Toyota, car-acceleration inquiries begin

LOS ANGELES — The National Academy of Sciences will lead a broad investigation into unintended acceleration and electronic vehicle controls under a 15-month study made public Tuesday.
In addition, the National Highway Traffic Safety Administration will conduct a separate inquiry into sudden acceleration by Toyota Motor Corp. vehicles. Toyota has issued nearly 10 million recall notices worldwide to correct floor mat and gas pedal defects that it says can lead to runaway vehicles.

The two investigations follow pressure from Congress on federal safety regulators to address persistent questions about the causes of unintended acceleration, and whether the problems stem from faulty computer-controlled electronic throttle systems.

At a time when cars are increasingly controlled through complex computer systems, the studies represent the most far-reaching effort to assess the causes of sudden acceleration.

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"We are determined to get to the bottom of sudden acceleration," Transportation Secretary Ray LaHood said. "For the safety of the American driving public, we must do everything possible to understand what is happening."

LaHood also said he had asked his department's inspector general to assess whether federal safety regulators dropped the ball over the last eight years in reviewing thousands of motorist complaints about sudden acceleration.

The two studies are expected to cost about $3 million combined.

In recent congressional hearings, the performance of those regulators came under severe criticism, based on concerns that they lacked expertise to examine automobile electronics and depended too much on the industry to police itself.

LaHood said his department's inspector general would determine whether NHTSA's Office of Defects Investigation has sufficient resources and expertise.

NASA will help

The National Academy of Sciences' investigation will be conducted by its National Research Council, which will tap a panel of experts that will study electronics in vehicles of all manufacturers, human error, mechanical failure and accelerator systems.

A second study focused on Toyota vehicles would be conducted by NHTSA, which is enlisting help from NASA. The space agency was brought into the probe for its "expertise in electronics, hardware, software, hazard analysis and complex problem solving," the Transportation Department announcement said.

The NHTSA effort, which is supposed to be completed by late summer, will try to determine whether Toyota vehicles "contain any possible flaws that would warrant a defect investigation."

NHTSA is reviewing its past defect investigations but does not have any formal investigation or inquiry into whether Toyota electronics could be causing sudden acceleration.

Toyota has acknowledged that its vehicles have mechanical defects that could cause sudden acceleration, but it has said there are no known defects in its electronic throttle systems.

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01/21/2010: Nissan's all-electric Leaf creates buzz among fans during Nashville stopover

Dan Easter is thinking about putting an electric car in his garage soon: Nissan's new Leaf.
A Green Hills resident, Easter was one of the first in Nashville to see the Leaf as it arrived in town on a three-day stopover during a national tour designed to drum up interest among potential buyers for what the carmaker hopes are brisk first-year sales. The Leaf — likely to sell for $15,000 to $20,000 — goes on sale in December in Tennessee and a few other markets before a broader national rollout in 2012.

"I went to see it in front of the Sommet Center, and I was quite impressed," said Easter, 50, director of procurement for Lipscomb University. "I'm eager to find out more about it and get a chance to drive it."

Nissan invited him to see the car after he became one of about 35,000 "hand-raisers" who signed up on the company's Web site to receive e-mail updates about the electric car. It's designed to operate on an advanced lithium-ion battery pack that will give the Leaf a maximum range of about 100 miles between charges.

From that initial group of interested fans of the vehicle, Nissan hopes to identify a sizable group who might buy the Leaf, the first mass-produced all-electric car to be offered by any automaker.

"I am definitely interested, although it would be a second vehicle for local use," Easter said of possibly putting a Leaf in his garage. "I have family in Virginia, and I don't think it would be practical to try to go that far in it."

On Wednesday, dealers, news media and government officials got to see the Leaf at Nissan's Cool Springs headquarters, and some brief test drives were offered — although not to the general public. Wednesday was the final day of the three-day viewing event here.

Those will come later when Nissan asks the hand-raisers' group whether they want to take the next step and make reservations to buy one. That's likely to start in April, said Mark Perry, vice president for product development at Nissan North America.

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Nashvillians who lived abroad see flaws in health reform

In Europe and Canada — broad regions with nearly universal health coverage — conventional wisdom was that providing insurance options for 32 million more Americans under health reform had dragged the United States into the 21st century.
But not all Nashville residents with firsthand knowledge of health-care practices in other lands agree.

Some see flaws in the reform package passed by Congress this month, saying it increases the role of government without adequately addressing the rising costs of medical care.

Judy Bishop, chief executive of Brentwood-based home health services provider Guardian Home Care, worries that insufficient planning to increase the supply of physicians could affect access to care in the long run.

She's also concerned that cuts to Medicare could lead more U.S. doctors to opt out of the federal program, practicing instead a sort of concierge medicine to focus on patients who can pay out of their own pocket for services.

One result could be an even more pronounced shift to a two-tier system of care in America, akin to the one in England, where those with money can avoid longer wait times by paying private practice doctors directly, said Bishop, who worked in the Canadian system for 25 years before spending 16 years in this country.

Craig Rowe experienced longer wait times for doctor's appointments and medical checkups firsthand before moving here a decade ago to start a consulting firm. Rowe is British, a London native.

"I'm now very spoiled by the health care that I've received in the United States," said Rowe, a U.S. permanent resident. "The expectation, the level of service is much better. But you pay for it. It's extremely expensive."

Rowe doesn't consider health-care reform as socialized medicine because companies and individuals still will share the costs. He believes health-care reform was needed but isn't sure it will save money.

"When you start excluding pre-existing conditions and (setting) policy limits, it's hard to see how you're going to save money because someone's going to have to pay for that," said Rowe, a marketing representative at a benefits consulting company, Benefit Communications Inc.

Too much government is fear

Meanwhile, Vanderbilt geriatrics physician Ralf Habermann, a native of Germany, would have liked to see more done to address the quality of care and medical liability under the federal makeover of the U.S. health system. Today, a fear of lawsuits causes doctors to order more tests as a safety measure, he said.

Habermann said many of his European colleagues never understood why the United States didn't have health insurance for all. But changing U.S. health policy to provide insurance coverage for millions of additional people won't be a panacea.

"History shows that whenever the government starts to get involved too much, the flexibility of planning and the flexibility of the markets get lost, and suddenly the system is not adjusting to changes. That ... leads to longer waiting times and certain services not (being) offered," he said.

Getahn Ward an be reached at 615-726-5968 or gward@tennessean.com.

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'City Paper' owner SouthComm lays off 7

Media group SouthComm Inc., which owns The City Paper , Nashville Scene and the Nashville Post , among its nine publications, laid off seven people on Monday to cut costs after the loss of a major advertiser.
The news follows an earlier round of 16 layoffs last fall after SouthComm had purchased the Nashville Scene . Among those who lost their jobs Monday was the Nashville Post 's politics blogger, A.C. Kleinheider.

Others included The City Paper 's managing editor Vincent Troia, Titans beat reporter Terry McCormick and entertainment reporter Ron Wynn.

SouthComm CEO Chris Ferrell told the Nashville Post in a story published on its Web site that none of the nine publications is at risk and that the company remains strong overall.

Eric Barnes, the new publisher of Westview , a community weekly in Bellevue, said his publication ran about 10 pages of foreclosure notices Friday under contract with the law firm Wilson & Associates, which had previously used The City Paper for such ads.

Barnes' Memphis-based company, The Daily News Publishing Co., acquired Westview for an undisclosed sum last month.

"It's an iffy market for newspapers now, but we certainly will make an investment in it,'' Barnes said, adding that the community paper planned to expand news coverage and invest more in design and distribution.

Contact business reporter Naomi Snyder at 615-259-8284 or nsnyder@tennessean.com.

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Health reform may spur building boom

With 32 million uninsured Americans projected to get health coverage because of the reform package that narrowly passed Congress, some analysts see a growth spurt on the horizon for new medical offices to house doctors' offices, outpatient clinics and diagnostic centers.
"Long-range, it's definitely going to spur the need for more medical office buildings," said Douglas Whitman, chief operating officer with Healthcare Realty Trust Inc., a Nashville-based operation that owns medical properties. "Short-term, doctors don't grow on trees. So, it's going to take a little while."

