighborhood; her efforts to restore League Park, the one-time home of the Cleveland Indians; and Ms. Lewis’ advocacy of school vouchers. “There was nothing anybody could get past her,” Mayor Jackson said. “She would fight for whatever she believed to be right.” Indeed, Ms. Lewis is the only Cleveland City Council member to have had legislation named in her honor. Enacted in 2004, the Fannie M. Lewis Cleveland Resident Employment Law — which requires that construction projects receiving $100,000 or more from city funds employ people who live in the city — is the essence of the principles Ms. Lewis had been working on her entire life, Councilman Cimperman said. “It was really about putting Clevelanders to work,” he said. “Fannie was always on the side of the person who she thought was getting the short end of the stick,” Mr. Cimperman said.

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DANIEL HO/CLEVELAND PRESS VIA CLEVELAND STATE UNIVERSITY SPECIAL COLLECTIONS

Ward 7 councilwoman Fannie Lewis on Feb. 17, 1982, hands over petitions from Hough community residents responding to a Department of Housing and Urban Development displacement notice.

Laura Paglin’s encounter with

Fannie Lewis was by chance, but it made an impression. Ms. Paglin is a filmmaker based in Cleveland Heights who set out on Election Day 2004 in Cleveland, camera in hand. “I didn’t go in with any agenda,” Ms. Paglin said. “I wasn’t expecting anything.” What she found, however, were long lines, exasperation and chaos at the polls — and it was happening on Ms. Lewis’ turf, where 40% of residents were living in poverty as of the 2000 Census. “When you’re in the presence of someone like that who has such charisma, you just start filming them,” said Ms. Paglin, whose 26-minute documentary, “No Umbrella: Election Day in the City,” starring Ms. Lewis, was screened at the 2006 Sundance Film Festival. The movie offers a glimpse at the very essence of Ms. Lewis. She was a woman who had no tolerance if she believed people were being wronged — and she didn’t hesitate to make that clear to everyone and anyone, including former Mayor Jane Campbell and “Vu,” as the councilwoman characteristically referred by last name to then-Cuyahoga County Board of Elections

manufacturing companies. That growth has been spurred by heavyweights Steris Corp., Roll-Kraft, Cres Cor and Avery Dennison. ■ Beachwood: Already enjoying a strong retail presence, Beachwood helped lure Eaton Corp. to relocate its headquarters to Chagrin Highlands office park, and University Hospitals is constructing its 53-acre Ahuja Medical Center at the same site. ■ Strongsville: A mix of manufacturing and retail have spurred this suburb’s growth, which includes a 21% jump in population since 1990. SouthPark Mall, which opened in 1996, draws shoppers, while the headquarters of paint specialist Akzo Nobel, crafts retailer Pat Catan’s and Momentive Performance Materials

provide the city with a strong base. ■ Avon/Avon Lake: Moving west, the Avon/Avon Lake area has been a hotbed of activity from the addition of upscale housing to new shopping and recreation options. The population numbers for both cities tell a striking story: In Avon, the city’s population climbed from 7,337 to 17,086 between 1990 and 2008. Avon Lake, meanwhile, grew to 23,996 in 2008 from 15,066 in 1990. ■ Medina: This suburb to the south grew from 19,231 residents in 1990 to 26,011 in 2008. It is home to local retail giant Discount Drug Mart; RPM International Inc., a maker of coatings and sealants; and family-owned Root Candles. — Joel Hammond, Amy Stoessel

‘Being Fannie Lewis’

CRAIN’S CLEVELAND BUSINESS

head Michael Vu. “Why should a person stand in line like they’re slaves to vote?” she says. “It’s like we prayed for rain and didn’t bring no umbrella.” No doubt a colorful character in public, many of those who knew the councilwoman also remembered another side. India Pierce Lee, program director for Neighborhoods, Housing and Community Development at The

Cleveland Foundation, most recently had been working with the councilwoman on a plan for the Upper Chester neighborhood. Ms. Lee said it was in the private, personal encounters with Ms. Lewis that she passed on cherished pieces of advice: stay strong, be committed, have faith in God. “It was those moments you appreciated who she was,” Ms. Lee said.

Council President Sweeney first met Ms. Lewis in 1988 when he was interning with council as a student at Cleveland State University. Twenty years later, he was one of those who eulogized Ms. Lewis. As for what the councilwoman and community leader will most be remembered for, Mr. Sweeney put it quite simply: “Being Fannie Lewis.” ■

When Francine Evans sat down at Hospice to begin sewing her memory quilt, her own life seemed lost. After all, it was just a few days earlier that her daughter Jennie was laid to rest. At first, the sewing group was just something to take her mind off everything. But as Francine stitched the swatches of Jennie’s clothes, her life started to come together, too. She found herself talking. And smiling. And healing a little more each day. At Hospice, we provide many services, like the Fabrics & Feelings group, to help survivors cope. Because we believe that death is no reason to stop living.

