Kalindrasorry, the prudent investor rule DOES apply. investing includes
what you already hold, not just what you are purchasing.Do you mean
to say if a fiduciary held, in trust, a 17 karat top grade diamond and he sold
it for 47 cents that hewould be in compliance with the prudent investor rule?
doesn't work that way.your comment about acting is good faith
is valid. But obtaining less for the shareholders just to protect an ideology
is NOT acting in good faith.of course, we can argue all we want, but
we will have to wait and see IF the cheated shareholders take it to court and
what the courts actually decide.
@ lost in DC: No - my comment that I am not making this stuff up is not an
indication that I think the law professor's comment is ridiculous. My comment that I am not making this stuff up is an indication that many
posters on this board are unfamiliar with the law and are refusing to recognize
a very important distinction when it comes to fiduciary duties.The
prudent investor rule does not apply because they were not making an investment
- they were divesting an asset.As the law professor stated, there
are many things that can be considered when divesting assets - price is only one
of them. As long as the board acted in good faith and can justify
their decision, they acted with appropriate fiduciary duty - even if they did
not take the highest offer - even if, at some point in the future, it proves to
have been a bad idea - as long as they acted in good faith, they acted
appropriately. There is no fiduciary duty, when divesting of assets,
for money to be the only consideration and the board does not have to accept the
highest offer. That is the law.
Maudine,Used up your 4 comments as Tolstoy, so you’re posting as
Maudine now?From your 3:29 post as Tolstoy yesterday,“may I be so bold as to refer your superior intellect to spring streets
comments on the subject as a start”You mean to say you (as
Tolstoy) never meant I was referring to spring street? Really??Kalindra,From your comment that you are not making this stuff up, it
seems to say even you recognize how absurd the law professor’s comment is.
I still believe the shareholders would have a valid claim against the board if
it turns out the asset was sold for less than it was worth, especially in light
of the prudent investor rule which weighs heavily in fiduciary law.Redshirt007,If what they are selling is theirs, they can, but if it
belongs to someone else towards whom they owe a fiduciary responsibility, they
In a free market the seller can sell to whomever they want. If not then
it's socialism, communism and tyranny!
@ lost in DC (and so many other posters): When Brian JM Quinn, an assistant
professor of law at Boston College Law School who writes a blog on M&A law
was asked about the sale price and the consideration of other factors, he
responded, "There is no legal duty to seek out the highest price for the
asset. The board can decide to sell the asset to any one for almost any
conceivable reason." He continued, "In hindsight, it may turn out to be
wrong, but it's enough of a reason for the court to justify its decision to
sell to the lower of two bids."I am not making stuff up - I am
telling you what the law says. You may disagree with it, but that does not make
it any less factual. Do a little research.@ L White: The Globe
projected an $85 million loss in 2011 - I know Breitbart claims there was $300
million offer that year, but other sources (The Globe itself for one) put the
offers at $35 million. But, since it wasn't sold that year, none of that
matters.It was sold this year and the highest reported difference is
Sorry I meant. Commented on not read
@lost You really just don't read comments do you? Tolstoy never
said you read speing streets comments they said that you need to reread them to
gain a better understanding of the subject. The way people behave on this
thread makes me feel like I stepped into a third grade recess.
Tolstoy,First, I made no reference to spring street or his/her comments.
Perhaps you should actually read my comment and those to whom I addressed
them.You accuse me of making derogatory comments, then you infer
that I am one of those who know the least. You do what you accuse me of. You accuse me of not knowing about fiduciary responsibility but offer no
indication of how I misunderstood fiduciary responsibility. Yet you defend a
board, who has a fiduciary responsibility to the shareholders they represent, of
breaching that duty by accepting less than could have been received just to
protect an ideology. May I suggest YOU review what is required of fiduciaries?
The board’s fiduciary responsibility is to the SHAREHOLDERS, not to the
editorial board’s ideology.Kalindra,Whether they sell
the entire company or just a part, their fiduciary duty is NOT reduced one iota.