Commercial real estate investment firm Marcus & Millichap of Walnut Creek, Calif., forecast in a recent brief that health-care reform would create demand for an additional 60 million square feet of medical office space in the U.S. between now and 2019.

If it materializes, that would help reverse a construction slowdown caused by recession and uncertainty over the shape of new federal health policy.

Although reform is now a reality, physicians have just started to analyze its effects, and skeptics say it will take a while longer to sort out real estate needs. Also, many changes including expansion of coverage and insurance rules won't start until 2014.

"We're a little leery about what health-care reform will mean to us," said Dr. Eddie D. Hamilton, a pediatrician who owns or co-owns five medical office buildings in the Nashville area. "While we're pleased more of our patients will have insurance, for providers it doesn't always translate to being adequately reimbursed."

Rob Mains, an analyst with Morgan Keegan & Co., expects more demand for preventive care, which could drive demand for leased space at outpatient imaging centers and surgery centers as lower-cost alternatives to providing services in a hospital setting.

C.J. Follini, managing principal of Noyack Medical Partners of New York City, expects health-care delivery to shift closer to where patients live, perhaps with more doctors and specialty clinics setting up shop in regional shopping centers.

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Spending growth hints at economic 'revival'

WASHINGTON — Confidence is growing that the economic recovery won't fizzle out. Consumers kept cash registers humming last month at a decent pace, pointing to modest and steady economic gains ahead.
The Commerce Department reported Monday that consumers boosted their spending by 0.3 percent in February, marking the fifth straight monthly gain.

Nigel Gault, chief U.S. economist at IHS Global Insight, called it "an encouraging sign of consumer revival."

The pickup in spending was a tad slower than the 0.4 percent increase registered in January and marked the smallest increase since September. Nonetheless, the spending gain was considered decent, especially given the snowstorms that slammed the East Coast and kept some people away from the malls.

"Households are starting to ease up on their tight grip on their wallets, though it would be nice if they had more money to spend," observed Joel Naroff, president of Naroff Economic Advisors.

Incomes see no gain

Americans' incomes did not budge, though.

Incomes were stagnant in February, as the bad weather forced employers to trim workers' hours. That followed a solid 0.3 percent gain in January and marked the weakest showing since July, when incomes actually shrank.

Many analysts predict the economy slowed in the first three months of this year after logging a big growth spurt at the end of 2009.

The economy will expand at a 2.5 percent-3 percent pace in the January-to-March quarter, analysts predict. That is roughly half the 5.6 percent pace seen in the final quarter of last year.

High unemployment, sluggish wage gains, hard-to-get credit and record-high home foreclosures in parts of the nation are all drags on the economy and among reasons that the pace of the recovery could be spotty.

Economists predict that employers added around 190,000 jobs in March, in what they hope will be the start of consistent payroll gains. If they are right, it would mark the biggest jobs gain in three years. The U.S. unemployment rate is expected to stay at 9.7 percent for the third straight month.

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Performers' royalties for music played on satellite, Web radio stack up

Wayne Moss, a 72-year-old rocker from Nashville who played with Bob Dylan, doesn't listen to satellite radio. He's never heard of Pandora, the Internet radio station.
So he was surprised when he got a call from a stranger in Washington, D.C., telling him he had a check coming because of his satellite and Internet radio play.

"It's a wonderful thing," Moss said. "If they want to start playing my music in outer space, that sounds good to me."

Recording artists aren't paid for their performances on traditional, over-the-air radio. In a legal arrangement that dates to the early days of radio, publishers and songwriters are paid for radio play, but the performing artists aren't.

That means people such as Moss — who gets constant radio play for performances on everything from Bob Dylan's Blonde on Blonde album to Roy Orbison's "Oh, Pretty Woman" — just aren't getting paid for traditional radio. They get paid if they wrote the song, but they don't get paid if they play it.

In a quirk of legal maneuvering in 1998, the recording artists managed to get Congress to pass a law mandating payments for satellite and Internet radio performances, but not for traditional radio.

This was during the nascent days of the digital media industry, before it had much lobbying clout.

In those days, digital radio wasn't making money. But that is changing. The challenge now is finding and paying all those artists and their descendants for the digital radio play that goes on around the clock.

"You'd be surprised how hard it is to give away money," said Laura Williams, who works for SoundExchange in Washington, D.C., a nonprofit organization created by the federal government to distribute the money to recording artists.

Williams estimated that there is $50 million in unclaimed royalties for artists who haven't been found, haven't registered or haven't gotten the credit due for their performances on albums.

One of the largest problems is what's called "bad data," in which good records weren't kept of who played on what albums. Some investigators go through session logs to look for artists who recorded on individual albums or CDs.

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Toyota workers' image takes beating in recalls

TOYOTA CITY, Japan — He works punishing hours, clocks in unpaid overtime without complaint and allows his bosses to call the shots both at the office and at home.
He's the archetype of the perfect employee. He's a Toyota Man.

Largely upon his shoulders, Toyota Motor Corp. last year surpassed General Motors Co. as the planet's bestselling automaker. He's the key ingredient behind Toyota's record of high quality (now tainted by its sudden acceleration problem) and productivity.

The Toyota Man's handbook is the decades-old "Toyota Way," a company manifesto that emphasizes continuous improvement and teamwork in the car-making process — a corporate game plan imitated and studied across Japan and the industrialized world.

But as the company faces a worldwide recall of several top models over alleged safety defects, some scholars and others are putting a decidedly more negative spin on the company's pristine Toyota Man image.

"The Toyota Man always says yes," said Hiroshi Oba, a veteran assembly-line worker who became a union activist. "He does whatever he's asked, works any shift, and then makes his reports on quality control — on his own time."

The payback for such worker obedience has meant cradle-to-grave job security, regular promotions and premium pay, guarantees that most U.S. firms can no longer match.

'Outside' control

In many nations, including the U.S., companies have sought to exert control over workers' off-duty habits. A century ago, carmaker Henry Ford used private detectives to spy on employees to make sure they didn't drink too much and had "unblemished" sex lives. Today, some U.S. companies have fired employees for dating colleagues or gaining too much weight, and have refused insurance policies for those who engage in such risky activities as sky-diving or riding motorcycles.

But pressure for conformity is stronger at Toyota than most other major firms in Japan, in part because of its size, its history as one of the nation's earliest overseas success stories and because of its insular nature. This is a company, after all, that has its own namesake city.

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BVS predicts solid future in digging up people's pasts

From a small outpost on Hillsboro Pike, a group of Nashville entrepreneurs has decided to do battle with one of the giants of drug testing and employee background screening.
The nearly 1-year-old startup in Green Hills, Background Verification Services, hopes to compete with Kroll Background America, another Nashville-based firm that's part of a huge risk consulting operation with offices around the world.

At least BVS founders Brett Thompson and David W. Temple (and two other working partners) expect to score enough sales volume to make a good living despite Kroll's international, multibillion-dollar reach.

Thompson has a background in human resources and executive recruiting. Temple and a partner started an express courier service in Memphis in the mid-1980s and expanded to 11 states before selling at a profit. Temple hopes to make BVS his next big thing.

The two men discussed in an interview with Tennessean Business Editor Randy McClain their latest venture and how to compete with — or even learn from — well-entrenched competitors.

Why do you see an opportunity for a smaller startup like yours in pre-employment screening and drug testing?

Brett Thompson: Where we fit in versus some of the larger competitors is that we try to offer very strong customer service and fast, efficient turnaround times. We partner with one of the largest drug-testing third-party operations in the nation with 15,000 drug-collection sites.

I've been in the employee and executive recruiting industry since 1989, and I've always had an interest in background checks, drug testing and resume verification. About two years ago, I put a business plan together with the idea of starting a targeted background- and drug-testing business.

As I researched it, I felt more confident there's a real niche here. I started looking for (investors) and eventually brought in three working partners. Rick Philpot has 20 years of experience as a manager and owner in auto sales here. David Temple and Joe Bankemper were co-owners of Express Courier International, an express delivery service that eventually expanded to 22 markets in 11 states before they sold it.