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Euro: Value may keep dropping continued from PAGE 3

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Greece, Germany just got cheaper, and Italy just got cheaper.” Indeed, all of Europe’s goods just went on sale — though Dr. Hill highlighted Germany and Italy because they are big participants in the machine and plastic injection equipment industries, just like Ohio. Cleveland-area companies that were boasting of healthy export sales into Europe, when it took fewer euros than now to buy their goods, aren’t as forthcoming about the potential impact on their businesses of a weakened euro. Several either declined to comment or did not return phone calls and e-mails to discuss the matter. However, Parker Hannifin Corp. in Mayfield Heights said in an e-mail that a falling euro and strengthening dollar “could negatively impact U.S. manufacturing for those companies that export heavily.” That said, multinationals such as Parker might have the least to fear. “For Parker, this change in currency values is unlikely to have a significant impact since Parker largely sources, manufactures and sells locally,” the company said.

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Those affected probably won’t be hit hard right away, said Ken Mayland, president of ClearView Economics in Pepper Pike, but they’ll feel the effects eventually — and probably for a long time to come. Dr. Mayland thinks the euro is all but kaput as an international reserve currency, as investors and nations have turned their back on the euro in favor of the U.S. dollar. “That permanently lessens its value, so I think the euro’s decline is

going to be sustained,” Mr. Mayland said. “In fact, ultimately, I think it’s going to fall even lower.” For now, at least, the bigger factor affecting the local economy is the United States’ own rebound from deep recession, Dr. Mayland said. But the effects of a falling euro are coming, and they will have their greatest impact in markets where U.S. companies and their European counterparts compete, he said. Take, for example, aircraft makers Boeing Co. of the United States and Airbus of Europe competing for the same international contract. The stronger dollar relative to the euro makes Boeing’s airplanes more costly than those of its rival. “It’s a pretty big adjustment,” Dr. Mayland said. “For Airbus, their planes just got 10% or 15% cheaper. What does Boeing do to take 10% or 15% out of their costs?”

Brokers: Some refuse bonus continued from PAGE 3

standards and equally distributed to the independent insurance agents who sell our products.”

A spokeswoman for Anthem Blue Cross and Blue Shield in Ohio said override payments are “paid only to brokers for managing an agency or for performing other administrative services, and not for steerage purposes.” Dave Petro, a broker with Accelerated Benefits in Hudson, said overrides vary depending on what the insurer is trying to accomplish, but they typically are presented as an incentive for each person the broker places with the insurer. Because people and companies buy insurance based on price and services included in a plan, insurers’ premiums are very comparable, Mr. Petro said. However, the override payments help brokers set plans apart from one another, he said. Dr. Silvers agreed. “If you don’t pay the override, if you don’t play the game, you don’t get compared with everybody else to the client. The client never sees you,” said Dr. Silvers, who previously was the CEO of the now-defunct University Hospitals QualChoice health plan and now sits on the board of SummaCare. “They all play the game — not one, but all of them,” he said. Though the override payments are not a secret that is purposely kept from clients, Dr. Silvers said clients often don’t ask how much a broker is paid or in what fashion. He said many small companies and government entities still buy their employee health insurance through a broker or consultant and “they probably don’t know what it costs them.” Although the override payments

The euro’s slide also means the purchasing power of European companies is diminished here, which is likely to impact merger and acquisition activity in the United States as would-be European buyers are removed from the equation. “The European buyers had been emboldened by the strength of their currency, and I believe there will be a drop in (M&A) activity because of this,” said Ralph Della Ratta, managing partner at Western Reserve Partners in Cleveland. Dr. Hill said that while a Greek vacation or bottle of French wine will be cheaper, the net effect of a falling euro is one the nation and Ohio companies would be better off without. “It’s subsidizing America’s heartfelt need to consume everything in sight,” Dr. Hill said. But, he added, “I’m more concerned about the welfare of people who make things.” ■

don’t necessarily show up on the cost breakdown for a health plan, they are part of the total cost of doing business for the insurer, said Paul Nachtwey, vice president for Todd Insurance brokerage in Beachwood, who also worked for Medical Mutual and Blue Cross and Blue Shield for 18 years. While override payments are still around, they aren’t as common as they were a few decades ago and they are not a problem for ethical brokers who choose not to accept those payments, Mr. Petro said. “Yes, some bonuses do occur, but the ethical broker keeps an eye on what’s best for the client,” he said. “If you’re not ethical and you just try to play with who pays the best commission, you’re going to move your clients around all the time.” Clients will tire of the instability and will take their business to a different broker, Mr. Petro said. Mr. Nachtwey agreed and said customers will take their business to an agent they believe is doing the right thing for them. He said he often obtains new clients because, in their eyes, their previous brokers didn’t understand their needs. Still, Dr. Silvers contends the insurance market is greatly affected by the bonus payments. “It is the biggest single indicator of why (health care) reform needed to be done,” he said. The health care reform bill will force states to create health insurance exchanges, or marketplaces where the uninsured will be able to shop for competitively priced health insurance as a group. The exchanges, slated to begin operating by 2014, should eliminate some side deals between brokers and insurers, Dr. Silvers said. ■