Regardless of what you or Tolstoy say, they have a duty to maximize the
return.Noodle, Thanks for the clarification
Well, I've been caught. I used the $180 million figure that others have
bandied about as the price that would have been offered for the Boston Globe. I
am so sorry. I was terribly wrong. The offer made by Aaron Kushner was $300
million. He made that offer in 2011. He also included the assumption of the
pension liabilities that have been estimated to be $110 million. The $70
million price did not include those pension liabilities. So, the spread
(don't you just love it when I use words like "spread"?) is at
least $340 million. Kushner offered a total of $410 million. The Globe was
sold for $70 and the Times still has to pay for the pensions. Sometimes it feels so good to be told how wrong I was and how I had misused
figures especially when the real news is that the "damage" was nearly
two times greater than I reported.Now, maybe we should all study up
on "fiduciary responsibility".
@ What in Tucket: Actually, NYTimes bought the Globe in 1993 - 20 years ago -
for 1.1 billion. Since then, the internet has severely affected circulation and
4 years ago NYTimes tried to sell it. They were able to refigure things and
decided to keep it.
@L White"I guess that's to be expected from a newspaper
that believes in "encouraging a civil dialogue". Maybe that notice is
reserved for us Conservatives. Maybe that notice never appears above the comment
box of those who are not Conservatives."Funniest comment
I've read in a long time.
I am still trying to figure out what the big deal is.Who cares if
politics were the guiding motive behind the sale, and who now owns the paper.The bigger question that people should be more concerned with, since it
potentially can harm people, is what is happening to the members of the Board
that approved the sale?If they sold the paper for less than what it
was really worth, then somebody should reconsider before putting those that were
infavor of the sale in charge of another company.
Who said the s stockholders who want to sue are conservatives? I would guess
they were liberals too. Still they might be disappointed as would most of you
if they received less than fair. The NY Times bought the globe 4 years ago for
$1.1 billion. Quite a comedown. No wonder they are mad. Until conservatives can
control some of the media they will not get their opinions out.
Is this a trick question?
L white As others have pointed out before your comment at most 10
million dollars was left on the table not the 100 million plus you claim and the
ny times sold a part of their business not their entire business which means
under the rules they do get to take in other considerations in their decision
making. as to not worrying about being truthful because you believe others are
doing the same would that not be moral relativism?
to Mike Richards"What you posted under another name was that I
"always" use moral relativity. Really? ALWAYS? "Actually? Yes. Everything else is "relative" to what you consider
"moral"The only media outlet that is really so biased that
it makes my stomach churn is Forbes. Fox news is the comic relief in
Murdoch's empire IMO. Irony alert... Both, Sean Hannity and
Seth MacFarlane are News Corp "employees".
@Lost in DCBut how do we know the Post is actually worth 250 million? I
mean in a real estate asset type sense. I mean if someone offered me 200,000 for
my house that I bought last year for 70,000 I would take it, but that
wouldn't mean it's worth 200,000. Do we actually know that the Post
was worth that kind of cash, or did the owners laugh all the way to the bank?
It's entirely possible that Bezos overpaid for the property, and the Globe
was sold at fair value, or it could be the other way around, all i'm saying
is that I highly doubt that anyone posting here has experience in valuing these
types of assets, this is all silly speculation, based on your already formed
political views at this point.
Oh my goodness but don't we have a circus today? Look at all the comments
that tell us that losing one-hundred-eighty million dollars is perfectly normal
in the sale of a liberal newspaper. Then look at all the comments that have
nothing to do with the sale of the newspaper but are just attacks on other
people who have commented. I guess that's to be expected from a newspaper
that believes in "encouraging a civil dialogue". Maybe that notice is
reserved for us Conservatives. Maybe that notice never appears above the
comment box of those who are not Conservatives. What really got to
me was the comment that selling a newspaper for seventy-million dollars had
nothing to do with "fiduciary responsibility" because that huge sale was
more like selling a single paper clip and nothing at all like selling a
business. (Of course, I am taking the same liberties that others have used all
day long to misrepresent comments. It seems to be in fashion. Why should I
stick to the truth when only Conservatives are expected to tell the truth?)Let's see how the court rules on this sale.
