JANUARY

Storm Watch: Heavy rain caused mudslides that closed Topanga Canyon, Laurel Canyon and other access roads between the San Fernando Valley and the Los Angeles basin.

Transit Tragedy: Eleven people were killed when a Metrolink commuter train heading from Ventura County through the San Fernando Valley and into downtown L.A. crashed into a vehicle parked on the tracks in Glendale and derailed.

Mall Fall: The Santa Monica City Council voted to begin negotiations with Macerich Co. to tear down and rebuild Santa Monica Place. Macerich has since walked away from its plans to build three condo towers on the site and continues to study alternatives.

Westside Internet: Yahoo signed a lease for 230,000 square feet of office space at Colorado Center.

FEBRUARY

Big Sale: Federated Department Stores Inc., parent of the Macy's and Bloomingdale's chains, and May Department Stores, parent of the Robinsons-May chain, announced a merger that would lead to the closure of about 20 Robinsons-May and Macy's stores at malls in the Los Angeles area.

MARCH

Pricey Digs: Downtown's Millennium Biltmore hotel went on the market for $500 million. Brokers and buyers questioned the high price, which would set a record for local hospitality properties. As the year ended, the WHB Corp. was set to consider a third round of bids on the property.

APRIL

Doctor Billionaire: Dr. Gary Michelson and his company, Karlin Technology Inc., settled a lawsuit against medical device manufacturer Medtronic Inc. for $1.35 billion. Michelson, a spinal surgeon turned inventor, had battled Medtronics over royalty payments. He spent $60 million of his own money on the case.

Takeover: Time Warner Inc. agreed to buy the local assets of Adelphia Communications in a $17.7 billion deal, making it the leading provider of cable services in Los Angeles.

MAY

New Leader: Antonio Villaraigosa, who rose through the ranks of organized labor and legislative office, defeated incumbent James Hahn to become the first Latino mayor of modern Los Angeles.

Wheel Deal: Billionaire investor Kirk Kerkorian's Tracinda Corp. raised its stake in General Motors Corp. to 7.2 percent. The purchase initially boosted confidence in the automaker, but later the stock tumbled in light of GM's massive debt and future obligations.

Labor Legacy: Miguel Contreras, who built L.A.'s labor movement into a power extending through local political circles, died. He was 52. L.A. City Councilman Martin Ludlow succeeded him as head of the County Federation of Labor.

Grand Plan: Related Cos.' proposal for the $1.8 billion redevelopment of Grand Avenue in downtown L.A. won approval of the project's oversight authority. The design features residential and retail components, and would connect Disney Hall, the new cathedral and City Hall with public space, including a new park.

JUNE

Times Change: Jeffrey Johnson was named publisher of the Los Angeles Times. Later in the year the company announced a new round of job cuts and plans to shut down the paper's 20-year-old plant in the San Fernando Valley.

Conflict Resolution: Even before taking office, Antonio Villaraigosa brokered a deal between the hotel industry and labor unions that averted a contract battle. Union leaders wanted to renegotiate contracts in 2006 in alignment with talks in other cities. They settled for expiration in the fourth quarter, later than they had originally wanted.

JULY

Internet Play: News Corp. bought Intermix Media, best known for MySpace, a popular social networking site. The $580 million deal was the most prominent example of a shift that saw so-called old media companies buying up businesses that have found success online.

Track Sale: Churchill Downs Inc. sold Hollywood Park to Bay Meadows Land Co. for $260 million. Bay Meadows plans to continue running the track while it tries to secure the right to install slot machines on the property. Land surrounding the track is to become the site of a major redevelopment.

AUGUST

Energy News: Chevron Corp. bought Unocal Corp. for $18 billion after an intense bidding war with the Chinese government-run oil company CNOOC. Layoffs began in October with about 30 of the 130 workers at Unocal's

El Segundo headquarters getting their notices. Most of the workers had been offered jobs at Chevron facilities in San Ramon and Houston, but didn't take them.

Trust Problems: The state Attorney General's Office opened an investigation into the finances of the J. Paul Getty Trust, which funds and manages L.A.'s Getty Center. The investigation centers on an array of issues covering the eight-year tenure of Trust President Barry Munitz.

Gas Prices: Summer and fail brought record high gasoline prices as the psychological barrier of $3 a gallon was crossed in most areas. Hurricane damage to refineries along the Gulf Coast was blamed. Prices later dipped to end the year in the low- to mid-$2.00 a gallon range.

Cases Closed: The Metropolitan Transportation Authority agreed to pay $45 million to its insurer to settle nine years worth of property damage claims filed over the construction of the Blue, Green and Red lines.