Decision opens door for Trib ex-managers

A federal judge on Wednesday opened the door for former managers of the Salt Lake Tribune to buy the newspaper, assuming they have the money to do so and only if they prevail at a November trial.

U.S. District Judge Ted Stewart ruled that MediaNews Group Inc. could transfer all Tribune assets, except for its stock in a company jointly owned by the Tribune and the Deseret Morning News, in exchange for the fair market value of the paper.

But the judge stopped short of requiring the transfer. That issue would be determined at trial.

The newspaper's value is currently set at $355.5 million, though Salt Lake Tribune Publishing Co. (SLTPC) challenged the price in a lawsuit filed this week.

The ruling, which was deemed a "significant win" by SLTPC attorneys, forces some real action in the 2 1/2-year-old case. A 120-day closing period for the deal, which was halted in November, calls for a closing in less than a month.

That schedule, however, may be affected by SLTPC's latest lawsuit against New Jersey-based Management Planning Inc., which completed the final appraisal that resulted in the exercise price of the paper being set at $355.5 million. SLTPC previously sued the company in a New Jersey state court for failing to conform to professional industry standards, but the case was dismissed.

MediaNews CEO William Dean Singleton said Wednesday's decision does little to change the landscape of the lawsuit. He continues to argue that SLTPC doesn't have enough money to purchase the Tribune, therefore making a trial unnecessary.

"I'm going to walk in and see what the money looks like," Singleton said. "Then I will have to make a decision if I will tender the assets."

If Singleton opts not to turn over the assets, the case would move toward a November trial, where jurors would determine if MediaNews breached the 1997 option agreement signed when SLTPC merged with Telecommunications Inc. TCI later merged with AT&T, which sold the Tribune to MediaNews in January 2001 for $200 million.

If jurors determined MediaNews breached the agreement, the judge would decide whether SLTPC is entitled to specific performance — that is, force MediaNews to hand over the Tribune assets — or simply an award of money damages.

If, on the other hand, SLTPC is unable to raise enough money, the dispute will essentially be over, and MediaNews will retain ownership and management of the Tribune.

Both MediaNews and the Deseret Morning News had argued the Newspaper Agency Corp. stock could not be split from other Tribune assets. They also maintained that a 50-year-old joint operating agreement between the two newspapers prohibited a transfer of the stock without the consent of the other party.