Conrad Black is scheduled to meet soon with the U.S. Securities and Exchange Commission.

TORONTO STAR ^ | Dec. 16, 2003 | ROB FERGUSOn, BUSINESS REPORTER

[Liz]

Tweedy Browne suing Hollinger

Top shareholder seeks legal fees

Investigated payments to Black

Hollinger International Inc. is facing a lawsuit from a New York investment firm that helped blow the whistle on millions in unauthorized payments made to Conrad Black, other executives and parent company Hollinger Inc. of Toronto.

Tweedy Browne Co. filed suit yesterday seeking reimbursement of legal fees its Global Value Fund incurred investigating possible wrongdoing at the company that owns London's Daily Telegraph, the Chicago Sun-Times and Jerusalem Post.

The lawsuit against Chicago-based Hollinger International was filed in Wilmington, Del., in the state's Chancery Court.

"Lord Black and his associates had been paying themselves many millions of dollars without proper disclosure,'' said the suit.

The suit asks for fees commensurate with "potential recovery of $31.55 million (U.S.)"

That's roughly the amount a special committee of Hollinger International is seeking from Black, other executives and Hollinger Inc.

Black and two executives have pledged to repay almost half the amount, while no decision has been made by Hollinger on the rest.

A figure for the legal fees — which under U.S. law cannot be charged to shareholders in the Tweedy Browne fund — was not specified. Tweedy Browne owns 13.1 million shares in Hollinger International, 18 per cent of its common stock, making it the newspaper company's second-largest institutional shareholder.

An analyst at the investment firm said seeking repayment from Hollinger International is justified because any unauthorized payments recovered will benefit all shareholders.

"We have been instrumental in seeing this go forward. We're trying to do the right thing," said Laura Jereski. "This should be a shared cost."

Hollinger International wouldn't comment on the lawsuit.

The $32.2 million paid to Black, other executives and Hollinger was for so-called "non-compete" fees as part of sales of Hollinger International newspapers to ensure Black and the others would not start competing newspapers. Tweedy Browne said that money should have gone to Hollinger International.

A special committee headed by former U.S. Securities and Exchange Commission chairman Richard Breeden was struck at Hollinger International earlier this year to look into the payments, and found they were not authorized by the board of directors. The committee is investigating other payments. Tweedy Browne has questioned $300 million in payments since 1995.

The suit was filed as The New York Times reported Black will have his first interview with the SEC on Monday as part of its investigation into the unauthorized payments that prompted him to step down as chief executive of Hollinger International last month. He remains chairman as the company looks at options, including the sale of newspapers, to resolve an impending financial squeeze.

Meanwhile, British stockbroker Collins Stewart confirmed yesterday it has entered the bidding for London's Daily Telegraph, Sunday Telegraph and The Spectator magazine.

But the firm, which usually buys companies and offers shares in them to institutional investors, would not elaborate on a report in London's Sunday Times that it is offering £500 million, or about $1.15 billion (Canadian).

Hollinger International has hired global investment banking firm Lazard to seek potential buyers. A source close to the process said no recommendations have been made to Hollinger International as yet.

"There are some (expressions of interest) that are going to make a short list later on and some won't."

Spokespersons for Black and Hollinger International would not comment on the SEC interview.

"If the SEC wants to discuss the status of their investigation, that's up to them," said Jim Badenhausen, Black's personal spokesperson in New York.

A spokesperson for the SEC in Washington declined comment.

The Ontario Securities Commission is also investigating Hollinger and co-operating with the SEC.

With files from the Star's wire services.

DICK LOEK/TORONTO STAR FILE

[AdamSelene235]

bump

[AdamSelene235]

Didn't Black just use corporate funds to purchase the papers of his hero, FDR?

[Grampa Dave]

Wow what an interesting twist.

A mutual fund company sues left wing rats in charge of a company for enriching their pockets while $crewing the stockholders and mutual fund share owners.

To bad we don't have this law here!

"Tweedy Browne suing Hollinger

Top shareholder seeks legal fees

Investigated payments to Black

Hollinger International Inc. is facing a lawsuit from a New York investment firm that helped blow the whistle on millions in unauthorized payments made to Conrad Black, other executives and parent company Hollinger Inc. of Toronto.

