Crain's Detroit Business, Aug. 22, 2016 issue by Crain's Detroit Business

Lisa Johanon, Central Detroit Christian chip away at blight, Page 3 AUGUST 22 - 28, 2016

Automation Alley to take tech path New leader targets ‘smart factory’ trend By Dustin Walsh

preneurship before becoming its COO last year. Under new leadership, AutomaKelly said the time has come for tion Alley is set to transition from a Automation Alley, which has a budprimarily networking organization get of $4 million funded by memfor its more than 1,000 members to bers, grants and government conan advocacy group focused on im- tracts, to take a more active role in plementing the next genthe region’s future. The oreration of manufacturing ganization’s geographic technologies through the membership area includes supply chain. the city of Detroit and The Troy-based busicounties of Genesee, Livness association promoted ingston, Macomb, MonTom Kelly, 50, to executive roe, Oakland, St. Clair, director. Kelly is replacing Washtenaw and Wayne. Ken Rogers effective Aug. “When we built Auto27. mation Alley, we were Rogers, 77, was appointmore passive. ... Our ed to create and lead Auto- Tom Kelly: strong membership mation Alley by Oakland Promoted to viewed us as a place to County Executive L. Brooks executive director. meet and collaborate with Patterson in 1999. Rogers other members. We want left his job as deputy county execu- to be a place that helps them run tive of Oakland County at the end of their business,” Kelly said. 2014 to run Automation Alley full “Now that we have depth and time; Kelly joined Automation Alley scale, we think we’re mature enough SEE TECH, PAGE 17 in April 2014 as its director of entredwalsh@crain.com

While Meijer still sees stores as large as the one that opened this month in Flat Rock (shown here) as central to its future, it is looking for new locations in cramped urban areas and mulling what a smaller store might look like. PHOTO BY MEIJER

Doubling down on the

big box

By Adrienne Roberts

For Meijer, building

trict Detroit, which immediately surrounds the forthcoming Little Caesars Arena in downtown Detroit, Meijer is still betting big on the big box. Crain’s reported in January. Competitors such as Wal-Mart However, Hank Meijer, CEO of and Target are experimenting with the retailer, said at the Meijer store smaller stores in an effort to draw opening in Flat Rock: “We don’t millennials and fit stores into more have any specific plans for (The compact urban footprints. But the a typical Meijer might look like. District Detroit). We know that at pioneer of that type of superstore One thing the company says isn’t some point it would be important still sees stores the size of three or happening, though, is a rumored for us to have a smaller format that four football fields, like one that store in the district surrounding the could take advantage of other opopened in Flat Rock earlier this new Little Caesars Arena in Detroit. portunities, but we’re not there yet.” month, as central to its future. Frank Guglielmi, senior director The privately held, family-owned That’s not to say Meijer isn’t retailer, based in Walker — with rev- for communications for Meijer, hedging its bets. Company officials enue of $16.1 billion according to added: “That’s a rumor. We don’t say it is looking for new locations in Forbes — was being courted to know where that started, but we urban areas and taking another run open a smaller store to fit into the were all scratching our heads as to at what a store about half the size of Woodward Square area of The Dis- where that rumor came from. We think it’s because we’re a major partner with the Detroit Red Wings. © Entire contents copyright 2016 by Crain Communications Inc. All rights reserved So a lot of people said, ‘Oh, they crainsdetroit.com Vol. 32 No 34 $2 a copy. $59 a year. must be putting a store there.’ ” Still, Meijer is thinking about smaller stores. The retailer’s first 102,000-square-foot mini-supercenter in Niles, Ill., a suburb of Chicago, closed in June after opening about six years ago. The retailer has opened four approximately aroberts@crain.com

smaller is not the way

NEWSPAPER

to get bigger — yet

SEE MEIJER, PAGE 17

DWSD’s new policy could drain more from business By Kirk Pinho

face,” said Gary Brown, director of the DWSD. The problem has been that some Nearly 21,000 nonresidential Detroit Water and Sewerage Department of the DWSD’s hundreds of thoucustomers will soon see changes to sands of customers have been billed their drainage charges that in many based on the size of their water mecases will drain more money from ters, while others have been billed their coffers. based on how much imThose customers — pervious surface is at their City goes after which include businesses property. That includes delinquent and tax-exempt and relithings like roofs, parking commercial gious institutions — will lots, sidewalks, driveways water accounts be charged for runoff and other surfaces. to add revenue, based on how much imStarting Oct. 1, owners Page 15. pervious acreage they of the 22,000 parcels will have instead of how large be billed $750 per acre of their water meter is. impervious surface per month. The DWSD says the move — Over the next year, the DWSD will which will also affect the owners of phase in industrial and government more than 22,000 parcels who have properties (December), commernever been billed for drainage cial properties (March), tax-exempt charges — is an effort to bring uni- and religious properties (June) and formity to the billing process. residential customers (July). “We are attempting to bring fair“If I flip the switch on all customness and equity into the system by ers that were being billed incorrectgetting everyone on the same billing ly, it would be a burden that some SEE WATER, PAGE 15 rate, which is an impervious surkpinho@crain.com

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MICHIGAN

BRIEFS Grand Rapids shirt maker tailors nostalgia for Stroh’s

Vintage-style T-shirts created by a Grand Rapids company are helping Stroh’s reconnect to its Detroit brewing roots. In anticipation of a July announcement that Stroh Brewing Co.’s parent firm would produce the beer in Michigan for the first time since its Detroit factory was shuttered in 1985, apparel maker The Mitten State got the go-ahead to create vintage T-shirts with Stroh’s old logo and the tag line “Stroh’s spoken here,” MLive.com reported. The clothing is aimed at the demographic that remembers their dads — and grandfathers — drinking Stroh’s during their childhood. “Stroh’s was really a staple for many of our fathers and grandfathers,” said Mitten State co-owner Scott Zubrickas. “It’s what they chose to drink, and they did so with pride because it was a premium beer that was made in Michigan.” The East-West collaboration began when Zubrickas and co-owner Will Bransdorfer found a six-pack of Stroh’s in the refrigerator of their

warehouse. They reached out to Stroh’s parent, Milwaukee-based Pabst Brewing Co., at the beginning of the year about licensing the Stroh’s brand for a series of T-shirts. The first Michigan-brewed Stroh’s in decades will be available in specially designed 12-ounce bottles and on draft in Michigan restaurants, bars and retail stores beginning this week. A Bohemian-style Pilsner will be produced in Brew Detroit’s $7 million facility in Corktown.

State targets tax breaks on cottages, second homes Records say thousands of summer cottages, second homes and other Michigan properties have lost a valuable tax break in recent years amid state Department of Treasury audits, AP reported. The crackdown on improper exemptions affects a wide range of property owners, including Detroit landlords and billionaires with multi-acre compounds. Records show 23,800 property owners have been ordered to pay more taxes after audits since 2013. The audits target properties that claim a 100 percent principal resi-

dence exemption. The break saves property owners on school district taxes. The audits were instituted in 2005 to determine whether property owners getting the tax break owned and occupied the home as a primary residence. In many cases, people ended up losing the tax break on rental properties and vacation homes.

MICH-CELLANEOUS n Michigan’s jobless rate dipped to 4.5 percent in July, a slight drop from the previous month but the lowest in 15 years, AP reported. The state said last week it’s the lowest rate since January 2001’s 4.4 percent, but officials say it corresponds with a significant drop in labor force and employment levels. The U.S. jobless rate was unchanged at 4.9 percent in July. n Michigan residents still may be allowed to use the state’s long-standing straight-party voting option in the November election after the 6th U.S. Circuit Court of Appeals in Cincinnati last week rejected the state’s request to keep intact a new ban on the practice, AP reported. U.S. District Judge Gershwin Drain in Detroit blocked the Republican-backed law last month, saying it would place a “disproportionate burden” on blacks in the election. Attorney General Bill Schuette said his office would file an emergency appeal for a review by the full appellate court. n Bay County was ranked ninth among the nation’s logistics leaders by the economic development trade

publication Business Facilities, which in its 12th annual report broke down the top U.S. municipalities over a number of business-related categories, including how products get moved from one place to the other. Memphis, Tenn., led the logistics list. n Consumers Energy is operating its second solar power plant in Michigan, AP reported. The new 1-megawatt site is on 8.5 acres at Western Michigan University in Kalamazoo. The Jackson utility in April opened a 3-megawatt solar facility at Grand Valley State University in Allendale. n The Michigan Senate will hold a hearing on Gov. Rick Snyder’s choice to lead the Department of Environmental Quality in the wake of Flint’s water crisis, AP reported. The Senate Natural Resources Committee will meet Sept. 7 to consider the appointment of Heidi Grether, a former oil and gas lobbyist who began the job Aug. 1. The pick has been criticized by Democrats and environmentalists. n After posting losses of $767,208 on revenue of $22 million last year, the Grand Rapids-based Grand Valley Health Plan told the Michigan Department of Insurance and Financial Services it will begin the process of

shutting down operations and withdraw from the state’s HMO market, said an insurance department spokesman.. n Spectrum Health completed a $24.5 million expansion and renovation of its Rehab and Nursing Center in Grand Rapids, the Grand Rapids

INSIDE THIS ISSUE

CLASSIFIED ADS...............................15 DEALS & DETAILS.............................14 KEITH CRAIN....................................... 6 OPINION .............................................. 6 PEOPLE ...............................................14 RUMBLINGS .......................................19 WEEK ON THE WEB ..........................19

COMPANY INDEX: SEE PAGE 18 Business Journal reported. Patients will move into the 122,600-squarefoot addition this month. n Two new hotels will be built to handle business traffic to be generated by the conversion by Las Vegas-based Switch of the former Steelcase Inc. pyramid in Cascade Township near Grand Rapids into a regional data center, MLive.com reported. A Marriott Hotel and a Holiday Inn Express will be built near the center, according to Grand Rapids-based NAI Wisinski, which said it handled the real estate deals. Contruction on the hotels by Grand Hospitality Management is set to begin in 2017. Switch is converting the pyramid property into the largest data center campus in the eastern U.S. n Frankfort-based Stormcloud Brewing Co. is building a new production facility there, MLive.com reported. Stormcloud expects to break ground on the 10,000- to 11,000-square-foot facility in late fall, and open in summer 2017.

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Mental health rift brings Calley to the table

“Our goal is zero abandoned and vacant homes in our 24 blocks ... we will keep our hand to the plow.” Lisa Johanon, Central Detroit Christian

Tension flares over workgroup reports, procedures By Jay Greene jgreene@crain.com

have 27 vacant and abandoned homes. But we will keep our hand to the plow.” CDC has been facing seemingly insurmountable odds. Seventy-six percent of the neighborhood’s population is below the poverty line. Forty percent of residents make less than $10,000 annually while 70 percent have no car. Sixty-six percent are unemployed, and 42 percent did not graduate from high school. Its mission focuses on employment, education and economic development, and it creates businesses so it can hire unemployed people in the neighborhood. In some parts of the city where private developers haven’t ventured yet, community development

Tensions flared several weeks ago between mental health advocates and state officials over how to proceed in developing a crucial report to the Michigan Legislature on how best to fund $2.4 billion in Medicaid behavioral health dollars and integrate physical and mental health services. Like earlier this year, when Gov. Rick Snyder’s proposed 2017 budget included boilerplate language to transfer funding management to the Brian Calley: state’s health Responded with plans from the calls, emails. public mental health system, Lt. Gov. Brian Calley was called on to referee the dispute. At the heart of the controversy is $2.4 billion in Medicaid funding that currently is disbursed to behavioral, mental and substance abuse providers through 10 regional and nonprofit prepaid inpatient health plans. Medicaid health plans, most of which are for-profit HMOs, want to take over the funding stream to integrate physical health with mental health. Opponents, who include mental health executives, providers and families, believe the current system can be improved to

SEE NEIGHBORHOOD, PAGE 16

SEE HEALTH, PAGE 18

LARRY PEPLIN

On a neighborhood mission By Marti Benedetti mbenedetti@crain.com

For 21 years, Lisa Johanon and her community development corporation, Central Detroit Christian, have chipped away at the expansive blight and poverty that plagues their North End Detroit neighborhood. What CDC is dealing with is staggering, but so is the progress it has made along 24 blocks between Clairmount Avenue to the north, Woodward Avenue to the east, M-10 freeway to the west and West Grand Boulevard to the south. CDC owns and manages 61 properties, including apartments, houses, duplexes and four-plexes, said Johanon, executive director

Central Detroit Christian slowly rebuilds houses, commerce in 24-block area of north Detroit of the nondenominational nonprofit. In addition, the organization owns several vacant lots where run-down houses once stood. “We’ve spent about $10 million to get where we are now. There’s been creative financing on a lot of the projects. “Our goal is zero abandoned and vacant homes in our 24 blocks,” she said. “Now we

Potential Flint plastic water pipe supplier has some cracks in its legal history By Chad Halcom chalcom@crain.com