If the NYTimes had sold the entire NYTimes company, yes, they would have had a
fiduciary duty/obligation to sell it for the best (highest) price they could get
for it.The NYTimes did not sell the whole company - they sold an
asset. When selling assets, there is no duty/obligation to get the highest
price - the board can take into consideration other factors.When an
asset is sold, the court assumes the board has full knowledge of the options and
made their decision based on that knowledge and that the decision, while maybe
not reflecting the highest price, does reflect the long-term best option for the
shareholders.You can argue fiduciary duty all you want - but
ignoring the facts of the situation automatically invalidates your argument -
you cannot argue the price of selling an apple when the product being sold is an
from the oped-"At the conservative American Thinker website, blogger Thomas
Lifson wondered" This is the entire basis for this story, a wondering
conservative blogger?Tolstoy, you obviously nailed it because Mike
is livid enough to attack you over your name/names (inventing his own conspiracy
if you will), the day, your religious affiliation and you morality, while
ignoring that you are quite correct in pointing out he uses a slide rule in his
ethical judgement of leeeberals vs conservatives here daily and everyone here
can read it themselves.
@Charlie, (Tolstoy, LDS Liberal, et al),Is the kettle black? What you posted under another name was that I "always" use moral
relativity. Really? ALWAYS? Is the law broken if the fiduciary misuses his
position of trust to give a "deal" to the owner of a baseball team when
someone else has offered to pay more for the newspaper? There's no
"moral relativity" in my statement, but it doesn't fit your
premise, so it must be "morally relative".Laws were written
to keep people from twisting the words of others to fit their idea of what is
right and what is wrong. The law tells us that you cannot accept a lower bid
for business if you represent the owners of that business unless those owners
approve the lower price. Those of us who are trustees know that principle. We
know that if we fail to put aside our personal preferences in our official duty
as trustee, that we will be held liable. You seem to want to suspend law unless
you agree with the outcome.
@mike richardsthree things, first I hardly think you are the one to
be lecturing anyone about posting under numerous pseudonyms Mike J White.
second, you may wish to review spring streets comments companies may take other
factor into consideration when making a sale. third I do not see anywhere in
Tolstoy posts were they claim the courts should never be used or any claim to a
religious affiliations. What I do see is you lashing out with wild unfounded
accusations and misrepresentations, Kind of the definition of relative morality
if you ask me.
@lost in dcmaybe before you go making derogatory remarks about other
posters you should brush up on your own understanding of fiduciary
responsibility may I be so bold as to refer your superior intellect to spring
streets comments on the subject as a start. Why is it that those that know the
least are so quick to try to make derogatory comments about others?
@tolsoy (aka many other pseudonyms),Your "game" is to rip
down anyone who doesn't agree with you. I will not play your game because
I don't believe anything that you post under this name or any of the other
names that you use. You wrote: "My problem is once again with
your relative morality and ethics that seem o constantly drift in the
wind."May I simply suggest to "get over it"? You
believe in only one thing that that thing is whatever you promote under the
guise of whomever you pretend to be on any given day. You pretend that courts
should never be used. Where did you come up with that? The Church that you
claim membership in (under another of your many pseudonyms) has many lawyers,
not to harass others, as you do, but to verify that all of their dealings are
according to law. How misguided are they? Do they have "relative
morality"?Fiduciary responsibility requires that you or any
person responsible, accept the highest bid when a business is sold as long as
that is an honest bid. I'm afraid that your "relative morality"
might be showing.
