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Court fines Idaho bodybuilding company, executives

A federal judge has fined two brothers and their Idaho-based online fitness supplement company millions of dollars for selling misbranded drugs.

U.S. Attorney Wendy Olson announced Aug. 1 that U.S. District Judge B. Lynn Winmill fined Bodybuilding.com $7 million for violating the Food, Drug and Cosmetic Act and placed the company on four years’ probation. Former company president, Jeremy DeLuca, was fined $600,000, and CEO Ryan DeLuca was fined $500,000 for several misdemeanor counts of selling misbranded drugs. The brothers were also placed on three years’ probation.

Investigators said the company sold products listed as dietary supplements that actually contained synthetic anabolic steroids.

Olson said the huge fines send the message that retailers and manufacturers have a responsibility to make sure they’re not selling drugs masquerading as dietary supplements.

The Associated Press

Scentsy launches handbag, accessories line

Scentsy Inc., a direct sales company based in Meridian, launched a new line of women’s bags and accessories called Grace Adele on Aug. 1. The company, which got its start selling wickless candles, now also sells other scented products, children’s toys and fondue kits.

The product line includes bags as well as clutches and accessories that can be added on to the bags. The Grade Adele line is named after the daughter of co-owners Heidi and Orville Thompson. Scentsy launched the website to take orders for the products on Aug. 1. Faux leather bags start at $80 while leather bags cost $200. Clutches are $40.

The new line was announced at the company’s annual conference in Las Vegas July 26. The company also announced new products and scents for its Scentsy Fragrance line. Earlier this year, the company launched a line of fondue warmers and chocolate called Velata.

Brad Iverson-Long

Idaho Power to hold hearings on 500 KV power line

Idaho Power is holding public hearings through August on the proposed route of the transmission line planned between Melba and Boardman, Oregon.

The proposed 500-kilovolt power line would run 300 miles across federal, state and private land in six counties in Oregon and Idaho. Idaho Power says the line is needed to provide additional capacity for its customers in Oregon and Idaho.

Idaho Power has been working with state and federal regulators since 2008 to find a route for the power line. The Boise-based company held a community advisory process to find alternative routes. Many ranchers and others were concerned about the impact of the line on their land and on views.

The line is expected to go into service in 2016, according to a timeline on the company’s website. But Idaho Power spokeswoman Lynette Berriochoa said that time could be adjusted if the decision-making process takes longer than expected.

The company has established a general proposed route for the transmission line, although it is still considering alternative routes in some areas. Those are the alternatives that will be discussed at the public hearings.

Idaho Power will propose routes in its final application to the Bureau of Land Management, and that agency will have the ultimate decision-making authority on the route of the project. Oregon’s Energy Facility Siting Council is also heavily involved.

The latest round of public hearings starts August 6 in Pilot Rock, Ore., and ends August 16 in Ontario, Ore. Hearings will also be held in Boardman, La Grande, and in Baker City, Ore., and in Marsing.

IBR Staff

 Idaho has November deadline on health exchange

Idaho must let the federal government know by mid-November whether it will set up its own health insurance exchange or let the federal government run an exchange and assert some regulatory control over the state’s health care market.

Health insurance exchanges are a provision of the 2010 federal health care law that would act as a one-stop shop, helping small businesses and individuals pick insurance plans and potentially receive federal subsidies. Idaho lawmakers rejected taking federal money to build an exchange, hoping the Supreme Court would toss out the health care law. After the law was upheld, Gov. C.L. Butch Otter set up task forces to study the exchange and whether Idaho should expand Medicaid coverage.

Idaho Department of Insurance Director Bill Deal said the state is foregoing an August deadline for a federal grant for the exchange and the next opportunity will be in November, the same month Otter must tell the federal government whether the state will try to run its own exchange.

“We’ve had grants, but that money has not been authorized,” Deal told a panel of lawmakers July 30. “We need more money to put forth a state-based exchange.”

Deputy Attorney General Brian Kane told a panel that the governor could tell the feds Idaho would run an exchange, but it would require legislative action to either fund that action or authorize the insurance department to implement the exchange.

Idaho could also follow the lead of Arkansas and set up a partnership exchange, with states and the feds sharing responsibilities of setting up an exchange, though insurers and business groups would favor a state-run exchange.

“The federal government would do the web portal and set up the consumer service center,” Deal said. “The state, if we were going to do it, we could have control of plan management.”

While Arkansas has gone that route, it’s unclear if Idaho lawmakers would sign off on a plan that still includes federal involvement in Idaho’s insurance industry.

“I think most Idahoans do not want the federal government involved in their insurance buying decisions,” said Sen. Dean Cameron, R-Rupert, who owns an insurance company and has worked on state-level exchange efforts.

If Idaho does set up its own exchange, it also faces a Jan. 1, 2013 deadline to show the Department of Health and Human Services that it will have its exchange up-and-running by 2014. Currently, 16 states have established state exchanges, according to the Kaiser Family Foundation.

Brad Iverson-Long

Idaho food service jobs offer annual wages of $13,000

The food service industry has grown nationally just over 4 percent since 2009.

But in Idaho, the industry has remained flat, according to Economic Modeling Specialists Int., a think tank in northern Idaho.

The Moscow-based EMSI says Idaho had 39,731 food service jobs in 2009 – and about the same number in 2012. Those jobs paid an average annual wage of $13,000.

Average annual wages for the foodservice industry nationally are $15,767 in 2012, EMSI said. Many of the workers are employed part-time, and the food service jobs are evenly divided between males and females.

EMSI said about one-third of the food service workers are ages 19 to 24, and 38 percent are ages 25 to 44. Twelve percent are ages 14 to 18.

