Pro sports leagues aim to put workers' comp out of play

One would think that we've learned from bitter experience not to trust a word uttered by our major professional sports leagues.

Yet here they are trying to put another howler over on us. This is their assertion that retired pro athletes — many of them from outside the state — are ripping off California's workers' compensation system for hundreds of millions of dollars.

The state Legislature is setting itself up to swallow this one whole: A bill to close this supposed loophole has been introduced by Assembly Insurance Committee Chairman Henry Perea (D-Fresno).

Let's start with the bottom line: This bill would be a total sellout to the major pro sports leagues and their billionaire team owners, who pay the workers' compensation claims won by their workers. Its victims would be athletes whose limbs, joints, backs and craniums were pounded relentlessly on the field of play and who were left with inadequate treatment or support after they retired.

Let's also home in on whose interests are most at stake: It's the National Football League, which is facing a tidal wave of legal claims related to long-term neurological damage suffered by players. Claims from more than 4,000 players and their families have been consolidated in a single immense lawsuit in Philadelphia federal court, where pretrial maneuvering has been lumbering on for months.

Among their allegations is that the NFL suppressed evidence that the concussions caused by its style of play could have long-term health consequences. The league has consistently denied that it tried to mislead players.

Perea's bill serves the NFL and the pro sports leagues and teams in basball, basketball, hockey and soccer. (Apparently lacrosse, rugby and softball leagues didn't have the juice to get their way in Sacramento.) It's purportedly a response to the upsurge in workers' comp claims filed by pro athletes, including many who never played for California teams, that started around 2007.

There were several reasons for the increase. Under state law, you can file a claim if you can argue that you suffered an injury in California, even if your employer was located elsewhere; it's a rare pro athlete who doesn't occasionally play an away game against a California team.

More important, California is one of nine states that allow workers' compensation for "cumulative trauma" injuries, those that build up over time. The most familiar of these are carpal tunnel injuries suffered by typists. But they also encompass knee or back damage from years of blocking and tackling, or neurological damage from repeated concussions.

"The NFL is not terribly worried about cumulative knee trauma," says Frank Neuhauser, a social insurance expert at UC Berkeley. "They understand what they're going to pay for that. But they're terrified of brain injuries, which can cost millions and result in complete disability." The NFL didn't reply to my request for comment on the workers' comp issue.

It's hardly shocking that the NFL and other major leagues would want to shut down this avenue of compensation. Nor is it very surprising that they would resort to disinformation.

"The NFL knows this could be detrimental to their bottom line," says attorney Mel Owens, who played nine years for the Los Angeles Rams in the 1980s and now represents athletes in workers' comp cases. "So they couch it in terms of players abusing the system."

The leagues' bid for sympathy depends on most laypersons having no idea about how workers' compensation works. So here's a primer. To begin with, taxpayers don't pay for workers' comp; employers do, either by buying commercial workers' comp insurance or (if they're big enough) self-insuring. Their premiums are overwhelmingly based on their type of business and their claims record. The premium paid by the employer of file clerks will be very different from that of a skyscraper builder.

Therefore, if California workers'-comp judges take a more liberal view of long-term brain injuries for football players (and as yet there's no evidence that they do), that may drive up premiums paid by sports teams, but it won't affect the premium paid by grocery stores.

The leagues "are trying to make it look like these are costs that will fall on all employers," Neuhauser says. "But it has nothing to do with current rates. Sports teams' premiums will go up, but not those for construction companies or anyone else."

Then there's the notion, also happily peddled by the leagues, that the athletes are getting away like bandits, abetted by aggressive lawyers. A 2012 analysis done for the NFL and the professional baseball, basketball and hockey major leagues by the benefits consulting firm Milliman Inc. estimated the cost of already-filed California cumulative trauma claims by athletes at $747 million.

That sounds like a lot, until you realize that it covers 4,500 players, for an average of $166,000 each, which includes the cost of medical treatment. Is that a lot for injuries that may be crippling for life and include Alzheimer's or other neurological syndromes? For a player judged partially but permanently disabled, the maximum benefit is $270 a week for up to 320 weeks. Long story short: No player is getting rich off these payments.

Nor are the players typically coasting into retirement with superstar nest eggs. Consider Reggie Williams. A standout linebacker who played 14 seasons for the Cincinnati Bengals, including two Super Bowls, he made $45,000 in his rookie year, 1976, and topped out at $445,000 after 14 seasons.

