Cal State Northridge is starting a new technology transfer program to commercialize faculty and student research. They have hired Crist Khachikian to head the program, which is still in the early stages of hiring staff, establishing policies, and educating faculty. The university currently brings in about $32 million annually in research funding, providing a foundation to build the new technology transfer initiative.

1. M A I L T O :
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NOMINEES ANNOUNCED! See page 6 or visit www.sfvbj.com/bizevents
SAN FERNANDOVALLEYBUSINESS JOURNAL
Volume 19, Number 15 July 28 - August 10, 2014 • $4.00
sfvbj.com
T H E C O M M U N I T Y O F B U S I N E S STM
By MARK R. MADLER Staff Reporter
To catch up with other universities, Cal
State Northridge is setting up a technology
transfer program to commercialize research
done by faculty and students.
The university has hired Crist
Khachikian, a former Cal State Los Angeles
engineering professor with degrees from
UCLA and MIT, to head the initiative, which is
still in its infancy.
The university needs to hire staff, establish
policies, educate faculty and, of course, get
more research funding. But there is a founda-
tion to build on: The school brings in about $32
By JOEL RUSSELL Staff Writer
After nearly a decade in the laboratory and accumu-
lated losses of $172 million, Kythera Biopharma-
ceuticals Inc. finally has a shot at making some
money – and providing a role model for other local
biotech startups.
The Food and Drug Administration on July 10
accepted the Westlake Village company’s paperwork
seeking approval to market its flagship drug ATX-101.
It’s an injectable chemical that breaks down fat cells,
and the company will market it as
the first non-surgical treatment for
a double chin.
Although Kythera has never
sold a product, investors love it.
The company went public in late
2012 and raised $72.5 million, fol-
lowed by a secondary offering last
year for $125 million. The compa-
ny had a market capitalization of $784 million and a
closing share price of $34.62 on July 23.
Ahmed Enany, president of the Southern California
Biomedical Council, a Los Angeles trade group, said
Marriott Sale
Checking Out
HOSPITALITY: L.A. firm buying
large Warner Center property.
BIOTECH: Kythera reaches milestone
as FDA to review anti-fat compound.
By ELLIOT GOLAN Staff Reporter
The Warner Center
Marriott is being acquired by
Century City real estate
investment and development
firm Laurus Corp. – the lat-
est example of how hotels are
the hottest sector in the com-
mercial real estate market.
The price for the 474-
room corporate lodging at 21850 Oxnard St.
being acquired from the Teachers Retirement
Fund of Illinois is undisclosed but is expected
to be well into the “nine figures,” according to
Tech Transfer
Enters CSUN
TECHNOLOGY: Northridge
school begins new program.
LOS ANGELES • GLENDALE • SANTA CLARITA • BURBANK • CONEJO VALLEY • SIMI VALLEY • SAN FERNANDO • CALABASAS • AGOURA HILLS • ANTELOPE VALLEY
By STEPHANIE FORSHEE Staff Reporter
A
s National Football League teams get ready
to start knocking heads next Sunday in a
preseason game, there will be one player on
the field with perhaps the most at stake.
It’s BRG Sports Inc., the local sporting goods
manufacturer that is the leading supplier of NFL
helmets through its Riddell subsidiary.
With concerns over concussions ever growing,
the company is being sued on multiple fronts,
from NFL players to youth leagues, over the safe-
ty of its product.
Indeed, some analysts believe owners Fenway
Partners LLC, a NewYork private equity group,
tried to sell off the helmet business last year when it
downsized predecessor company Easton-Bell Sports
Inc. and renamed it BRG – but there were no takers.
Now, Fenway is stuck with the business and
doing the best it can, defending itself on the legal
front while releasing more advanced helmet designs
it claims are safer than ever.