Flint officials may have good reasons for holding off the past six months on an offer from North America's largest plastic pipe manufacturer to replace lead-tainted water supply lines in the city with new donated pipes. The city has yet to respond to Los Angeles-based JM Eagle Inc. since owner and CEO Walter Wang made an offer Feb. 22 to the Flint City Council to furnish enough free polyethylene pipe to replace all the city’s residential and commercial lead service lines. But JM Eagle already has been found by a federal court jury to have knowingly misled five other municipalities, regional water authorities

or utilities in California, Nevada and Virginia, about the strength and durability of PVC water pipes it supplied on public construction projects in the past. It could face a second trial in March on similar claims from dozens of other local governments in at least seven other states. Former JM Eagle parent company Formosa Plastics Corp. USA already has paid $22.5 million in a settlement with more than 75 city, county, state and other government agencies in California, Massachusetts and Nevada in the same court case. A U.S. District Court judge in Los Angeles approved distribution of the settlement funds last December after various governments alleged JM Eagle sold them substan-

dard PVC pipe, including some that failed in drinking water, irrigation and other public service lines. Formosa Plastics sold JM Eagle predecessor JM Construction Co. Inc. to Wang, the son of Formosa founder Y.C. Wang, for $100 million in 2005. The company went on to acquire PW Eagle Inc. in 2007 for about $400 million, and moved to Los Angeles in 2008. Polyvinyl chloride, or PVC, has a different chemical composition, pressure and temperature tolerance points from the harder, more crystalline high-density polyethylene (HDPE) pipe Flint may receive under the offer. Eric Havian, partner at Constantine Cannon LLP in San Francisco SEE JM EAGLE, PAGE 16

MUST READS OF THE WEEK

Freedom Hill gets new name Amphitheatre sells naming rights to Michigan Lottery, plans upgrades, Page 5

IP clash? Patent clash could brew between Motor City, Silicon Valley, Page 9

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Ash Stevens CEO: Sale ‘good fit’ for company’s further growth By Jay Greene jgreene@crain.com

Ash Stevens CEO Stephen Munk initially told representatives of Piramal Pharma Solutions in March 2015

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that the 54-year-old privately owned business was not for sale. Over the past 15 years, the Riverview-based company had tripled revenue to nearly $20 million and recently received approval from the U.S. Food and Drug Administration for two more anti-cancer drugs. “They were pretty relentless in their pursuit of us,” said Munk, who has been CEO of the generic drug and active pharmaceutical ingredient manufacturing company for the past 20 years. But after multiple contacts with executives of India-based Piramal, including CEO Vivek Sharma, Munk said he presented the offer to Ash’s five-member board, of which he is a member. “We recognized there are many synergies for our customers and our company with Piramal,” Munk said. “Our customer base does not overlap. We complement each other. The board felt it was a good fit” and approved the sale. If the deal closes as expected in late August, Piramal will pay $43 million for Ash Stevens and up to another $10 million based on hitting future financial targets in the next six months. Stephen Rapundalo, CEO of MichBio in Detroit, said the sale was surprising to him as Ash Stevens has been successful in the past on its own. “In the grand scheme of things, they are competing with larger players that are dealing in bundled services,” Rapundalo said. “They do APIs (active pharmaceutical ingredients), and they do it well. Now they have joined up with the Indian company to get bigger in scale without having to spend a lot of money to grow it internally.” In approving the deal, Munk said, the board and management took into consideration the issues Ash Stevens had in the past in getting bank loans to expand. To conduct cutting-edge research and development that has led to FDA approval of 14 oncology drugs, Ash Stevens has invested more than $45 million in capital. “It wasn’t easy going to banks” and describing the high costs of purchasing sensitive pharmaceutical manufacturing equipment and technologies to develop the drugs. In 2013, Ash Stevens completed a 15-year, $45 million project that helped increase its production by at least 50 percent by building a 10,000-square-foot warehouse and adding another 8,000 square feet to its 30,000-square-foot manufacturing plant. Besides other equipment, the company also added a 2,250-gallon reactor bay with 500-, 750- and 1,000-gallon vessels for mixing compounds. “We are in a very capital-intensive

business,” said Munk, adding that he expects Piramal to invest in expansion that could add 30 jobs, bringing Ash Stevens to more than 100. “We now have access (to capital) from a large and financially stable organization that is committed to the pharmaceutical space,” he said. Munk said Piramal also will help fund research and expose the company more to the global drug market. Over the years, Ash Stevens has received 14 FDA manufacturing approvals for innovator APIs, including a Stephen Munk: number of fastAsh Stevens CEO track manufacsays deal offers turing approvals benefits. for the active ingredients for the oncology drugs Velcade, Vidaza, Clolar and Iclusig. Ash Stevens develops comprehensive small-molecule drug substances and current good manufacturing practices. The company also provides contract research services to the National Institutes of Health and the Na-

tional Cancer Institute.

Founded in 1962 by Arthur Ash and Calvin Stevens, privately held Ash Stevens was the first business to spin off from Wayne State University’s chemistry department. Proceeds of the sale, after paying off an $11 million bank loan, will accrue to the 50 to 75 shareholders. Munk declined to give the precise number of shareholders. Besides Munk, Ash Stevens’ board members are Cate McClure, the granddaughter of co-founder Calvin Stevens; Roy Ash, grandson of co-founder Arthur Ash; Carl LeBel, the son of Wayne State professor Norman LeBel; and Peter Blumbergs, the company’s first employee. Other shareholders include a few recent investors and employees who own small amounts of shares, Munk said. “Professor Stevens’ family is the biggest shareholder and along with the Ash family own the majority of shares,” he said. Wells Fargo Securities LLC served as exclusive financial adviser to Ash Stevens, with legal counsel provided by Morrison & Foerster LLP and Honigman Miller Schwartz and Cohn LLP. Jay Greene: (313) 446-0325 Twitter: @jaybgreene

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State lottery buys naming rights to Freedom Hill Amphitheatre By Bill Shea bshea@crain.com

The Michigan Lottery will pay at least $900,000 to put its name on Freedom Hill Amphitheatre in Sterling Heights under a new naming rights deal. Beginning Jan. 1, the concert venue will be called the Michigan Lottery Theater at Freedom Hill. The deal is for an initial three-year term that pays Freedom Hillâ&#x20AC;&#x2122;s owners $300,000 a year. A three-year renewal option under the contract requires a new payment to be negotiated, lottery officials said. Businessman Tom Celani, who has co-owned the amphitheater since 2012 through his Novi-based venue owner Luna Entertainment, was scheduled to make the naming-rights announcement Saturday evening. He told Crainâ&#x20AC;&#x2122;s on Thursday that the money from the Michigan Lottery deal will be used to pay for more popular acts, and for a $200,000 upgrade to the facilities used by entertainers backstage. â&#x20AC;&#x153;We can afford more risk,â&#x20AC;? Celani said. â&#x20AC;&#x153;We can go after bigger acts that allow Freedom Hill to sell out.â&#x20AC;? He noted that he â&#x20AC;&#x153;overpaid dearlyâ&#x20AC;? to get country act Lady Antebellum as the venueâ&#x20AC;&#x2122;s first act when it reopened in 2013 after three years of closure. â&#x20AC;&#x153;Those are the kind of acts we

FREEDOM HILL AMPHITHEATRE

The â&#x20AC;&#x153;Tribute to the American Workforceâ&#x20AC;? wall at Freedom Hill Amphitheatre is made of marble and metal and is 28 feet tall and 60 feet wide. It also includes a video screen centerpiece. want to bring to Freedom Hill next year,â&#x20AC;? he said. â&#x20AC;&#x153;Acts with regional appeal.â&#x20AC;? The venue now averages about 200,000 event attendees annually. It seats 4,200 under a covered pavilion, and 3,300 more on the lawn. Acts this year ranged from the Charlie Daniels Band to Whitesnake to the Beach Boys to Harry Connick Jr. Classic rock and pop staples such as Huey Lewis and the News, Rick Springfield and REO Speedwagon also were among the 21 acts scheduled this year. The Michigan Lottery logo and branding signage will be added to all of Freedom Hillâ&#x20AC;&#x2122;s marketing materials and tickets, and added to the entrance marquee. The lotteryâ&#x20AC;&#x2122;s current advertising and promotion budget is $23 million, according to Jeff Holyfield, director of public relations for the

unions, organizations and companies, and it includes an LED display screen. The wall was designed by St. Clair-based architectural firm Infuz Ltd. and built by Sterling Heightsbased general contractor Roncelli Inc. Freedom Hill Amphitheatre opened in 2000 at 120-acre Freedom Hill County Park off Metropoli-

Michigan Lottery. Luna, which says it has spent $2 million on improvements at the amphitheater, inked a deal last year to have Auburn Hills-based Palace Sports and Entertainment manage Freedom Hill. Luna is owned by Celani, a former MotorCity Hotel Casino investor who now owns Farmington Hills-based MotorCity Harley-Davidson and Bloomfield Township-based MotorCity Power Sports, and Joseph Vicari, CEO of Warren-based Andiamo Restaurant Group. Celani was to make the naming-rights announcement Saturday after unveiling a monument at Freedom Hill that honors workers and the labor movement. â&#x20AC;&#x153;Tribute to the American Workforceâ&#x20AC;? is a 60-foot wide, 28-foot tall stone and metal block wall on the main concourse built at a cost of about $250,000. Its engraved granite blocks honor

tan Parkway. The amphitheater was previously called the Jerome-Duncan Ford Theatre at Freedom Hill under a naming rights deal beginning in 2004 until that sponsor filed for bankruptcy and its assets were acquired by the Suburban Collection in 2006. Bill Shea: (313) 446-1626 Twitter: @bill_shea19

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OPINION

Turmoil may force changes in exchanges Is “Obamacare” dying? That was the subtext of conservative commentators reacting to Aetna’s announcement last week that it was pulling out of public health insurance exchanges in 11 of 15 states it’s currently doing business in. Aetna blamed growing deficits for the coverage it’s offering — patients were sicker and more at-risk than the company had anticipated. Then came the revelation that Aetna had threatened in a letter to Justice Department officials that it would take “immediate actions” if its planned merger with Humana were blocked. When the antitrust folks rejected the merger earlier this summer, the company responded. In fact, all five of the largest publicly traded insurers have reported losses on their public exchange businesses, according to The Wall Street Journal. Aetna CEO Mark Bertolini, who started his health care career in metro Detroit as the CEO of an HMO in the 1990s, said its pretax losses were about $430 million on coverage sold to individuals on public exchanges since 2014. “Providing affordable, high-quality health care options to consumers is not possible without a balanced risk pool,” Bertolini said in a statement. But one of the largest nonprofit insurers in the country — Kaiser Permanente — said it’s sticking with the exchanges, where it has been slightly profitable. And in Michigan, the insurers on the exchange — Blue Care, McLaren, Meridian, Molina and Priority Health among them — seem able to make their plans work for patients and their bottom lines. Aetna, the nation's third-largest insurer, was not on Michigan's exchange. Three important points to remember as the exchange market shakes out: First, commercial insurers seemed to have been unprepared for the kinds of patients who would be enrolling for coverage under the Affordable Care Act, aka Obamacare. Millions of the newly enrolled likely had untreated issues or had been denied coverage because of pre-existing conditions until that was outlawed by the act. Medicaid HMOs are more prepared to treat that population, investing in patient-care coordinators who help keep people with chronic conditions on track. Meanwhile, some of the for-profit insurers under-priced their plans to begin with — to gain market share. Second, the exchanges are showing signs of limited competition. A new analysis by the consulting firm Avalere found that in 36 percent of the exchange regions, only one carrier was offering a plan for 2017 — and in some areas, no plans were available. In Michigan, 88 percent of the regions had two or more carriers in 2017 and only 6 percent have only one or no carriers. Third, the ACA was expected to force consolidation among insurers and providers because of economies of scale and the drive to reward outcomes versus fees-for-service. But antitrust law is getting in the way, as Aetna has learned. Can the exchange system be fixed? If insurers take a page from the Medicaid HMOs, it could help. Also, if new plans were created to focus on millennials who are not opting in for coverage, it would also help. One thing is clear: If there’s more turmoil, it could lead to what many in health care policy believe is the holy grail — universal coverage, à la Medicare. That day may be closer than expected — depending in part on who is elected president in November.

