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Label: WorldFactbox: Video game industry meets with Biden gun task force
Label: TechnologyWASHINGTON (Reuters) – Representatives from the companies that make “first-person shooter” games such as “Call of Duty,” “Medal of Honor” and “Grand Theft Auto” met with Vice President Joe Biden on Friday as the Obama administration looks for ways to curb U.S. gun violence.
Biden is heading a task force formed after a gunman shot dead 20 children and six adults last month at a Connecticut elementary school. Biden plans to make recommendations on reducing gun violence to President Barack Obama by next Tuesday.
The vice president has held discussions with a wide range of groups including gun retailers, gun owners, the National Rifle Association gun rights lobbying organization, the film industry, victims of gun violence, and law enforcement authorities.
Following is a list of groups present at Friday’s meeting with Biden, Attorney General Eric Holder and Health and Human Services Secretary Kathleen Sebelius.
Activision Blizzard Inc
Electronic Arts Inc
E-Line Media
Entertainment Software Association
Entertainment Software Ratings Board
Epic Games
GameStop Corp
Joan Ganz Cooney Center at Sesame Workshop
Take-Two Interactive Software Inc
Texas A&M University
University of Wisconsin at Madison
Zenimax Media Inc
(Reporting by Roberta Rampton; Editing by Will Dunham)
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Alabama's Lacy, Milliner, Fluker enter NFL draft
Label: LifestyleTUSCALOOSA, Ala. (AP) — Alabama tailback Eddie Lacy, cornerback Dee Milliner and right tackle D.J. Fluker are entering the NFL draft after helping lead the Crimson Tide to a second straight national title.
Lacy and Milliner announced their plans to skip their senior seasons Friday at a news conference. Fluker couldn't be there for the announcement because he was traveling.
It's another exodus of talented underclassmen for a team that has won three of the past four national championships. Most of the four first-round picks in each of the past two drafts that left Alabama were underclassmen.
"I appreciate what they've done for the University of Alabama but we also acknowledge the fact that from a business standpoint, these guys are making good decisions about their future and what they can do," coach Nick Saban said.
Unlike recent groups of departing juniors from Alabama, only Milliner is pegged as a sure first-round pick.
He was a Jim Thorpe Award finalist and unanimous All-American after recording two interceptions and 22 pass deflections. He and guard Chance Warmack, who was a senior, are projected as the Tide's top current prospects.
"I think while I was here, I met all the goals and team affirmations that I set for myself as a freshman by winning a championship, becoming an All-American, just being part of a team that always loved to win," Milliner said. "I think I fulfilled all my goals and am ready and prepared to go to the next level."
Lacy was MVP of the national championship game against Notre Dame after rushing for 140 yards and scoring two touchdowns. He said he wasn't 100 percent healthy all season until the title game Monday night, but Lacy still ran for 1,322 yards and 17 touchdowns while averaging 6.5 yards per carry.
"We don't have a lot of years to play this position, so you have to go while you can," Lacy said. "I would love to come back. This is a great place. We have the best fans, but I really didn't want to risk coming back and not having such a good year or maybe even risking injury. I've had my share of injuries this year. I feel like you've got to get out while you can."
Lacy thinks he "made a pretty solid statement" in the title game, when he made a spin move into the end zone on a TD catch and on another run pushed 248-pound linebacker Danny Spond away with one hand.
Lacy was recruited in the same class as Trent Richardson, last year's No. 3 pick by Cleveland, but redshirted and then spent two seasons as a backup. He's not widely projected to follow Richardson and 2009 Heisman Trophy winner Mark Ingram into the first round. Lacy said he was projected as a second- or third-round pick in feedback from the NFL, but was impressive in the finale. Ordinarily, Saban only recommends projected first-round picks leave early.
"I'm fully supportive of what Eddie's doing," Saban said. "It's a little bit of a different situation than we've had in the past, but it's a little bit unique as well. Every one of these situations is unique to that particular individual and what his situation is. "
The 6-foot-6, 335-pound Fluker started 35 games for the Tide and was a second-team Associated Press All-American.
He was one of the Tide's top-rated signees in 2009 but came in overweight at about 395 pounds and was redshirted.