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Tech firmâ&#x20AC;&#x2122;s sensors can reroute data Bluetronix hopes military eventually will use product; now, itâ&#x20AC;&#x2122;s pitching it as industrial tool By CHUCK SODER csoder@crain.com

Mark Heiferling said he hopes his companyâ&#x20AC;&#x2122;s technology one day will allow cell phones to relay messages through other mobile phones and will help the U.S. military set up communications systems in the heat of battle. For now, however, the founder and president of Bluetronix Inc. is happy to put the technology on the factory floor. The company in Chagrin Falls has spent much of the past decade developing sensors designed to communicate with each other so they can figure out the best way to route data. The result, Mr. Heiferling said, is an extremely versatile, flexible sensor system that can be implemented quickly and can reroute information when parts of the network go down. Bluetronix since 2003 has received about $2 million in federal money to develop the technology, with most of those dollars coming from

the Defense Advanced Research Projects Agency and some from NASA, Mr. Heiferling said. Now, however, Bluetronix has started testing its technology in factories in an effort to start selling this summer sensors packaged for industrial use. The company as of February had about 12 customers testing the technology or starting to use it to relay temperature and pressure readings and other information that factories already gather. Mr. Heiferling could not be reached last Friday, May 21, to provide an updated number. Mr. Heiferling said he believes the technology is well-suited to factory use because itâ&#x20AC;&#x2122;s compatible with wireless technologies such as Wi-Fi and ZigBee, is easy to set up and is affordable. The sensors, without packaging, cost $80 to $100 each at a volume of 10, and costs go down as the number ordered goes up, he said. David Miller, business development manager for Rocket Ventures in Toledo, also sees potential in the company, which employs four in Chagrin Falls and two in Maumee,

near Toledo. Rocket Ventures, a publicly financed entrepreneurial support organization, last April gave Bluetronix a $50,000 grant to validate its technology and plans to invest at least $300,000 more, though that agreement has not been finalized, Mr. Miller said. Bluetronixâ&#x20AC;&#x2122;s sensor system is more reliable than other wireless technologies because of the ability of the companyâ&#x20AC;&#x2122;s sensors to reroute data if one sensor stops working â&#x20AC;&#x201D; a feature that could help factories keep their machines running, Mr. Miller said. Factory owners, he added, would rather not run wires to all their machines. â&#x20AC;&#x153;Itâ&#x20AC;&#x2122;s very expensive for them to run data lines to all the equipment in a factory,â&#x20AC;? he said. Mr. Heiferling said he expects the technology to be ready for military use in three or four years. He also sees other uses for the technology. For instance, mobile phone calls could be routed through other phones equipped with Bluetronix sensors before the calls are relayed to towers, and emergency responders could use the sensors to set up a decentralized communications system quickly. â&#x20AC;&#x153;If there is a disaster like (Hurricane) Katrina, emergency employees can communicate,â&#x20AC;? Mr. Heiferling said. â&#x2013;

Eton: Developers calculated with tenant mix continued from PAGE 3

A new Brooks Brothers store opened last month, plucked from Beachwood Place, as did a tiny showroom for Lululemon Athletica, a Vancouver-based yoga and fitness attire retailer with a cult following. Mr. Stark wooed the latter from the retail portion of The Hamptons Apartments, also in Beachwood. Another recent addition is Penzyâ&#x20AC;&#x2122;s Spices, a retailer based in Wauwatosa, Wis., with one other Ohio location, in Columbus. Those openings followed other high-profile additions last year, such as Orvis, the outdoor clothes and fishing supplies store, and popular outdoor clothing retailer North Face. Eton also gained B Spot, the debut in the eastern suburbs for famed Cleveland chef Michael Symon, which became the eighth restaurant in the center. Making room for B Spot required moving around a handful of tenants to clear the key frontage on Chagrin Boulevard. For example, Audreyâ&#x20AC;&#x2122;s Sweet Threads, a local boutique, moved out of whatâ&#x20AC;&#x2122;s now B Spotâ&#x20AC;&#x2122;s storefront and went into part of the original Eton Collection enclosed mall that survived the 2005 remake of the property. Sweet Threads joined in the enclosed space other local boutiques, which Mr. Stark believes add zest to the retail center and kept in place Etonâ&#x20AC;&#x2122;s landmark Kilgore Trout menâ&#x20AC;&#x2122;s store. All told, just four storefronts â&#x20AC;&#x201D; some 20,000 square feet â&#x20AC;&#x201D; remain empty at Eton, and Mr. Stark said he is in talks about those spaces with multiple retailers he wouldnâ&#x20AC;&#x2122;t identify. The lifestyle center has 225,000 square feet of selling space and includes an 80,000-square-foot office building that also predates Etonâ&#x20AC;&#x2122;s current incarnation. Recent additions halved the vacancy rate in the complex to 5%, Mr. Stark said. The retail makeover has not been easy. Mr. Stark said he won one retailer â&#x20AC;&#x201D; again, he wouldnâ&#x20AC;&#x2122;t identify