TALK ON THE WEB Re: $1 billion I-75 reconstruction project kicks off Having comprehensive regional transit sure would make this easier. Sadly, no one blinks an eye dropping a billion dollars on 18 miles of road (a poor investment because roads are constantly crumbling in this climate and require constant additional expenditure), but a modest proposal for some real transit like every other legitimate urban region has causes an uproar. 269035

Reader responses to stories and blogs that appeared on Crain’s website. Comments may be edited for length and clarity. nance costs. It will not improve a single thing outside of Oakland County and will be paid for from Hawaii to Maine. While it is true that Detroit would benefit most from mass transit, a weak Detroit is a detri-

ment to Oakland County and the rest of the suburbs. John T. Feret

The feds are paying 80 percent of this project. That means 80 percent of the cost of rebuilding this stretch of road is being paid for by everybody, people who may never even look at it, much less drive on it. The federal government paid 90 percent for the construction of I-75, and it was a major factor in Oakland County’s growth. The federal financing of highways, while leaving mass transit to compete on its own, helped decimate mass transit. This project will not lower drive time in most instances. All it will do is make a new highway with higher mainte-

Re: Feeding millennial hunger for ownership with townhouses I think the trend is a good one for our communities and our quality of life. Especially the idea of being within walkable communities, and with a mass transit system (on the ballot in November) we take another step closer to improving the quality of life for people in Southeast Michigan away from being tied to the automobile. E M Parmelee

Re: Jim Harbaugh’s pay now up to $7M with insurance premiums That’ll buy enough pairs of khakis to clothe the Harbaugh lineage for the next millennium. Only in America. UM President Mark Schlissel and the regents must shake their heads from time to time when they realize that offensive and defensive coordinators and line coaches on the football staff have salaries that exceed their own. Markets are powerful forces and sometimes yield counterintuitive outcomes. Christopher Robbins

Re: Ash Stevens to be sold to India-based drug company From one of the companies that supplies drugs at low cost to the Third World, now perhaps the U.S. will have more competition. When is Medicaid/Medicare finally going to buy the drugs straight from the source? Drugs in India are cheaper than America. We all know most of the research comes from universities. It’s long past time for universal generic drugs at low cost. Nathan Downing Phenicie

It is still the motor capital of the world Last weekend, we established once again that this community is still the motor capital. Hundreds of thousands of car enthusiasts lined Woodward Avenue for miles to watch thousands of cars parade back and forth all day to the delight of fans and drivers alike. This is a celebration of the car. Anything goes. From minivans to family sedans, everyone is welcome. Weather doesn’t matter. It could be snowing in August, and a million people would still show up. All the cities on the route could cancel the event, and a million people and tens

of thousands of cars would still show up. There is no admission for either spectators or participants. In fact, I don’t think there is anything quite like it in the nation. Woodward, simply put, is an icon. Like Route 66, this is a place that conjures up all sorts of memories just by the name. Everyone has some idea of Woodward. Back in the day, it was a public drag strip that all too often Big Three automotive engineers would use to test or race their latest creations. (Completely illegally, of course.) Car enthusiasts from all over the nation

KEITH CRAIN Editor-in-chief

knew of its reputation, and its legend grew. Creating the Woodward Dream Cruise was an instant success and further proved the passion that

Detroiters have for their cars and the reputation this street has achieved. I remember the first Dream Cruise was held on the same Saturday, in 1995, as the funeral of J.P. McCarthy, another great icon of Detroit. No one knew what would happen, and thousands showed up for what has become a tradition. Detroit is the motor capital of the nation. The Dream Cruise simply re-establishes how strong Detroit’s reputation is. If you weren’t there last Saturday, put it on your bucket list. Anyone who has a fondness for

automobiles has to experience this unbelievable event, an event that now seems to last for at least a week. It is an event that the people will celebrate every year at this time. Thanks to the sponsors, it has organization behind it. And if you liked the Dream Cruise, you have to plan on the Gold Cup boat races. Another famous icon on the Detroit River that takes place on the weekend of Aug. 26-28. One hundred years of racing on the river. Add that to your bucket list too. It will be memorable.

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New Wayne County treasurer crusades to further reduce foreclosures New Wayne County Treasurer Eric Sabree frequently strolls the county

office hallways asking visitors if they received the tax information they need or had a good experience with county employees. He periodically calls the treasurerâ&#x20AC;&#x2122;s office to see how long it takes to reach a customer service representative. â&#x20AC;&#x153;Five minutes, not bad,â&#x20AC;? he said, after calling and timing how long it took to get a person. Sabree, 62, Sabree: County won the Aug. 2 treasurer wants to primary. He had do the basics well. one Democratic opponent, Beverly Kindle-Walker, who garnered 43 percent of the vote while he took 57 percent. He has no Republican opponent for the November election. Although this is his first time running for an office, Sabree knows his way around politics. His mother-inlaw was Daisy Elliott, the African-American civil rights advocate and former Michigan representative best known for writing and co-sponsoring the Elliott-Larsen Civil Rights Act. She died at age 98 last December. Sabree worked in the treasurerâ&#x20AC;&#x2122;s office for five years as deputy of land management under retired county Treasurer Raymond Wojtowicz before stepping into the interim treasurerâ&#x20AC;&#x2122;s job April 8. Since then, the Wayne County treasurerâ&#x20AC;&#x2122;s office, Sabree, the city of Detroit and the Detroit Citizens Review Board have been sued by seven homeowners who feel they were improperly denied a poverty exemption in 2014 on their property taxes. Sabree would not comment on pending litigation. Reporter Marti Benedetti talked with Sabree recently about his accomplishments so far and his goals for the 43 communities in the stateâ&#x20AC;&#x2122;s largest county.

ber-two guy. I took care of a lot of things. But when the position opened up earlier this year (when Judge Richard Hathaway resigned), I figured Iâ&#x20AC;&#x2122;d go for it. Some people didnâ&#x20AC;&#x2122;t think I could win the election because I never ran for anything. But I got the support of Mayor (Mike) Duggan and the Wayne County executive, Sheriff Warren Evans, and I had volunteers put up 3,700 lawn signs. ... I worked at winning like it would be a tight race. Q: What are your major goals as county treasurer?

I want to do the basic things well. We want to provide professionalism and courtesy to customers. We will

do what we can to encourage folks to avoid delinquency. Our office did outreach this summer. (During two weeks in June, Loveland Technologiesâ&#x20AC;&#x2122; surveyors, with help from interns in Sabreeâ&#x20AC;&#x2122;s office, knocked on the doors of 8,745 foreclosed residences thought to be occupied in the cities of Detroit, Highland Park and Hamtramck, making direct contact with 1,789 occupants and delivering information to them about how to stay in their homes.) Q: What have you accomplished so far?

We have reduced foreclosures 46 percent in the last year. We want to

keep that trend going. I came up with Delinquent Tax Payment Kiosks, which are in Rite Aids and other participating locations in Detroit and a few suburbs. The kiosks allow property owners to make payments, look up account details and pay taxes with a check, cash or credit card. It makes it easier for people to pay. They donâ&#x20AC;&#x2122;t have to drive downtown, park, wait in the county offices.

Q: What are the major challenges of the job?

We need to invest in training the managers and the staff in our office. We need to push to be more professional and knowledgeable. Iâ&#x20AC;&#x2122;d also

like to reduce traffic in the office. (Itâ&#x20AC;&#x2122;s not unusual to have 800 to 1,000 people visit the office per day.) We want them to pay by phone, use the kiosks and use our website. But we need to improve the website and then maintain it.

Q: What do you see happening in the county and the city of Detroit in the next 10 years?

The county is progressing well and will continue to progress as long as it continues to attract jobs. The city will take a little longer. We need more people to have jobs and income. ... We have to educate and train the people who are here.

REL ABLE

Q: Tell me about your background and prior career.

I grew up primarily in Detroit and attended Catholic Central, where I played football and was a weight lifter. At Michigan State University, I won a teenage national weightlifting championship. I worked for many years in city government as a building inspector and on the city housing commission under former Detroit Mayor Dennis Archer. During this time, I obtained a law degree from the Detroit College of Law (now the Michigan State University College of Law). Shortly after Kwame Kilpatrick was elected mayor, I lost my job. I was told they werenâ&#x20AC;&#x2122;t sure they could trust me. After having my own law firm for a couple years, I was hired by the treasurerâ&#x20AC;&#x2122;s office in 2005, where I worked as corporate counsel until 2011, when I took the job under Raymond. Q: Was it a long-term goal to be a treasurer?

No. I was happy to be the num-

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IP Experience

Bloomberg’s team working with Detroit on city issues

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For more than a year, a team of top-flight consultants has been working behind the scenes with Detroit officials to improve city operations or launch new programs dealing with a variety of issues. New York City-based Bloomberg Associates, a nonprofit founded by former New York Mayor Michael Bloomberg, has been doing the work pro bono, according to Dan Austin, deputy communications director for Mayor Mike Duggan. Areas of focus have been the creation of a new Bloomberg: municipal ID — Ex-NYC mayor started nonprofit. an ordinance establishing it was approved by the Detroit City Council in May — green infrastructure, transportation, and occupied tax-foreclosed homes owned by the Detroit Land Bank Authority. Rose Gill Hearn, who under Bloomberg was the longest-serving commissioner of the New York City Department of Investigation in the department’s 140-year history, is working with Fayrouz Saad, Detroit director of immigrant affairs, on the municipal ID program, according to Jerrell Harris, Detroit’s director of restructuring and transformation. Gill Hearn is also working with Charity Dean, who is sales and programs manager for the land bank, on a pilot program that allows people living in land bank-owned homes to buy them back. Adam Freed, a former deputy managing director of The Nature Conservancy’s Global Water Program, is working with Palencia Mobley, deputy director and chief engineer of the Detroit Water and Sewerage Department, and the Detroit Economic Growth Corp. on programs that would help reduce DWSD customers’ drainage charges by installing green infrastructure. Janette Sadik-Khan, who ran the NYC Department of Transportation

for six years under Bloomberg as its commissioner, is working with Ron Brundidge, director of the Detroit Department of Public Works, on “quick change opportunities on key corridors and intersections and to help craft a long-term vision for mobility across the city,” Harris said. Things like traffic-signal timing, and bus, bike and pedestrian safety enhancements are also under review. The nonprofit Bloomberg Associates focuses on advising cities in the areas of cultural assets management, marketing and communications; media and digital strategies; municipal integrity; social services; transportation and urban planning.

C R A I N ’ S D E T R O I T B U S I N E S S // A U G U S T 2 2 , 2 0 1 6

SPECIAL REPORT: LAW DUSTIN WALSH dwalsh@crain.com Twitter: @dustinpwalsh

Pro bono IP work a growing service The legal community has a longstanding relationship with low-income Michigan residents, whether on housing, consumer issues, education or otherwise. But pro bono intellectual property representation is a growing community service — and an important facet to economic development, said David Berry, of counsel for Brooks Kushman PC in Southfield. “There’s always been pro bono (IP) activities, but it flies under the radar,” Berry said. “There isn’t the established legal aid network like other areas of law, but IP is important to building new inventors and innovations.” Berry chairs the steering committee for the Michigan Patent Pro Bono Project through the State Bar of Michigan and as an adjunct professor at Wayne State University Law School, where he teaches students participating in the school’s Patent Procurement Clinic, a U.S. Patent and Trademark Office-certified program that puts students to work on low-income clients’ IP needs. The uptick in pro bono IP work stems from the enactment of the Leahy-Smith America Invents Act in 2012 — which created pro bono partnerships, like the Michigan Patent Pro Bono Project, through regional U.S. Patent and Trademark Office locations, Berry said. The Michigan program began in 2015 and uses a referral network of roughly 30 attorneys, Berry said. About 70 people have applied, though no patents have yet been granted. “Hopefully some patents will be issued next year,” Berry said. “There are a lot of success stories from this program nationally, and we should have some here soon.” The pro bono program focuses on inventors with an income two times the federal poverty line, which ranges from $15,930 for a family of two and $24,250 for a family of four. However, roadblocks remain for low-income inventors. Filing fees can be expensive, Berry said, and those providing pro bono services are barred from paying them on behalf of the client. Low-income inventors still must pay to have the drawings of their inventions prepared as well as shelling out roughly $1,000 in filing fees, Berry said. “The patent office’s whole approach is to generate enough fees to pay for operations,” Berry said. “I have a lot of clients that are under-resourced that have great ideas. They can have inventions just like those at a Fortune 500 company; there’s no monopoly on creativity. The patent system just isn’t set up for low-income people.”

Clash of IP titans? By Dustin Walsh dwalsh@crain.com

As the West Coast’s largest technology companies jump deeper into the automotive landscape, fears of increased litigation are bubbling in Southeast Michigan. In May, FCA US LLC and California’s Google Inc. signed an agreement to jointly develop 100 autonomous Chrysler Pacifica minivans. Apple, and its Birmingham office, work to extend its Beats by Dre audio brand in FCA products. Ford Motor Co. and Google were rumored to be signing an agreement, but the deal fell through. Greg DeGrazia, partner and intellectual property attorney at law firm Warner Norcross and Judd LLP in Southfield, said that as the tech and auto industries continue to merge, a clash is on the horizon. “We’re running toward a major issue, frankly,” DeGrazia said. “While suppliers are scared to sue someone like General Motors because they could go out of business without the orders, companies like Google and Apple are not intimidated by GM, Ford or anyone else.” Historically, automakers have always been the biggest player in the room in any negotiation. Not anymore. Google’s parent

Bringing tech, auto players together over smart cars could raise risk of litigation company, Alphabet Inc., has a market value near $550 billion, and Apple’s market value is more than $585 billion, compared to Ford and GM at less than $50 billion and FCA at less than $9 billion. Apple generated revenue of $233.7 billion in 2015, more than $80 billion more than Detroit’s biggest automaker, GM, which reported revenue of $152.4 billion last year. Google, for instance, has enough cash on hand — more than $9 billion in the second quarter — to buy FCA outright. Plus, the major U.S. tech players, including Google, Apple and Microsoft Inc., are litigious in protecting intellectual property. The trio has been involved in more than 1,100 patent lawsuits in the past 10

years, compared to the Detroit 3’s 204, DeGrazia said. “Look at the judgments coming out of the cellphone wars,” DeGrazia said. “Imagine what the damages could be for 10 million cars.” In recent years, Apple has won more than $1 billion in damages in patent infringement cases against Korean cellphone maker Samsung Electronics Co. Ltd., which uses Google’s Android operating system, though many of those cases have been appealed and some overturned. “What if Google or Apple gets boxed out of the industry? Then they go on the offensive,” DeGrazia said. “I fully anticipate patent infringement lawsuits in the pipeline.” Thus far, the two industries have played nice, largely because of the use of joint development agreements (JDAs), said Martin Sultana, partner and IP attorney at Brooks Kushman PC in Southfield. Agreements with partners within the traditional auto supply chain can save time and smooth development, especially where patents exist. Advantages are magnified when auto companies dive into areas in which engineers have little experience SEE CLASH, PAGE 10