Now 58, Williams has suffered through 24 operations on his right knee, leaving the knee looking like hamburger and that leg 3 inches shorter than his left. "I never played a game where I didn't get hurt," he told me. That includes 14 games in California against the Rams, Raiders, 49ers and Chargers. "Now I wake up every day in extreme pain." Five years ago he had to leave a job with Walt Disney Co. because he could barely stand on his feet.

In 2008, Williams filed for workers' compensation in California, but the Bengals have blocked that claim, for now, arguing that under his employment contract he was required to file in Ohio. If the team wins, he may be out of luck, for the statute of limitations on Ohio workers' comp claims has long passed, and the state doesn't cover cumulative trauma.

"The NFL doesn't want to be liable for any of this," says Williams' lawyer, Owens. He points out that taxpayers bear the ultimate cost if the leagues skate on their obligations. "If the players can't get workers' comp benefits and they can't get health insurance, they end up on Social Security disability and Medicare," Owens said.

Why California legislators should bend over backward to help out franchise-owning plutocrats is a mystery. That's especially true since the reason athletes have to resort to workers' comp in the first place is that the owners have abdicated their responsibility to care for the injured players who have made them rich. Sure, they'll pay lip service to player health, but talk is cheap. It looks even cheaper in light of the NFL's new broadcast contracts, which are worth more than $40 billion over the next decade.

If the leagues want their California problem to go away, that would be easy: reach deals with the players' unions providing lifetime injury coverage superior to what they can get from workers' compensation. That's a very low bar, even when you're trying to clear it while carrying bagfuls of money.

Michael Hiltzik's column appears Sundays and Wednesdays. Reach him at mhiltzik@latimes.com, read past columns at latimes.com/hiltzik, check out facebook.com/hiltzik and follow @latimeshiltzik on Twitter.

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Jury in Bell corruption trial may be deadlocked

A court spokeswoman said Thursday the jury in the Bell corruption case appears to be deadlocked.

“The jurors may be at an impasse,” said Patricia Kelly, a spokeswoman for L.A. County Superior Court.

Jurors sent a note to the judge Thursday morning, and all the attorneys in the case were called in.

Six former Bell City Council members are accused of stealing public money by paying themselves extraordinary salaries in one of Los Angeles County’s poorest cities.

Luis Artiga, Victor Bello, George Cole, Oscar Hernandez, Teresa Jacobo and George Mirabal are accused of misappropriation of public funds, felony counts that could bring prison terms.

They were arrested in September 2010 and have been free on bail.

The nearly $100,000 salaries drawn by most of the former elected officials are part of a much larger municipal corruption case in the southeast Los Angeles County city in which prosecutors allege that money from the city’s modest general fund flowed freely to top officials.

The three defendants who testified painted a picture of a city as a place led by a controlling, manipulative administrator who handed out enormous salaries, loaned city money and padded future pensions. Robert Rizzo, the former adminstrator, and ex-assistant city manager Angela Spaccia are also awaiting trial.

The four-week trial of the former council members turned on extremes.

Deputy Dist. Atty. Edward Miller said the council members were little more than common thieves who were consumed with fattening their paychecks at the expense of the city’s largely immigrant, working-poor residents.

Miller said the accused represented the “one-percenters" of Bell who had “apparently forgotten who they are and where they live."

Defense attorneys said the former city leaders -- one a pastor, another a mom-and-pop grocery store owner, another a funeral director -- were dedicated public servants who put in long hours and tirelessly responded to the needs of their constituents.

Jacobo testified that Rizzo informed her she could quit her job as a real estate agent and receive a full-time salary as a council member. She said she asked City Attorney Edward Lee if that was possible and he nodded his head.

"I thought I was doing a very good job to be able to earn that, yes," Jacobo said.

Cole said Rizzo was so intimidating that the former councilman voted for a 12% annual pay raise out of fear the city programs he established would be gutted by Rizzo in retaliation if he opposed the pay hikes.

The defense argued that the prosecution failed to prove criminal negligence -- that their clients knew what they were doing was wrong or that a reasonable person would know it was wrong.

The attorney for Hernandez, the city’s mayor at the time of the arrests, said his client had only a grade-school education, was known more for his heart than his intellect and was, perhaps, not overly “scholarly.”