"I certainly feel like this year has been his best year as a player, and I feel that he's made a good decision about what he wants to do," said Saban, adding that Fluker has improved as much as any player on the team.
The mammoth Fluker, who wears a size-22 shoe, said in a statement that leaving early "is never an easy decision when you are playing at a place like Alabama."
"''These four years in Tuscaloosa have been the best four years of my life and I appreciate everyone who helped me along the way," he said.
Quarterback AJ McCarron, All-America linebacker C.J. Moseley and guard Anthony Steen have already said they're returning for their senior seasons. Saban didn't rule out other juniors possibly declaring for the draft before Tuesday's deadline.
The Tide does have promising players who have logged plenty of playing time behind Lacy and Milliner, especially. Two freshmen — tailback T.J. Yeldon (1,108 yards, 12 touchdowns) — and cornerback Geno Smith saw significant action.
"You've got people that are going to go to the NFL each year and you've got people behind them that are going to do the same things when their time comes," Milliner said.
Flu Vaccine Safe for Children Allergic to Eggs, Doctors Say
Label: HealthScott Olson/Getty Images
Dr. Anne Furey Schultz examined a patient who was experiencing flu-like symptoms at Northwestern Memorial Hospital in Chicago.
Because the vaccine is grown in chicken eggs, manufacturers recommend that the roughly 2 percent of all children who have egg allergies not get them.
But flu hospitalizes 21,000 young children a year, said Dr. James L. Sublett, chair of the public relations committee of the American College of Allergy, Asthma and Immunology.
Because only trace amounts of egg protein remain in the vaccine, “we now know administration is safe,” he said. “'The benefits of the flu vaccination far outweigh the risks.”
Even children who have gone into anaphylactic shock from eating eggs should get flu shots, but from an allergist trained to handle emergencies, the association recommended.
The rival American Academy of Allergy, Asthma and Immunology says on its Web site that children whose only reaction to eating eggs is hives can have flu shots in a pediatrician’s office with a 30-minute observation period afterward, while children with more serious reactions like breathing difficulty or lightheadness should get them from an allergist, again with an observation period.
Thomas Skinner, a spokesman for the Centers for Disease Control and Prevention, said his agency’s position was that people who have had a reaction to eggs should consult a doctor to discuss how severe it was and the benefits of vaccination.
About 70 percent of all children allergic to eggs outgrow the allergy by age 16, Dr. Sublett said.
DealBook: Wells Fargo Profit Jumps 24% in Quarter, Driven by Mortgage Gains
Label: Business8:46 a.m. | Updated
Wells Fargo reported $5.1 billion in profit for the fourth quarter on Friday, a 24 percent increase, driven by the bank’s lucrative mortgage business.
Seizing on low-interest rates that have spurred a flurry of refinancing activity, the bank again notched record profits. For the last 12 quarters, profits at the bank have increased.
In this latest quarter, Wells Fargo, based in San Francisco, reported earnings of 91 cents a share, which exceeded analysts’ expectations. Ahead of the report, analysts polled by Thomson Reuters estimated that the bank would report earnings of 89 a share.
Wells Fargo, unlike many of its rivals, has been able to steadily increase its revenue. The first bank to release fourth-quarter earnings, Wells Fargo reported $21.95 billion in revenue in the fourth quarter, up 7 percent from a year earlier.
Much of the revenue gains stemmed from the bank’s consumer lending business, as borrowers jumped on record low interest rates to refinance their mortgages. Wells Fargo, which dominates the market as the nation’s largest mortgage lender, notched $125 billion in mortgage originations, up from $120 billion in the fourth quarter of 2011. Refinancing applications accounted for nearly 75 percent of that total.
The big profit in the group came from the extra money that Wells Fargo makes bundling the mortgages into bonds and selling them to the government. In the fourth quarter, the bank reported $2.8 billion of so-called net gains on its mortgages activities, up 51 percent from the previous year.
The question is whether those gains are sustainable. Refinancing activity shows signs of tapering off. And the housing recovery is far from robust, which means it may be tough to make new mortgages.