“It’s certainly our goal to always be moving for-
ward with the protective performance of our foot-
ball helmets,” said Thad Ide, BRG’s senior vice
president of research and development. “Our
Please see TECHNOLOGY page 48Please see SPORTS page 46
Please see BIOTECH page 47
Concussion furor, rivals rattle helmet-maker Riddell
Please see HOSPITALITY page 46
Investors See Double Over Chin Drug
Smash Mouth: Packers QB
Aaron Rodgers takes a hard
hit from 49ers defensive end
Ray McDonald during 2013 NFC
wildcard game in Green Bay.
CRUNCH
TIME
News &
Analysis
The Looney
Tunes gang will
teach your kids
to read – and
you can tweet
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PAGE 5
Up
Front
Have an extra
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out this classic
car auction.
PAGE 3
HITTING PAY DIRT: The Santa Clarita
Valley may seem an unlikely place but
it’s where developers are building
industrial projects. And firms seeking
modern space and lower leases aren’t
far behind.
SPECIAL REPORT
REAL ESTATE QUARTERLY
BEGINNING ON PAGE 15
Khan
Market capitalization
of Kythera, which
has yet to receive
FDA approval.
$784
million
The greater
Valley’s largest
law firms.
PAGE 10
List

2. 46 SAN FERNANDO VALLEY BUSINESS JOURNAL JULY 28, 2014
at least one expert.
Austin Khan, chief investment officer for
Laurus, said his firm was one of several at the
buyers table trying to pick up the asset from the
retirement fund, which bought the hotel in 2003
for $85.3 million.
“Our obligation to our investors is to find
great investments, and this is one,” Khan said. “I
think that our reputation as being able to quick-
ly assess an opportunity and being able to close
has provided us with a competitive advantage.”
In the past 18 months alone, Laurus has
picked up 10 hotels around the country
through its Ethika Investments LLC affiliat-
ed private equity fund. Khan said the fund is
still trying to raise more capital to buy hotels,
with a $200 million goal for the end of the
year. He declined to provide information on
how much the fund has spent thus far.
Laurus isn’t the only company seeing
potential in the hospitality market.
Trophy hotels have been selling all across the
country, from Los Angeles to Manhattan, as
occupancy numbers continue to recover from the
recession. And that has fueled a push for more
development in the sector, with several projects
underway or planned in the greater Valley.
Bruce Baltin, senior vice president at PKF
Consulting USA in LosAngeles, said the L.A.
County occupancy rate is hovering around 78
percent, a historically high figure for the indus-
try that is promoting development. Still, he
said it’s a good time for the teacher’s pension
fund to cash out.
“Hotels like this don’t sell everyday, but it’s
not entirely that uncommon right now,” he said.
“The value of hotels has never been higher, so it’s
a really good time for owners to sell. Occupancy
is the highest I ever remember seeing it.”
The teacher’s fund did not respond to calls
or emails seeking comment, and Tishman
Hotel & Realty of NewYork, which was man-
aging the property, declined comment.
Kahn said Laurus plans to bring in
Evolution Hospitality of San Clemente to run
day-to-day operations
Adam Christofferson, first vice president
and regional manager at the Encino office of
Marcus & Millichap Inc., said the Warner
Center Marriott sale would “absolutely”
eclipse nine figures.
“We’re seeing more and more large transac-
tions happening, and not only on the Westside
and downtown, but in the Valley,” he said.
“This points to the rejuvenation of the area, but
it also just points to the strength of the market.”
Sellers market
The 335,000-square-foot Warner Center
Marriott was built on 4.2 acres in 1985, and
received some renovations in 2004. The hotel
is No. 4 on the Business Journal’s annual list of
largest hotels. According to the list, room rates
Hospitality: Hotel Among Several Sold in L.A.
Trophy: Warner Center Marriott, featuring 474 rooms aimed at corporate traveler.
Continued from page 1
Please see MARRIOTT page 47
enhancements in design, we think, will improve
the performance of our football helmets.”
Riddell, based in Rosemont, Ill., remains the
nation’s leading manufacturer of football hel-
mets, but the controversy over concussions
appears to have loosened its grip on the market.
This year, after 25 years of only allowing
the Riddell brand logo to be visible on NFL
helmets, the league is barring any brand dis-
play during games.