Prosecutors argued that the council members pushed up their salaries by serving on city boards that rarely met and, in one case, existed only as a means for paying them even more money.

Jurors were also left to deal with the question of whether council members were protected by a City Charter that was approved in a special election that drew fewer than 400 voters.

Defense attorneys say the charter allowed council members to be paid for serving on the authorities.

But the prosecutor argued that the charter -- a quasi-constitution for a city -- set salaries at what councils in similar-sized cities were receiving under state law: $8,076 a year. Because council members automatically serve on boards and commissions, the district attorney said the total compensation for all of each council member's work was included in that figure.

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Global Health: After Measles Success, Rwanda to Get Rubella Vaccine

Rwanda has been so successful at fighting measles that next month it will be the first country to get donor support to move to the next stage — fighting rubella too.

On March 11, it will hold a nationwide three-day vaccination campaign with a combined measles-rubella vaccine, hoping to reach nearly five million children up to age 14. It will then integrate the dual vaccine into its national health service.

Rwanda can do so “because they’ve done such a good job on measles,” said Christine McNab, a spokeswoman for the Measles and Rubella Initiative. M.R.I. helped pay for previous vaccination campaigns in the country and the GAVI Alliance is helping to finance the upcoming one.

Rubella, also called German measles, causes a rash that is very similar to the measles rash, making it hard for health workers to tell the difference.

Rubella is generally mild, even in children, but in pregnant women, it can kill the fetus or cause serious birth defects, including blindness, deafness, mental retardation and chronic heart damage.

Ms. McNab said that Rwanda had proved that it can suppress measles and identify rubella, and it would benefit from the newer, more expensive vaccine.

The dual vaccine costs twice as much — 52 cents a dose at Unicef prices, compared with 24 cents for measles alone. (The MMR vaccine that American children get, which also contains a vaccine against mumps, costs Unicef $1.)

More than 90 percent of Rwandan children now are vaccinated twice against measles, and cases have been near zero since 2007.

The tiny country, which was convulsed by Hutu-Tutsi genocide in 1994, is now leading the way in Africa in delivering medical care to its citizens, Ms. McNab said. Three years ago, it was the first African country to introduce shots against human papilloma virus, or HPV, which causes cervical cancer.

In wealthy countries, measles kills a small number of children — usually those whose parents decline vaccination. But in poor countries, measles is a major killer of malnourished infants. Around the world, the initiative estimates, about 158,000 children die of it each year, or about 430 a day.

Every year, an estimated 112,000 children, mostly in Africa, South Asia and the Pacific islands, are born with handicaps caused by their mothers’ rubella infection.

Thanks in part to the initiative — which until last year was known just as the Measles Initiative — measles deaths among children have declined 71 percent since 2000. The initiative is a partnership of many health agencies, vaccine companies, donors and others, but is led by the American Red Cross, the United Nations Foundation, the Centers for Disease Control and Prevention, Unicef and the World Health Organization.

This article has been revised to reflect the following correction:

Correction: March 1, 2013

An article on Tuesday about a coming measles-rubella vaccination campaign in Rwanda misstated the source of the vaccine and some financing for the campaign. The vaccine and financing are being provided by the GAVI Alliance, not by the Measles and Rubella Initiative.

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Airports big and small may feel effects of federal budget feud

Get ready for longer lines at Los Angeles International Airport, slower delivery of packages and the possible shutdown of small Southern California airport control towers if a resolution isn't reached on federal budget cuts.

The good news is that the biggest effects probably will not take hold until April, giving President Obama and congressional leaders time to hammer out a deal to resolve the budget feud.

But if no agreement is reached, the Federal Aviation Administration will be forced to cut its budget about $600 million. That could force the FAA to close more than 100 air traffic control towers across the country, primarily at smaller regional airports, including in Santa Monica, Victorville and Oxnard.

The night shift for air traffic controllers could also be eliminated at about 70 larger airports, including LA/Ontario International.

The federal agency has also put out the option of furloughing FAA employees for one or two days per two-week pay period, beginning in mid-April.

At Los Angeles International Airport, officials say it is too early to gauge how much of an effect the budget cuts would have on the average air traveler.

But Transportation Security Administration head John Pistole said lines at security gates at major airports across the country could grow longer during the peak spring and summer travel seasons if he is forced to cut overtime pay, which would reduce the number of screening officers.