Investors seemed to look beyond the strong profits to the potential challenges. Shares of the Wells Fargo were down modestly on Friday, as the bank reported a drop in its net interest margin.
Under the tenure of its chief executive, John G. Stumpf, Wells Fargo has aggressively expanded into the mortgage market, a strategy that might help the bank surpass its rivals in profits, notably JPMorgan Chase.
Wells Fargo’s net interest margin, a closely watched profit metric that measures the difference between the interest the bank collects and the interest it pays on its own borrowings, was down slightly to 3.56 percent, from 3.89 percent a year earlier.
Profit in the community banking division, which spans Wells Fargo’s retail branches and mortgage business, increased 14 percent to $2.9 billion.
The bank successfully courted more cash from depositors, adding $72 billion in total core checking and savings deposits than a year earlier.
“The company’s underlying results were driven by solid loan growth, improved credit quality, and continued success in improving efficiency,” Wells Fargo’s chief financial officer, Tim Sloan, said in a statement.
The bank has benefited from sweeping federal stimulus initiatives that have buoyed the mortgage business. The Treasury Department has helped spur Americans to refinance their mortgages.
Wells Fargo is the reigning titan in the mortgage industry, generating roughly a third of all the mortgages across the United States. Mortgage originations continued to climb, up 4 percent to $125 billion.
Adding to its mortgage-related profit, Wells Fargo reported a $926 million profit from its servicing business, in which the bank collects payments from homeowners. That’s up roughly 6 percent from a year earlier.
Alongside the consumer loan business, Wells Fargo had gains in its wealth management business, a particular focus for the bank to defray the impact of federal regulations that dragged down profits elsewhere.
Still, Wells Fargo’s profit from residential mortgages could wane this year if the Federal Reserve halts its extensive bond buying spree.
Working to move beyond the mortgage crisis woes that have dogged the bank, Wells Fargo has been brokering deals with federal regulators. Wells Fargo was one of 10 banks that signed onto an $8.5 billion settlement this week with the Comptroller of the Currency and the Federal Reserve over claims that shoddy foreclosure practices may have led to the wrongful eviction of homeowners.
The sweeping federal pact ends a deeply flawed review of millions of loans in foreclosure that was mandated by federal regulators in 2011. The review, which was ended this week, began in November 2011 amid mounting public fury that bank employees were churning through hundreds of foreclosure filings without reviewing them for accuracy.
In addition to the settlement, the bank set aside $1.2 billion to prevent foreclosures.
Zorbing Accident Kills 1 Man and Injures Another in Russia
Label: World
MOSCOW — It is called a zorb, an outsize inflatable ball in which people strap themselves, then bounce down a ski slope and, presumably, have a good time doing so. But when a zorb veered off a ski run high in Russia’s Caucasus Mountains earlier this month, there was little anyone could do but watch as the two men inside careened along a jagged ridge and then plunged over a precipice.
The ball tumbled down the mountain at the Dombai ski resort for almost a mile, slamming into rocks as it picked up speed, rescue workers said on Wednesday in a televised statement. One of the men, Denis Burakov, 27, injured his spinal cord and died on the way to a hospital. The other, Vladimir Shcherbakov, 33, suffered a concussion and deep cuts to his arms and face.
The accident on Jan. 3, which a friend of the men filmed on a cellphone and then uploaded to the Internet on Tuesday, has generated concern over unlicensed attractions on Russia’s loosely regulated ski slopes.
The man who harnessed Mr. Burakov and Mr. Shcherbakov into the zorb told the police that they were his first customers, and that he was not licensed to offer rides, having bought the ball two years ago for his own use. On Thursday the police arrested the man, Ravil Chekunov, 25, who said he had charged Mr. Burakov and Mr. Shcherbakov about $10 for the ride.
Russia’s minister of emergency situations called Wednesday for tighter safety precautions at skiing facilities, after a rash of winter sports injuries. Russian television reported this week that 10 people had been seriously injured on a single ski slope in Kolomna, a city 50 miles southeast of Moscow. A woman who descended on a sled broke her spine after she ran into rocks at the bottom.