IBR Staff

Dance Allegro Academy to double its space

Dance Allegro Academy plans to move within the Mercato at BridgeTower commercial plaza in northwest Meridian in September, more than doubling its space there, academy owner and Director Jessica Seymour said.

The startup Breakaway Cycling Studio will occupy Dance Allegro’s current space of about 1,500 square feet, between a State Farm insurance office and Salon G, as soon as it becomes available, Breakaway owner Lance Beeson said. He and four employees will work at Breakaway, to offer stationary cycling exercise classes.

Mercato is at the southeast corner of Ten Mile and McMillan roads. Seymour said she considered moving the two-year-old Dance Allegro, but decided to stay at Mercato because it is central to where many students live. The new space is between a State Farm insurance office and Gino’s Italian Ristorante. Seymour contracts with dance instructors.

Spaces of 5,280 square feet and 1,500 square feet remain available in the approximately 22,000-square-foot Mercato center, said manager Hoyt Michener of HM Property Management.

Brad Carlson

Supervalu to lay off 20 in IT in Boise

Restructuring by Supervalu Inc. means 20 employees in the company’s Boise office will lose their jobs at the end of August. The Minnesota-based grocery company is restructuring its information technology department in an effort to save $250 million.

Supervalu bought Albertsons Inc. in 2006 and could also be looking for a new buyer itself. The company also fired CEO Craig Herkert July 30. Wayne Sales, the chairman of Supervalu’s board of directors, replaced Herkert, who came to the company in 2009 after working as an executive for Wal-Mart Stores Inc.

Lilia Rodriguez, a spokeswoman for Albertsons, said July 30 the Boise layoffs were part of restructuring that was announced July 11 after the company reported a 45 percent drop in profits in the first quarter of its fiscal year.

The layoffs aren’t the first for Supervalu in Boise. In February, the company laid off 130 workers at its Albertsons Store Support Center.

Brad Iverson-Long

MWI Veterinary shares rise on strong 3Q, guidance

Shares of MWI Veterinary Supply Inc. jumped 15 percent July 30, after the animal health products company announced a better-than-expected fiscal third-quarter net income and boosted its full-year profit and revenue predictions.

For the quarter ended June 30, the Boise-based company earned $14.5 million, or $1.15 per share, up 27 percent from $11.4 million, or 91 cents per share, in the same quarter last year.

Revenue jumped 35 percent to $554.7 million from $410.7 million, boosted by contributions from the company’s October acquisition of Micro Beef Technologies Ltd. Excluding the acquisition, the company said its U.S. revenue rose 19 percent, while its United Kingdom revenue rose 20 percent.

The results easily beat Wall Street predictions. Analysts, on average, expected a profit of $1.06 per share on $524 million in revenue, according to a FactSet poll.

MWI said its Internet sales to independent veterinary practices and producers in the U.S. rose about 33 percent, while revenue from veterinary pharmacy programs grew 34 percent to $46 million.

MWI raised its full-year profit prediction to a range of $4.14 to $4.20 per share on $2.05 billion to $2.07 billion in revenue. The company previously projected a profit of $3.96 to $4.06 per share on $2 billion to $2.03 billion in revenue.

The Associated Press

Treasure Valley Angel Fund could start making investments in a month

The new Treasure Valley Angel Fund is going live after raising more than $750,000, making it the second operating angel fund in the Boise area.

The fund, which sold shares to prospective angel investors at $50,000 a share, is being managed by Loon Creek Capital. If it finds a desirable deal, the fund could start making investments in as soon as a month, said Earl Sullivan, chairman of the board for The Core, which organized the fund.

The angel fund was created under special rules that allow it to advertise for investors – actions that would lead to a very costly process of registering shares in a normal fund. In return for the allowance of advertising, fund investors are required to primarily live in Idaho, investments must be made for companies that stay in Idaho for at least nine months and strict disclosure rules must be followed.

Sullivan said the ability to advertise appears to have paid off. In the first meeting of shareholders in the fund, there were many people who were not recognized by the usually close-knit group of angel investors.

“Just based on the initial meeting that the group had, there are a lot of new faces,” he said.

The Core negotiated the fund’s rules with the Idaho Department of Finance. It will now step back and have no control over the fund, Sullivan said.

Sean Olson

Former undersheriff files discrimination lawsuit

A former undersheriff in Twin Falls County has filed a lawsuit in federal court claiming she suffered gender discrimination during her brief time on the job.

Gerlyn “Sam” Walker filed the lawsuit in U.S. District Court the week of July 23. The Times-News reports that Walker alleges she was regularly treated differently from her male counterparts and should be paid for damages after being demoted in 2009.

Sheriff Department spokeswoman Lori Stewart says department policy forbids commenting on an ongoing lawsuit.

In the lawsuit, Walker claims she was required to work more hours for her salary than salaried men on the administrative team.

She also alleges men on the administrative team received perks not offered her and that she was purposely excluded from daily meetings held at a local coffee shop.

The Associated Press

Idaho GOP official sued over alleged Ponzi profits

A lawsuit between a federal court receiver trying to recover money from a multi-million dollar Ponzi scheme and the head of the Republican Party in eastern Idaho’s Bonneville County has gone to trial in Pocatello.

The Post Register reports that court receiver Wayne Klein sued GOP official Doyle Beck in 2010, contending Beck received $555,000 in fraudulent payments from a company called Trigon Group run by Daren Palmer.

Palmer was convicted last year of wire fraud and money laundering for what prosecutors said was the largest Ponzi scheme in state history.

Beck has denied any involvement with the scheme, and said the money he received was simply to pay back a $500,000 loan he had previously made to Palmer’s brother-in-law. Klein contends that money came from Ponzi victims.

The Associated Press

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