March 16, Thursday

March 16--it's now been six full months since the September 16 announcement by Rupert Phillips that he planned to close the Star-Bulletin in exchange for a $27 million payment from Gannett. But we're still open. We hit another milestone Saturday, which marks another year of Starbulletin.com. Happy birthday to Blaine, Ken & Co.

I was reminded yesterday of the trump card held by the newspaper unions, a group which in our case includes the ILWU. If the company were to provoke a strike, as happened in Detroit, it is likely that dockworkers would refuse to unload shipments of newsprint bound for the newspaper agency. As a result, a leading indictor of upcoming problems might be the stockpiling of newsprint.

Another friend pointed to the interesting history of the Toronto Sun, which was started by a group of staffers from the Toronto Telegram following that paper's demise in 1971. The day after the shutdown, the Sun was formed, and has grown into a media chain of its own.

March 17, Friday

The bleed continues. A coworker told me yesterday that some sources are beginning to favor Advertiser reporters based on a perception that we won't be around much longer and, as a result, it's best to build long-term relations with the 'Tiser. It's the first such report that I've run into, but probably not the last. I can empathize with the dilemma facing someone trying to get their story out.

But folks, we're not dead yet!!

The San Francisco Bay Guardian reported last month on details of what assets of the SF Examiner have been offered for sale. The story includes the full text of the "confidential" asset summary from the New York firm of Veronis, Suhler & Associates, Inc., which is handling the transaction. Obviously, they've been able to at least conceptually split off many more substantive assets than Gannett could here in Honolulu. If you're like me and missed the story when it appeared on February 2, be sure to check it out today.

Rumblings over the imminent departure of assistant city editor Alan Matsuoka continue. Alan's last day with the regular crew is today, although he actually wraps up with our Saturday edition tomorrow. We wish him well, and hope we'll be doing as well as he.

Hopefully he'll keep us posted on progress of the great novel from his hideout in the cool rain forest of Volcano, where the 3000-foot elevation gives distinctly non tropical weather. As our days get hotter, literally and figuratively, his position may look better and better.

 

March 18, Saturday

It was mostly smiles through the newsroom yesterday after a story moved across the AP wire just before 10 a.m. announcing the sale of the San Francisco Examiner.

It was like a wave of good news implying that the Department of Justice actively pressed to keep the newspaper open, or so it seemed to most of us, based on the somewhat cryptic sentence in a statement issued by Hearst Corp and quoted by AP in an early version of the story:

"After a vigorous and protracted sales effort and discussions with regulatory authorities and Clint Reilly and his attorneys in connection with the litigation regarding the transaction, The Hearst Corporation determined that in order to complete its purchase of the Chronicle, it was appropriate to facilitate the continued publication of the Examiner rather than close the newspaper."

And the Examiner reported the comment of publisher Timothy White, who was asked whether pressure applied by local politicians affected the outcome. "You'll have to ask the Justice Department about that," White replied.

Bingo!

It seems clear that a combination of pressures forced Hearst Corp. to do something they didn't want to do. Instead of simply closing the Examiner, the paper will be reborn as a potential competitor, aided by an officially undisclosed "significant financial commitment" that Hearst will make to the continued publication of the Examiner.

The Chronicle, citing sources close to the deal, reported today that the purchase price was "nominal" and that Heart will pay subsidies of up to $25 million a year for three years as part of the deal.

The Examiner will be moved to a morning publication and compete head-to-head with the Chronicle. Current Examiner employees are being offered positions with the Chronicle, reported with a one-year guarantee, unless they sign on with the new purchaser.

That's a very long way from the original plan, and certainly signals behind-the-scenes hardball by a variety of players, including the Department of Justice.

Most of us felt the news can't be anything but positive for us, and gives new hope that the Star-Bulletin will survive.

Not all reactions were positive. At least one Star-Bulletin staffer said, "it sucks for the Examiner people. What about the union? What about union wages? Will they have to reapply for their own jobs?" Too many uncertainties for them, was his view.

AP reported that Examiner employees were asked after the announcement to raise their hands if they wanted to work at the new paper. No hands went up.

But at least the Examiner staff now have choices and some future employment, and the community continues to have a competing daily voice.

 

March 19-25, Sunday-Saturday

I'll be out of town for the week, and won't be updating this page until next Sunday, March 26. Check back then, please. I canceled out of two other trips since September out of fear that the paper could be closed at any moment, and I wanted to be around just in case. This time I'm getting on the plane. Hopefully there won't be any unexpected bombshells.

Please send me a note if you have any thoughts about the new developments, and I promise to check my email at least a couple of times during the week.

In the meantime, it's possible that you could catch a glimpse of me via this link, live from the Cat's Meow. That's what it says, honest. Is this some kind of karmic cat-lovers coincidence? Anyway, now you know where I'll be for the week.

 

March 26, Sunday

Back safely. This was the first out of state trip I've allowed myself since the survival battle started back in September, and I have to admit only fleeting and quickly repressed thoughts of the Star-Bulletin during the week. I assume the paper will still be there when I report back to work on Tuesday, but I didn't worry about it. There's a bit of free floating guilt about that, but overall it feels like an accomplishment.