Sorry, my first sentence should have been, "So, the 7th largest paper in the
United States sold for $180 million more than than the 24th largest paper in the
U.S. and this is a liberal conspiracy because the two papers should have had the
same value?"Other sources report that the bids ranged from $65
million to $80 million. At most, $10 million was left on the table.It is also reported that the successful $70 million bid was a cash bid - which
may have been an influencing factor.There are many issues taken into
consideration when selling an asset and it is entirely possible that accepting a
lower bid will prove the best move for shareholders as time progresses.One poster made a comparison to selling your home - if I have a choice of
selling my home for $700,000 or $800,000 and I know the lower buyer is going to
take better care of it as opposed to the higher buyer tearing it down, selling
it for parts, and leaving the lot empty - I can sell it to the lower buyer.
Looks like the attorneys are going to get rich from the NYT’s
board’s malfeasance.Leaving money on the table just to protect
liberalism. Maybe they can get George Soros to pay off the shareholders.Larceny,Not just the company, but the board and management need to
be sued.Tolstoy, George, FreedomFighter41Why is the concept of
fiduciary responsibility so foreign to you? Oh, I know, you’re liberals.
Any type of responsibility is a foreign concept.Noodle,No one
is assuming the Globe is worth $180MM more than the Post, only that it is not
worth $180MM less.
Why are we assuming the Globe is worth 180 million more than the Post? The post
is a national paper, with national readership, the Globe is a regional paper,
with half the readership. In addition, how do we know that Bezos didn't
just pay way too much for the Post? It's hard to tell if this is bad at all
because none of us really know what this type of thing is worth.
So, the 7th largest paper in the United States sold for $180 million more than
than the 24th largest paper in the world and this is a liberal conspiracy
because the two papers should have had the same value?Seriously
people?As for "fiduciary duty" - companies are under no
obligation to seek for or accept the highest offer when selling off assets.
They are allowed to take other factors into consideration - such as local
impact, long term plans, future of the employees, etc.Should the
shareholders decide to sue, the most they could ask the court to consider is the
additional $10 million the highest out-sold bidder offered. They would then
have to prove that the additional factors would not have made such a big
difference in the long run and/or that the Board was not fully informed and/or
acted with malice towards the shareholders. And, they would have to be able to
do all that without costing the company $10 million or negatively affecting the
value of the company in some other way.And looking at the sour
grapes and misinformation being spread by the higher bidder, the Times has
grounds to support their decision.
Redshirt - Haha, good job not reading the article and then commenting; tt tells
a great deal about your willingness to opine without a basis in understanding.
In this article, the conservative lemmings are complaining about a deal that is
reportedly the same as the Al Jazera/Current deal you apparently approve of.
Regardless, this report is woefully uninformative and does a
disservice to anyone concerned with the facts. At the moment, all we have is
Lynch's claim that they (U-T SD) had bid more (though no monetary amount is
provided). Indeed, we don't know how the two offers were structured (cash,
holdings, stock, etc...), but even if the fiscal amount from U-T SD was more (no
indication how much more, a dollar? a million?) the Board may reasonably decide
that the structure of the offer is not the most conducive to shareholder
interests in the long run. Further, the author of this article
seemingly wanted to use he phrase "the proverbial other shoe dropped"
without considering the facts. Directly comparing the WaPo to the Boston Herald
ignores the influence of readership demographic and the fact that the WaPo has
more than double the Herald's readership.
@redshirtyou may want to go back and read the story before commenting. It
is not liberals that are complaining it is conservatives but thanks for helping
make the point the liberals have been trying to make all morning.
Lets review some recent history for you liberals out there.Al Gore
recently sold his TV network to Al Jazera. Al Jazera was not the highest offer,
but it was the one that Al Gore chose because they have values similar to
his.Was there a conspiracy involved? Why choose this to complain
about, yet during Al Gore's sale you didn't care?Either
the leaders of a company can decide who they sell to or not, you can't
ignore it when liberals cut deals for liberals then complain when conservatives
do the same.
