Haier America won't be the first company to bring its headquarters to New Jersey without the help of state incentives. But the circumstances seem far different from the last big name that grabbed headlines over such a move.
In July, Bausch & Lomb said it would shift its home base from Rochester, N.Y., to the Garden State, a move tied to the acquisition of the eye care company by Valeant Pharmaceuticals. The announcement had indications of a consolidation — and not job growth — and at the time, state officials said the companies had not sought any of the tax credits and grants that often help seal the deal in a cross-border move.
That's also the case for Haier, but the Chinese appliance giant actually is bringing 500 jobs to Wayne from New York City. That's perhaps why it raised eyebrows that the company is moving its U.S. headquarters without state incentives.
It also led to an Oct. 20 story in The Record, in which real estate experts floated every explanation for not using incentives — from avoiding the government scrutiny to not wanting to make specific job commitments.
The Economic Development Authority, which awards the incentives, has not said whether the company ever applied for incentives.
Myriad lawsuits on the way
Four months after the Supreme Court ruled companies can't claim patents on discoveries of naturally occurring genes, limits of the decision are being tested.
Elmwood Park-based BioReference Laboratories Inc. was sued last week by Myriad Genetics, which alleges BioReference's new suite of tests infringes upon Myriad patents.
A source specializing in intellectual property law said more challenges on patent claims likely are on the way. Myriad's product costs about $2,500; the source said companies are motivated to provide consumers with less-costly diagnostic tests.
"Companies are thinking it's fair game," the source said. "The Supreme Court invalidated certain claims, and that give manufacturers wiggle room to design tests without infringing on patents. We're talking serious dollars for the consumer."
The Supreme Court ruled companies can't claim patents on naturally occurring gene sequences but can claim patents on synthetic DNA, where some genetic engineering is performed. The ruling's impact will become more clear as challenges are decided, the source said.
"In many different life science technologies, these boundaries are going to be tested," the source said. "Not just with Myriad, but with a lot of companies."
All quiet on M&As
The flurry of mergers and acquisitions finalized in late 2012 is unlikely to repeat this year, an attorney said.
The 2012 rush was driven by executives rushing to beat looming year-end tax changes.
"December was a crazy month, and we were busy doing all sorts of dividend recapitalizations and M&A transactions in anticipation of changes in capital gains," the source said. "I don't know if that's coming down the pike again."
Taxes on capital gains, dividends and upper income brackets were set to rise Jan. 1, 2013, because of the scheduled expiration of George Bush-era tax cuts. Congress later scaled back some of those increases as part of so-called "fiscal cliff" negotiations.
Broader economic trends also suggest a slowdown in deals, the source said, noting that capital markets have been on a lengthy rally despite persistent weakness in the broader economic recovery: "If the capital markets comes down somewhat, I think you are going to find financing will be more challenging."
Grapevine reports on the behind-the-scenes buzz in the business community. Contact Editor Tom Bergeron at firstname.lastname@example.org.