"The longer it goes, the greater the potential impact," he said of the budget battle.

The National Air Traffic Controllers Assn. expects the cuts to lead to fewer flights and increased delays of as long as 90 minutes during peak hours.

"Safety will remain the top priority, but in order to maintain the appropriate level of safety with fewer controllers, fewer planes will be allowed in the sky, as well as in and out of airports," the group said in a statement.

The FAA has announced plans to shut down towers at airports with fewer than 150,000 landings and takeoffs a year. Santa Monica Airport, which is on the FAA closure list, operates about 105,000 landings and takeoffs a year. Van Nuys Airport, which is not on the list, has more than 250,000 landings and takeoffs.

Still, the effect on smaller airports on the FAA cut list may not be severe because pilots can land and depart without the help of an air traffic controller by keeping track of each other through radio communications.

Joe Justice, who operates Justice Aviation, a company that offers flying lessons at Santa Monica Airport, said he doesn't expect his business to face major changes if the tower is closed.

"We would continue to give flying lessons," he said. "There would be no reason not to. We would depart here and practice at a place where there is an open tower."

Private jet charter companies said they may even get more business if sequestration increases delays on commercial airlines, forcing passengers to charter a jet.

"People who are sitting on the fence about wanting to hire a private jet may spend the extra money so they won't be caught in a situation where they have no idea how long their delays will be," said Ben Schusterman, founder of Los Angeles-based ElJet.

The closure of overnight shifts at the control tower in Ontario could eliminate 12 passenger flights, or 9% of operations, but a bigger effect would be the loss of 73 cargo flights, or 36% of all cargo operations.

Cargo operators at Ontario said they were still unsure of the effect of budget cuts on their businesses.

"UPS is closely monitoring the sequestration proceedings," United Parcel Service Inc. spokesman Mike Mangeot said. "And while we are in communications with the FAA regarding the effects of the possible cuts, it is premature to speculate at this time."

hugo.martin@latimes.com

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Santa Cruz hit hard by officers' deaths

SANTA CRUZ — Flags throughout this sparkling beach town flew at half-staff Wednesday. The entire Police Department was meeting with grief counselors. Handmade signs cropped up, sympathy cards to a stunned city.

"Thank you for your service Santa Cruz Police Department. RIP Detective Baker. RIP Detective Butler." That's what Mary Gregg wrote in neat black letters on yellow construction paper, hanging her message in the window of the downtown check-cashing store where she works.

"Something," she felt, "had to be said today."

Best known for its surfing museum and a roller coaster that Bay Area newspaper columnist Herb Caen described as "one long shriek," Santa Cruz is not used to the kind of pain that rippled through town the day after a gunfight left two veteran officers — and the man they were investigating — dead.

The city's Police Department, which has less than 100 sworn officers, had operated for 150 years without losing a single one in the line of duty. Until Tuesday afternoon, when two veteran detectives in plainclothes walked up to Jeremy Goulet's house as part of a misdemeanor sexual assault investigation.

Sgt. Loran "Butch" Baker, 51, and Det. Elizabeth Butler, 38, were killed on Goulet's doorstep, Santa Cruz County Sheriff Phil Wowak said during a news conference near an impromptu memorial at police headquarters.

"We don't know all that happened when they came into contact with Goulet," said Wowak, whose department is leading the investigation so Santa Cruz police can mourn. "We do know what was left in the aftermath."

The 35-year-old Goulet, who had a long history of run-ins with the law, killed and disarmed the detectives before fleeing in Baker's car, Wowak said. Law enforcement officers from throughout the region began a sweep of the Santa Cruz neighborhood where Baker and Butler were slain. A short time later, Goulet ditched the car and tried to flee on foot.

In the ensuing gun battle, Wowak said, Goulet shot up a firetruck, sending firefighters, medical personnel and passersby scrambling. After killing the suspect, authorities discovered Goulet had been wearing body armor and had three guns.

"It is our belief that two of the three weapons belonged to the Santa Cruz Police Department, but we haven't confirmed it," said Wowak, adding that it was still unclear whether Goulet had taken the body armor from Baker's car or had it on before the shooting broke out.

"We know now that he was distraught," the sheriff said. "We know now that he had the intention of harming himself and possibly the police.… There's no doubt in anyone's mind that the officers who engaged Goulet stopped an imminent threat to the community."