Teams could always buy authorized hel-
mets from competitors, which include Schutt
Sports Inc. in Litchfield, Ill., Xenith LLC in
Lowell, Mass. and Rawlings Sporting
Goods Co. Inc. in St. Louis. That, of course,
leads to the obvious question: why would
companies want to enter such a business,
when Riddell already has paid out millions in
settlements and legal fees?
Paul Swinand, a sporting goods analyst at
Morningstar Inc. in Chicago, likens the
business to others in which high litigation
costs are a fact of life – but there is still
money to be made.
“Think about hunting,” he said. “Lots of
investors don’t want to be involved, but some-
one has to run those businesses.”
Defensive position
Riddell was founded in 1929 when John T.
Riddell invented the removable cleat for use
during football. Ten years later, Riddell creat-
ed the first plastic-shell helmet. Riddell cur-
rently sells helmets, shoulder pads, face
masks and other accessories such as knee
pads, kickoff tees and footballs.
Riddell is facing at least seven lawsuits,
from litigation in state courts to the U.S.
Supreme Court. Most recently, a class-action
suit was filed by a West Virginia youth foot-
ball league over false advertising allegations.
The association said it purchased Riddell
Revolution helmets based on claims from a
2003 University of Pittsburgh Medical Center
study that concluded the helmets reduce con-
cussions by 31 percent, research it claims has
since been debunked.
A total of four other class-action suits have
been filed by consumers in Florida, New
Jersey and California with similar allegations
that arose from the study’s claims of concus-
sion prevention.
The highest profile case against Riddell,
though, is its involvement as a defendant in a
lawsuit filed by 4,500 former players against
the NFL. The federal lawsuit alleges that the
NFL withheld information related to head
trauma suffered while playing football.
Because Riddell is worn by the vast majority
of NFL players, the helmet maker was named
as a defendant in the lawsuit.
The litigation specifically alleges that two
of its helmets, the VSR4 and the discontinued
AF2, provided insufficient padding to prevent
concussive brain injuries.
This month, U.S. District Court Judge
Anita Brody in Philadelphia granted prelimi-
nary approval for a settlement between the
NFL and former players. Brody originally
denied approval earlier this year, arguing that
the $675 million cap to be paid out to retired
players might not be enough. The league has
since removed the cap.
Riddell announced it will not contribute
money to the settlement and its part of the lit-
igation is ongoing.
No other helmet manufacturers are cited in
the multidistrict litigation even though the
NFL allowed other certified brands to be
worn, but only the Riddell name could be vis-
ible on nose bumpers.
Dan Arment, Riddell’s president and
executive vice president of BRG, said he
believes the company is being targeted
because it’s the leading helmet maker in the
country, with a profile raised by its NFL
association.
“It’s not uncommon for the industry leader
to be more in the spotlight,” Arment said.
“We embrace this position and are comfort-
able with the opportunities and issues associ-
ated with head protection.”
Attorney Timothy Epstein, partner at
SmithAmundsen LLC in Chicago who spe-
cializes in sports law, said the Riddell case
will not conclude until the claims against the
NFL are settled.
“A number of plaintiffs might go away,
but many will keep suing Riddell and as they
move through discovery, they have the option
to do that,” he said. “As with anything, litiga-
tion is a cost of doing business, particularly if
you’re a product manufacturer – whether
that’s an airplane, car or helmet.”
Despite the ongoing NFL litigation, the
company has scored a legal victory in Los
Angeles County. In late March, a jury found
Riddell was not liable for a football injury
suffered by a former high school student who
sued Riddell four years ago.
The Pomona student, Edward Acuna,
17 at the time of his injury, was partially
paralyzed. The lawsuit claimed Riddell
could have prevented the injury with safer
helmet materials.
Brian Roche, general counsel for Riddell,
said in a statement after the California ruling
that the company firmly stands by the safety
of its equipment.
“Riddell will continue to vigorously
defend our products when presented with
baseless allegations created by plaintiffs’
attorneys and the misleading opinions offered
by their experts,” he said.