Inside: See how patent applications and grants have fared over the years, Page 11

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SPECIAL REPORT: LAW

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— such as new software. “The perception is always that the auto companies better be on the lookout because of Apple and Google,” Sultana said. “What they fail to realize is that Silicon Valley needs the auto industry just as much as the auto industry needs Silicon Valley. Working together, nicely, provides a significant advantage to getting autonomous vehicles out in the marketplace.” Sultana said the JDAs are being driven by business decisions, and the auto companies realize Apple and Google are the enablers to get auto customers what they want and it behooves both industries to work toward fair deals. But those deals can be complicated, said Claudia Rast, partner at Butzel Long PC in Ann Arbor. Dealing with huge tech companies presents a different dynamic for auto companies, which are used to dictating most of the terms of an agreement to their suppliers. “It’s very dynamic right now,” Rast said. “The typical (automaker) model of buying tech and owning it doesn’t work in this space. The big players out of California carry the big stick, so there’s a lot of negotiating going on.” Sultana said the biggest hurdle in the negotiation process is determining the value of the IP. “Not knowing the value, or future value, of the technology creates the biggest pitfalls,” Sultana said. “But there’s nothing in the legal framework that can’t be overcome. If you’ve got two parties that want to engage in a joint development, they can make it happen.” In some cases, auto companies are choosing to acquire outright advanced technologies instead of creating JDAs with the tech world’s most powerful players. In May, GM closed on a $1 billion acquisition of San Francisco startup Cruise Automation. Cruise manufactures an aftermarket, roof-mounted autonomous-driving kit. For GM the deal provides access to Cruise’s “deep software talent and rapid development capability to further accelerate” GM’s development of autonomous vehicles. The acquisition is likely to represent one of the largest automotive M&A deals of the year and a deal that shows auto companies’ escalating approach to buy technology. The total value of automotive supplier deals in 2015 and 2016 was $74.4 billion, according to data compiled by Bloomberg, with each of those years far exceeding the $17.7 billion annual average in the previous 10 years. The number of transactions valued at $500 million or more also skyrocketed to 18 last year, triple the level of the previous decade. “Automotive bankers are definitely spending more time in places like Silicon Valley,” Christian Kames, Citigroup Inc.’s head of investment banking for Germany, Austria and Switzerland, and the global co-head

“The typical (automaker) model of buying tech and owning it doesn’t work in this space. The big players out of California carry the big stick, so there’s a lot of negotiating going on.” Claudia Rast, Butzel Long PC

of automotive, told Automotive News earlier this month. “The focus areas are electronics, communications and software. In the past, most suppliers didn’t really have that kind of technology, but they now know they need to have it to set the industry standards for the future.” Suppliers are also joining the fold of acquiring tech in lieu of signing JDAs. Last year, Southfield-based Lear Corp. acquired the intellectual property and technology of Santa Rosa, Calif.-based Autonet Mobile Inc., an internet-based telematics and app service provider for the automotive market, and Troy-based Arada Systems Inc., which is bringing to market a completely integrated modular unit that connects vehicles to infrastructure, other vehicles and the cloud. Connecting vehicles to infrastructure and other vehicles is designed to increase safety by enabling the ability to monitor traffic, push safety warnings or allow better traffic flow. The unit will be modular enough to upgrade the hardware easily, focused on security and software capable of over-the-air updates. Lear has since renamed its electrical business segment E-Systems to better reflect the complexity of its automotive electrical systems. “There’s still plenty of room for the smaller tech companies to get into automotive,” Rast said. “It’s very disruptive. We’re seeing medical device makers and companies designing ‘wearables’ technology looking to incorporate that tech in the car.” Sultana said, though, as more and more tech comes online, the winning formulas will result in more JDA agreements and less acquisition activity. “Once the tech starts to mature, the concrete starts to dry, you may see more action down the road,” Sultana said. “We’ll see JDAs from either coast getting more action.” DeGrazia, however, warns that when the tech does mature, the problems escalate. “It’s a storm on the horizon,” he said. “Google and the others are going to make money on their patent portfolio. There’s no walking it back. Auto patent infringement lawsuits start rising as soon as autonomous vehicles hit the road.” Dustin Walsh: (313) 446-6042 Twitter: @dustinpwalsh

C R A I N ’ S D E T R O I T B U S I N E S S // A U G U S T 2 2 , 2 0 1 6

SPECIAL REPORT: LAW

Patent surge

Innovation is key to U.S. economic growth, and that’s never been more evident than in the past couple of decades. Between 1994 and 2014, patents granted by the U.S. Patent and Trademark Office have nearly tripled. That spike, in both patents granted and patent applications filed, is largely due to the boom in mobile technologies, like smartphones and software from Apple Inc., Google Inc., Microsoft Corp., Samsung Electronics Co. Ltd. and others, said Phil Rettig, partner and head of the intellectual property group at law firm Dickinson Wright PLLC in Troy. “These companies file more applications than ever before,” Rettig said. “There’s immense competition, and the velocity of technological advancement has required the velocity of patent filing to increase as well.” Locally, automakers and auto suppliers are also filing more patents than ever before, Rettig said, as automotive advancements progress and research budgets swell.

SOURCE: WORLD INTELLECTUAL PROPERTY ORGANIZATION GRAPHIC BY LISA SAWYER

Farmington Hills firm settles eye care formula lawsuits with Bausch & Lomb By Chad Halcom chalcom@crain.com

Farmington Hills-based Vitamin Health Inc. is settling two federal lawsuits, in Michigan and upstate New York, with eye care giant Bausch & Lomb Inc., shortly before closing arguments were expected in a trial over vitamin formulas that purportedly slow the progress of macular degeneration. Rochester, N.Y.-based Bausch and New Jersey-based Wyeth LLC, a patent co-owner with Bausch, wrapped trial testimony earlier this month after two weeks in a lawsuit alleging patent infringement and false advertising against Vitamin Health over its VitEyes eye vitamin products. Vitamin Health was expected to begin its

rebuttal testimony, but jurors were instead notified of a settlement. Terms of that deal, which covered the New York state case and a Michigan lawsuit that Vitamin Health brought in 2015 against Bausch, were not disclosed. The settlement is not expected to affect marketing or sales of a VitEyes formula that is based on the second Age-Related Eye Disease Study, or AREDS 2, of 2013, said Vitamin Health attorney Steven Susser of Carlson Gaskey & Olds PC in Birmingham. At issue are alleged similarities between VitEyes and Bausch’s own PreserVision formula as treatments for age-related macular degeneration, based on the two AREDS studies from the National

Eye Institute, one of the federal National Institutes of Health. Quebec-based Valeant Pharmaceuticals Inc., which acquired Bausch &

Lomb shortly before the New York lawsuit was filed in 2013, previously has estimated that PreserVision was its second-highest-grossing product line, with $250 million in global sales in 2014. Vitamin Health has contended that its AREDS 2-based formula has a lower zinc dosage that does not reduce the health benefits of the formula and therefore does not infringe on the Bausch-Wyeth patent, but Bausch has contended that means the AREDS 2 product labeling is false advertising. Chad Halcom: (313) 446-6796 Twitter: @chadhalcom

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CRAIN'S LIST: INTELLECTUAL PROPERTY LAW FIRMS

Ranked by number of IP lawyers Rank

Firm Address Phone; website

Top local executive(s)

Local intellectual property Total number of lawyers local lawyers June 2016/2015 June 2016/2015 Practice areas

Brooks Kushman PC 1000 Town Center, 22nd Floor, Southfield 48075 (248) 358-4400; www.BrooksKushman.com

Mark Cantor president

79 77

Harness, Dickey & Pierce PLC 5445 Corporate Drive, Suite 200, Troy 48098 (248) 641-1600; www.hdp.com

Executive committee

58 58

Patent prosecution, trademarks, intellectual property litigation, post-grant proceedings, open source compliance, IP due diligence, trade secrets, licensing, copyrights, legal IT consulting, compliance and technical design consulting Patents, trademarks, copyrights, litigation, transactions/due diligence, anticounterfeiting, foreign rights, appellate litigation

Dickinson Wright PLLC 500 Woodward Ave., Suite 4000, Detroit 48226 (313) 223-3500; www.dickinsonwright.com

William Burgess CEO

41 38

185 170

Intellectual property, business technology, copyrights, patents, trademarks, intellectual property and trade secrets litigation

Honigman Miller Schwartz and Cohn LLP 2290 First National Building, 660 Woodward Ave., Detroit 48226-3506 (313) 465-7000; www.honigman.com

David Foltyn chairman and CEO

34 34

215 214

Trademark and copyright, patent and intellectual property litigation practice groups

Howard & Howard Attorneys PLLC 450 W. Fourth St., Royal Oak 48067 (248) 645-1483; www.howardandhoward.com

Mark Davis president and CEO

31 30

69 66

Young Basile Hanlon & MacFarlane PC 3001 W. Big Beaver Road, Suite 624, Troy 48084 (248) 649-3333; www.youngbasile.com

Andrew Basile Jr. president

26 26

29 26

Carlson, Gaskey & Olds PC 400 W. Maple Road, Suite 350, Birmingham 48009 (248) 988-8360; www.cgolaw.com

Theodore Olds III president and CEO

21 20

Bankruptcy and creditorsâ&#x20AC;&#x2122; rights, business and corporate, commercial litigation, employee benefits, environmental, estate planning, franchising, intellectual property, labor, employment, immigration, mergers and acquisitions, real estate, securities and tax. Patent and trademark litigation, prosecution and counseling; technologyrelated transactions, including licensing, acquisitions and divestitures; representation of emerging growth companies; and commercial and employment litigation Patents, trademarks, copyrights and trade secrets worldwide. Intellectual property and commercial litigation

Reising Ethington PC 755 W. Big Beaver Road, Suite 1850, Troy 48084 (248) 689-3500; www.reising.com

William Francis chairperson and president

20 20

Patents, trademarks, copyrights, trade secrets, counseling, opinions, portfolio management, litigation

Quinn Law Group PLLC 39555 Orchard Hill Place, Suite 520, Novi 48375 (248) 380-9300; www.quinnlawgroup.com

Christopher Quinn president

19 16

17 16

Patents and trademarks

Bodman PLC Sixth Floor at Ford Field, 1901 St. Antoine St., Detroit 48226 (313) 259-7777; www.bodmanlaw.com

Ralph McDowell chairman

18 16

133 136

Technology transfer, IP litigation, digital publishing, trademark selection, registration and licensing, economic espionage, entertainment, IP brand protection

Dinsmore & Shohl LLP 900 Wilshire Drive Suite 260, Troy 48084 (248) 647-6000; www.dinsmore.com

Thomas Anderson office managing partner

17 16

Patent, trademark and copyrights

Brinks Gilson & Lione 524 S. Main St., Suite 200, Ann Arbor 48104-2921 (734) 302-6000; www.brinksgilson.com

Steven Oberholtzer managing partner Ann Arbor office

16 17

Patent prosecution, intellectual asset management, trademark litigation, green tech licensing, biotech/pharma, nanotechnology

Fishman Stewart PLLC 39533 Woodward Ave., Suite 140, Bloomfield Hills 48034 (248) 594-0600; www.fishstewip.com

Michael Stewart and Michael Fishman founding partners

14 15

Trademark, copyright, patent, patent prosecution, trade secrets, social media, due diligence, litigation and dispute resolution, IP consulting, transactional and e-commerce services

Miller, Canfield, Paddock and Stone PLC 150 W. Jefferson Ave., Suite 2500, Detroit 48226-4415 (313) 963-6420; www.millercanfield.com

Michael McGee CEO

13 13

127 139

Patents, trademark, copyright and trade secret prosecution, counseling and litigation

Warner Norcross & Judd LLP 2000 Town Center, Suite 2700, Southfield 48075-1318 (248) 784-5000; www.wnj.com

Linda Paullin-Hebden executive partner

12 12

38 38

Copyright law, intellectual property, IP enforcement and litigation, patent prosecution and portfolio management, technology and IP licensing, purchase and sale, trademark portfolio and brand management

Bejin Bieneman PLC 300 River Place, Suite 1650, Detroit 48207 (313) 528-4882; b2iplaw.com

Thomas Bejin, Charles Bieneman, Stephen Kontos, and Christopher Francis members Christopher Darrow president

11 10

Patent prosecution, IP litigation, trademarks, licensing, due diligence

11 7

11 8

Procurement and litigation of intellectual property rights

16 16

Darrow Mustafa PC 410 N. Center St., Suite 200, Northville 48167 (248) 864-5959; www.darrowmustafa.com

The Dobrusin Law Firm PC 29 W. Lawrence, Suite 210, Pontiac 48342-2813 (248) 292-2920; www.patentco.com

Eric Dobrusin president and shareholder

10 10

10 11

Patent practice, trademark practice, IP strategy and counseling, patent opinions, IP due diligence, technology transfer, government contracts, customs enforcement

Cantor Colburn LLP 201 W. Big Beaver Road, Suite 1101, Troy 48084 (248) 524-2300; www.cantorcolburn.com

Scott McBain partner

9 11

Litigation, patents, trademarks and copyrights, licensing, opinions, IPRs

Garan Lucow Miller PC 1155 Brewery Park Blvd., Suite 200, Detroit 48207 (313) 446-1530; www.garanlucow.com

Robert Goldstein chairman of executive committee

8 7

60 66

Carrier, Blackman & Associates PC 43440 W. 10 Mile Road, Novi 48375 (248) 344-4422; www.carrier-blackman.com

Joseph Carrier senior partner

6 6

Insurance defense and coverage analysis, appellate law, commercial banking and real estate, commercial transportation and logistics, ERISA and employee benefits law, municipal law, intellectual property, no-fault and auto negligence and workers' compensation Patent for mechanical, chemical, electrical, computer; trademark; copyright; trade secret.