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it â&#x20AC;&#x201D; by pressing its real estate representative to get on a plane so he could explain the makeup of Clevelandâ&#x20AC;&#x2122;s tony eastern suburbs after an initial turndown. â&#x20AC;&#x153;They said we were too close to Detroit,â&#x20AC;? Mr. Stark said. â&#x20AC;&#x153;Can you imagine that?â&#x20AC;?

Well-suited to Eton Mr. Stark pursued Brooks Brothers for two years despite its presence at Beachwood Place, typically considered the most fashion-oriented center in Northeast Ohio. Mr. Stark said he tells Brooks Brothers and other retailers that he views Chagrin Boulevard as the regionâ&#x20AC;&#x2122;s new retail spine, reaching closer to growing suburbs such as Solon and Chagrin Falls than the traditional Cedar Road retail focus. Chagrin Boulevard was not seen as such in the past, Mr. Stark maintains, because it was composed primarily of smaller, older retail centers or freestanding stores. Kathy Self, Brooks Brothersâ&#x20AC;&#x2122; chief real estate manager, said in an interview that the decision to move to Eton was a natural. â&#x20AC;&#x153;We did it for the convenience of our customers,â&#x20AC;? Mrs. Self said. â&#x20AC;&#x153;We are a destination. They donâ&#x20AC;&#x2122;t want to go by 100 stores to get a suit. When an opportunity came up to be in a beautiful building, a terrific space, and drive up to one of six parking spaces reserved for Brooks Brothers customers, where they can shop and meet a friend for lunch, we were interested.â&#x20AC;? The move to Eton is not the first time Brooks Brothers eschewed an enclosed mall. â&#x20AC;&#x153;What you need is foot traffic from other stores and restaurants,â&#x20AC;? Mrs. Self said. â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;ve done the same thing in Dallas and in Charlotte, in all a half-dozen stores that are in lifestyle centers or freestanding on established retail streets.â&#x20AC;? She declined to disclose sales figures, but said Brooks Brothers has experienced higher sales with the new open-air stores

than its mall stores.

Let the right one in Around the corner from Brooks Brothers and Penzyâ&#x20AC;&#x2122;s on an alley next to Flemingâ&#x20AC;&#x2122;s Prime Steakhouse, the Lululemon showroom occupies a cement-block building with a garage door instead of a storefront. The image reeks of an Ohio City legacy retailer or a bargainbasement startup boutique. It is not the typical location of an outlet in the 125-store chain. Clerks in the store proudly tell shoppers how they decorated the showroom themselves, including a painting inside the garage door done by a graffiti-artist friend. Mr. Stark said he sold Lululemon on moving to Eton because of the potential of more shoppers, adding, â&#x20AC;&#x153;I hate to see stupidity in the selection of place.â&#x20AC;? Since opening at Eton a few weeks ago, Mr. Stark said Lululemonâ&#x20AC;&#x2122;s sales have doubled, and the company is pursuing a much larger store in the region â&#x20AC;&#x201D; perhaps at Eton. A public relations representative for Lululemon who declined to be identified by name said Eton is one of 27 showrooms the company uses to test markets for the chain. The company designs and makes its own line of athletic apparel for women, men and female youth for yoga and fitness-related activities. A report on Lululemon by YCharts .com, a stock analysis web site, stated, â&#x20AC;&#x153;If you live in one of Lululemonâ&#x20AC;&#x2122;s markets, you have seen women and, increasingly men, in their signature black yoga pants. What started as product for yoga enthusiasts is now worn for daily activities.â&#x20AC;? Although the report ponders if the chain is growing too fast, it concludes, â&#x20AC;&#x153;We love the products.â&#x20AC;? At Eton, Mr. Stark said he landed such retailers by going slow. â&#x20AC;&#x153;We could have filled the spaces faster, but I waited for the right tenants,â&#x20AC;? Mr. Stark said. â&#x20AC;&#x153;This is a testament to perseverance.â&#x20AC;? â&#x2013;