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Nashville People in Business

Christian Schuetz is director of legal affairs for the Tennessee Chapter of the German American Chamber of Commerce of the South. Schuetz is director of legal and marketing at Bradley Arant Boult Cummings LLP.
Reba Sloan received the Excellence in Practice Award in the area of eating disorders at the 26th Annual Symposium of Sports, Cardiovascular and Wellness Nutrition. Sloan is a registered dietitian in Green Hills.

Construction

Jason Campbell is senior solar consultant for LightWave Solar Electric LLC. Campbell had been vice president of renewable energy at Architectural & Environmental Associates in Flagstaff, Ariz.

George Horrocks is now PV project engineer for LightWave Solar Electric LLC. Horrocks had been a project manager at Harmony Energy Works in Hampton, N.H.

Financial services

Christopher T. Holmes is chief banking officer at FirstBank. Holmes had been director of corporate financial services and chief retail banking officer for South Financial Group in Greenville, S.C.

Hoskins & Co. said:

Kidist Woldetensaye recently earned the designation of CPA. Woldetensaye is a senior auditor.

Georgina Inkum recently earned the designation of CPA. Inkum previously worked in corporate accounting for Nissan.

John C. Gibson earned the chartered financial consultant designation. Gibson is president of Insurance and Planning Solutions in Brentwood.

Nonprofit

Nashville Public Television announced its 2010 Community Advisory Board:

Kent M. Weeksis chairman. Weeks is a partner with the law firm of Weeks Anderson & Baker.

Bob Loflin is chairman-elect. Loflin is a community volunteer.

Hal St. Clair is immediate past chairman. St. Clair is senior vice president of R&D at Dialogic Communications.

Claiborne Gayden is nominating committee chair. Gayden is vice president of the Governor's Books from Birth Foundation.

Kasar S. Abdulla is member-at-large. Abdulla works with the Tennessee Immigrant and Refugee Rights Coalition.

Carol Creswell-Betsch,a retired educator,is member-at-large.

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Trolley barns at Rolling Mill Hill will get new life

The trolley barns at Rolling Mill Hill, near the banks of the Cumberland River and within view
of downtown Nashville, will undergo a renovation that will create 90,000 square feet of office, retail and restaurant space.
Emma, a fast-growing e-mail marketing firm, has signed a letter of intent for 20,000 square feet of that space. The firm plans to move from its Eighth Avenue South offices next year.

Developer The Mathews Co. is pursuing additional leases to fulfill a requirement for obtaining a bank loan to fund the project.

"It's going to be a great home for Emma and when consummated will be a catalyst for Rolling Mill Hill's future development over the next decade," said developer Michael W. Hayes, vice president of CB Ragland Co. Hayes has no financial part in the trolley barn project.

"The trolley barns really are the heart and soul of the development," Hayes said.

Barns have had multiple uses

The six trolley barns, built in the 1930s during the Great Depression, have been used by Metro as repair shops, for storage and as offices until they became dormant in 2007.

Metro Development and Housing Agency hired The Mathews Co. to renovate, lease and manage the barns off Peabody Street at the lower section of Rolling Mill Hill. MDHA owns the barns.

Bert Mathews, chief executive of The Mathews Co., hopes to complete the renovation work by summer 2011. The work would have to begin nine months in advance to be completed by then.

Emma has an option to take 10,000 square feet of additional space as well, said Bo Spessard, the firm's chief operating officer.

Now 8 years old, Emma has ridden a wave of digital marketing growth. It has 85 of its 100 employees in Nashville. It occupies 15,000 square feet in a building on Eighth Avenue South.

"We're just trying to envision what our growth is going to look like over the next year and a half," Spessard said. "We're going to be ready for some more space and we're looking to get in front of that."

Getahn Ward can be reached at 615-726-5968 or gward@tennessean.com.

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Airlines drop 9 flights, add 2 in Nashville

Three airlines have announced seasonal changes to their flight schedules at Nashville International Airport that will result in nine daily flights being dropped and two new ones being added.
Southwest Airlines, the Nashville airport's busiest carrier, will discontinue one daily departure to Chicago Midway; New Orleans; Orlando, Fla.; Phoenix; and San Diego effective Aug. 14-Oct. 30.

Beginning on Thursday, American Airlines will drop two of its daily flights to St. Louis, while adding a departure to Miami.

Also on the same day, Delta Air Lines will discontinue one of its daily flights to Cincinnati and New York's John F. Kennedy International Airport, and add a departure to Minneapolis.

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Despite the cuts, the airport will still have multiple daily departures by its various airlines to the affected destinations, spokeswoman Emily Richard said.

The airport is served by 12 airlines, which together have about 375 daily arrivals and departures. Southwest accounts for about half of the flights.

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Nashville People in Business

Jeni Dominelli is healthy lifestyles director at Elmcroft of Lebanon.
Tom Monroe is convention services manager at Hilton Nashville Downtown.

Sandi Windorfer is director of sales at Union Station Hotel. Windorfer had been with Gaylord Opryland Resort & Convention Center.

Technology

Hans Stabell is a senior consultant for Axis Accounting Systems LLC, which provides IT consulting and financial software. Stabell was director of professional services at D1 Technologies.

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Mortgage help is expanded

WASHINGTON — Under pressure to stem the foreclosure crisis, the Obama administration launched a plan Friday to reduce the amount some troubled borrowers owe on their home loans and give jobless homeowners a temporary break.
Administration officials cautioned that the plan wouldn't stop all foreclosures or help all troubled homeowners. Instead, officials said, their goal is to meet their original target, announced last year, of helping 3 million to 4 million borrowers avoid foreclosure.

The new effort is designed to help two groups:

• Borrowers who owe more on their loans than their houses are worth. Nearly 15 million homeowners fall into this category, according to Moody's Analytics. About 10 million of them owe at least 20 percent more than their house's current value.

These people would be helped in either of two ways: Their mortgage companies can cut the total amount they owe on their mortgage. Or they can refinance into loans backed by the Federal Housing Administration, which insures loans against default. The FHA will get $14 billion in incentive money from the federal bailout fund.

• Unemployed borrowers. People receiving unemployment benefits would see their mortgage payments drop to no more than 31 percent of their monthly income — but only for three to six months. That's intended to give homeowners more time to find a job. Once they do, they may qualify for a loan modification that would permanently reduce their home payments.

Regina Harvey, program director with Dominion Financial Management in Smyrna, said loss of income was the top reason cited for delinquency in the past month by people who came to the housing and financial counseling service for help with their mortgages.

"Anything that could provide assistance for a family that's dealing with a loss of income can give them a greater amount of time to find a job," she said.

The administration's existing program to prevent foreclosures has failed to make a big enough dent in the problem. A lack of planning and shifting rules on qualifications for it produced a huge backlog in the program, the special inspector general for the federal financial bailout fund told lawmakers this week. Only 170,000 homeowners have completed loan modifications of 1.1 million who began the program over the past year.

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Open windows in a Margaritaville bar? Preservationists say not in Nashville

Battle lines are being drawn again along Lower Broadway's honky-tonk row — this time between parrot heads and preservationists.
At issue is the look of windows planned for a $10 million Jimmy Buffett Margaritaville Café to be built in the 300 block of Lower Broad. Developers say they want the windows to open to create Buffett's signature Key West, Fla., feel and set the property apart from its down-home and neon country neighbors.

"The real sticking point is our operable storefront windows that can be opened in good weather, and they're a key element of the Margaritaville Cafes," said Mark Bloom, a principal in the Corner Partnership, which owns the three-story building and is paying to develop the beach-themed restaurant.

The Metropolitan Historic Zoning Commission, which governs the look of buildings in the city's historic district, wants a more traditional storefront with glass that doesn't flop open.

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"This is not Key West, this is Nashville. These buildings are part of what makes Nashville unique," said Tim Walker, the commission's executive director.

If the commission doesn't give in, Bloom said his Margaritaville colleagues could walk away.

Walker said he has heard developers threaten to abandon big deals before but doubts this one will end up that way.

"They do make windows that would work within the guidelines; … having windows that open won't make or break a business," he said.

Fans favor cool breezes

Not surprisingly, Buffett fans favor Margaritaville's owners and the cool breezes they imagine enjoying once the restaurant opens.