Goulet had been arrested Friday on suspicion of disorderly conduct. Local news accounts said he had broken into the home of a co-worker and been fired from his job at The Kind Grind coffeehouse Saturday. A manager at the beachfront shop declined to comment Wednesday.

According to Goulet's father, the barista — who recently had moved from Berkeley to Santa Cruz — was a ticking time bomb who held police and the justice system in deep contempt. Ronald Goulet, 64, told the Associated Press that his son had had numerous run-ins with the law and had sworn he would never go back to jail.

But the elder Goulet said he never thought his troubled son would turn to such violence.

Goulet said his son undermined any success in the military (he reportedly was a member of the Marine Corps Reserves and later the Army) or college because of an insatiable desire to peep in the windows of women as they showered or dressed.

"He's got one problem, peeping in windows," his father said. "I asked him, 'Why don't you just go to a strip club?' He said he wants a good girl that doesn't know she's being spied on, and said he couldn't stop doing it."

In 2008, a Portland, Ore., jury convicted Jeremy Goulet on misdemeanor counts of unlawful possession of a firearm and invasion of personal privacy after he peeked into a woman's bathroom as she showered, said Don Rees, a chief deputy district attorney in Multnomah County.

Goulet faced additional charges, including attempted murder, after he allegedly fired a gun at the woman's boyfriend. The two had fought after Goulet was spotted outside the woman's condo, but a jury acquitted him of those charges, Rees said.

During the trial, Goulet admitted that he liked to use his cellphone to record unsuspecting women undressing, according to the Oregonian newspaper. Prosecutors alleged he had peeped at women "hundreds of times" without getting caught.

Goulet was given three years' probation, Rees said, but spent time in jail after his probation was revoked.

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Lawyer says Lohan committed to turning life around

LOS ANGELES (AP) — Lindsay Lohan is committed to turning her life around and wants to record public service announcements on the dangers of domestic violence, alcohol abuse and drunken driving, her attorney said Wednesday.

Mark Heller told The Associated Press that the actress' plans are independent of a criminal case that could return her to jail on charges that she lied to police about being a passenger in her car when it slammed into a dump truck in June.

The "Liz & Dick" star has been repeatedly sentenced to jail, rehab, and community service since her first pair of arrests for driving under the influence in 2007. She spent several months in court-ordered psychotherapy until a judge released her from supervised probation in March 2012.

As part of the intense psychotherapy sessions, Lohan is in the beginning stages of trying to become an inspirational speaker to young people, he said.

"I think she suddenly woke up one morning and had an epiphany and she suddenly realized and appreciated the seriousness of the events that led to her being in court," Heller said.

"She's going to try to inspire hope in people," he said. "I think it will be good for her. It certainly won't hurt others."

Heller mentioned Lohan's intent to become an inspirational speaker in a letter to prosecutors and a judge that was obtained Tuesday. He said he will meet with prosecutors on Friday to try to reach a resolution in Lohan's newest case, which includes misdemeanor charges of reckless driving and obstructing officers from performing their duties.

She has pleaded not guilty. Lohan, 26, was on probation at the time of the crash and faces up to 245 days in jail if a judge determines her conduct violated her probation in a 2011 necklace theft case.

Officers suspected alcohol might have been involved in the June accident on Pacific Coast Highway, but the actress passed sobriety tests at a hospital and she was never charged with driving under the influence.

Santa Monica police Sgt. Richard Lewis said officers did not give Lohan a field sobriety test at the accident scene because she and her assistant were injured in the crash and were taken to a nearby hospital. While officers could not rule out that Lohan might have been drinking, he noted that she did not show signs of impairment.

Celebrity web site TMZ, citing anonymous sources, reported Wednesday that a bottle of alcohol was found next to Lohan's sports car after the crash. Lewis said he could not discuss evidence in the case, but noted that the actress was not charged with drunken driving.

Heller wrote in a motion filed last week that officers found a bottle that they initially thought was urine, but might have contained wine. His filing, which seeks a delay or dismissal of charges against the actress, states that "upon information and belief" the bottle's contents were never tested.

Lohan's case returns to court on Friday, although the actress is not required to attend.

Heller is asking a judge to dismiss the case against Lohan because officers ignored the actress' request to talk to her attorney before being interviewed, court records show. He said he is prepared to defend Lohan at trial if necessary, but is hoping a deal can be worked out. He is seeking a delay in the case to have time to prepare and allow Lohan to demonstrate she is improving her life.