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Venture: Funds draw outside investors Jackson: City’s defense of continued from PAGE 1

of $6 million that CardioInsight Technologies Inc. recently raised to speed up the commercialization of its heart imaging technology. Draper previously invested in the Cleveland company in 2006. Draper is among the firms that was drawn here because of the two programs, said managing director Mike Stubler. The firm, which has a staffed office in Cincinnati, likely would retain its presence in Ohio if the two funds were not renewed, Mr. Stubler said. However, he indicated not all venture firms based elsewhere could be expected to follow suit. “I would be hard pressed to say they would still be on the ground without these programs,” said Mr. Stubler, who frequently travels to Cleveland from Pittsburgh. The primary goal of the two funds is to make money, but both are designed to favor investments in firms with a presence in Ohio. The two funds each have money in about 40 Ohio-based companies. Messrs. Cohn and Carter said investments in their respective funds, both formed in 2005, are going well, considering the state of the economy. Mr. Cohn said a few out-of-state companies in the Ohio Capital Fund’s portfolio have been sold for “some nice profits” in the past few months, and most of its Ohio firms continue to grow and hire. “You can see tangible results from the fund right now,” Mr. Cohn said.

provide a response to a question regarding whether the pension fund would continue investing in the Ohio-Midwest Fund. However, Mr. Carter, in a speech last September in front of the Ohio Venture Association, noted that Credit Suisse’s state-focused investment programs, which include funds in North Carolina, Indiana and Oregon, have tended to grow. The pension fund already expanded Ohio’s program once, doubling its size in 2007. “Every program we’ve done has expanded over time. And hopefully this one will expand again soon,” said Mr. Carter, a Credit Suisse employee.

Nothing ventured … The two funds — the Ohio Capital Fund in particular — have received a lot of credit for helping increase venture capital investment in the state. Several out-of-state venture firms that received money from the two funds have opened offices in Ohio. The Ohio Capital Fund so far has invested in 21 funds, including nine that as a result established a physical presence in Ohio. Six of those nine are in Northeast Ohio, and the number rises to seven if you count Draper Triangle Ventures LP, which has an office in downtown Cleveland that is not permanently staffed. Draper does invest in the region: The Pittsburgh-based firm was among the investors that contributed part

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He noted, however, that the fund slowed the pace of its investing during the recession, mainly because it wanted to refinance its bonds so that their prices no longer would fluctuate with what turned out to be an unpredictable market. The refinanced bonds should go on sale this week, freeing the fund to invest the rest of its money, Mr. Cohn said.

Home field advantage The Ohio-Midwest Fund, which invests in venture capital and private equity firms, has had a few exits as well, and the funds it invests in are “performing well compared to their own internal plans,” Mr. Carter said. BioEnterprise Corp. has been pushing state legislators to expand the Ohio Capital Fund, said Baiju Shah, president of the nonprofit, which assists health care companies in Northeast Ohio. He considers both funds key pieces of Ohio’s growing entrepreneurial infrastructure. They complement the recently renewed Ohio Third Frontier Project, which has funded the development of technologies that eventually were financed by the venture firms in which the funds invest, Mr. Shah said. The two funds’ preference for working with investment firms that have a presence in Ohio helps the state attract even more money from outside the region, Mr. Shah said. He noted how a French investor that helped Draper finance CardioInsight likely wouldn’t have participated in the deal had Draper not had a physical presence in the area. “(Out-of-state investors) want to know, ‘Is there a local fund that is present that can be actively engaged in mentoring a company?’” Mr. Shah said. Mark Heesen, president of the National Venture Capital Association of Arlington, Va., said state-focused investment funds can generate good returns and help regional economies. Large states such as Ohio tend to have enough companies worthy of investment and the infrastructure needed to grow them, Mr. Heesen said. Plus, the ready availability of money for such companies gives regions that traditionally haven’t been flush with venture capital a way to attract new investors and to create success stories that could attract even more, Mr. Heesen said. “They need to be able to demonstrate that there are homegrown venture capitalists who are able to grow companies,” he said. ■