@ Freedom Fighter41:The free market concept in capitalism applies to
its generally accepted meaning when dealing with privately owned businesses. The
NYT is not a privately held company, but rather is publicly owned by
stockholders. Hence, the fiduciary responsibility to those stockholders who
ultimately are the owners. Those stockholders collectively do have the freedom
to sell to whom they want because of the free market concept you mentioned. But
from this article, it doesn't appear they were involved with the sale
decision. It appears the NYT CEO made that decision on his own, and thus
neglected his responsibility to company stockholders. That would be the only
grounds for a lawsuit... that wouldn't even be mentioned if that
wasn't the case. @ LDS Liberal:It's not a
conspiracy theory at all when a situation is based on facts. The writer of the
article did a great job of bringing out the FACTS. It would only be a conspiracy
to a liberally biased perspective. And your previous posts have left no doubt as
the where your biases lie. Such a bias tends to see a conspiracy in any
situation that isn't liberal based.
Disclaimer: I consider myself politically conservative.Statement: Good for
the Boston Globe selling for $180M less than they could have got. Anyone stupid
enough to invest in the NYT deserves to get what they get.
@joe I think you see what you want to see Joe. I would be shocked
not because I think fox new is some evil entity but because why would they sale
to a company that is going to completely change the brand they built? You seem
to believe that you have this ability to see evil intent in everyone else yet
you are blind to your own assumptions and a belief in your own moral
superiority to the rest of us.
@mike richards Here is the thing Mike. IF it turns out that they did
sale the globe to a lower bidder then I do not disagree that stock holders
should be allowed to avail themselves to the courts. My problem is once again
with your relative morality and ethics that seem o constantly drift in the wind.
You are one of those that are always decrying government intrusions and people
that turn tot he courts when they don't get their way.
George: So let me get this straight. I'm wrong because ... well, because
you would be shocked. No data to support your position. Just you own assumption
of your infallibility in knowing that would be the case.Interesting
way to prove my point. Thanks for driving it home.
What's it like to see conspiracies in everything?
@Tolstoy,When fraud is committed (and fiduciary irresponsibility can
easily be shown as defrauding the owners of the gains that would have been seen
if the fiduciary had done his job properly), then the court is the proper place
to solve that problem. Why do you think that there are lawyers? Aren't
they there to protect us from being taken advantage of by those who (appear) to
have had a higher duty towards the new buyer than they had to the owners of that
newspaper?Perhaps the best way to solve this problem is to have the
fiduciary pay the difference between the price that would have been offered and
the price accepted from his own pocket, then the Boston Globe will be owned by
someone from Boston and the owners will be paid what they deserve.
I recall concerns when Murdoch acquired the Wall St Journal. That has turned out
to be much ado about nothing.Bezos is a capitalist success story and
people moan about his political leanings. Ask a Miami Marlins fan
about Henry's business acumen.
@JoeYou may not have doubts but you would still be wrong. I would be
shocked if Fox News, lets say, ever decided to sale if they allowed it to fall
into the hands of liberals no matter the bid.
The sale would have had to be approved by the board of directors who represent
the shareholders. Again a conservative conspiracy scare that amounts to nothing.
" if - then" statements are all you have to go on, no facts
or even sense. Shameful.
Mike Richards So IF it turns out to be anything more then sour
grapes and that they did take a lower bid how exactly do you propose it be
resolved? Should people turn to the courts (government) and sue? Should the
government step in and fine them? or should the market decide?