Threats from judges and jail sentences that are invariably cut short because of overcrowding haven't helped Lohan, Heller said. "None of it really brought closure to this predicament that led to this most recent event."

___

Anthony McCartney can be reached at http://twitter.com/mccartneyAP

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Global Health: After Measles Success, Rwanda to Get Rubella Vaccine

Rwanda has been so successful at fighting measles that next month it will be the first country to get donor support to move to the next stage — fighting rubella too.

On March 11, it will hold a nationwide three-day vaccination campaign with a combined measles-rubella vaccine, hoping to reach nearly five million children up to age 14. It will then integrate the dual vaccine into its national health service.

Rwanda can do so “because they’ve done such a good job on measles,” said Christine McNab, a spokeswoman for the Measles and Rubella Initiative. M.R.I. helped pay for previous vaccination campaigns in the country and the GAVI Alliance is helping to finance the upcoming one.

Rubella, also called German measles, causes a rash that is very similar to the measles rash, making it hard for health workers to tell the difference.

Rubella is generally mild, even in children, but in pregnant women, it can kill the fetus or cause serious birth defects, including blindness, deafness, mental retardation and chronic heart damage.

Ms. McNab said that Rwanda had proved that it can suppress measles and identify rubella, and it would benefit from the newer, more expensive vaccine.

The dual vaccine costs twice as much — 52 cents a dose at Unicef prices, compared with 24 cents for measles alone. (The MMR vaccine that American children get, which also contains a vaccine against mumps, costs Unicef $1.)

More than 90 percent of Rwandan children now are vaccinated twice against measles, and cases have been near zero since 2007.

The tiny country, which was convulsed by Hutu-Tutsi genocide in 1994, is now leading the way in Africa in delivering medical care to its citizens, Ms. McNab said. Three years ago, it was the first African country to introduce shots against human papilloma virus, or HPV, which causes cervical cancer.

In wealthy countries, measles kills a small number of children — usually those whose parents decline vaccination. But in poor countries, measles is a major killer of malnourished infants. Around the world, the initiative estimates, about 158,000 children die of it each year, or about 430 a day.

Every year, an estimated 112,000 children, mostly in Africa, South Asia and the Pacific islands, are born with handicaps caused by their mothers’ rubella infection.

Thanks in part to the initiative — which until last year was known just as the Measles Initiative — measles deaths among children have declined 71 percent since 2000. The initiative is a partnership of many health agencies, vaccine companies, donors and others, but is led by the American Red Cross, the United Nations Foundation, the Centers for Disease Control and Prevention, Unicef and the World Health Organization.

This article has been revised to reflect the following correction:

Correction: February 27, 2013

An earlier version of this article misstated the source of the vaccine and some financing for the campaign. The vaccine and financing is being provided by the GAVI Alliance, not the Measles and Rubella Initiative.

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Island Air is Ellison's latest buy

How do you follow the purchase of an island in Hawaii?

If you're Oracle Chief Executive Larry Ellison, you buy an airline so you can hop to and from your tropical paradise.

Ellison has been on a shopping spree lately, buying 98% of the island of Lanai in June from Los Angeles billionaire David Murdock and then, in November, buying a beachfront Malibu home from film and TV producer Jerry Bruckheimer.

Ellison's most risky acquisition may be Island Air, which he bought Wednesday through a holding company.

The exact purchase prices of Ellison's recent deals have not been disclosed, but local observers value the 141-square-mile island at more than $500 million and the three-bedroom, three-bath Malibu pad at more than $3.65 million. The details of the airline deal were not announced.

Island Air, a regional carrier serving airports on all major Hawaiian islands, has 245 employees and three turboprop planes, with 224 weekly flights between the islands of Oahu, Maui, Molokai, Lanai and Kauai.

Lanai, the sixth-largest Hawaiian island, was once a pineapple plantation and is still sparsely inhabited. It includes two resort hotels and two golf courses with clubhouses, according to Hawaii's Public Utilities Commission.

But Ellison did not buy the airline just to get to and from his island, airline officials say.

He hopes to expand the businesses to serve locals visiting relatives on the islands and to fly mainland and foreign tourists throughout the island state, airline officials said. The airline plans to retire two 1980s-era planes and expand to four or five new ATR 72 turboprops by the end of the year.