"It just wouldn't be a Margaritaville without those windows, which are very inviting," said downtown visitor Misty Colclasure, 30, of Hendersonville, who has visited Buffett's New Orleans café in the French Quarter.

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Take Part: Has your medical identity been stolen?

Have you been a victim of medical identity theft? Contact reporter Getahn Ward at 615-726-5968 or at gward@tennessean.com to share your experiences for an upcoming story.

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Lawyers prepare for Toyota lawsuits

SAN DIEGO — As lawsuits over Toyota acceleration problems multiply nationwide, more than 150 attorneys gathered Wednesday to sharpen their legal tools on the eve of a major federal court hearing on whether dozens of cases will be consolidated before a single judge.
The main topic at the conference, organized by legal publisher HarrisMartin, was today's scheduled hearing before a panel of federal judges in San Diego who will choose whether to combine more than 100 Toyota lawsuits and where to send them.

Lawyers for people suing Toyota and the company itself have suggested 19 jurisdictions, including California — site of Toyota's U.S. headquarters — Florida, Ohio, Kentucky and even Puerto Rico, according to court documents. The panel is not required to pick from that list.

"You have consumers that have been affected in every state," said Howard Bushman, a Miami attorney whose recent cases included a $24 million settlement for AIDS patients who paid for a drug they didn't need.

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Toyota has been hit with an avalanche of lawsuits that potentially could cost the company billions of dollars after its recall of more than
8 million vehicles worldwide over sudden unexpected acceleration, including about 6 million in the U.S. The National Highway Traffic Safety Administration has linked 52 deaths to the accelerator problems, which Toyota has blamed on floor mats that can snag accelerator pedals or pedals that sometimes stick.

At least initially, the panel of seven judges — formally known as the U.S. Judicial Panel on Multidistrict Litigation, or MDL for short — will decide whether to combine dozens of proposed class-action lawsuits filed by Toyota owners who claim their vehicles have dropped sharply in value because of the recalls. Those owners also claim that Toyota has not been forthcoming about the possible role its electronic throttle controls play in the acceleration incidents, which Toyota has repeatedly denied.

But attorneys said there are many more Toyota lawsuits that could eventually wind up before the same judge as these so-called consumer cases, including those filed seeking damages for vehicle crashes and those brought by Toyota owners who want to return their vehicles for a new one. Still other lawsuits claim that Toyota should be held liable for allegedly covering up faulty electronic throttles for years.

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Nashville aircraft plant gets new owner after Vought sold

The Carlyle Group agreed on Tuesday to sell its Vought Aircraft Industries Inc. subsidiary to Triumph Group Inc. for cash and stock totaling $1.44 billion.
Impact on the Nashville facility, which employs about 880 people, is expected to be "minimal," Vought spokeswoman Lynne Warne said.

"Most of Vought won't see any significant operational changes as a result of this transaction," she said.

Vought, which has a large aircraft parts manufacturing plant near Nashville International Airport, will operate as Triumph Aerostructures–Vought Aircraft Division after the deal closes in July.

The deal broadens Triumph Group's foothold as a supplier to Boeing Co. and Airbus SAS.

The purchase ends a near-decade of ownership of Vought by Washington-based Carlyle Group. The sale is among 71 announced or completed acquisitions of U.S.-based aerospace and defense assets in the past year amid the U.S. recession.

Triumph executives said the acquisition would add to Wayne, Pa.-based Triumph's earnings immediately, contributing more than $1 a share in the year through March 31, 2011, before any cost savings or expenses. It also will double annual sales based on the two companies' size and past history.

The deal should more than double annual sales.

"We see the acquisition price as attractive," Standard & Poor's equity analyst Richard Tortoriello wrote in a note to clients. "However, with sales more than doubling, we also see integration risk, and believe today's surge in (Triumph Group's) stock price brings shares near to (the) appropriate value."

Tortoriello cut his rating to hold from buy.

Earnings improve

Also Tuesday, Vought said its revenue and net income increased for the fourth quarter and all of 2009, with fourth-quarter increases "primarily due to increased sales" of components for the Boeing 747-8 aircraft.

Sales for the year increased 6 percent to $1.9 billion, and operating income was up 9 percent, to $160.4 million, the company reported.

Vought said it completed the sale of its Boeing 787 operations in South Carolina to The Boeing Co. for $590 million in the fourth quarter.

Revenue for the fourth quarter totaled $555.5 million, up 35 percent from the same period in 2008, and net income for the quarter was $47.7 million, compared with a loss of $29.9 million a year earlier.

Triumph Group operates aircraft-component manufacturing and repair facilities in 58 locations, serving commercial, business and military customers.

Dallas-based Vought makes wings and fuselages for a variety of military and civilian aircraft.

The Nashville plant builds components for some Airbus jetliners, C-130 military cargo planes, and Cessna and Gulfstream business jets.

The plant endured a four-month strike in late 2008 and early 2009.

Carlyle, which bought Vought in 2000, will hold 31 percent of the outstanding stock of Triumph Group after the sale is final. It also will get $525 million in cash from Triumph.

"We believe this is a great opportunity to become part of a larger enterprise and diversify beyond Vought's core business of aero-structures manufacturing," Warne said.

Bloomberg News contributed to this story.
Contact business writer G. Chambers Williams III at 615-259-8076 or williams1@tennessean.com.

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Renal Care loses $19.3 million ruling

A long-running whistleblower complaint against the once-Nashville based Renal Care Group has led to a $19.3 million federal court judgment against the acquired dialysis supplier and the German company that bought it four years ago.
The lawsuit, which focused on improper claims submitted to Medicare for home dialysis supplies, named Renal Care Group Supply Co. and Fresenius Medical Care Holdings Inc., as co-defendants. The federal government joined the whistleblower complaint more than two years ago.

Renal Care operated a shell billing company solely to submit claims on behalf of itself in violation of federal law that requires suppliers to be independent of the dialysis facilities where patients are treated, the government said. Even after employees raised concerns, Renal Care continued to operate the billing company because of the "illicit revenues it created," the suit said.

One employee wrote: "I do not wish to go to jail" and felt the company's plan "was not in the best interests of patients," said federal Judge William J. Haynes Jr. of Nashville in his ruling.

The billings reportedly occurred over a six-year period beginning in 1999. The Fresenius-Renal Care acquisition closed in 2006 at a sales price of $3.5 billion.

Renal Care Group also failed to heed the advice of its lawyers when operating the supply company, and discussed an internal audit of the supply company that found 100 percent of its files were lacking information that Medicare requires, the court said. The suit was originally filed in St. Louis in 2005. The case was later moved to Nashville.

The defendants Tuesday appealed the ruling with the U.S. Sixth Circuit Court.

Reach Getahn Ward at 615-726-5968 or gward@tennessean.com.

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Puckett's Grocery & Restaurant to open in downtown Nashville

Puckett's Grocery & Restaurant, known for its burgers, down-home food and live music, will open its first downtown Nashville location this fall, a move that nearby shopkeepers say should draw more customers and boost business.
The location will open as early as August at 500 Church St., near the Downtown Presbyterian Church. Owner Andy Marshall said Puckett's and its landlord plan to spend about $700,000 expanding the site from 3,400 square feet to 5,200 square feet. Construction will start in four or five weeks.

Marshall said he's been eyeing a downtown location for a couple of years but now believes it's a good time to start a new outlet because of the number of available restaurant spaces, favorable rents and enough residents downtown.

Marshall said he expects annual sales at the new store to reach $3 million or more within a three-year period. That would be at least 50 percent more than recent sales at his Franklin location.

Related20 years and still servingMap: Puckett's location in Nashville

"Puckett's has always been big about being part of communities," he said. "The community is there."

Puckett's started in Leiper's Fork in the 1950s, serving residents of Williamson County. Marshall bought the store in 1998 and has since opened another restaurant in Franklin.

Marshall said he sold the Leiper's Fork operation to songwriter and Mississippi native Rob Robinson last year, although he retains ownership of the land there and the Puckett's brand name.

Puckett's serves breakfast, lunch and dinner and features live music nights.

Marshall said the new location would be similar to his Franklin store. Its kitchen will operate seven days a week, opening at 6 a.m. daily and closing as late as 11 p.m. on Fridays and Saturdays.