Butzel Long PC 150 W. Jefferson Ave., Suite 100, Detroit 48226 (313) 225-7000; www.butzel.com

Justin Klimko president and managing shareholder

6 6

125 116

Remarck Law Group PLC 4141 North Atlantic Boulevard, Suite 2, Auburn Hills 48326 (248) 270-2885; www.remarck.com

Brian Hollis, Michael Schaldenbrand, Thomas Jurecko, and Jason Benedict members Daljit Doogal Detroit office managing partner

5 5

Patent application preparation and prosecution (United States and abroad), trademark application preparation and prosecution, legal opinions, IP due diligence, IP licensing

5 5

32 33

Patent prosecution, strategic IP management/portfolio development, IP clearance, freedom to operate, due diligence, IP licensing and transactions, IP litigation and enforcement

Bill Sider CEO and managing partner

5 5

108 103

IP rights, trademark and copyright registration, IP licensing, transactions involving technology and e-commerce, IP litigation, arbitration and appeals, employment and executive contracts, technology transfers

23 23

Foley & Lardner LLP 500 Woodward Ave., Suite 2700, Detroit 48226-3489 (313) 234-7100; www.foley.com

Jaffe Raitt Heuer & Weiss PC 27777 Franklin Road, Suite 2500, Southfield 48034-8214 (248) 351-3000; www.jaffelaw.com

This list is an approximate compilation of intellectual property firms in Wayne, Oakland, Macomb, Washtenaw and Livingston counties. It is not a complete listing but the most comprehensive available. Unless otherwise noted, information was provided by the firms. Firms with headquarters elsewhere are listed with the address and top executive of their main Detroit-area office. NA = not available. LIST RESEARCHED BY SONYA D. HILL

C R A I N ’ S D E T R O I T B U S I N E S S // A U G U S T 2 2 , 2 0 1 6

DEALS & DETAILS ACQUISITIONS & MERGERS

Rehmann, Troy, a financial services firm, has merged with Sobb Roberts Inc., Toledo, Ohio. Sobb Roberts will

operate as Rehmann effective Sept. 1, and all 15 Sobb Roberts associates will join Rehmann. Website: rehmann.com.

CONTRACTS

Geometric Results Inc., Detroit, a managed services provider, has named Millennium Software and Staffing, Southfield, a staffing and IT services firm, to its Platinum Preferred Partner supplier program. Websites: geometricresultsinc.com, webmsi.com. PublicCity PR LLC, Southfield, a public relations agency, has been retained by Baron Chocolatier, Vernon Hills, Ill., a premium chocolate maker. Websites: publiccitypr.net, baronchocolatier.com. ZipLogix LLC, Fraser, a real estate

technology company, announced a partnership with Certified Proof of Funds Inc., Culver City, Calif., a website and mobile application firm providing secured proof of funds needed to complete real estate transactions. Also, ZipLogix partnered with CurbCall Inc., Boston, to provide real estate professionals with the Guide to Safer Showings; with Realtors Property Resource LLC, Chicago, to synchronize data between zipForm and RPR; and with Corefact Corp., Hayward, Calif., a printing and online marketing firm, for use of Corefact’s print and digital products and marketing platform, ListAssist. Websites: ziplogix.com, certifiedpof.com, curbcall.com, narrpr.com, corefact.com.

EXPANSIONS

Domino’s Pizza Inc., Ann Arbor,

opened its 13,000th store worldwide, in Auburn, Wash. Website: dominos.com.

Art Van Furniture, Warren,

announced a new 45,000-squarefoot showroom in Cadillac. Website: artvan.com. Fox Run retirement community, Novi, a part of Erickson Living,

Catonsville, Md., has opened a $26 million, 116-unit residence building. Website: ericksonliving.com.

NEW PRODUCTS

Living Essentials LLC, Novi, the

distributor of 5-hour Energy shots, debuted a new protein shot. Each shot has 21 grams of protein and is available in berry, peach mango, grape extra strength and berry extra strength. Website: 5hourenergy.com.

NEW SERVICES

Meijer Inc., Grand Rapids, added

curbside service to its Rochester Hills location. Customers can shop online and pick up their groceries curbside without leaving their vehicles. Website: meijer.com.

Tata Technologies Inc., Novi, a

provider of engineering and product development, launched its new product lifecycle management, engineering and manufacturing blog, Tech Talk, for design engineering clients and prospects. It features tips and tricks, how-to videos, local user group information, promotions and upcoming events. Website: tatatechnologies.com.

Altair Engineering Inc., Troy, announced the release of Envision, a cloud-based business intelligence platform. Website: altair.com. Duo Security Inc., Ann Arbor, a

cloud-based security provider, has launched Duo Insight, a free tool that lets IT run internal phishing simulations within five minutes. Website: duo.com.

PEOPLE: SPOTLIGHT Visteon names Garcia executive VP, CFO

Van Buren Township-based supplier Visteon Corp. named Christian Garcia as

IQense LLC, Farmington Hills, a

channel management company, announced Through-Channel, which delivers marketing and sales channel insights in a new dashboard module. Website: iqense.com. Carbon Media Group LLC, Bingham

Farms, a digital media firm, launched its latest daily news website, Agdaily.com. Website: carbonmedia.com.

Deals & Details guidelines. Email cdbdepartments@crain.com. Use any Deals & Details item as a model for your release, and look for the appropriate category. Without complete information, your item will not run. Photos are welcome, but we cannot guarantee they will be used.

ADVERTISEMENT SECTION

ACCOUNTING

Christian Garcia

executive vice president and CFO, effective Oct. 1. Garcia, 52, will replace

William Robertson, who has served as

Visteon’s interim CFO since March 31 after Jeffrey Stafeil departed to become executive vice president and CFO for Johnson Controls Inc.’s automotive experience unit in Plymouth. Robertson will remain Visteon’s vice president and corporate controller. Garcia joins Visteon from Houston-based Halliburton Co., where he most recently was senior vice president of finance and interim CFO.

New president, chairman at United Road Services United Road Services has named Mark Anderson president in addition to his role as COO, while CEO Kathleen McCann

LAW Richard A. Dietz Senior Attorney

Foster Swift Collins & Smith, PC Foster Swift Collins & Smith, PC welcomes Richard A. Dietz and Michael J. Liddane to its transportation practice group. Dietz has practiced in the transportation industry for more than 35 years, handling railroad defense matters, death and serious injury railroad claims, insurance litigation and major maritime and railroad property damage claims. He is a current member and past president of the Propeller Club of the United States, Port of Detroit.

Michael J. Liddane

Daniell R. Patterson & David G. Heimbuch Principal / Principal Fenner, Melstrom & Dooling, PLC Fenner, Melstrom & Dooling, PLC announced today that Daniell R. Patterson has joined the firm. Mr. Patterson has over 25 years of experience in public accounting. He has widespread experience assisting clients with internal control analysis, financial statement audits, fraud prevention analysis and consults with clients on how to maintain a competitive advantage by implementing various best practices. Mr. Patterson also has extensive expertise in technology, dealerships, and manufacturing. Fenner, Melstrom & Dooling, PLC located in Birmingham is pleased to announce its selection of David Heimbuch as Principal. Mr. Heimbuch has over 12 years in the accounting profession and serves as a business advisor to a wide range of clients. His services include corporate accounting and tax services, individual tax returns, and personal tax planning including minimizing tax exposure. His expertise in accounting and tax law has allowed him to build solid relationships with clients.

Senior Attorney

Foster Swift Collins & Smith, PC Liddane represents transportation companies in railroad and merchant vessel-related accidents. He is an experienced litigator in marine salvage cases, subrogation recoveries for insurance clients and Marina liability matters. His litigation experience ranges from cargo transit property losses to liability for toxic tort asbestos and amusement park injuries. Dietz and Liddane practiced with the firm of Foster, Meadows and Ballard, PC prior to joining Foster Swift.

PEOPLE ON THE MOVE provides an opportunity

to announce the selection, promotion, appointment, leadership or role responsibility expansion of an employee, colleague or team member across industries and sectors. For more information or questions regarding advertising in this section, call Lynn Calcaterra at (313) 446-6086 or email: lcalcaterra@crain.com

becomes chairman of the board, the Mark Anderson Romulusbased auto transport company announced. Anderson has been COO since joining the company in Kathleen McCann 2014. McCann will replace Michael Eisenson, managing director and CEO of Charlesbank Capital Partners, the company’s majority shareholder, at the helm of the board. McCann joined United Road in 2011 as its president and was named CEO in 2012.

Mopec names new CEO Oak Park-based Mopec has named Jay Troger as CEO. Troger succeeds Jane VanDusen, who “left to pursue other business opportunities,” said a spokesman for Mopec, which designs and manufactures customized equipment for the pathology, anatomy, mortuary and animal science industries. Troger, 60, was most recently CEO of Ohio-based Nextronex Inc., a manufacturer of utilityscale solar inverters.

August 22, 2016

WATER FROM PAGE 1

commercial and industrial accounts couldn’t handle,” Brown said. In all, 64.4 percent (13,410) of the city’s 20,813 nonresidential accounts currently being billed by meter size will see a decrease in their costs (7,435 customers) or a small increase (5,975 customers) of up to $500 the first year when they switch over to being billed per impervious acre, according to the DWSD. The remaining 7,403 nonresidential customers will pay more than $500 more the first year after the impervious acreage rate kicks in, with 604 customers paying $35,000 or more extra and 98 paying $30,000 to $34,999 more, according to DWSD data. However, the rates are expected to decrease the second and third years. The DWSD spends about $125.7 million per year transporting, treating and storing billions of gallons of stormwater and melted snow and ice. By state law, the department cannot collect more in drainage costs than it incurs, said Marcus Hudson, the DWSD’s CFO. He stressed that the department, which is spending about $14.2 million to implement the uniform drainage charges, will not see an increase in revenue. However, collecting from property owners — surface parking lot owners, for example, which don't have DWSD accounts because they don't use water — is expected to generate about $10 million per year. Over the three-year period, collecting from the owners of the 22,000 parcels is expected to generate $29.5 million, Hudson said. Switching meter-based rate customers to the impervious acreage calculation is expected to generate $63 million over three years, after phase-in credits are applied: $13 million in the first year, $21 million in the second year and $29 million in the third year. But the per-acre rate is expected to decrease over the next two years as more customers will be collected from and everyone will be paid based on the same rate, DWSD officials said. In FY 2018, it would decrease to $618.97 per impervious acre and in FY 2019, it would decrease to $579.36 per acre. The owners of the 22,000 parcels who hadn’t been billed for drainage in the past will not be back-billed. That’s in contrast to three years ago, when about 1,200 Detroit businesses received retroactive bills, sometimes for six figures, for drainage costs that hadn’t been charged for years. This time around, the DWSD is not retroactively billing the owners of those 22,000 parcels for the drainage costs, said Bryan Peckinpaugh, public affairs manager for the DWSD, which employs about 420 people. The department, he said, has hired about 20 new employees to deal with the new uniform drainage

C R A I N ’ S D E T R O I T B U S I N E S S // A U G U S T 2 2 , 2 0 1 6 CRAIN’S DETROIT BUSINESS

“We, along with the city, have to take a long, hard look to make sure we aren’t creating undue burden. We’ll have continuing conversations with the administration.” Brad Williams, Detroit Regional Chamber

charge, mostly in the area of customer service. Brad Williams, vice president of governmental relations for the Detroit Regional Chamber, said some of its members will see significant cost increases because of the change. “We, along with the city, have to take a long, hard look to make sure we aren’t creating undue burden,” he said. “We’ll have continuing conversations with the administration and see what happens from there.” Dan Gilbert’s Bedrock Real Estate Services LLC, one of the largest property owners in the city, “will be working with the city to assess how this affects Bedrock,” said Whitney Eichinger, the company’s director of communications. Among those expected to be hit is Crain Communications Inc., parent company of Crain’s Detroit Business, for its Brewery Park headquarters at Gratiot Avenue and Russell Street downtown. “We don’t know enough information yet,” KC Crain, executive vice president and director of corporate operations of Crain Communications, said Friday. “So we are going to be working with the city and some other departments to see what our options are.” Gregg McDuffee, executive director of the Detroit-Wayne Joint Building Authority, said it’s good to get those who haven't been paying drainage charges to do so. The building authority, which owns the Coleman A. Young Municipal Center downtown, pays $1,787 per month in drainage charges, he said. McDuffee, also a member of the board of directors and treasurer of BOMA (Building Owners and Managers Association) Metro Detroit, said that organization has been “tracking this very carefully.” “I can see this being an enormous hit for people,” he said. “But any major users with a big roof, big impervious parking area, or both, if they haven't been billed in the past, they are going to see a really substantial hit.” Williams also said, however, that for a city that just a couple years ago was in federal bankruptcy court, it’s important that Detroit collects the revenue owed to it. “From that perspective, it makes sense,” he said. Kirk Pinho: (313) 446-0412 Twitter: @kirkpinhoCDB