However, in April of last year, the compa-
ny experienced a mixed result in a Denver
lawsuit filed by an injured high school student
against school administrators and Riddell.
A jury disagreed with the claim the helmet
was poorly manufactured, but it did find
Riddell did not properly warn that its prod-
ucts could not prevent concussions. A jury
award of $11.5 million was later reduced by
the judge to $3.1 million.
Taking hits
The controversy over football concussions
is fueled by a combination of forces including
individual lawsuits, former NFL players who
have suffered brain damage and studies that
have linked not only severe concussions but
repeated smaller hits to neurological disor-
ders.
Among the highest profile cases was the
suicide of former NFL linebacker Junior Seau
in 2012. An autopsy found that he suffered
chronic traumatic encephalopathy, a neurode-
generative brain disease that can follow multi-
ple hits to the head.
Since then former players, such as Jim
McMahon, a star quarterback with the
Chicago Bears in the 1980s, have been
vocal about linking their memory problems
with repeated concussions while playing in
the league.
Riddell’s response has been to release
new helmet designs, though some research-
ers are skeptical that any helmet could pre-
vent concussions from occurring while play-
ing football.
It introduced what is considered a ground-
breaking helmet in 2008 called the
Revolution Speed with enhanced side-impact
protection. Indeed, the helmet was the first to
be given a five-star rating when Virginia Tech
started a helmet research and ratings program
three years ago. That helmet is still on the
market and costs $169 to $274.
Three years ago, the company released its
Riddell 360 model, which is promoted as the
first helmet to feature “energy managing mate-
rials” and a face mask that disperses energy of
frontal impacts. It costs $299 to $379.
Sports: BRG’s Riddell Facing Multiple Lawsuits
Continued from page 1
Advances: InSite Impact Response System, left. New Speedflex helmet.
Please see HELMETS page 49

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Then, this past spring, Riddell introduced
its SpeedFlex helmet to several college foot-
ball programs. San Diego State, Miami and
Arkansas have committed to use the helmets
next season, while others, including UCLA
and USC, have players trying them out.
The most notable update on the SpeedFlex
is a thin cutout at the crown of the helmet,
which is said to absorb energy and further
reduce head impacts. It
also features a ratchet-
style chin strap that
was developed to stay
on, even if a player
takes a hard hit.
The new helmets
are available in limit-
ed sizes this summer
and will have a full
launch in September.
Prices were unavail-
able but NFL teams
began submitting
orders last month.
The NFL declined
to comment specifical-
ly on why its exclusive
partnership with
Riddell was not
renewed, but NFL
spokeswoman Joanna
Hunter said in an
email: “We have
always encouraged players to wear the best
available equipment.”
Riddell expects many college teams will not
order the latest helmet immediately and instead
wait to see how it is accepted. Indeed, UCLA
will continue to use the Revolution Speed hel-
met it has used for the past two years.
“My approach is to be a little more guard-
ed, waiting to see how it goes [with other
teams] at least after a season,” said Tony
Perri, equipment manager who has worked
with UCLA football for more than 30 years.
One issue with the team is rising costs.
Perri noted that typical helmet prices have
jumped from $120 to about $300 in recent
years across all top brands. About 60 percent
of UCLA’s team uses the Revolution while
the remaining 40 percent wear competitor
brand Schutt.
Competition has grown dramatically over
the last few years as the rival helmet makers
seek to get their products tested. In the latest
Virginia Tech report released earlier this
summer, Riddell’s 360 and Revolution
Speed helmets continue to boast five stars,
but so do seven other helmets from Schutt,
Xenith and Rawlings.
Dr. Stefan Duma, a researcher at Virginia
Tech who directs the project, said helmet mak-
ers have improved their designs to reduce injury.
“They have to perform well at low impacts,
as well as high impacts,” he said. “As we move
forward, we have to ask which helmets, based
on science from independent data, reduce
acceleration and therefore reduce injury.”