Russian leaders, notably President Vladimir V. Putin, have tried for years to build interest in downhill skiing in Russia. The country has invested billions of dollars in ski resorts in the Caucasus, and in particular in the Black Sea resort of Sochi, which will host the Winter Olympics in 2014.
Mr. Putin mingled with stunned vacationers at a resort near Sochi during the winter break, and the culture minister, Vladimir R. Medinsky, lavishly praised the local ski conditions on Twitter.
But an investigation into the accident at the Dombai ski resort, less than 100 miles east of Sochi, found 50 unlicensed attractions and guides operating on the mountain, the newspaper Izvestia reported.
A Moscow-based businessman, Montay Imanov, told Izvestia that the zorb that carried the two men was stolen from him at gunpoint in 2009, when he traveled to the region intending to open a zorbing business.
“They didn’t cordon the track off from the gorge,” he said. “It’s just a nightmare. They needed to put six rows of nets there.”
Jimmy Dushku: The 25-year-old who is North Korea’s one true Twitter friend
Label: TechnologyMother Jones takes a look at a globetrotting young investor who’s the only American — and the only human being — Pyongyang follows
Google Chairman Eric Schmidt capped a controversial four-day visit to North Korea on Thursday with a call for the country’s censorship-happy communist government to give its people access to the internet, or face further economic decline due to the country’s global isolation. It was a strong message from one of the web’s most powerful figures, although North Korea watchers seem pretty confident the country’s young leader, Kim Jong Un, will ignore it. There’s one American, however, Pyongyang does appear to listen to. That would be Jimmy Dushku, a young investor who is one of exactly three Twitter users Kim’s government follows on Twitter. What’s the story behind this unlikely online bromance? Here, a guide:
Who is Jimmy Dushku?
He’s a 25-year-old financial whiz kid from Austin, Texas. Dushku, who also goes by the nicknames “Jimmer” and “Jammy,” started a website development business when he was 14, according to Mother Jones, and he parlayed his early earnings into investments that now include everything from construction projects in Europe to real estate in Texas to mines in South America. He’s also a rabid Coldplay fan, and when he isn’t jetting around the world, he says he likes to play Rachmaninoff on his piano and zoom around on his Ducati Monster motorcycle.
SEE MORE: North Korea’s rocket launch: 3 consequences
So how did he become buddies with North Korea?
Dushku tells Asawin Suebsaeng at Mother Jones he’s not really sure. “People always ask me how it happened, and I honestly can’t remember,” he says. “It started sometime back in 2010. I was initially surprised.” North Korea followed him, he followed North Korea “out of courtesy.” He tweeted back, “Hello my friend,” and a relationship was born. Then, the North Korean government, which has piled up some 11,000 followers in two-and-a-half years on Twitter, abruptly whittled down the number of accounts it follows, leaving just three. Dushku made the cut (along with a Vietnam account and another official North Korean handle).
What has Dushku gotten from the relationship?
Death threats, for one thing. Not long after he linked up with North Korea’s account, which goes by @uriminzok (or “our nation”), Dushku says he started getting angry messages from exiles and South Koreans. Since then, he has mostly kept a low profile, just to be safe, although he does occasionally grant interviews to foreign publications. For its part, North Korea gets a rare glimpse at the outside world through Dushku, as his is the only account North Korea follows that is regularly updated — the other two haven’t tweeted in months. He’s also the only human being in the bunch.
Will @JimmyDushku and @uriminzok ever meet in real life?
That’s always the question for acquaintances who meet online, isn’t it? Dushku says his friendly relationship has won him a standing offer to visit North Korea. Casual observers, however, advise him to proceed with caution. “Am I the only one thinking they picked some random guy so they can lure him into North Korea and use him as a political prisoner/bargaining chip?” one commenter at Gizmodo said. Another suggests that Dushku play it cool, without making Pyongyang angry, saying, “Never unfollow anybody with nuclear weapons.”
Sources: Austinist, CNN, Gizmodo, Mother Jones
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Researchers: NFL's Seau had from brain disease
Label: LifestyleWhen he ended his life last year by shooting himself in the chest, Junior Seau had a degenerative brain disease often linked with repeated blows to the head.