Page 15

City takes multi-pronged approach to collect on delinquent water bills By Chad Halcom chalcom@crain.com

A move to collect drainage fees for nearly 22,000 land parcels across the city in October may bring new accounts and customers into the Detroit Water and Sewerage Department, but it is not expected to boost

revenue. That job instead might fall to city officials and attorneys pursuing business owners for delinquent commercial account balances from business, nonprofits, government agencies and others across the city who owe about $30 million on past due balances. Director Gary Brown of the DWSD said the city department is taking a multi-pronged approach to getting delinquent commercial users caught up on those balances, but it generally pursues shutoffs and tax liens against commercial and property owners over city residents. “The first priority for (settling up) is on delinquent commercial accounts,” Brown said. “And we are doing several things. We’ve hired a law firm and are suing many of them, so we’re going after them with lawsuits.” About 9,000 of the city’s approximately 17,500 commercial accounts have balances that are 60 days or more in arrears, at an average past due balance around $2,800 per commercial customer, DWSD officials said. But that’s not to say all are scofflaws, since thousands might be on repayment plans and remain on the delinquency account lists until they are current again on water bills. “All 9,000 commercial accounts might be in arrears to different degrees, for more than $25 million, but if you’ve got $13 (million or) $14 million of that sum with users who are already on installment agreements, then calling them all delinquents doesn't seem fair or accurate,” said Marcus Hudson, the DWSD’s CFO. For comparison, Detroit has about 175,000 residential accounts, Brown said, and those carry a combined $65 million in past due balances. The city can, and has for about 10 years, imposed property tax liens against landowners for water balances more than six months overdue, but only does so on nonresidential accounts, Brown said. Shutoffs are another incentive to bring delinquent business owners into line, but Hudson and Brown said the city's options are more limited. Hudson said the DWSD does not contemplate shutoffs for any nursing homes, apartment building managers and similiar businesses, and Brown said business owners are often better positioned than residents to commit to payment plans or avoid litigation. “They are the priority for shutoffs, but for the most part they have the dollars or the resources to get into a payment plan and get current again with us, where residential ac-

counts struggle financially and they are having a much harder time,” he said. “When you have 40 percent of accounts below the poverty line, you can see how difficult it is to manage these things.” Federal guidelines from the U.S. Environmental

Protection

Gary Brown: First priority: commercial accounts.

Agency

also call for water and sewer bills not to exceed 2.5 percent of median household income in a community — $25,769 for Detroit, according to the U.S. Census

Bureau

— so residential revenue may be more con-

strained. The DWSD has retained Detroit-based Kilpatrick & Associates PC to pursue delinquent commercial customers, and the firm has a lawsuit pending in Wayne County Circuit Court against Colonial Manor Properties LLC, former management company for an apartment building on Lahser Road north of 8 Mile Road in Southfield, awaiting a settlement

conference in November. Two other lawsuits, against the Babcock Puritan Co-Operative LLC apartments and the Canetcom Inc. owned apartments on the city’s northwest and west sides, respectively, both obtained default judgments in the city’s favor earlier this year. Unlike delinquency payment plans, which can shore up revenue for the department, the new drainage fee system isn't intended to generate more cash for the department, but to redistribute a $125.7 million annual operating cost more evenly and equitably, Hudson said. New and increased fees will also be phased in over three years, he said, while many properties will see reduced rates. “All we’re ever trying to do is recover our cost; there’s a $125 million revenue requirement we’re trying to meet without preference or prejudice. And as we add those new people into the customer base, the cost will go down per customer because there are more billable acres, for lack of a better word,” he said. “Some property owners may get hurt by it, but others will benefit.” Chad Halcom: (313) 446-6796 Twitter: @chadhalcom

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C R A I N ’ S D E T R O I T B U S I N E S S // A U G U S T 2 2 , 2 0 1 6

NEIGHBORHOOD FROM PAGE 3

corporations are the one kind of entity putting shovels in the ground. Ernie Zachary, vice president of Detroit-based Zachary & Associates, a community group consulting company, said community development corporations emerged in the 1980s as a way to help neglected urban neighborhoods. “If they offer continuity and a continuum of leadership, they can be effective,” he said. “(Central Detroit Christian) is putting in place enough substance so there is meat on the bone.” In the case of CDC, its roster of businesses ranges from farming operations to multipurpose businesses. These include: Cafe Sonshine is a 2,800-squarefoot soul food restaurant that will have an emphasis on healthy food. Unlike most restaurants of its ilk, it will be pork-free and offer baked chicken and tilapia in addition to the usual standards. It is doing some catering and is expected to open in about a month. Higher Ground has been maintaining lawns and landscaping yards since 2011. Johanon said the business is a success story. Craig Grissom, a former prisoner, bought it from the CDC last year and it employs neighborhood residents. The CDC Farm and Fishery on Second Street has been breeding and growing fish and uses fish waste to fertilize the basil in the CDC’s gardens. However, Johanon recently tweaked the business. It cost $9 a pound to manufacture fish that was selling for $6 a pound — not a workable model. Now the lower level of the building will be a processing center for vegetables and the upper floor will handle a lower volume of aquaponics. Restoration Warehouse is a thrift store. Detroit Remade scavenges used materials and repurposes them to sell. Peaches & Greens is a market and a commercial kitchen. It had its first break-even year last year, said manager Liz Etim. Faith, Hope and Love Productions is CDC’s gardens and orchard.

JM EAGLE FROM PAGE 3

and an attorney for several of the municipal governments and an ex-Eagle employee in the case, said the next trial in March is expected to focus on damages for the plaintiffs who already prevailed, while a third trial for remaining governments has yet to be scheduled. He declined to elaborate on details of the case, however. The Michigan Department of Environmental Quality has allowed for PVC and for HDPE or polyethylene pipe to be installed in public water systems, although state regulations generally call for very high pressure tolerance or for thicker walls in water lines of these materials. But Flint is one of several U.S. cities that has not allowed for the specification of

CENTRAL DETROIT CHRISTIAN

A Central Detroit Christian residence before (above) and after volunteers clean it up and give it a fresh coat of paint. Solid Rock Property Management manages CDC’s commercial and residential properties. Shadow of the Almighty Security handles security for the neighborhood’s construction projects. Fit & Fold Laundromat allows customers to flex their muscles with exercise equipment while they do laundry. Etim said Peaches & Greens is mission-driven like much of the CDC. It has a mobile truck that does community outreach delivering food and also does pop-up farmers markets. “The mission is accessibility to fresh produce in the neighborhood,” she said. “We’ve seen a shift in the population here. People have moved out, but with the resurgence in Detroit, we are seeing new faces coming into the shop.” The market’s food truck serves employees in nearby places such as Henry Ford Hospital and New Center Park. There’s an education element at the market with Michigan State University teaching canning and other useful domestic skills. Johanon said CDC bought the large house across from Peaches & Greens for $1,800 and is remodeling it as a community center to be used by Brilliant Detroit, an organization working to help families and their children get on a course for success. For Johanon, it’s all supportive of her social conscience. She grew up in Redford Township and attended Moody Bible Institute in Chicago. She continued her education at Wheaton College in Wheaton, Ill., and John Marshall Law School in Chicago. She ended up working in the Cabrini

Green projects in Chicago before moving to Detroit to tend a Christian teen organization. When it moved to the suburbs, she and a partner, who is no longer involved, started CDC. CDC has 24 staff people and employs another 12-16 through its businesses. It attracts up to 400 volunteers each summer. Over the years, CDC has orchestrated the demolition of homes deemed to be total losses and turned some of the vacant lots into parks with playgrounds, picnic tables and benches. It has built seven exercise pods on smaller plots of land and brought in volunteers to teach residents how to use them. Large flower planters sit on street corners — giving the neighborhood a cared-for vibe. The Kresge Foundation, along with the Skillman Foundation, the Kellogg Foundation and Chase Bank, have given six-figure donations over the years, she said. Kresge’s Detroit Program has made grants of $841,000 to CDC since 2010. A grant of $365,000 in 2010 supported the stabilization of the neighborhood through the acquisition, renovation and sale of foreclosed vacant homes. Grants of $366,000 in 2012 and 2013 supported development of the area around Peaches & Greens. Most recently, a $110,000 grant through the Kresge Innovative Projects: Detroit

initiative of the Detroit Program, a small neighborhood grants program for city organizations, supported the transformation of seven vacant lots into neighborhood pocket parks with exercise equipment. George Jacobsen, senior program officer with Kresge’s Detroit Program, said Johanon, as the leader of CDC, has a vision. “She is really good at implementing things, and she is able to do a lot with quite a little,” he said. He added that the foundation looked at 100 applications and narrowed it to a pool of 18 projects. CDC was a shoo-in. “We knew their track record and Lisa’s ability to deliver,” Jacobsen said. “She put together tangible things that funders like to see.” In February 2015, CDC acquired a 30,000-square-foot church building at 1550 Taylor St. to be its headquarters, a preschool similar to Head Start, a facility for youth programs (now housed in the nearby Blessed Sacrament Cathedral), and a housing counseling center for 400 families. It was purchased for $3,000, but is undergoing extensive remodeling. They hope to open it in January. In addition, the Michigan Economic Development Corp., the Michigan

plastic pipe in the past. The city has been proceeding cautiously on Wang’s proposal, and not all of its elected officials were aware of JM Eagle’s court troubles when contacted by Crain’s. “Of course something like that is a factor,” said Flint City Council member Monica Galloway when told earlier this month of the JM Eagle verdict and upcoming second trial. “We’ve seen that sort of history with some of our trash contractor bidders, and we’ve seen issues like that with the (environmental services) contractor that our former emergency manager hired, Veolia (North America Inc., which tested Flint water quality in 2015). “That speaks to quality of product. It sounds easy to just go get something free, but if it’s not reliable, that’s not good. I think the city wants to

know what we’re getting. And there are so many steps you have to take in this process.” Wang could not be reached for comment, and a marketing director for JM Eagle referred requests for comment to a section of the company’s website. There, JM Eagle calls the litigation “scurrilous allegations by the former employee who had been fired for soliciting a kickback,” notes that the allegations involve pipe manufactured between the late 1990s and 2006, and that some states and local governments have declined to participate or backed out of the litigation. “JM Eagle suspects that many other municipal governments would have dropped out, but to do so they would have to hire attorneys and make numerous court filings. For these small cities and municipal water districts, it was easier and cheaper

to simply do nothing,” the company states. “JM Eagle is so highly confident that its pipe will not fail that it has guaranteed it for 50 years, which is unprecedented in the industry.” The lawsuit contends that various management executives at JM Eagle knew since the 1990s that pipe it had sold had failed testing, and that it regularly fell significantly below minimum pressure tolerance thresholds on industry certification labels it had posted on its products. Some communities have alleged pipes exploded within a year of installation. Flint Mayor Karen Weaver said in a statement in late June that the city was reviewing “concerns” from engineers “about the lifespan of the plastic pipes, due to the harsh weather conditions we experience in Michigan.” But it did not elaborate, and city pub-

State Housing Development Authority

and the CDC recently announced a crowdfunding campaign by Patronicity for the project. If the campaign

reaches its goal of raising $50,000 by Sept. 23, the project will win a matching grant with funds from MSHDA and MEDC’s Public Spaces Community Places program. The church, formerly called the Tried Stone Baptist Church, also has a gymnasium and a dental clinic, which Central Detroit Christian hopes will be in business in 2017. An even larger project is the 1929 Casamira apartment building, which was donated to CDC by the Wayne County Probate Court. Restoring it for use as an apartment building will require inventive financing and likely cost $10 million, Johanon said. Plans call for market rate and affordable units. CDC buys most of its properties through Wayne County auctions. According to CDC’s 2015 formal audit, the nonprofit has almost $3.7 million in assets and the same amount in liabilities and equity. The majority of its annual budget, almost $2 million, has gone toward building and improvements. The neighborhood relies on the charter Henry Ford Academy to educate about 400 elementary students, as well as several middle and high school students in the area. The improvements Central Detroit Christian has made have not been based on a steady upward line. It started going through hard times in 2008 when it had 27 vacant houses. By 2009, it had 103 vacant homes. Because the neighborhood is close to three highways (I-75, M-10 and I-94), it made fleeing from the scene of a crime easier. “We got rid of the drug dealers by buying property. Then we actually tripled in size over the Great Recession,” Johanon said, adding that the downturn came later for her neighborhood. “After the recession, with all the work we did, it looked like we did nothing.” Undeterred, CDC picked itself up in recent years, and Johanon feels good progress has been made. “Volunteers and neighbors are starting to see people here have hope. Now people wave and are happy to see you,” said Johanon, who lives in the neighborhood with her husband and children. “People have enough (confidence and trust) that they are contributing to make a difference in the neighborhood. Some of the most unlikely characters are helping. We have not seen this before.” lic relations director Kristin Moore said late last week officials were still weighing the options and aren’t yet ready to give a definitive answer on the JM Eagle plastic pipe offer. At the moment, replacement work will proceed with copper pipes, she said. “We plan to reach out to the leaders of JM Eagle to get feedback and clarity on the issues that have been identified. In the meantime, we will continue to use copper pipes as we move forward with the next phase of the FAST Start initiative,” Weaver said in June, referring to an initiative to target and remove lead pipelines from the water network. “However, we have yet to make a final decision on whether plastic will be used in the future as we work to replace all the lead-tainted pipes in the city of Flint.” Chad Halcom: (313) 446-6796 Twitter: @chadhalcom