I also have to admit failing the New Orleans' Party Test. Never made it to BourboCam, didn't venture in the French Quarter after dark, and made only a single walkthrough of the new downtown casino.

But we did manage early morning walks through the mansions of New Orleans' Garden District, and past the zoo to the Mississippi River. It's not the Pacific, but impressive nonetheless.
	We also spent a bit of time searching for good food, and the best Louisiana hot pepper sauce. Mission not yet completed. In the process, stumbled across CajunGrocer.com, which looks like a good way to continue the task from a distance.

Back on the home front, I was pointed to an interesting historical item. It seems that Rupert Phillips, general partner in the Liberty Newspapers Limited Partnership, which now owns but is trying to shut down the Star-Bulletin, was one of two newspaper brokers hired by Gannett when it set out to sell its Arkansas Gazette to the rival Arkansas Democrat back in 1991. The brokers said they couldn't locate another buyer, but various parties said they had never been contacted. The deal (and the Gazette) closed in October, and just a year later Rupert was slotted in to become Gannett's new JOA partner in Honolulu. It's been collusion from the beginning. No wonder the prospect of a real antitrust investigation is such a threat.

 

March 27, Monday

The SF Examiner ran an interesting story last week by reporter Seth Rosenfeld which contains additional details on efforts to sell the Examiner.

The story, citing court filings, says more than 80 possible buyers were contacted, but little interest was shown in a deal. Virtually all newspaper companies showed no interest, although Knight Ridder, owner of the San Jose Mercury News, said it might have pursued a deal that included the Examiner's 50% share of the existing JOA with the morning Chronicle.

The story then notes:

"The documents show Hearst's efforts to craft a deal that would satisfy the U.S. Department of Justice, which was investigating whether Hearst's purchase of the Chronicle would create an illegal monopoly; local politicians, who had advocated maintaining multiple editorial voices in San Francisco, and Reilly's lawsuit."

It isn't clear just what the folks from Justice were doing in the background, but this appears to be more evidence that they played an active role and are likely doing the same here.

If any readers can help clarify the DOJ's role in the Examiner sale, please contact me. Any and all background would be much appreciated.

 

March 28, Tuesday

The federal court hearing to determine whether the State of Hawaii will be required to post a $21 million bond in order to pursue their antitrust lawsuit has reportedly been postponed. Most likely this is in deference to ongoing settlement discussions, or the scheduled hearing on Gannett's motion to dismiss the case. But just another sign that we're not in "pedal to the metal" litigation mode.

National Public Radio's "Talk of the Nation" yesterday morning featured a segment which they titled: Are Family Newspapers Dying?, but was really commentary on the impact of corporate control. The guests were Walter E. Hussman Jr, the newspaper owner who drove Gannett out of Arkansas, and Jim Squires, former editor of The Chicago Tribune and author of Read All About It: The Corporate Takeover of America's Newspapers. Several listeners called in with complaints about their local Gannett papers. The program is available in the NPR archive in Real Audio format, and is an interesting listen.

I was in the throes of leaving for New Orleans on the 4th anniversary of the Star-Bulletin's online edition (Saturday, March 18). Too bad, because there were a couple of items of interest in the "Letters" section.

First was another of Paul Minczer's great graphics featuring Smokey the cat. Thanks, Paul, for the ongoing support! It is followed by a letter from Phil Mayer, retired Star-Bulletin reporter and Guild activist, who takes a closer look at details in the last circulation audit of both the S-B and Honolulu Advertiser. Phil points to the direct evidence that Gannett, through its control of the Hawaii Newspaper Agency, "has encouraged the decline of the Star-Bulletin circulation." "For instance," Phil writes, "in Waikiki there were 429 Advertisers but only 229 Star-Bulletins placed in news stands; in hotels and on military bases there were 3,708 Advertisers but only FIVE Star-Bulletins. And there were 4,568 Advertisers home-delivered on the neighbor islands and only 868 Star-Bulletins."

 

March 29, Wednesday

A small group from the Star-Bulletin met at noon yesterday with Guild staffer Wayne Cahill for an update on contract negotiations. Cahill said negotiations are moving forward despite the unsettled question of the S-B's future. The next meeting with company reps is scheduled for Monday.

After reviewing the outlines of the Guild's initial contract demands, questions were immediately raised about the status of settlement discussions in the pending antitrust lawsuits against Gannett and Liberty Newspapers.

Cahill was obviously reluctant to say much about this topic. Initially he said simply that settlement talks are just a part of the ongoing process of moving a case to trial. Nothing out of the ordinary, a hoop you have to jump through.

Then he was asked whether the fact that settlement discussions are ongoing is a sign that there is movement towards a deal. Wouldn't settlement talks be abandoned if there was obviously no grounds for compromise?

Cahill said: "There's nothing that I am aware of that would indicate any progress towards a settlement." He said he expects the case to proceed to trial. But he qualified this with the suggestion that he could be wrong, and a surprise deal could always occur.