deal puzzles some observers continued from PAGE 1

partnership.” That’s the way predecessors such as George Voinovich and Michael White, at least in his early years, did it. A Cleveland mayor would have called on a few key CEOs or a management consulting firm to roll up their shirt sleeves and help him develop a strong new policy, then assist him in the complicated business negotiations that would produce a bulletproof deal. A week ago, the Jackson administration believed it had a slam-dunk winner — the new LED lighting plant would create 350 jobs — and it would be the first of what Mayor Jackson hopes would be series of similar deals where the city uses its purchasing power to attract new businesses and new jobs to the city. At a time when communities bargain with hard dollars such as grants, loans and tax abatements to woo companies to town, the mayor believes a procurement agreement is a low-cost way to invest in economic development. And it still may be a workable idea. But an unexpected firestorm of opposition to the deal erupted. GE Lighting, the world’s largest light bulb seller, which employs 700 people at its headquarters in East Cleveland, was the leader of the opponents. Its pride and maybe its pocketbook were wounded because its lighting products wouldn’t be glowing from the traffic lights and street lamps of its home town. Before the week was over, two other companies joined in to say they could provide the city a better deal. Legislation that would allow the city of Cleveland to sign an agreement with Sunpu-Opto will be before Cleveland City Council tonight, May 24. The legislation had a good chance of passage late last week, though a lawsuit to block the deal could follow any passed legislation.

Business polish lacking The idea of more efficient, moneysaving lighting fit neatly into Mayor Jackson’s efforts to cut the cost of government. And bringing jobs to the city has been at the top of the mayor’s to-do list since the day he took office. However, GE Lighting did a good job of calling into question some of the key elements of the deal, and the city’s defense of its agreement with Sunpu Opto left some observers astonished by its lack of business savvy. At a City Council hearing last Monday, May 17, GE Lighting president Michael Petras questioned the wisdom of a 10-year contract for lighting products at a time when lighting technology is changing rapidly. He and other business people who believe they could better serve the city’s lighting needs also questioned tying what should be a commodity purchase awarded to the lowest bidder to a future promise to build a manufacturing plant. Mr. Petras went further, disparaging Sunpu Opto’s product claims, citing federal government concerns about the safety of LED lighting in some uses and a lack of any Sunpu Opto customer testimonials. The Jackson administration

answered some of those concerns in response, but its defense lacked the business school analysis — and charts and graphs — of the GE presentation. Using procurement to spark economic development is rare, in part because of legal strictures on how city contracts are awarded. Only in small business and minorityand woman-owned business set-aside deals do communities use procurement to advance economic development goals.

Skeptical views raised Had the city asked, it might have heard from two local economic development professionals that they were skeptical that linking purchasing and business attraction would work. “Not many places I know are using this approach,” e-mailed Don Iannone, an economic development consultant in Mayfield Village who was on the job last week in Seattle. “I worked on a deal like this many years ago, and it fell through because the company wasn’t strong enough financially.” Ed Morrison, a Clevelander who has consulted with Akron and Cuyahoga County and is economic policy adviser at the Purdue University Center for Regional Development in Indianapolis, said strict regulations usually inhibit the use of a city’s purchasing power in economic development. “I have never seen a one-off deal like Sunpu,” he said by e-mail. “That’s not to say it does not happen, but I have never seen one.” Mr. Morrison said he believes the city should slow down its rush into a marriage with Sunpu-Opto. He also believes a city should reinforce its internal staff effort with advice from intermediaries who know China.

Help may have helped Several business observers who asked not to be identified by name said they were surprised at the lack of outside assistance sought by the Jackson administration and recalled how earlier mayors — Mr. Voinovich and Mr. White in his first term — relied heavily and with great effect on the business community for assistance. Beginning in 1979, the city of Cleveland, under Mayor Voinovich, created a widely envied and copied “public-private partnership.” If he found himself in unfamiliar territory as he rebuilt the city’s finances, Mayor Voinovich didn’t hesitate to call on business executives for advice. He even conscripted some into months of service as loaned executives. Had Mayor Jackson taken a similar approach, management consultants might have given the mayor the ammunition to anticipate some of the objections that GE Lighting and other opponents raised. And maybe, several observers agreed, one of those advisers might have suggested that Mayor Jackson challenge GE Lighting on its viability as a long-term supplier to the city because its parent, General Electric Co., has not disputed reports that it plans to sell its consumer products business, which includes the lighting business based in Nela Park, as soon as a buyer offers it the right price. ■

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CRAIN’S CLEVELAND BUSINESS

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MAY 24-JUNE 6, 2010

THEINSIDER

THEWEEK

REPORTERS’ NOTEBOOK BEHIND THE NEWS WITH CRAIN’S WRITERS

MAY 17 - 23

A case where charity wouldn’t begin at home

Pulling their oars in the same direction

IRA money helps dollars flow to biomed startup

The big story: Cuyahoga County and MMPI Inc. completed the purchase of land for the planned $425 convention center and medical merchandise mart, and they named a construction company and an architectural firm to manage the building of the project. The county will pay $3.1 million for the Sportsman‘s Restaurant, completing the acquisition of property at the northeast corner of Ontario Street and St. Clair Avenue. The county earlier bought the 113 St. Clair Building and its attached garage for $15 million. MMPI, the county’s development partner on the project, selected Turner Construction Co. and URS Corp. as the design/build team for the complex from among four competing teams.