Steven Means, who manages produce for H.G. Hill Urban Market for his father, said Puckett's could drive more customers into the store looking for goods that Puckett's doesn't have, such as fresh meats. The owner of H.G. Hill Urban Market — Scott Means — and Marshall are related.

Meanwhile, the number of downtown residents is expected to grow slightly this year. The Nashville Downtown Partnership estimates downtown residents will increase 3 percent this year to more than 5,700 people.

"I think they will be very successful. They've got a great product and a good following," said David Baker, a partner at Baker Storey McDonald Properties, a commercial real estate firm. "I think people will seek out Puckett's."

Marshall said Puckett's could expand further at some point, perhaps with stores in Columbia or Collierville, Tenn.

Wendy Lee can be reached at 615-259-8092 or wlee@tennessean.com.

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Health care information company IMI makes acquisition

Health care information company IMI Health said it has acquired BoundaryMedical, a Minneapolis-based provider of medical outcomes measurement software.
With the deal, clients of both companies will have access to more robust data collection and analysis to help them and their patients to make more informed decisions about patient care options, executives said.

IMI’s national customer base includes health plans, pharmacy benefits managers and health care providers, while Boundary’s clients are mostly providers, clinical research facilities and medical product companies.

Boundary’s operations have relocated to Nashville and its top executives will remain with IMI. They include former Chief Executive Officer Mark Walinske, who’s now chief business development officer for IMI.

IMI is raising expansion capital to build a sales and marketing team to grow the companies, officials said.

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Wall Street bill sent to full Senate

WASHINGTON — Democrats sent a massive Wall Street regulation bill to the full Senate on a party-line vote Monday after a temporary retreat by Republicans that still left the bill's chances for bipartisan passage in doubt.
In a surprise move, the Senate Banking Committee met briefly to approve the bill 13-10, but not before Republicans jettisoned more than 300 amendments they had planned that could have put their imprint on the bill. Senators had been expecting a long week of votes and debate, only to find themselves voting as they were still easing into their seats.

Despite a conciliatory tone struck by the committee's Democratic and Republican leaders, the development did nothing to mend the partisan divide over the legislation and adds even more uncertainty to Congress' ability to pass a sweeping rewrite of financial regulations this year.

The Senate would not take up the bill until April at the earliest.

RelatedHandling of vote on Wall Street regulation bill dismays Corker

In their opening remarks before the committee vote Monday, committee Chairman Christopher Dodd, D-Conn., and the committee's top Republican, Sen. Richard Shelby of Alabama, chose to sound optimistic about the bill's prospects.

"We will have reform this year," Dodd said.

"I just don't believe we're quite there yet," Shelby said.

Sen. Bob Corker, R-Tenn., said he was disappointed the bill was rushed through committee without any real discussion.

"It's pretty unbelievable that after two years of hearings on arguably the biggest issue facing our panel in decades, the committee has passed a 1,300-page bill in a 21-minute partisan markup. I don't know how you can call that anything but dysfunctional," he said.

But Corker said he still holds out hope for a "sound piece of legislation that will merit broad bipartisan support in the full Senate."

Watchdog splits parties

Dodd unveiled his bill last week, 18 months after Wall Street's spectacular failures helped plunge the nation into the worst recession since the Great Depression.

The legislation would give the government unprecedented powers to split up firms considered a threat to the economy, put together a council of regulators to watch for risks in the financial system and create an independent consumer watchdog.

Shelby said that seeking changes in committee would have been pointless. Shelby said he hoped he and Dodd would find agreement before the bill reaches the Senate floor.

Dodd did accept 25 Democratic amendments, including one sought by Federal Deposit Insurance Corp. Chairwoman Sheila Bair that she said would prevent unintended bail outs of large financial institutions.

Democrats and Republicans are mostly split over the need for an independent consumer entity. But other issues also divide the parties, including how to regulate complex trading instruments and what firms should be exempt from new rules.

Industry lobbyists said the decision to move swiftly through committee made it much more difficult to predict what the Senate would ultimately do with the legislation.

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Tennesseans' diagnoses vary on health-care plan

Like many Tennesseans, country singer Gail Davies is still trying to sort out the winners from the losers as a massive health-care overhaul bill speeds toward President Barack Obama's desk.
Davies, a 62-year-old songwriter who made her mark in music four decades ago, said she pays nearly $400 a month for catastrophic health insurance for her husband and herself — double the rate of five years ago. She expects the legislation to expand insurance options, improve access to care, and reduce costs for her family and many others.

"It's time for America to come out of the Dark Ages and start taking care of people's interests," Davies said. "That's what government is supposed to do."

But just as many taxpayers and business owners here argue that the health-care package pushed through Congress by the Democratic Party will spark higher insurance costs, raise taxes and create too much government red tape.

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Chief Executive Allen Howell at Corporate Flight Management, a general aviation company at Smyrna Municipal Airport, said he and other small-business owners "are very confused and not entirely sure" what happens next.

"But I'm pretty sure that over the long haul, it's going to cost us higher taxes. Most of the people in Washington, D.C., don't have a clue what the people trying to make payroll every week (have) to do. I can't print money like they can," Howell said.

The massive legislation — actually a pair of bills — rewrites many of the rules governing hospitals, doctors and insurers, and promises health-care coverage for 32 million Americans who are now uninsured.

Critics say the bill is a grave misstep that will swell the federal deficit.

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Toyota shareholders sue over falling stock prices

MIAMI — Toyota shareholders incensed over a sudden drop in the Japanese automaker's stock price are heading to court with lawsuits claiming company executives deliberately misled investors and the public about the depth of accelerator problems in millions of its vehicles.
At least three proposed class-action lawsuits filed by Toyota investors say the company gave false initial assurances that the sudden acceleration problem was a simple matter of floor mats trapping gas pedals, helping prop up the stock price.

The shareholder cases are part of an avalanche of potentially costly lawsuits against Toyota Motor Corp. over the acceleration issue, including those filed by crash victims and their families and those brought by Toyota owners contending their vehicles are worth far less because of the recalls.

The investor lawsuits say Toyota spread misleading information through news releases, conference calls with stock analysts and interviews to assure stockholders and the public that the accelerator problem was easily fixed or might be drivers' fault.

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Instead, the lawsuits contend, top executives have known for nearly a decade that faulty electronic throttle controls caused vehicles to sometimes careen out of control but covered it up to protect Toyota's reputation for safety — and its stock price. Toyota has not issued any recalls involving flaws in the throttles and has repeatedly denied they are the problem.

Damages could reach billions

U.S-listed shares rose from just over $75 on Oct. 5, the day of the floor mat recall, to above $90 on Jan. 21, when Toyota announced another recall — over gas pedals it says can stick in certain conditions.

After that, the stock price fell, dropping 16 percent as of early March. Shares have since rebounded somewhat, but some investors say the recovery did not prevent them from losing potentially millions of dollars as the stock was dropping.

Since the sticky pedal recall in late January, Toyota's total U.S. market capitalization has fallen 13 percent to $135.87 billion. In trading on the Tokyo Stock Exchange, Toyota shares also have lost nearly 17 percent of their value since Jan. 21.

Toyota declined to comment because the cases are pending. It has repeatedly denied its electronic throttle controls are to blame for sudden acceleration.

In the lawsuits, the shareholders are asking a judge to certify a "class" of plaintiffs that would represent all Toyota shareholders in the U.S. who held company stock on specific dates. If Toyota is found liable, damages could run into the hundreds of millions or even billions of dollars.

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UAW faces struggle to fix image, union

DETROIT — General Motors and Chrysler aren't the only ones trying to bounce back from their bankruptcies last year.
The UAW also faces a historic challenge of rebuilding not just its membership — which has fallen from a high of 1.5 million in 1980 to a historic low below 470,000 — but also its image.

How low the union's image has sunk became apparent during congressional hearings in late 2008, when GM and Chrysler sought federal aid. Politicians, bondholders and others over the next several months lashed out at the union and blamed it for the automakers' woes.

"The vast majority of my constituents are not making anywhere near what General Motors, Chrysler and Ford pay their employees," U.S. Rep. Spencer Bachus, R-Ala., said at the time.

