Posted on 01/17/2004 9:17:01 PM PST by HAL9000
NEW YORK (Reuters) - Newspaper publisher Hollinger International Inc. said late on Saturday it was ousting media tycoon Conrad Black as its chairman and suing him and one of his top deputies for more than $200 million.The lawsuit filed by a special committee of the company's independent board members charged that Black and Hollinger Inc. -- a Toronto-based holding company through which he controls Hollinger International -- together with former president and chief operating officer David Radler, collected unjustified and excessive management fees and altered company books and records to conceal their actions.
Hollinger International, which owns the Chicago Sun-Times and Britain's Daily Telegraph among other newspapers, said in a statement that by action of its board, Black ``has been removed as non-executive chairman of the company, effective immediately.''
Black, a member of Britain's House of Lords, resigned as Hollinger's CEO in November under pressure after the company disclosed that he, Radler and several other executives had received $32.2 million in payments not authorized by the board of directors.
In a separate statement Hollinger said its lawsuit ``charges that the defendants diverted and usurped corporate assets and opportunities from the company through systematic breaches of fiduciary duties owed to the company and its non-controlling public shareholders.''
The suit, filed in U.S. District Court in Manhattan, accuses Black and the other defendants of ``altering the company's books and records'' and of ``misrepresenting or omitting to provide material information in statements to the company's independent directors or to public shareholders.''
Hollinger said it would explore a possible sale of its assets.
A lawyer for Black, John Warden, said in a statement that lawsuit was an attempt by the special committee to draw attention away from new evidence that contradicts earlier statements by independent board members concerning certain payments to Black.
``We believe this lawsuit is an attempt by the special committee now to divert attention from the fallacy of their earlier claims,'' Warden said.
Under an agreement reached with the company when he resigned as CEO, Black faces a Sunday deadline to start paying back $850,000 of the roughly $7 million in payments the company deemed unauthorized in November.
The U.S. Securities and Exchange Commission on Friday obtained a federal court order against Hollinger International, to protect efforts by the special committee to recover some of the unauthorized payments to Black even if the company were sold.
The SEC also filed a civil complaint against Hollinger alleging that it failed to disclose the controversial payments to former insiders from at least 1999 to 2001. Hollinger said it was cooperating with the SEC.
Meanwhile, several British newspapers reported in their Sunday editions that billionaires David and Frederick Barclay, brothers who own the Ritz Hotel and The Scotsman newspaper, had approached Black about buying control of Hollinger's Telegraph newspapers.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.