Researchers from the National Institutes of Health said Thursday the former NFL star's abnormalities are consistent with chronic traumatic encephalopathy, or CTE.
The hard-hitting linebacker played for 20 NFL seasons with San Diego, Miami and New England before retiring in 2009. He died at age 43 of a self-inflicted gunshot in May, and his family requested the analysis of his brain.
"We saw changes in his behavior and things that didn't add up with him," his ex-wife, Gina, told The Associated Press. "But (CTE) was not something we considered or even were aware of. But pretty immediately (after the suicide) doctors were trying to get their hands on Junior's brain to examine it."
The NIH, based in Bethesda, Md., studied three unidentified brains, one of which was Seau's, and said the findings on Seau were similar to autopsies of people "with exposure to repetitive head injuries."
"It was important to us to get to the bottom of this, the truth," Gina Seau added, "and now that it has been conclusively determined from every expert that he had obviously had CTE, we just hope it is taken more seriously. You can't deny it exists, and it is hard to deny there is a link between head trauma and CTE. There's such strong evidence correlating head trauma and collisions and CTE."
In the final years of his life, Seau had wild behavioral swings, according to Gina and to 23-year-old son, Tyler, along with signs of irrationality, forgetfulness, insomnia and depression.
"He emotionally detached himself and would kind of 'go away' for a little bit," Tyler Seau said. "And then the depression and things like that. It started to progressively get worse."
He hid it well in public, they said, but not when he was with family or close friends.
Seau joins a list of several dozen football players who were found to have CTE. Boston University's center for study of the disease reported last month that 34 former pro players and nine who played only college football suffered from CTE.
The NFL faces lawsuits by thousands of former players who say the league withheld information on the harmful effects of concussions. According to an AP review of 175 lawsuits, 3,818 players have sued. At least 26 Hall of Famer members are among the players who have done so.
The National Football League, in an email to the AP, said: "We appreciate the Seau family's cooperation with the National Institutes of Health. The finding underscores the recognized need for additional research to accelerate a fuller understanding of CTE.
"The NFL, both directly and in partnership with the NIH, Centers for Disease Control and other leading organizations, is committed to supporting a wide range of independent medical and scientific research that will both address CTE and promote the long-term health and safety of athletes at all levels."
NFL teams have given a $30 million research grant to the NIH.
The players' union called the NIH report on Seau "tragic."
"The only way we can improve the safety of players, restore the confidence of our fans and secure the future of our game is to insist on the same quality of medical care, informed consent and ethical standards that we expect for ourselves and for our family members," the NFLPA said in a statement.
"This is why the players have asked for things like independent sideline concussion experts, the certification and credentialing of all professional football medical staff and a fairer workers compensation system in professional football," it said.
Seau is not the first former NFL player who killed himself and later was found to have had CTE. Dave Duerson and Ray Easterling are the others.
Before shooting himself, Duerson, a former Chicago Bears defensive back, left a note asking that his brain be studied for signs of trauma. His family filed a wrongful-death suit against the NFL, claiming the league didn't do enough to prevent or treat the concussions that severely damaged his brain.
Easterling played safety for the Falcons in the 1970s. After his career, he suffered from dementia, depression and insomnia, according to his wife, Mary Ann. He committed suicide last April.
Mary Ann Easterling is among the plaintiffs who have sued the NFL.
Tyler Seau played football through high school and for two years in college. He says he has no symptoms of brain trauma.
"I was not surprised after learning a little about CTE that he had it," Tyler said. "He did play so many years at that level. I was more just kind of angry I didn't do something more and have the awareness to help him more, and now it is too late."
Gina Seau's son Jake, now a high school junior, played football for two seasons but has switched to lacrosse and has been recruited to play at Duke.
"Lacrosse is really his sport and what he is passionate about," she said. "He is a good football player and probably could continue. But especially now watching what his dad went through, he says, 'Why would I risk lacrosse for football?'
"I didn't have to have a discussion with him after we saw what Junior went through."
Her 12-year-old son Hunter has shown no interest in playing football.
"That's fine with me," she said.
Children’s Flu Medicine in Short Supply
Label: Health
As influenza cases surge around the country, health officials say they are trying to stem a shortage of treatments for children.