Cahill also said he has been in contact with a local investment group that is interested in buying the Star-Bulletin, but Gannett says the paper is not for sale. He actually said there have been several interested parties. He said newspaper chains have not expressed an interest, in part because of a reluctance to buck Gannett's strong position in favor of an Advertiser monopoly. However, when asked whether that means that there are no newspapers among the parties expressing an interest, he backed away from a direct answer.

So the waltz continues.

And, from my friend and Star-Bulletin fan Marnie Weeks, comes this impression of S-B owner Rupert Phillips:

 

March 30, Thursday

A check with the clerk's office in U.S. District Court earlier this week turned up the protective order approved by Magistrate Judge Kurren last month to cover "confidential information" disclosed in the pending Star-Bulletin antitrust lawsuits. It took a while for this to make it into the case file.

The strict protective order appears to even prevent the plaintiffs from inspecting documents and information turned up during the discovery process. It helps explain why so little information about the progress of the case is emerging through the tight layers of secrecy that now surround the whole process, from settlement negotiations to ongoing discovery, if any.

According to the order, attorneys for the state, several individual plaintiffs, and Gannett submitted arguments and proposed orders by letter in early February. Neither the letters nor the proposed orders appear in the record or are noted in the case docket.

Kurren's order was issued on February 25, and "governs and is intended to facilitate the classification, designation, and production of confidential information produced by a party in this action, as well as the use of such Confidential Information by and between the parties."

The order provides that a party asked to produce documents or information may, "on a good faith belief", designate it as confidential if it "consists of proprietary business information, trade secrets, or confidential research, development, or commercial information not normally available to the public or to persons or entities outside the party and its affiliates."

Once designated confidential, the information can only be disclosed to "qualified persons", a category spelled out in detail. Qualified persons include court personnel; anyone who originally received the information; lawyers for either side and their employees, as well as outside services such as copy services that are involved; consultants or experts hired to evaluate the information; "any present or former officer, director, or employee of a party whose participation is determined to be necessary by counsel of record," although the person must first sign an agreement not to disclose any of the information to others.

Conspicuously absent from the list are the Save our Star-Bulletin plaintiffs, a distinguished group which includes two former Lt. Governors of the state.

The order exempts confidential information "which is otherwise publicly available, or developed or obtained independent of discovery in this action", or which becomes public knowledge "as a result of events over which the parties receiving such information have no control."

Anyone who might handle the confidential documents must be provided a copy of the protective order and must sign a nondisclosure agreement.

The order then provides that documents and exhibits containing "confidential information" or exhibits "shall be filed with the clerk of the court in a sealed envelope," and all the confidential information must be returned or destroyed within 45 days of the end of the case and any appeal.

A subsequent request to amend the protective order was granted in part and denied in part, according to notes in the file. Again, there is nothing in the file or shown on the docket to indicate a request was made, or the party that made the request."No restrictions as to the Governor regarding these documents."

March 31, Friday

It's been pouring rain in Kaaawa since around 2 a.m. or so, washing out our early morning walk for the first time in months although there are signs that the rain will let up at dawn. I'll just have to end the week with the memory of yesterday's sunrise, which didn't qualify as outstanding but you take what you get. One of those lessons of life, I suppose. The real problem with heavy rain is that I've got all eight impatient cats locked in the house, always an exciting event.

 

It was another crazy day for us yesterday as spectators attempting to follow events in San Francisco's parallel newspaper world. A ripple spread through the newsroom as each story moved on the wire. First news that the Justice Department had approved the Chronicle-Examiner deal, followed just a couple of hours later by news that a request for a temporary injunction had been approved in federal court. At each step the question is asked: What do you think? Is this good or bad for us?

The prevailing mood seemed to imply an answer--anything that adds weight and legitimacy to antitrust concerns has got to be positive for our newspaper's future.

Yahoo has an excellent set of links on the San Francisco situation in their full coverage news section.

Across the street at the Legislature, the House Judiciary Committee yesterday approved a resolution in support of the Star-Bulletin, according to a report last night by KHNL News8. The concurrent resolution has already been approved in the Senate, and must now go to the House floor for action.

Here's another one that should just be referred to as Overt Act #1001. It's a little bragging box on a little newsletter put out by Gannett's Hawaii Newspaper Agency for its Newspaper in education program. It reports that two sponsors, Burger King Hawaii and 7-Eleven Hawaii, donate profits from the sale of newspapers in their stores to the NIE program.

Then: "Currently our NIE sponsors have made it possible for 9,000 plus copies of the Honolulu Advertiser to be distributed to students on Oahu to be utilized as part of their curriculum. An investment in the future of our youth!!!"

Yes, the three exclamation marks are in the original. Of course, this has to be read in conjunction with Phil Mayer's recent letter to the editor, which cites a recent circulation audit which showed only a single issue of the Star-Bulletin going each day to the DOE along with the hundreds of daily Advertisers.

Gannett's NIE newsletter should read: "A questionable and possibly illegal investment in the future of our monopoly!!!"

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