Changing attitudes
Doug Dagan has witnessed firsthand the
importance of helmet ratings as the owner
of Dagan Sales and Marketing, a
Camarillo dealer that distributes helmets to
about 75 schools in Los Angeles and Santa
Barbara counties.
His employees are fielding more and more
questions from concerned parents and coach-
es. (Riddell sells directly to schools, so he
works with it on a limited basis).
Dagan noted that throughout the 1980s
and 1990s, innovation in helmet design was
fairly stagnant. So he views the upgrades in
technology that have occurred every year or
two since 2000 as a positive.
“Six years ago, I would have had someone
think nothing of buying a $500 baseball bat,
but if you said a helmet was $500, they would
get sticker shock. I’d wonder why they would
pay that for a baseball bat but not pay as
much to protect their kid’s head,” Dagan said.
“Now we’re starting to see parents say, ‘OK,
this is a good investment.’”
If anything, though, prices will rise more
as additional advanced technology is incorpo-
rated into designs.
Riddell will release its InSite Impact
Response System in the fall. The monitoring
and alerting tool, which fits into all of its hel-
mets, integrates sensors and telemetry equip-
ment that attach to the interior of a helmet.
Coaches are alerted to the impact by a side-
line computer and monitor.
The player units cost $150 each, and the
alert monitor costs $200 and will cover up to
150 players. The company claims that the
new system is able to determine if a particular
hit caused head trauma to a player, regardless
of his height or weight.
Virginia Tech’s Duma said technology
such as this is crucial for the future of impact
sports if they want to continue to thrive safely.
“When someone is injured, we want to make
sure attention is given to them and to diag-
nose the concussion,” he said.
Mixed results
Since Riddell is privately held, it’s difficult
to assess how the concussion controversy and
litigation has impacted sales, but there is little
doubt it’s affected the business.
In 2003, Fenway spent $100 million to
acquire Riddell, and a year later forked out
$240 million on Bell Sports Corp., a manu-
facturer of helmets for bicycles and motor-
sports.
Then earlier this year, just a decade after
building Easton-Bell Sports Inc. into a formi-
dable sporting goods manufacturer, Fenway
sold off the baseball and softball business to
Canadian manufacturer Bauer Performance
Sports Ltd. for $330 million.
In April, the reformed BRG moved its
headquarters to Scotts Valley from Easton’s
longtime offices in Van Nuys, where the com-
pany still maintains operations.
There were reports Riddell was on the
block but there were no takers. Arment
declined to comment on the speculation.
The bulk of the company’s remaining
business will consist of football and cycling,
as well as some action sports including snow-
boarding. Products are sold under the Riddell,
Giro, Blackburn and Easton brands.
Prior to the sale, Easton-Bell filed limited
annual financial reports with the Securities
and Exchange Commission due to its publicly
traded debt. But it planned to use some of the
proceeds to pay down its $350 million debt
and has not filed anything since.
However, in last year’s annual filing, the
former Easton-Bell Sports attributed team
sports sales increases to continued market
share gains from Riddell football. Riddell’s
sales are not broken out, but are included
within the team sports category. The company
reported a positive impact from new rules in
2011 that require football programs to retire
helmets after 10 years, while it noted sales
declined in 2012.
Riddell’s Arment said the company has
reported record revenues and financial per-
formance for the last five years, though he
won’t release specific numbers. He expects
sales to pick up even more for the upcoming
season.
“While there have been changes to the on-
field rights relationship at the NFL level,
Riddell continues to be on track for another
year of record performance across all levels
of play,” he said.
But the helmet manufacturer could face
challenges from a sea change in attitude about
football from parents wary of exposing their
children to the dangers of concussions.
According to the Sports and Fitness
Industry Association, youth football numbers
were down by 5.2 percent for players under
the age of eight in the last five years.
And, of course, this season, as rabid NFL
fans sit down in front of the TV on Sunday,
they might see new brands adorning the hel-
mets of their favorite players.
Helmets: Sensor-Telemetry Systems Developed
Continued from page 46
Local offices: BRG operations in Van Nuys. Riddell is in Rosemont, Ill.
Ide
Arment