Pharmacies around the country have reported dwindling supplies of liquid Tamiflu, a prescription flu medicine that can ease symptoms if taken within 48 hours of their onset. The drug is available in capsules for adults and a liquid suspension for children and infants.
“There are intermittent shortages of the liquid version (but not the capsule version) due to the supplier’s challenges to meet the current demand,” Carolyn Castel, a spokeswomen for CVS Caremark, said in an e-mail.
Pharmacies around the country are experiencing shortages of the liquid suspension “due to recent increased demand,” Sarah Clark-Lynn, a spokeswoman for the Food and Drug Administration, said on Thursday.
Ms. Clark-Lynn said the F.D.A. was working with the company that markets Tamiflu, Genentech, to increase supplies. The agency is also letting pharmacists know that in emergencies they can compound the adult Tamiflu capsules to make liquid versions for children.
A similar shortage of Tamiflu has hit Canada, which has also been gripped by widespread flu outbreaks, prompting the government there to tap into a national stockpile of the drug.
“That really unexpected increase in demand — far above other influenza seasons — has really depleted the usual stocks which in any other season would have been more than sufficient,” Dr. Barbara Raymond, director of pandemic preparedness for the Public Health Agency of Canada, told The Ottawa Citizen.
DealBook: For Some Dead Brands, a Tortuous Path to Resurrection
Label: BusinessAt a time when bankruptcy auctions are filled with sad tales of beleaguered brands, snagging a well-known name for pennies on the dollar can seem like a sure bet for ambitious investors.
Yet, as Stephen F. Heese and Stephen M. Julius describe, buying the rights to a name and restarting operations requires years of dedication.
The two, who were classmates at Harvard Business School in the 1980s, manage their own capital at Stellican, an investment firm. Their goal: to seek out so-called heritage brands — those remembered for their high quality and authenticity — and rebuild a company. One project is the revival of Chris-Craft, once the largest pleasure boat manufacturer in the United States.
The notion of buying and resurrecting a beloved brand can be appealing across product categories, as reflected by the current bidding dance for Hostess or the woefully long ordeal of Saab, which was sold to Chinese and Japanese investors last year.
Chris-Craft, which Stellican now operates, was known for its meticulous design and use of wood and chrome. Its boats were widely sought after and associated with the many celebrities and public figures who owned them, including Katharine Hepburn, Frank Sinatra and Presidents Franklin Delano Roosevelt and John F. Kennedy. That image made it appealing to Stellican’s principals.
Yet, while nostalgia can be a powerful marketing tool, business school case studies are filled with would-be white knights that needed more than money to succeed. For example, Excelsior Henderson, a motorcycle maker twice rescued from bankruptcy, ultimately failed. Yet, Triumph Motorcycles was revived in 1984 and has operated since.
“Brands are not like tech start-ups where there is a template — X number of years to prototype, X number of years to harvest,” said Nancy F. Koehn, a Harvard Business School marketing professor. “A big piece of it is art; there’s an alchemy to it.”
The death and rebirth of Chris-Craft played out over decades. The company was founded by Christopher Columbus Smith, who built his first vessel in 1874 and soon developed a reputation as a master. The Smith family sold Chris-Craft in 1960, around the time fiberglass began displacing wood as the material of choice for boats.
By 1968, Chris-Craft had been sold to the media mogul Herb Siegel. It stopped making wood boats, and expanded beyond powerboats, adding sailboats and houseboats to its offerings. Market share and profits declined.
Enter Stellican. Mr. Julius, with assistance from Mr. Heese, had previously resuscitated Riva, a premium Italian boat maker, in 1998. He sold it to the Italian yacht company Ferretti Group in 2000.
Before joining forces for the Riva deal, Mr. Julius and Mr. Heese took different paths after Harvard. Mr. Julius started his career with the Boston Consulting Group and eventually moved to London. Mr. Heese, a certified public accountant by training, headed to what was then Price Waterhouse and later to the Erico International Corporation, a privately held manufacturer of electrical and mechanical hardware.