It's a point of view the UAW faced repeatedly. "They think we are overpaid, lazy workers, and we are not," said Ronda Danielson, president of UAW Local 879 in St. Paul, Minn.

'Low point' reached

Despite the criticisms, the UAW emerged from the crisis with a surprising amount of potential. The union protected base wages, pensions and retiree health care. And its health-care trust fund now owns 17.5 percent of GM and 67.7 percent of Chrysler.

That could give the UAW a chance to recast its image, which is critical to rebuilding membership ranks.

Bob King, who is expected to be elected president of the 75-year-old union in June, has given hints of his new strategy. He has expressed a desire to better promote the union's charitable activities, and he is signaling that the insular union will be more open and transparent.

"I think we hit the low point last year and we're on the rebound," said Mike Dunn, chairman of UAW Local 5960 in Lake Orion, Mich.

King is known as an effective organizer and strategist who has the right skills to lead the UAW as it fights to recover from the worst crisis in its history.

King, 63, led the UAW's national organizing department for eight years as vice president before taking charge of the UAW's Ford department in 2006. He is the union's nominee to become president at its constitutional convention in June.

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Marketers must react as U.S. households morph

The size and complexion of American households are changing at a pace never before experienced. Marketers must recognize this — and react accordingly.
Three huge trends stand out: the age of who heads the household, the number of moms who are bringing home the paycheck, and minorities as the majority.

• Through 2009, fertility rates have fallen 44 percent since the baby boom's peak after World War II. Demographers predict the rate will fall an additional 12 percent over the next several decades.

The result: Someone older than 65 will head more than one-third of U.S. households by 2037.

• According to a Census Bureau report in January, the number of working moms who are the sole breadwinners in their households reached an all-time high. For the third year in a row, the number of moms as the only working spouse grew.

Of couples with children younger than 18 at home, almost 1 million moms were the only parent in the work force. The percentage of households with the dad as the sole breadwinner dropped to 28.2 percent, the lowest since 2001.

The prolonged current recession is causing cultural, as well as economic, changes.

"The economic crisis is heavily affecting families, and what the latest data show is that gender roles are flexible and are going in the direction of egalitarian roles," said Pamela Smock, a University of Michigan sociology professor.

• By 2025, the majority of families with children in the U.S. will be multicultural, Hispanic, black, Asian or other minority.

These three trends will ensure that marketers change the way they approach the American family. Consumer marketing will be more multicultural, consumption patterns — especially for consumer packed goods — will change dramatically, and growth will be difficult in the coming decade.

Households more connected

Amid these huge changes, today's households are more connected than ever. A recent Nielsen 2010 Media Industry Fact Sheet detailed American media use and delivered these points for marketers to process:

• 114.9 million homes have at least one television, and almost 30 percent have four or more.

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Mobile market ripe for growth

When Marshall Benhard charges up his cell phone, it's not just to make calls.
The 26-year-old business owner uses his iPhone to buy plane tickets, translate words into Vietnamese, and check his bank account. If a local restaurant doesn't take reservations on a mobile Web site, Benhard usually moves on to another location.

"My phone is always with me, all the time," Benhard said.

With customers like Benhard increasingly attached to their smart phones, companies large and small in the Nashville area are spending money on launching mobile Web sites, enabling customers to easily buy products and make reservations on their phones. Mobile sites are often pared-down versions of regular Web sites, letting customers navigate the information faster on their handheld devices.

Analysts say it's the wave of the future, as more consumers are snapping up smart phones like Apple's iPhone. Mobile commerce made up $201 million in sales last year and is expected to grow to $360 million in 2013, according to projections from Cambridge, Mass.-based Forrester Research.

"I think it's not only a trend. We're only seeing the tip of the iceberg," said Dawn Iacobucci, senior associate dean of Vanderbilt University's Owen Graduate School of Management. The younger generation of consumers remained tied to their cell phones, and it's a new opportunity for businesses to connect with them.

"They use their phones for everything," Iacobucci said. "It's an extension of their hands almost."

Streamlining

Nashville-based Gaylord Entertainment Co. this month plans to launch a mobile site that allows its clients to make hotel and restaurant reservations. The company also is testing text message alerts that notify guests who sign up for the service about hotel events.

"It makes it easier for the consumer to interact with us the way they want to," said Michael McCamish, Gaylord's manager of e-commerce marketing.

Restaurants with mobile sites have an edge in attracting smart phone users like Benhard. He uses the program OpenTable on his iPhone to reserve a table at local restaurants like Germantown's The Mad Platter and Suzy Wong's House of Yum on Church Street. The program also lists the restaurant's price range and links to the menu.

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Hospitals in quest for quiet

Hospital stays can have all the quiet relaxation of a day at the airport.
But medical administrators who realize their buildings are just too noisy are making changes.

They're replacing loud overhead paging systems with personal devices doctors carry, hard vinyl floors with rubber and traditional ceilings with sound-absorbing tiles.

Patients have to share rooms less often. And when hospitals redesign their buildings, they move elevators and other noisy areas away from patient rooms.

Several studies show that such practices can reduce patient stress, improving their recovery. Another motivating factor — the inclusion of questions about noise in patient satisfaction surveys hospitals are required to report to the federal government.

Survey scores could play a role in how hospitals get reimbursed for services.

"If you can reduce noise, you can reduce distractions, and that will help to reduce medical errors," said David J. Stewart, a principal in the health-care group at Gresham, Smith and Partners, a Nashville-based design and consulting firm.

High decibel levels

Patient and employee conversations and medical equipment in transit often produce noise that approaches the level in a busy restaurant, according to research studies. Meanwhile, noises from alarms and certain equipment such as portable X-ray machines were compared to walking next to a busy highway when a motorcycle or large truck passes.

Though the "quiet hospital" trend is catching on, many apparently still have work to do to better satisfy patients. But overall, noise level satisfaction is higher in Tennessee vs. the nation's average, according to an analysis by health-care consultant Press Ganey Associates of South Bend, Ind.

Last year, 43.8 percent of Tennessee respondents gave their hospital a "very good" grade for noise levels vs. 38.6 percent of all respondents nationwide. The 43.8 percent in Tennessee was up slightly from the 42.4 percent in 2008, while the nationwide average improved slightly from 37.2 percent in 2008. Tennessee patients, however, consider noise level just as important to satisfaction as do patients nationwide.

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Nashville People in Business

Powell Creative LLC announced:
Christy Dennis is account manager/media director. Dennis was director of global business development with CX-Analytics.

Tori Cameron is graphic designer.

Associations

Michael Gangwisch is director of activities and events for the Tennessee Chapter of the German American Chamber of Commerce of the South. Gangwisch is senior vice president of V. Alexander.

The Young Leaders Councilannounced its 2010 board of directors:

Brian Tayloris chairman. Taylor is a broker at Zeitlin & Co. Realtors.

James Crumlin Jr.is chairman-elect. Crumlin is a member of Bone McAllester Norton PLLC.

Shay Howard is secretary. Howard is a Realtor for Zeitlin & Co. Realtors.

Sean Torris treasurer. Torr is audit senior manager atDeloitte & Touche LLP.

The committee chairs are:

Josh Anderson, special events and programs co-chairman. He is a Realtor forKeller Williams Realty.

Christy DiNapoli, development and communications co-chairwoman. DiNapoli is president and CEO ofThe Music Group.

Adrian Granderson, development and communications co-chair. Granderson is a radio personality forClear Channel Communications.

Fiona Haulter, special events and programs co-chairwoman. Haulter is a civil engineer forGresham Smith and Partners.

Members of the board are:

Jonathan Cole, shareholder atBaker Donelson Bearman Caldwell & Berkowitz PC; Robby Davis, commercial real estate broker for Cassidy Turley; Kasey Dread, executive director at the Nashville Academy of Medicine; LeShane Greenhill, president of Pishon; Bob Grimes, manager of staff and community development for Turner Universal; Everton Heron, managing partner for Emerging Markets Group; Paula Roberts, executive director for Museum of African-American Music, Art & Culture; JillRobinson, director of executive learning and marketing for the Scarlett Leadership Institute at Belmont University; Holley Stein, account executive at Katcher Vaughn & Bailey Public Relations; and JordanGarrison Waldron, marketing and sales at FirstBank.