A quick search on fiduciary responsibility showed: "The courts stringently
examine transactions between people involved in fiduciary relationships toward
one another. Particular scrutiny is placed upon any transaction by which a
dominant individual obtains any advantage or profit at the expense of the party
under his or her influence. Such transaction, in which Undue Influence of the
fiduciary can be established, is void."Some posters have told us
that people who own a company should, in effect, just sit back and "take
it" when they lose $180 million. If they were offered $50,000 for their
house or $500,000, which offer do you think they would take? Maybe
I'm wrong, but I doubt if any of them work for $1 per year to improve the
world. I doubt that any of them give fistfuls of money to anyone who askes, but
they see nothing wrong with giving other people's money away. Before this wrings out, don't be surprized if several people are exposed
for acting in their own interests and not in the interests of the owners of that
Interesting how perspectives change. If a conservative had sold at a lower price
to a conservative, i have no doubt Tolstoy, George, FreedomFighter, et al would
be leading the way in decrying such an action. Equally, I have no doubt larceny,
SCFan, et al would be championing the owners right to see to whoever he
wants.This is the problem in our political environment today. Nobody
has any real convictions of right and wrong. We just have convenient attitudes
that are completely dependent on party politics. And despite the fact that our
attitudes are floating "with every wind of doctrine," we carry absolute
intolerance for those who don't see it exactly the way we do.What a mess we are in. As a nation, we are fractured - in my opinion, beyond
repair. As our children and their children continue to swirl in this eddy that
will lead to ultimate destruction, we can at least have the satisfaction of
knowing we did it to them because we each view ourselves as omniscient gods and
close our ears and hearts to any who disagree.
Ah yes, yet another "Conspiracy Theory".or should I say,
Shouldn't the shareholders be taking someone to task instead of the court
of conservative victimhood?
Look how noble some people are when they approve stealing $180,000,000 from the
stockholders of the Boston Globe. They problably see nothing wrong with the
government wanting to take over Apple for 10 years just as they see nothing
wrong with cheating the owners (stockholders) of the Boston Globe of the money
that was offered - and rejected. But, those people who approve of loosing $180
million are not concerned because it's not their money. They're not
at risk. That money belongs to some "rich guys" who should be stripped
of all their money so that lazy citizens can sit back and enjoy life - at
someone else's expense.
Free market means that it can be sold to whoever they want. Sounds like repubs
are wanting to circumvent the free market.
SCfan,You hit on the point I was going to make. It doesn't matter
to the vocal leftists when George Soros or Ariana Huffington own news outlets.
And of course there's totally no liberal bias in America's network
news anyway, BUT... if a news organization is about to fall into Conservative
hands... it's a huge problem? If the organization had no bias... then why
is it so huge that it may be owned by a Conservative owner?The news
report I watched this morning mentioned that Warren Buffett (well known investor
and Democrat) owns dozens of news papers. If the guy from Amazon.com owns
one... it's a travesty. But Warren Buffet owning dozones... ho-hum no big
deal...I think it's only natural for people in a news
organization to have biases. I don't know any human being that hasn't
acquired biases from their life experiences. The question is... can they put
their natural biases aside and report objectivley when doing their job? Most
can. Some notable example can't. People with huge biases
seem to gravitate to MSNBC, Huffington Post, MoreOnDotOrg, etc. And that's
Funny how quickly conservatives who always cmplain about sue happy people turn
sue happy the second they think they may have been slighted.
I guess there couldn't be any other reason but liberal hit job right like
say they decided to go with a guy that bought it is from the Boston area and
shown a commitment to the local community rather then someone from LA with no
other ties to Boston? no its got to be those horrible liberals.
Funny isn't it. Most journalists will claim no political influence in
their organization be it print or broadcast. Yet when the threat of some
"conservative" influence comes along they cry foul. However, if someone
like George Soros bought the paper, no one would worry about the
"liberal" influence one bit.
I hope they sue, I really do. That is unacceptable in todays economy to leave
money like that on the table. It is insulting, and shows total lack of respect
for all involved. If I were a very, very unlucky shareholder in said company, I
would want to sue.A company that is stupid enough to leave 180M+ on
the table deserves to be turned on its head and shaken til nothing is left!