In 1991, Mr. Julius formed Stellican as an advisory and investment vehicle for his family’s assets. In 1998, while living in Italy, he called Mr. Heese, who was in the United States, to ask if he could help set up distribution in the United States for Riva. Mr. Heese officially joined Stellican in 2001, and the partners began work on the Chris-Craft deal.
Although the two would not discuss their firm’s financial returns, they say they expect internal return rates higher than 35 percent on their investments.
Stellican owns no more than two companies at once, and typically has an investment ceiling of $10 million. “We put all our eggs in one or two baskets,” Mr. Julius said.
Chris-Craft’s path to revival was tortuous. In 1981, the Chris-Craft boatyard was bought by G. Dale Murray, but Mr. Siegel retained rights to the Chris-Craft name.
Mr. Murray’s company went bankrupt in 1988, and was bought by the Outboard Marine Corporation, which sold several brands of boats as well as outboard engines, before going bankrupt in 2001. After Mr. Heese read about the bankruptcy, he contacted Mr. Julius.
Stellican acquired the assets of Chris-Craft (finished and unfinished boats) and the trademark for the name in separate transactions. The complicated process of acquiring the assets included a 12-hour, 20-way auction held in a conference room at the Chicago office of the law firm Skadden, Arps, Meagher, Slate & Flom.
Four hundred industry players gathered, all competing for the Chris-Craft assets. Mr. Julius, bidding on behalf of Stellican, lost out to the owner of Genmar Industries, Irwin Jacobs, who had teamed up with Bombardier to buy all of Outboard Marine’s assets for $95 million.
As he left the room, Mr. Julius told Mr. Jacobs to call him if he ever wanted to sell Chris-Craft. That call came just days later. In March 2001, Stellican bought the Chris-Craft assets from Genmar for $5 million.
Acquiring the Chris-Craft name, which was still owned by Mr. Siegel, was next. But Mr. Siegel refused to sell the name rights to Stellican. So, when Mr. Julius learned Mr. Siegel was in the process of selling his media company, Chris-Craft Industries, to Rupert Murdoch’s News Corporation, he approached Mr. Murdoch directly.
They reached a deal that enabled Stellican to buy the brand for $5 million.
Restarting operations was a bit more daunting. During the decades when Chris-Craft languished, its products had become middle market, Mr. Julius said. Scrapping the old product line was Stellican’s first order of business.
“It was always, ‘I remember,’ followed by a smile and a positive memory,” he said. Chris-Craft evoked the innocence and promise of post-World War II America — and Henry Fonda piloting a 1950s model in “On Golden Pond.” Building products that fulfilled that promise became their mantra, Mr. Heese said.
Restoring Chris-Craft also required rebuilding its dealer network. Mr. Julius said that dealers were initially skeptical that the type of customer he described — one obsessed with beauty and performance, not price — existed. The company makes 20- to 36-foot boats whose prices range from about $50,000 to $550,000.
He had to sell his products to dealers and feel comfortable they could sell them to customers.
Cost control also remained important, a role falling to Mr. Heese, who signs every check as chief executive. “We’re very hard-nosed when it comes to investing our own money,” he said.
Chris-Craft continues to bolster its dealer network worldwide. In June, the company plans to release a line of Chris-Craft branded sports apparel for a wider market. The company just signed a deal with IMG, which will serve as its licensing agent for watches, sunglasses and toys.
After starting at zero, Chris-Craft sales were $32 million in 2012. Its high was $60 million in 2008.
In between, Stellican bought Indian Motorcycles in 2006, turned it around, and sold it to Polaris Industries in 2011.
The partners acknowledge that their efforts may not have worked at a traditional private equity firm, most of which seek companies with positive cash flows.
Product innovation separates the winners from the losers when it comes to brand revivals, said Scott Galloway, a marketing professor at the Stern School of Business at New York University. “Brands lose value because they get fat, dumb and happy,” he said.
Although Stellican has received attractive offers for Chris-Craft, it plans to hold onto it for now. Mr. Heese said he was in no hurry to begin chasing deals again, a process he described as “gut-wrenching.”
“When you’re buying a company that’s in bankruptcy, you’re sitting across from people who screwed up,” Mr. Heese said. “They’re not dumb — they just got one thing wrong,” he said.
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