C R A I N ’ S D E T R O I T B U S I N E S S // A U G U S T 2 2 , 2 0 1 6

TECH

MEIJER

to drive what the industry should be focused on. We can put our flag in the ground and say we should focus on new automation because change is coming ... rapidly.” Industry 4.0, otherwise called the fourth industrial revolution after mechanization, the assembly line and robotics, is a megatrend in manufacturing centered on the “smart factory” — using the internet and cloud computing to make decentralized decisions and create communication among machines, workers and the factory systems. This interconnectivity is designed to improve efficiency, quality and profits. According to a September survey on Industry 4.0 by Pricewaterhouse Coopers LLP, 72 percent of industrial companies surveyed expect to achieve a high level of digitization by 2020, compared to the 33 percent that said they already accomplished that level of digitization. Manufacturers expect to reduce operational costs by 3.6 percent while increasing efficiency by 4.1 percent annually through 2020 by using Industry 4.0 technologies and methodologies, according to the survey. Kelly, however, worries that smaller manufacturers will miss out if large players don’t assist them in implementing the strategy down the supply chain — which is critical to the region’s success, he said. “We must own this story,” Kelly said. “It’s not just about mobility. If we do this right, we can in-source jobs from Mexico and China as it becomes more cost effective to get our products to market.” Kelly said he’d spent the first 90 days as executive director developing a strategic plan with Automation Alley’s board of directors to roll out to its members. Next year, the organization will push to create executive committees consisting of advanced manufacturing’s most influential executives, he said. The committees, focused on such technologies as additive manufacturing and virtual-reality simulation, will dictate how Automation Alley facilitates the advancement of the Industry 4.0 concept. “Once we assemble the thought leaders, this can become transformational,” Kelly said. “Small- and medium-sized companies will want to rub shoulders with these people, and we can push to scale it up.” He expects the committee structure to grow its membership, but a target number has not yet been identified. Kelly said the plan will take 24 to 36 months to ramp up before Automation Alley becomes a go-to organization for advanced manufacturing processes and skills training. “We know our assets in the region and what we do well and poorly,” he said. “This convergence of tech is in our wheelhouse. We can make it work. I didn’t come up with some brilliant strategy; it’s just looking at the puzzle pieces how best to boost economic development in the region.”

100,000-square-foot stores offering predominantly food, and has plans to open a similarly sized concept close to home in Grand Rapids in 2018 at the earliest. How Meijer's forthcoming Grand Rapids store could differ from the closed mini-supercenter in Niles is unclear. Meijer’s mini-supercenters are about half the size of a typical store. “We have committed to opening a smaller format store in Grand Rapids, in an urban project that we hope we’ll learn from,” Meijer said. “We’ve still got a lot of work to do on that one. We hope that will begin to give us a model to put in other areas.” Guglielmi said it’s important to keep in mind that Meijer’s “smaller” stores are still relatively large, and consumers won’t see the retailer doing a 20,000- to 30,000-square-foot concept that would fit neatly into a big city’s downtown. He said the reason Meijer’s prices are lower for groceries compared with traditional supermarkets is because there are higher profit margins for general merchandise. Smaller stores make that difficult because the stores can’t stock as much. “Never say never, but I think you’ll see traditional Meijers around Detroit before you see smaller ones,” Guglielmi added. That’s because Meijer’s two su-

FROM PAGE 1

ADRIENNE ROBERTS

Hundreds of people gathered for the opening of the Meijer in Flat Rock recently. percenters in Detroit — one at the

Gateway Marketplace development

at Eight Mile Road and Woodward Avenue and the other in northwest Detroit at the site of the former Redford High School at Grand River Avenue and McNichols Road — have been successful, especially the supercenter at the Gateway Marketplace, the first store Meijer opened in Detroit. The stores have done so well, in fact, that the company is eyeing other locations in the city, such as along Jefferson Avenue between I-375 and Grosse Pointe Park, Crain’s has reported. Meijer has no updates on the reported plans. Guglielmi said that when looking for a location to build a new store, Meijer looks at a combination of population density, traffic patterns and distance from competitors. “We continue to be very excited about Detroit,” Meijer said. “Our

competitors are making big investments here, too, but we want to build share, and that’s our goal.” Despite recent efforts by retailers to move away from the big-box format, Ken Dalto, founder and owner of Farmington Hills-based business consulting firm Kenneth J. Dalto & Associates, said Meijer does well when it opens its typical large superstores in underserved areas. The three areas of growth for bigbox retailers are in online sales, opening smaller stores and building stores in areas that lack a variety of retail and grocery options, he said. While Target Corp. has succeeded in capturing millennials’ dollars online and opening smaller-footprint stores (the retailer has used names such as TargetExpress and CityTarget for these concepts), Wal-Mart Stores Inc. and Meijer have done well opening in underserved areas, such as in northwest Detroit, or certain

areas of northern Michigan and the Upper Peninsula. He said Target has captured millennial dollars because it’s seen as a one-stop shop for food, namebrand clothing, home improvement products, small appliances and pharmacy needs. “When people tell you they’re going to Target, they have everything, (and shoppers are) going to get everything,” Dalto said. He said that while Meijer has similar offerings, it’s still viewed primarily as a place to buy groceries. Cindy Ciura, principal of CC Consulting in Bloomfield Hills, said another challenge for Meijer opening a smaller-footprint store is that shoppers choose to go to a Meijer because “the selection is amazing, there are such wide varieties, and they buy so deep.” She said that when Meijer tries to fill more of a niche for shoppers with its grocery-focused mini-supercenters, it’s a case of “stores trying to be something that they’re not,” and consumers don’t latch on to the concept easily. She said niche retailers like the discount supermarket chain Aldi, Trader Joe’s, Whole Foods or a smaller-footprint Target (because it’s “nimble”) would do well in downtown Detroit. “(Retailers are) tempted to want to do something (in downtown Detroit because) it’s so under-groceried, and they want to capture that market,” Ciura said.

C R A I N ’ S D E T R O I T B U S I N E S S // A U G U S T 2 2 , 2 0 1 6

HEALTH FROM PAGE 3 www.crainsdetroit.com Editor-in-Chief Keith E. Crain Group Publisher Mary Kramer, (313) 446-0399 or mkramer@crain.com Editor Jennette Smith, (313) 446-1622 or jhsmith@crain.com Director, Digital Strategy, Audience Development Nancy Hanus, (313) 446-1621 or nhanus@crain.com Managing Editor Michael Lee, (313) 446-1630 or malee@crain.com Managing Editor/Custom and Special Projects Daniel Duggan, (313) 446-0414 or dduggan@crain.com Assistant Managing Editor Kristin Bull, (313) 446-1608 or kbull@crain.com News Editor Beth Reeber Valone, (313) 446-5875 or bvalone@crain.com Senior Editor Gary Piatek, (313) 446-0357 or gpiatek@crain.com Research and Data Editor Sonya Hill, (313) 446-0402 or shill@crain.com Newsroom (313) 446-0329, FAX (313) 446-1687, TIP LINE (313) 446-6766

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integrate physical and behavioral care. A 120-member group known as the Stakeholder Section 298 Workgroup spent three months developing policy recommendations for the Legislature. The group’s report was completed in July and turned over to the state Department of Health and Human Services, which then was mandated by the Legislature to develop the final report with ongoing stakeholder input. Mental health advocates are particularly concerned because one of the key recommendations approved overwhelmingly by the Section 298 workgroup is that Medicaid behavioral health funding should continue to be managed by the public mental health system. Calley told Crain’s he did not attend a July 29 meeting called by HHS to explain the next steps in the legislative report preparation to a small gathering of mental health, hospital, insurance and health plan representatives. HHS officials explained that three new workgroups would be formed to write the final policy recommendations. But Calley said he quickly responded with phone calls and emails to state officials when he received an Aug. 5 letter from eight mental health advocacy groups expressing concern that the Section 298 Workgroup’s report might be ignored by the next three workgroups. HHS and legislative budget chiefs also received the letter. In the letter, the advocacy groups said it “was unsettling to learn that the next steps would not pick up from where the 298 workgroup ended.” They told Calley that HHS officials repeatedly said the next three workgroups would take an “unbiased” look at developing policy recommendations for the Legislature. They also said the 18 main core values and 29 design elements that should be included in a redesigned mental health and physician health

CALENDAR UPCOMING EVENTS

Connecting Cultures to Business Luncheon. 11:30 a.m.-1:30 p.m. Sept. 8. Livonia Chamber of

Commerce. Representatives from metro Detroit businesses will provide information about Asian, German, Chaldean and Hispanic cultures, and new ideas to better prepare for productive interactions with business people from different cultures. Moderator: Roop Raj, WJBK-TV2. VisTaTech Center, Schoolcraft College, Livonia. $30 members; $40 guests. Contact: Laura Tahmouch, phone: (734) 427-2122; email: tahmouch@livonia.org. Raising Capital and Building Capital Source Relationships. 8:30-10 a.m. Sept. 13. Automation Alley. Topics

will include developing ways to identify financing sources and requirements; establishing a

system that were developed and overwhelmingly supported by the 298 workgroup “would be subject to interpretation” by the next three workgroups as part of the process. HHS is required to file a report to the Legislature by Jan. 15 on reforming how Medicaid mental health funding is distributed within the state’s mostly nonprofit behavioral health system and how to “implement behavioral and physical health service integration.” Elizabeth Hertel, HHS’ policy and legislative director, said the department plans to complete the draft report in October and then distribute it for public comment. She said mental health advocates “misinterpreted” HHS’ plan to develop the report. “My first reaction (about the letter) was there was probably some kind of communication misunderstanding,” Calley said. “This was the reason I want to stay closely engaged in this to keep in close contact with everybody. I made it clear that the values and framework and vision is non-negotiable. (The Section 298) workgroup is the framework we will be using going forward. I reiterated that with the department.” Elmer Cerano, executive director of the Michigan Protection & Advocacy Service Inc., said state officials told the group in the July 29 meeting that three new workgroups will develop the policy recommendations for the Legislature. “(We) asked if the new groups will pick up where the last group left off,” said Cerano, who attended the meeting. “We were told we don’t want to be biased by it, that there would be a new approach. We asked about the core values and design recommendations and were told that would be up to this (new) group, too.” Lynda Zeller, HHS’ deputy director of behavioral health, also told Crain’s there was a simple misunderstanding about how the three new state affinity workgroups were going to develop policy recommendations. “Our intention is to build upon the work of the Section 298 work-

group,” Zeller said. “I really believe the group is moving together to strengthen the system ... all physical health and mental health services.” Dohn Hoyle, public policy director for The Arc of Michigan, said the mental health advocates met after the meeting and were in unanimous agreement that HHS meant it had decided to start the planning from square one. “We were all quite alarmed, looked at each other and said, ‘We have to talk about this,’ ” Hoyle said. It was at that point that Cerano, Hoyle, Mark Reinstein and several other mental health leaders decided to involve Calley. Reinstein is a consultant and former director of the Mental Health Association in Michigan. But Rick Murdock, executive director of the Michigan Association of Health Plans, who was present at the July 29 meeting, said his recollection was that HHS would use the 298 workgroup report. “I am hearing there is a report with recommendations and that is the starting point” for the next three workgroups, Murdock said. “Clarification came out the next day (by HHS) that of course we are going to use the report. I was not concerned about the workgroup report not being used going forward. It is the best possible solution for the state.” At the next meeting Aug. 12, Hertel said she confirmed with the group that the 298 workgroup recommendations “will be followed.” Cerano said that meeting, after the letter and Calley’s intervention, was “totally different.” He said the state clarified that it would “follow what we did in the Section 298 group.” Hoyle said he is happy HHS will consider the 298 workgroup’s recommendations, but he said he still has lingering concerns that HHS continues to favor the original Snyder boilerplate language that would have granted the health plans the $2.4 billion in Medicaid funds to manage the entire system. “There was a vote (in the 298 workgroup) about whether the money should go through the

health plans, and it was soundly rejected. There were a few votes from the health plan representatives,” Hoyle said. “We voted on having the money go through the community mental health organizations, and it was overwhelmingly approved.” Calley said he knows there are hard feelings on the mental health advocacy side from earlier this year when the state’s original boilerplate language was inserted into the budget without warning or discussion. “We have to be extra sensitive how well we communicate. The language and approach is a little different” between state officials and mental health advocates, he said. “I felt the department had reflected quickly and adjusted quickly to those concerns.” Calley said he still hasn’t formed an opinion on how the Medicaid mental health funding should be handled — either through the HMOs or through the prepaid inpatient health plans. The PIHPs receive state mental health funding, manage provider networks and distribute payments to the community health agencies and providers. “I do think it is important to allow for innovation in different parts of the state,” Calley said. Cerano said he also hopes HHS recommends setting up various regional pilot projects to test how physical and mental health can be integrated to deliver more services to the public at lower costs. “The bottom line is we want a re-envisioned system with self-determination and person-centered planning,” Cerano said. “We still have concerns how this actually gets done. There is an undercurrent that the private system wants to take over the public system and cherry-pick clients to skim off the profits.” Hertel said the next meeting of the workgroup will be Aug. 26. Participants will appoint members to serve on the three workgroups — eligibility, payers and providers — that will develop concrete policy recommendations.

marketing process; negotiating financing; understanding the underwriting process and interpreting the financing agreements, shareholder agreements and terms. Speakers: David Ritter, shareholder, strategic advisory group, Doeren Mayhew; and Claudio Calado, managing director, Doeren Mayhew. Automation Alley, Troy. $20 members; $40 nonmembers; $30 walk-in members; $50 walk-in nonmembers. Email: info@automationalley.com; phone: (800) 427-5100.