■ A local law firm that has made a habit of sending undistributed class action funds to local charities under a little-known legal doctrine is advocating making its practice the law. The cy pres doctrine, as it is known, is from the French phrase “cy pres comme possible,” meaning as near as possible. It refers to the intent to get close to the objective of a charitable trust when the cause it is created to support — like the abolition of slavery — no longer exists. It since has been expanded for money left over from class action lawsuits. Dworken & Bernstein partner Patrick Perotti said there are two pieces of legislation pending, one each in the state House and in the state Senate, that would require the full amount of a class action settlement to be paid — either to the members of the class, or to charity. Both bills are in committee. Now, Mr. Perotti said, unpaid settlement money often “quietly slides back to the treasury” of the company that made the deal. “You have to pay what you say and say what you’re going to pay,” he said. “It deals with truth in settlements.” Dworken & Bernstein, a firm in Cleveland and Painesville, has directed $20 million in otherwise-unclaimed settlement money to charities over the past four years, Mr. Perotti said. He suggested that making cy pres law would free up $60 million a year for charity. Mr. Perotti said six states have similar legislation. — Arielle Kass

■ The city of Cleveland is preparing to put its oars in the water with the Cleveland Rowing Foundation’s plan to expand its boathouse and offerings at the former Commodore’s Club Marina at 1585 Merwin St. A measure is pending before Cleveland City Council to provide a $300,000 loan to the project. The loan has crucial backing from Councilman Joe Cimperman, whose Ward 3 includes the property. “They are in the middle of a fundraising drive. We thought it would be important to show city support for the project,” said Tracey Nichols, Cleveland economic development director, in talking about the 15-year loan at 3% interest. She said the city is confident the rowing group will have sufficient revenue to repay the loan. Theresa Gang, rowing foundation executive director, declined to say how much of the $3.6 million the nonprofit wants to raise is committed. The foundation’s campaign chairman, Jon Adams, did not return two phone calls to his cell phone. Under a plan orchestrated with the Trust for Public Land, the former marina would provide a base for the rowing athletes who ply Cuyahoga River as well as public canoe, kayak and bicycle rentals. The club needs more room and must vacate its current leased home at 1948 Carter Road. — Stan Bullard

■ A biomedical startup in Solon has been raising money from an unexpected source — investors’ retirement funds. Thermedx LLC, which has developed a system that heats and pressurizes irrigation fluid used during surgeries, has raised money from 10 individuals who tapped dollars held in self-directed retirement accounts. Company managers weren’t aware that individual “angel” investors could use money from self-directed IRAs to finance startups until one of their investors mentioned the idea about three months ago. Many of the other investors in the company weren’t aware of the concept, either, said Bryan Carr, business development manager for Thermedx. The method is not unheard of in the angel community, according to Todd Federman, executive director of North Coast Angel Fund. Individuals who are part of the angel group have used the method before, he said. Regardless, it has proved to be a pretty effective tool for Thermedx, which has worked with Equity Trust Co. in Elyria to create appropriate IRAs for the company’s investors. Thermedx has raised a total of about $3.6 million from a few dozen individuals since it was formed in 2007. It also has received $140,000 in loans and is in line to get $1.2 million more. — Chuck Soder

MILESTONE

BEST OF THE BLOGS

Let’s talk: The Cleveland Clinic is in talks with Hamot Health Foundation about a merger or affiliation with Hamot Medical Center in Erie, Pa. The Clinic and the University of Pittsburgh Medical Center have emerged as the two health systems that were most open to a merger or affiliation with the 351-bed Hamot Medical Center, which is overseen by Hamot Health Foundation, said Lucia Conti, a Hamot Medical Center spokeswoman. Clinic officials declined comment on the talks. Hamot also approached University Hospitals in Cleveland and Geisinger Health System in Danville, Pa., Ms. Conti said, but merger talks no longer are in the works with those two health systems. Join the crowd: Following in the footsteps of other health insurers, Medical Mutual of Ohio Inc. is allowing customers to keep adult children up to age 26 on their health insurance ahead of a deadline established in the recently passed health care bill. Under the bill, this provision does not officially become enacted until Sept. 23, but Medical Mutual, Humana, Kaiser Permanente, UnitedHealthcare and WellPoint Inc. have begun offering the additional coverage early.

Excerpts from blog entries on CrainsCleveland.com.

