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August 2000

The Year of
Stalemate and Sitzkrieg
Black at the End of the Tunnel

Dispatches from the Front by Burl Burlingame
8/1/00 Star-Bulletin bidders complained that Gannett was providing incomplete financial information, and providing it too little and too late to allow realistic bids on the business. Gannett's hiding of financial records may result in no bids being offered, warned bidder Cec Heftel. Bidders had been proceeding under the assumption that the "sale" process was a legitimate offer, and not simply a way for Gannett to manipulate the courts and delay litigation.
8/2/00 Walker's ruling, which ignores the intent of the Failing Newspaper Act, made it possible for other JOAs in the United States to be shut down without notice. "Monopoly papers behave very differently than competitive papers, and it is nearly always to the benefit of readers to have competitive papers," said Ben Bagdikian, former Dean of UC Berkeley's graduate school of journalism. In other newspaper anti-trust news, the Los Angeles Times secretly loaned money to rival LA Daily News to keep a stronger competitor from buying it.
8/4/00 The top-secret data room, containing everything bidders supposedly need to know about the Star-Bulletin's finances, closed. The "room" is actually a couple of cardboard boxes, one of which contains promotional items such as balloons.
8/5/00 Gannett's Advertiser, the publication that will benefit hugely from the murder of the Star-Bulletin, runs a couple of back-to-back stories about the data room closure. The "news" contains quotes from "experts" about how hopeless it will be to operate an independent newspaper in Honolulu, as well as the usual boilerplate about how Gannett is doing its best to sell the paper. The stories also contain sloppy factual errors, such as claiming the newspaper is 107 years old when it actually is 118.
8/10/00 Judge Kurran extends both the data room accesibility and the deadline for submitting bids. Most known buyers have complained about Gannett's unrealistic deadlines and skimpy financial information. Star-Bulletin staff worry if a deal has already been struck.
8/11/00 Gannett takes over the Arizona Republic, sending in Reno publisher Susan Clark-Johnson to finish the job of killing the afternoon paper, softening the news coverage and cutting back on staff. At Reno, Clark-Johnson served on the boards of casinos despite protests that it compromised news coverage.
8/18/00 Three Arkansas newspapers form an alliance that they insist is not a Joint Operating Agreement, but which has all the hallmarks of one, including diminished "competition" between the products and a merging of all non-newsroom assets. The Justice Dept. has not weighed in on this one.
8/20/00 Gannett's Detroit paper ignores a massive public protest right under their nose -- likely because it was about Gannett anti-union tactics.
8/25/00 The Honolulu Advertiser's Gannett editors added personal baby-sitting services to employee duties, which resulted in a union grievance.
8/29/00 Gannett's nation-wide power grab draws the attention of commentators, and is explained by a disappointed ex-employee.

David Black
8/30/00 Canadian newspaper mogul David Black of Black Press threw his hat in the ring for the Star-Bulletin. We on the ESOP committee, along with banking advisor Josh Wolf-Powers, had been doing a secret dance with Black for weeks while he researched the opportunities in Honolulu, and he forbade public disclosure of his intentions. Another group, including former Chicago Sun-Times co-owner Robert Page, are stymied by Gannett's refusal to release financial information. Page calls Gannett's actions "patently absurd" and "ridiculous."
NEXT! September 2000
Stopping Them at the Border

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