Rossman. The Townsend Hotel,

nonmembers. An additional $5 will be charged to those registering the day of the event. Contact: Jaimi Brook, phone: (248) 641-8151; email: theteam@troychamber.com.

The Big Four: Brogan, Lovio-George, Muirhead, Rossman-McKinney. 11:30 a.m.-1:30 p.m. Sept. 14. Inforum. PR

and marketing gurus who are successful business owners in their own right: Marcie Brogan of Brogan & Partners, Christina Lovio-George of Lovio George Communications and Design, Georgella Muirhead of Van Dyke Horn Public Relations (formerly

Berg Muirhead and Associates) and Kelly Rossman-McKinney of Truscott

Birmingham. $45 Inforum members; $65 nonmembers; $25 students; $700 table sponsor (table of 10-preferred seating; company logo recognition in event presentation and event signage). Website: inforummichigan.org.

New Roles for Philanthropy in Metro Detroit: A Perspective From the Kresge Foundation. 8-9:30 a.m. Sept. 21. Troy Chamber of Commerce. Speaker: George Jacobsen, program

officer, Kresge Foundation. Rehmann, Troy. Free for Troy Chamber members; $10 for

Jay Greene: (313) 446-0325 Twitter: @jaybgreene

Calendar guidelines. Visit crainsdetroit.com and click “Events” near the top of the home page. Then, click “Submit Your Events” from the drop-down menu that will appear. Fill out the submission form, then click “Submit event” at the bottom of the page. More Calendar items can be found at crainsdetroit.com/events.

INDEX TO COMPANIES

These companies have significant mention in this week’s Crain’s Detroit Business: Ash Stevens ........................................................... 4

Luna Entertainment ..............................................5

Automation Alley .................................................. 1

Meijer ....................................................................... 1

Brooks Kushman PC ............................................ 9

Michigan Dept. of Health & Human Services .18

Butzel Long PC .....................................................10

Michigan Lottery ....................................................5

Central Detroit Christian ......................................3

Vitamin Health ......................................................11

Detroit Water and Sewerage Department ...1, 15

Warner, Norcross and Judd LLP .......................... 9

WEEK Judge rules against Detroit schools in teacher sick-out lawsuit

Michigan Court of Claims judge ruled against Detroit Public Schools in a lawsuit targeting

teachers accused of encouraging sick-outs that closed dozens of schools earlier this year, AP reported. Judge Cynthia Stephens wrote that the district interpreted state law in a way that’s “offensive to fundamental rights of free speech.” Attorneys for the district said the sick-outs were really illegal strikes and sought an injunction.

COMPANY NEWS

n Detroit-based StockX, a Dan Gilbert portfolio company launched last February, said it is expanding beyond the sneaker resale market to include limited-edition Fourth of November merchandise using a consumer-goods initial public offering model. n Detroit-based Blue Cross Blue Shield of Michigan has agreed to delay phasing out its retiree health plan for former bargaining unit employees until 2018, as part of an agreement with the UAW International Union, Blue Cross officials confirmed to Crain’s. n Valentus Specialty Chemicals Inc., a portfolio company of Detroit-based Huron Capital Partners LLC, acquired New Rochelle, N.Y.-based wood finish company Paint Over Rust Products Inc. Terms of the deal were not disclosed. n Blackford Capital’s Grand Rapids-based Michigan Prosperity Fund is taking a stake in the auto industry, investing in Chesterfield Township-based injection molder Davalor Mold Corp., Plastics News reported. Terms were not disclosed. n Detroit-based The Ascent Group has made an investment in Detroit cloud-based sales-motivation software company LevelEleven that gives it almost half ownership. n Ann Arbor-based Kelleher Enterprises, which creates programs that drive individual and organizational performance, was acquired

CHRIS EHRMANN

Cass Community Social Services plans

to build 25 tiny homes on the north end of its campus on Elmhurst Street in Detroit. Along with different house sizes, some of the homes will have different interiors depending on the price of the house.

C R A I N ’ S D E T R O I T B U S I N E S S // A U G U S T 2 2 , 2 0 1 6

ON THE WEB AUG. 13-19

Detroit Digits A numbers-driven look at last week’s headlines:

597

The number of lawsuits the city of Detroit said it plans to file to recoup $12.2 million in taxes owed from 2010-12 on more than 1,500 parcels of land.

$2 million

The amount of an annual life insurance premium the University of Michigan has agreed to pay for Jim Harbaugh, effectively increasing the football coach’s pay to $7 million a year, in a contract addendum that went into effect in June.

$3.28 million

The amount raised by a dinner and pro-am golf tournament, both featuring golfing legend Jack Nicklaus, for Detroit-based Cornerstone Schools. The total surpassed the original $3 million fundraising goal.

by Terryberry, a 98-year-old Grand Rapids maker of employee awards, MLive.com reported. Terms of the deal were not disclosed. n Shareholders from Johnson Controls Inc. and Tyco International approved the merger between the two companies, Automotive News reported. Once the deal is completed, Johnson Controls plc will have its global headquarters in Cork, Ireland, with its North American base in Milwaukee. JCI’s Plymouth-based automotive seating unit is being spun off this fall into a separate company, Adient. n Grosse Pointe Park-based nonprofit Wolverine Human Services submitted a request to purchase 11 acres of vacant land in Detroit on which to plant 3,500 apple trees on what will be called Core Orchards. n The long-awaited Wahlburgers restaurant in Greektown in downtown Detroit opened its doors to a line of customers eager to try the Boston-based, burger-focused chain’s fare. Actor Mark Wahlberg owns the chain with his family. n Gus’s World Famous Fried Chicken formally opened its doors to the public in Detroit’s Midtown, offering spicy fried chicken, a variety of sides and pies. n Athens Coney Island, a popular diner in Royal Oak, changed its name to Nicky D’s Coney Island. Zef and Marija Dedvukaj, who own several Nicky D’s in metro Detroit, bought Athens last year from its founders, Mark and Greg Mitchell.

OTHER NEWS

n A U.S. District Court judge ruled in favor of a Garden City funeral home that fired a transgender funeral director who wanted to wear women’s clothing. The judge ruled that the funeral home owners’

rights to fire Aimee Stephens from the Garden City location of Detroit-based R.G. & G.R. Harris Funeral Homes Inc. in 2013 were protected under the federal Religious Freedom Restoration Act. n The former Big Buck Brewery & Steakhouse Inc. site in Auburn Hills may be redeveloped into a new “football bowling” — or “fowling” — venue called The Hub. An application has been submitted to redevelop the site, vacant for almost a decade, on the west side of I-75 near University Drive, an official said. n Eighteen faculty members at the Wayne State University School of Medicine have agreed to retire, accept phased retirement or received notice of nonrenewal of their contracts, according to a letter to faculty sent from Jack Sobel, M.D., dean of the medical school and chair of the Wayne State University Physician Group. A total of 37 faculty members will be affected in the wake of plans to reduce costs, Sobel said. n One of Detroit’s most popular tourist attractions, The Heidelberg Project is about to start evolving into an arts community. Notable paintings and massive sculptures of found objects such as dolls and stuffed animals will be removed from the city blocks, and certain pieces of artwork will be transported to museums and galleries throughout the city and nationally. n The U.S. Navy has locked in its previous tentative date of Oct. 22 to commission the USS Detroit in its namesake city. Plans are to conduct the ceremony on the Detroit riverwalk at the GM Renaissance Center. n A new cultural festival, the Fiesta del Rio Detroit, has been slated for Aug. 27 along the Detroit River in southwest Detroit. The Detroit RiverFront Conservancy and Detroit-based Ideal Group are hosting the West Riverfront Park event celebrating Latino culture. n Airports in the Detroit-Cleveland region, including Detroit Metropolitan Airport and Willow Run Airport, will get satellite-based air traffic control upgrades aimed at boosting on-time arrivals and saving fuel. The Federal Aviation Administration’s Next Generation Air Transportation System will replace ground-based radar and radio communications with GPS systems for $29 billion by 2030. n The Michigan Department of Natural Resources is developing a master plan for Belle Isle’s trail system that includes a trail around its perimeter and a Detroit trailhead for the Iron Belle Trail. A public meeting is slated for 6:30-8:30 p.m. Aug. 24 at Flynn Pavilion on the island park.

OBITUARIES

n John Sobeck, co-founder of the 60-year-old metro Detroit restaurant chain Chicken Shack, died Aug. 13. He was 92.

RUMBLINGS

Environmentalist Jung says no to ethanol

erry Jung, former owner of Michigan CAT and longtime

environmentalist, is using his wealth to take down ethanol production. Jung, chairman of the Michigan Colleges Alliance, recently launched RethinkEthanol.com — a website calling for the end of the federally mandated and subsidized cornbased ethanol industry. “It’s just crazy,” Jung said. “The current ethanol policy is sold as a green, renewable and energy-independent resource. It’s a big farce. (The mandate) is a very environmentally damaging policy.” The Renewable Fuel Standard, enacted in 2005 under the Energy Policy Act, called for increased use of biofuels in traditional gasoline. Currently, most gasoline in the U.S. contains 10 percent ethanol. “Ethanol production requires 35 million acres to farm; that’s more than the size of Michigan,” Jung said. “The amount of pollution this

produces is staggering.” Jung has contracted a lobbyist and others to promote the cause. Jung made his wealth partly from selling the family business, which sold, rented and serviced heavy equipment, primarily Caterpillar brand, in 2011 to Indianapolis-based MacAllister Machinery Co. Inc. for an undisclosed sum. Jung’s grandfather, Jack Frost, founded the company in 1944 as Michigan Tractor and Machinery. In an attempt to convince legislators of the ill effects of ethanol, Jung has secured an audience with U.S. House Minority Leader Nancy Pelosi and Speaker of the House Paul Ryan, he said. The campaign is also working to draft a lawsuit against the U.S. Environmental Protection Agency, he said. “I retired a little early, I have financial resources and I’m very goal-oriented,” Jung said. “This is a worthy goal, and I’m putting everything I’ve got into it.”

One of the two L.L. Bean Bootmobiles

traveled Woodward Avenue on Friday as part of the Dream Cruise, giving out prizes and coupons.

L.L. BEAN

L.L. Bean opens store, cruises Woodward Freeport, Maine-based outdoor retailer L.L. Bean opened its first Michigan store Friday at The Mall at Partridge Creek in Clinton Township — and brought its Bootmobile to the Woodward Dream Cruise. The new store is creating about 90 new jobs, said Ken Kacere, L.L. Bean’s senior vice president and general manager of retail. In addition to selling active and casual apparel and footwear, hiking, fly fishing, kayaking and other outdoor lifestyle gear, the store has an Outdoor Discovery School.

For a fee, customers can learn kayaking, archery, fly fishing and other outdoor activities. Stand-up paddle boarding lessons will cost $25, but won’t begin until next summer. At the end of September, customers can start learning fly casting for $69 and map-and-compass navigation for $39. The Bootmobile is a large replica of the retailer’s iconic Bean Boot and travels the country. One Bootmobile is built on a Ford F-250 frame; the other is on a GMC Sierra 2500 HD chassis frame.

Michigan’s auto tech to draw ITS event talk In October, Michigan’s move to mobility will be a hot topic at the 23rd ITS World Congress event in Melbourne, Australia. Scott Belcher, president and CEO of the Washington, D.C.-based Intelligent Transportation Society of America, which is an organizer of

the event, said other countries, particularly those in the Asia-Pacific region, are interested in learning how Michigan has organized its resources around the connected car and connected infrastructure. The state has installed sensors that can interact with the connect-

ed and driverless vehicle prototypes automakers are developing along a 125-mile stretch from I-96 near General Motors Co.’s Milford Proving Grounds, I-94 from Ann Arbor to metro Detroit, U.S. 23 from Ann Arbor to Brighton, and elsewhere. A small part of downtown Detroit is also connected. Peter Sweatman, founder and director of the University of Michigan Mobility Transformation Center and principal at mobility advisory firm CAVita LLC, and Kirk Steudle, director of the Michigan Department of Transportation, are expected to attend the Oct. 10-14 event.

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