This just in: CEOs not fond of places with high taxes

In line for a deal: Preformed Line Products Co. in Cleveland agreed to acquire Electropar Ltd., which is based in New Zealand and also operates a subsidiary in Australia. Electropar makes pole line and substation hardware for electrical utilities. Preformed Line said the acquisition will strengthen its position in the power distribution, transmission and substation hardware markets and will expand its presence in the Asia-Pacific region. Preformed Line makes cable and anchoring hardware for utilities and telecom companies.

A stop at the station: Associated Estates Realty Corp. bought Riverside Station Apartments, an apartment community in Woodbridge, Va., about 20 miles south of Washington, D.C. Riverside Station is currently 95% leased and has average market rents of $1,470 per month. With the purchase, Associated Estates, a Richmond Heights-based real estate investment trust that specializes in apartment properties, now has 1,472 units across seven properties in the Maryland/Virginia region. This and that: FirstMerit Corp. offered $315 million of its common stock in a public offering. The Akron-based company said proceeds will provide FirstMerit Bank with additional capital following the acquisition this month of Midwest Bank and Trust Co. of Elmwood Park, Ill. … BrandMuscle Inc. in Beachwood, a provider of web-based marketing services, named technology veteran Chaz Napoli to the newly created post of chief operating officer. He will oversee technology, product development, sales and marketing functions for the company.

COMPANY: Trolley Tours, Cleveland THE OCCASION: The 25th anniversary of Lolly the Trolley Didn’t think we’d let this issue go by without noting one more anniversary, did you? Lolly the Trolley, which provides tours and transportation throughout Cleveland and Northeast Ohio, is all grown up now, after turning 25 years old last month. “When we started there was no North Coast Harbor, no Warehouse District, the Flats was not really hot yet, Ohio City was just starting up … and you’d have an occasional rock thrown at the trolleys out in the Cultural Gardens, which were overgrown and neglected,” says Sherrill Paul Witt, president of Trolley Tours. “Talk about pioneers!” Each trolley in the company’s fleet seats up to 38 people in an open environment designed to promote conversation and camaraderie. More than 20 miles of facts are covered in Trolley Tours’ City Sightseeing Tours. The 1- or 2-hour narrated tours include hot spots such as The Flats, the Rock and Roll Hall of Fame and Museum, the Warehouse District, Ohio City and the West Side Market. Reservations are required for all tours. For information, visit www.lollytrolley.com. Send information about corporate anniversaries to managing editor Scott Suttell at ssuttell@crain.com.

■ CEOs are not terribly impressed with Ohio as a place to do business. Chief Executive magazine asked 651 CEOs to grade states on taxes and regulations, quality of work force and quality-of-life issues, such as transportation access, housing costs and cultural institutions. They were asked to base their opinions on direct experiences with the states, not their perceptions. (So keep in mind there might be an issue of small sample size with the results.) Ohio ranked 44th, scoring a C- in taxes/ regulations, a B in work force quality and a B- in quality of life. The state was down one spot from last year, but compared with five years ago, it has tumbled: Ohio ranked 20th in the magazine’s 2005 survey. The top-ranked states generally are warmer-weather, lower-tax spots: Texas, North Carolina, Tennessee, Virginia and Nevada. The five at the bottom of the magazine’s list are high-tax states: California, New York, Michigan, New Jersey and Massachusetts.

San Diego venture has a strong taste of Cleveland ■ There are Cleveland ties to a new venture in San Diego, the Gary and Mary West Wireless Health Institute, that says its mission is “innovating, validating, advocating for and investing in the use of wireless technologies to transform medicine.” The Wests, telemarketing billionaires from Omaha, have put $65 million of their own

money into the institute, according to a blog on ZDNet.com. It’s headed by veteran executives from Johnson & Johnson and Cardinal Health, ZDNet.com reported, but, “The big brain of the outfit is research director Mehran Mehregany, a veteran MEMS researcher who is still listed on the faculty of Case Western Reserve University in Cleveland.” The institute’s web site lists another Cleveland connection: The vice chairman of its board is Dr. Eric Topol, former chair of the Cleveland Clinic’s department of cardiovascular medicine.

Auto dealers put their spin on Obama loan proposal ■ Michelle Primm, general manager of the family-run Cascade Auto Group in Cuyahoga Falls, was quoted in a New York Times story on an Obama administration proposal to put loans at auto dealerships under the purview of a new federal consumer protection authority to guard against fraud and abuse. Through their lobbying arm, the National Automobile Dealers Association, dealers argue “ they did not cause the financial crisis, and they should not be penalized for it through a burdensome and costly new regulatory structure.” Ms. Primm told The Times, “The way the White House is portraying us as evil, it’s just wrong.” She made two trips to Washington last month to speak with both of her senators and congressional staff members about the potential harm from the auto loan provision, the newspaper reported. She and other dealers say they already are heavily regulated, mainly at the state level, through regulations that prohibit the loan abuses cited by President Obama.

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