Tweedy Browne Co. filed suit yesterday seeking reimbursement of legal fees its Global Value Fund incurred investigating possible wrongdoing at the company that owns London's Daily Telegraph, the Chicago Sun-Times and Jerusalem Post.

The lawsuit against Chicago-based Hollinger International was filed in Wilmington, Del., in the state's Chancery Court.

"Lord Black and his associates had been paying themselves many millions of dollars without proper disclosure,'' said the suit.

The suit asks for fees commensurate with "potential recovery of $31.55 million (U.S.)"

That's roughly the amount a special committee of Hollinger International is seeking from Black, other executives and Hollinger Inc.

[Grampa Dave]

Go to this search site on Yahoo for the answers to your excellent question:

http://search.yahoo.com/search?x=op&va=+Conrad+Black+Roosevelt&va_vt=any&vst=0&vd=all&fl=0&ei=ISO-8859-1&vm=p&n=20

[Liz]

Didn't Black just use corporate funds to purchase the papers of his hero, FDR?

Black considers himself a student of history and bought FDR's papers for $8 million.
SEC filings indicate they were paid for by Black's company, Hollinger, as investments.

Black recently promoted his just-released book, the massive, “Franklin Delano Roosevelt: Champion of Freedom,” that he penned on his offtime. When Black tried to talk up FDR’s New Deal, the only deals people wanted to know about were those he cut with Hollinger.

[Beck_isright]

It just gets better by the day. I wonder if by 2005 the Mutual Fund industry will finally take it's rightful place in history like the old "holding companies" we all knew and loved from the past.

[Grampa Dave]

It doesn't take a long time for most investors to say adios to a Mutual Fund Company that $crewed them so their rich buddies could make illegal trades.

The Mutual Fund Companys that didn't do this will end up with a large part of the roll over.

This move by Tweedy Brown is an excellent move. This should put the fear of you know what into a lot of CEO's who support political parties and other PC BS with what should be shareholder dividends and increased profits.

[BOBTHENAILER]

A mutual fund company sues left wing rats in charge of a company for enriching their pockets while $crewing the stockholders and mutual fund share owners.

What rich irony. A left wing RAT actually getting sued? What are our courts coming to?

[AdamSelene235]

Well, given he used corporate funds from a nearly bankrupt company (typical Socialist genius) I suppose FDR's papers will need to be auctioned off to repay as many creditors as possible.

I have a table than need leveling, I might submit a bid. I hear the CATO Institute is low on toliet paper.

[Liz]

Wow what an interesting twist. A mutual fund company sues left wing rats in charge of a company for enriching their pockets while $crewing the stockholders and mutual fund share owners. To bad we don't have this law here!

England is contrary. In an English court of law, you are guilty until proven innocent, their daily newspapers are as prolific as dime store novels but their libel laws are much more stringent than ours. Liberace once collected after suing a British columnist for calling him gay. What else to expect from a land whose private schools are called public schools?

[Grampa Dave]

Put on your fire resistant Nomex suit now!:)

Seriously, if more responsible Mutual Fund Companies do what Tweedy Brown has done here, we will seen massive behavioral changes in top management of many companies.

[Liz]

This move by Tweedy Brown is an excellent move. This should put the fear of you know what into a lot of CEO's who support political parties and other PC BS with what should be shareholder dividends and increased profits.

Gosh, I betcha they never knew that was risky.(/sarcasm).

[Grampa Dave]

Maybe, Mr Al Goron, there is a controlling legal authority since you left DC!

[Liz]

It just gets better by the day. I wonder if by 2005 the Mutual Fund industry will finally take it's rightful place in history like the old "holding companies" we all knew and loved from the past.

Heheh. Nice take.

[Constitution Day]

I read the book review that a National Review writer did on Black's tome, and they were nearly merciless.

[Citizen of the Savage Nation]

I guess I've been out of the loop. Isn't Black the owner of the National Post? I liked that paper. What happened??

[BOBTHENAILER]

I read the book review that a National Review writer did on Black's tome, and they were nearly merciless.

Merciless darn near rhymes with PRICELESS.

[habs4ever]

Conrad Black is very right wing.Always has been.

[Liz]

Bob, you are the poet of FR. LOL.