But Ellison should not get his hopes up about pocketing big profits, said Ray Neidl, an aviation analyst for Nexa Capital Partners in Washington, D.C.

"It's a high-risk situation with no significant margins, at least initially," he said of owning an airline.

And if Ellison hopes to expand the business, he should expect to get some resistance from the big carrier on the island, Hawaiian Airlines, Neidl added. "It really depends on what Hawaiian does."

Island Air began in 1980 as Princeville Airways, carrying passengers from Kauai to Honolulu. The history of the carrier has not always been blue skies and soft landings.

"In our 30-plus years, we had our ups and downs, pardon the pun," said Michael Rodyniuk, a senior consultant to the airline.

Like most airlines across the country, he said, Island Air struggled during the economic turmoil between 2008 and 2012 but expects to thrive with a surge in tourism that Hawaii has been enjoying in the past year or so.

The state welcomed a record 8 million visitors in 2012, surpassing the previous high of 7.6 million visitors in 2006.

"All major markets are up," Rodyniuk said.

The previous owner of the airline, California businessman Charles Willis IV, had been looking for a buyer for the airline and had put all 245 employees on notice that layoffs could begin as soon as March 11 if a buyer was not found, he said. "So Mr. Ellison saved 245 jobs," Rodyniuk said.

Forbes ranks Ellison as the third-richest American, with a net worth of $36 billion. He has cut big checks in the past on high-priced properties in Malibu, Lake Tahoe, Rancho Mirage and other locations.

But unlike real estate, air carriers are an investment that can give investors nightmares.

Virgin America, a California-based airline partly owned by millionaire Richard Branson, has been operating for more than five years without recording a profitable year.

California Pacific Airlines is the brainchild of Encinitas businessman Ted Vallas, who has already invested more than $6 million of his own money but has spent the last year trying to clear federal red tape so he can begin selling tickets.

And then there are the 11 other airlines — including American, Delta, United and US Airways — that have filed for bankruptcy since 2000.

"The profit margins on airlines, even though they are improving, are not that attractive," Neidl said.

hugo.martin@latimes.com

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Tribune Co. hires advisors to explore sale of newspaper unit

Tribune Co. has hired investment bankers to advise the media company on the potential sale of its newspaper publishing unit.

The company announced that it has retained JPMorgan Chase & Co. and Evercore Partners to assess whether to sell the division that includes the Los Angeles Times, Chicago Tribune and six other daily newspapers.

The bankers will analyze bids from suitors, but their hiring does not necessarily mean that the assets would be sold.

"There is a lot of interest in our newspapers, which we haven't solicited," Gary Weitman, a Tribune spokesman, said in a statement. "Hiring outside financial advisors will help us determine whether that interest is credible, allow us to consider all of our options, and fulfill our fiduciary responsibility to our shareholders and employees."

Tribune hopes to sell the newspaper group intact instead of selling each paper individually, according to a person familiar with the matter.

The Chicago company has a healthy balance sheet and doesn't feel financial pressure to sell the properties, according to the person. It's unclear how long the process could take.

There has been widespread speculation that Tribune would attempt to unload the newspaper business to focus on its more promising television operations. Rupert Murdoch's News Corp. is among the possible bidders for the newspaper assets.

Tribune emerged from its four-year bankruptcy at the end of 2012 and appointed broadcasting veteran Peter Liguori as chief executive in January.

JPMorgan Chase holds an ownership stake in Tribune.

Evercore Partners, a boutique investment bank, also is working for the parent company of the New York Times on its planned divestiture of the Boston Globe.

walter.hamilton@latimes.com

andrew.tangel@latimes.com

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Greek man charged in NY Dali theft pleads guilty

NEW YORK (AP) — A Greek man has admitted to stealing a Salvador Dali painting from a New York City gallery, only to return it in the mail.

Phivos Istavrioglou pleaded guilty on Tuesday following his arrest in the theft of a work titled "Cartel de Don Juan Tenorio."

Prosecutors say the fashion industry publicist walked into the Manhattan gallery in June, put the painting valued at about $150,000 in a shopping bag and walked out. He anonymously mailed the piece back to the United States from Greece after seeing news coverage of the theft.

Under the plea deal, Istavrioglou avoids additional jail time if he remains incarcerated until his formal sentencing on March 12. He also must pay more than $9,000 in restitution.

His lawyer said it was a stupid thing to do.

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