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Nashville's Vanguard to buy Detroit Medical Center

A Nashville-based hospital chain announced Friday it signed a letter of intent to acquire Detroit's largest nonprofit medical system.
For-profit Vanguard Health Systems Inc. said the $417 million purchase price includes money to retire The Detroit Medical Center's outstanding bonds and other long-term debt.

Vanguard also agreed to spend $850 million over the next five years on capital projects including a new Children's Hospital tower.

"We are very excited about entering the Detroit market," Charles N. Martin, Vanguard's chief executive, said in a statement.

The acquisition would fit with Vanguard's focus on hospitals in urban markets with large population concentrations.

"This is a system that has demonstrated for the last several years consistent profitability but has had limited access to additional capital resources to fund growth and capital projects," Phil Roe, Vanguard's chief financial officer, said about Detroit Medical.

"We have access to capital and want to invest capital in a market where we see opportunities to grow and to invest in additional health-care services."

Analyst has questions

Hospital industry analyst Sheryl Skolnick of CRT Capital in Stamford, Conn., however, has concerns about the deal, including about the Detroit economy and Vanguard's capital spending commitment.

Metro Detroit's unemployment rate was 15.6 percent in January, while the national rate stood at 9.7 percent.

"It seems to me that Vanguard may have some concessions from the community or seller that we don't yet know about," Skolnick said.

Vanguard, for instance, is seeking approval for a 12-year break on property taxes related to six of Detroit Medical's eight hospitals that are downtown.

Detroit Medical will be owned and operated by a Vanguard subsidiary called VHS Michigan. Its hospitals will continue to operate under the Detroit Medical Center brand and their historic names.

Detroit Medical is Michigan's largest provider of care to the poor, uninsured and underinsured. For 2008, it earned $44.7 million, up from $37.2 million in the previous year.

The health system has been profitable since 2004, but CEO Mike Duggan said that such safety net hospitals face difficulty landing financing at favorable interest rates from Wall Street rating agencies and bond companies to fund new facilities and equipment.

"The nonprofit hospital model is killing health care in the city of Detroit," Duggan said at a news conference Friday.

Vanguard owns and operates 15 acute care hospitals with 4,135 beds in four states. The company had revenues of about $3.2 billion for its last fiscal year that ended June 30, 2009.

The letter of intent will end on June 1 if the parties don't reach a definitive agreement.

Getahn Ward covers the business of health care. He can be reached at 615-526-5968 or at gward@tennessean.com.

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FDIC closes seven more banks

WASHINGTON — Regulators on Friday shut down seven banks in five states, bringing to 37 the number of bank failures in the U.S. so far this year.
The closings follow the 140 that succumbed in 2009 to mounting loan defaults and the recession.

The Federal Deposit Insurance Corp. took over First Lowndes Bank, in Fort Deposit, Ala.; Appalachian Community Bank in Ellijay, Ga.; Bank of Hiawassee, in Hiawassee, Ga.; and Century Security Bank in Duluth, Ga.

The agency also closed down State Bank of Aurora, in Aurora, Minn.; Advanta Bank Corp., based in Draper, Utah; and American National Bank of Parma, Ohio.

The FDIC was unable to find a buyer for Advanta Bank, which had $1.6 billion in assets and $1.5 billion in deposits. The regulatory agency approved the payout of the bank's insured deposits and it said checks to depositors for their insured funds will be mailed on Monday.

The failure of Advanta Bank is expected to cost the federal deposit insurance fund $635.6 million.

Seizures may accelerate

The pace of bank seizures this year is likely to accelerate in coming months, regulators have said, as losses mount on loans made for commercial property and development.

Depositors' money — insured up to $250,000 per account — is not at risk, with the FDIC backed by the government. Apart from the fund, the FDIC has about $66 billion in cash and securities available in reserve to cover losses at failed banks.

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Appeal filed to release TNInvestco documents

A Franklin-based venture capitalist is appealing a Davidson County chancellor's ruling that keeps government documents surrounding a $120 million state venture capital program under wraps for five years.
The appeal by Larry Coleman, president of Coleman Swenson Booth, keeps alive his fight to gain public records so he can see how the state rated 25 firms that applied for tax credits under the TNInvestco program and view the winning scores of the six firms chosen to participate.

The appeal was filed Friday in Davidson County Chancery Court. Coleman also filed a motion for expedited review with the Tennessee Court of Appeals.

Earlier this month, the state won the right to keep the records from public view for five years, citing its responsibility to protect confidential information provided by companies investing in the state.

The TNInvestco program makes $20 million in aid available through a program of tax credits for firms to invest in start-up and mid-stage companies to spur economic development and create jobs.

— BONNA JOHNSON
THE TENNESSEAN

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Porsche zooms to top in quality

NEW YORK — Porsche shot to the top of a closely watched study of long-term vehicle dependability, overtaking U.S. and Japanese rivals, J.D. Power and Associates said Thursday.
The German sports car brand took the No. 1 spot in the annual study, which gave it ninth place last year. Lincoln came in second, while Buick and Lexus tied for third. Mercury and Toyota rounded out the top five.

The annual study measures problems experienced by the original owners of vehicles after three years. In last year's study, Buick and Jaguar tied for fewest problems, but both brands lost ground to rivals this year.

U.S. brands had a particularly strong showing this year, reflecting concerted efforts in Detroit to catch up to foreign rivals that have traditionally dominated the quality study, said David Sargent, J.D. Power's vice president for vehicle research.

Top-five finishers Lincoln and Mercury are owned by Ford Motor Co., while Buick is owned by General Motors Co. The Cadillac DTS full-sized sedan, which is sold by GM, was named highest-quality car overall.

"The domestics are moving a little bit faster catching up," Sargent said.

Toyota slips

Toyota, whose reputation has come under scrutiny in the face of massive recalls, fell two spots from its third-place standing last year. While average vehicle quality across the industry improved from last year's survey, Toyota's quality score fell slightly.

However, the Japanese nameplate still swept four segment awards, more than any other brand, while its Lexus brand took one segment award. Japanese rival Honda took three awards, while Ford Motor Co.'s Lincoln brand took two.

The industry average was 155 problems per 100 vehicles, J.D. Power said. That's a decline from 167 problems per 100 vehicles last year.

Sargent said that's roughly in line with the industry's historical rate of quality improvement. "If you don't improve by 5 to 10 percent every year, you will get left behind," he said.

Chrysler Group LLC was the only Detroit automaker without any marques above the industry average. Land Rover owners reported the most problems among the 36 brands surveyed by J.D. Power.

J.D. Power's 2010 dependability study surveyed more than 52,000 original owners of 2007 model-year vehicles between October and December 2009. The results are watched closely by automakers and are often used in advertising. Owners' opinion of a car after three years can be a major influence on their opinion to buy that brand again.

The firm also releases an initial quality study that usually comes out in June.

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Leadership Music offers insider's look at industry

Established entertainment industry leaders curious about more tricks of the trade are invited to broaden their music business knowledge through participation in Leadership Music classes — they just have to fill out an application and submit it for approval first.
Applications are due by March 26 for the program, which takes an insider's look at the different micro-businesses or professions that drive the entertainment industry. (Those applications are available for download at www.leadershipmusic.org.)

"Our goal each year is to bring a class together that is representative of all facets of the music industry, put them together and instill a deeper understanding in the leaders of the industry," said board member and alumni Caroline Davis. "They have different backgrounds, different focuses and different main concerns." (Selection, Davis said, is based on merit and not driven by entry fees.)

Founded in 1989, Leadership Music is a nonprofit educational organization that has filtered more than 700 students through its program at a rate of about 50 participants at a time. Over the course of nine months, applicants are expected to attend six 12-hour classes and two weekend retreats.

"It's a time commitment and an open mind commitment," Davis said. "You may be head of a record label and certainly be recognized and acknowledged as a leader in the industry, but you may not know what the current concerns are of someone who runs a studio. ... You may know a lot about the industry, but you are interacting closely with people who are coming from different segments and hearing on the ground floor what is essential to them. We want people to learn about all these things."

Each class focuses on a different field in the music business, and students are seldom confined to seats. At 7 a.m. one Friday a month, participants are likely to file onto a bus and be transported to various locations around Nashville — the destination might be a recording studio, a publishing company, touring service or music distributor. While there, students might take in panel discussions, artist performances or a keynote speech. When it's over, they're off to lunch and then potentially another two stops before calling it a day.

And each year, the program is a little bit different. The most recent class of graduates is responsible for the curriculum for the new group of industry leaders.

"That's pretty exciting," Davis said. "The architecture of the program hasn't really changed since that first class, but by getting recent graduates it keeps it fresh."

Jeff Gregg, a talent agent at Creative Artist Agency, went through Leadership Music in 2003. And while he's been in the music business for more than two decades, he said he realized he still had plenty to learn.

"It was just bearing down on the details," Gregg said. "There was a takeaway from every single day, and each time I learned something. I've stayed active by volunteering. It's a great way to meet new people. It's a great forum on many aspects."

Reach Cindy Watts at 615-664-2227 or ciwatts@tennessean.com.

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Tennessee's unemployment rate won't get much relief from jobs bill

A jobs package signed into law on Thursday is not expected to create enough jobs to improve Tennessee's persistently high unemployment rate.
"It will have almost zero impact," said David Penn, associate professor of economics at Middle Tennessee State University and director of the Business and Economic Research Center there.

A few companies may find the tax breaks enough of a motivator, but the vast majority of businesses are waiting for demand to come back before they start hiring again, Penn said.

Tennessee's unemployment rate in February came in at 10.7 percent, the same rate for the third consecutive month, the state Department of Labor and Workforce Development said Thursday.

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The fact the rate hasn't spiked upward is good news, but even more encouraging is that employment has grown for several months in a row, said economist William Fox, director of the Center for Business and Economic Research at the University of Tennessee.

"I think the signals are clearly that the labor market has stabilized," Fox said.

Two major state employment surveys show net gains in employment, a positive sign although significant hiring has yet to occur, said Labor Commissioner James Neeley.

President Barack Obama's $38 billion jobs package contains $18 billion in tax breaks and $20 billion in highway and transit spending, a modest mix designed to encourage the private sector to start hiring again.

The tax breaks could generate 250,000 jobs by year's end, according to the most optimistic estimates, a tiny portion of the 8.4 million jobs the economy has shed since the recession began in December 2007.

"It will have a small impact on the cost of hiring employees," Fox said. "Employers will not expand only because of the tax credit. Ultimately, they will need to see demand for their products to justify new workers."

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Bernanke fights Senate's bid to reduce oversight

WASHINGTON — Federal Reserve Chairman Ben Bernanke urged Congress on Wednesday to let the Fed keep all of its banking oversight, arguing that information gleaned from that process helps the central bank guide the economy.
Testifying at a House hearing, Bernanke waged a fresh battle against Senate efforts to scale back the Fed's role in overseeing the nation's banks.

The Fed boss argued that policymakers factor information they get from the Fed's role as bank regulator into their decisions on interest rates. And Bernanke said its banking duties give the Fed insights into the health of the entire banking system.

"The insights provided by our role in supervising a range of banks, including community banks, significantly increases our effectiveness in making monetary policy and fostering financial stability," Bernanke told the House Financial Services Committee.

Bernanke's testimony comes as the Fed faces a significant shift in its supervisory duties.

In an effort to overhaul the nation's financial regulatory structure, Senate Banking Committee Chairman Christopher Dodd, D-Conn., has offered legislation that would strip the Fed of its power to supervise state-chartered banks and bank holding companies with assets of less than $50 billion.

That would leave the Fed with 35 of the biggest bank holding companies under its supervision.

Critics blame lax regulation at the Fed and at other agencies for contributing to the financial and economic crises. Bernanke once again acknowledged deficiencies, and he said the Fed is taking steps to beef up oversight.

"Frankly, the Fed's performance ... has been inadequate," said Rep. Spencer Bachus of Alabama, the senior Republican on the House panel. "In spite of its oversight, many of the large, complex banking organizations excessively leveraged and engaged in off-balance sheet transactions that helped precipitate the financial crisis," he said.

The Fed oversees about 5,000 bank holding companies, about 850 smaller banks that are state-chartered and are members of the Federal Reserve system and some foreign banks operating in the United States.

Dodd's bill, however, also would give the Fed new powers to oversee nonbank financial firms that are so large and interconnected that their failure could pose a risk to the economy.

Such firms could include insurance giant American International Group Inc. or General Electric Co.'s GE Capital business.

Bernanke said the Fed is "quite concerned" about losing oversight of small banks and essentially becoming the "too big to fail regulator" under the Dodd bill.

"We want connections to Main Street as well as Wall Street," Bernanke said.

With its narrower authority, the Fed's system of 12 regional banks could face profound changes. The Kansas City Federal Reserve Bank and the St. Louis Federal Reserve Bank, for instance, would have no banks under their supervision.

The Obama administration has supported a broader supervisory role for the Fed. Legislation passed by the House overhauling the regulatory landscape doesn't trim the Fed's banking duties.

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Tell us: Did bad credit keep you from a job?

Did bad credit keep you from a job?
Did a bad credit history keep you from getting hired when you applied for a job? Be interviewed for a story. Contact reporter Bonna Johnson at 615-726-5990 or bjohnson@tennessean.com.

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Nashville Business Calendar

Brentwood Business Women's Group, 5:30 p.m., Thursday, March 18, Boscos Restaurant, 2000 Meridian Blvd., Suite 110, Franklin. RSVP at bbwg1@yahoo.com.
Urban Design Forum, 5:30-7 p.m., Thursday, March 18, Nashville Civic Design Center, 138 Second Ave. N., Suite 106, Nashville.

Business After Hours, 5-7 p.m., Thursday, March 18, Hilton Garden Inn, 290 Alfred Thun Road, Clarksville. 931-245-4341.

Future Architects Design Sustainabale ArchitectureNashville Business Calendar

Business briefs: Emdeon to acquire consulting company

Emdeon Inc. said that it has an agreement to acquire Healthcare Technology Management Services, an Indianapolis-based health care information technology consulting company.
The Nashville-based provider of health care payment and administrative systems will pay $11 million in cash and stock at the closing expected this month. Emdeon also could pay up to $14 million more in cash based on financial performance of the acquired business for three years after the closing.

Separately, Emdeon reported fourth-quarter net income of $4.7 million, or 3 cents per share, vs. $4.2 million, or 4 cents per share, a year earlier.

— GETAHN WARD

LifePoint board OKs stock repurchase

LifePoint Hospitals Inc. said its board has authorized the repurchase of up to $70 million of its stock on or before May 7.

The Brentwood-based hospital operator said that there's no guarantee as to the exact number of shares that would be repurchased or that there will be any repurchases at all.

— GETAHN WARD

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First Call Ambulance Service sues federal government

A Nashville-based ambulance company has sued the federal government, seeking to reverse a claim that it owes $2.6 million, reflecting a multiplying of the amount of alleged overpayment for its services.
In the filing in Nashville federal court last week, First Call Ambulance Service Inc. said the $10,764 allegedly overpaid shouldn't have been multiplied because the company already had more than half of the claims overturned during an appeals process.

The company's dispute with the U.S. Department of Health and Human Services comes as the federal government has stepped up efforts to identify and reduce fraud by Medicare providers. That includes use of private contractors such as AdvanceMed to review claims. AdvanceMed's review of a sample of claims that First Call filed during 2005 and 2006 and related medical records found a 50.94 percent error rate, the basis for multiplying of the overpayment.

That error rate should have been reduced to 25 percent or less based on outcomes of the appeals, which should have lowered First Call's bill, it said.

First Call, whose owners include businessman Alan Sielbeck, offers transportation of patients paid for by government programs including Medicare.

The government questioned whether some of the patients it transported required an ambulance. First Call argued Medicare covers non-emergency, scheduled and repetitive ambulance services if the patient's doctor deemed the trip medically needed.

Getahn Ward covers the business of health care and commercial real estate. He can be reached at 615-726-5968 or through e-mail at gward@tennessean.com.

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