What the verdict meant - Page 2

What the verdict meant: Behind the Guardian's $15.6 million court victory

But in places where a strong competitor challenged the VVM paper — San Francisco and Cleveland being the two most notable examples — the chain was losing money or its profits were much thinner.

The folks in Phoenix were obsessed with going after the Guardian. The record is littered with e-mails between VVM headquarters and the SF office discussing ways to get ads out of the locally owned paper. The Weekly publishers had to send a regular "Guardian report" back to Phoenix to show how the two papers stacked up. Weekly publishers admitted that they might have offered special bonuses to sales reps who took ads away from the Guardian.

In fact, three witnesses testified that on the day he bought the Weekly in 1995, Mike Lacey, one of the chain's two principals, threw a copy of the Guardian on the floor and vowed to put us out of business.

The jurors found that sort of behavior strong evidence of predatory intent. One panel member, Kerstin Sjoquist, a local business owner and graduate student, said in an interview that "it felt overly predatory on the part of the Weekly" and that "the predatory intent trickled down from the top."

You could see that same intent by the way the Weekly covered the trial. None of the local reporters at the paper were in the courtroom; instead, the chain brought in one of its top editorial executives, Andy Van De Voorde, from Denver to write about the case every day. And the blog posts he authored were about as personally vicious as anything I've seen in a long, long time.

Van De Voorde portrayed this entirely as an attempt by Guardian publisher Bruce Brugmann to shake down the Weekly and VVM for money. (And he never reported on the fact that the evidence clearly showed Bruce and his wife, Jean Dibble, had never taken big profits out of the paper and had instead reinvested money to improve the Guardian.) From the start, Van De Voorde called the suit silly and stupid and tried to make the case that the Guardian had no evidence at all to prove predatory pricing.

As the case wore on, he started to change his tune: by the last few days, he was tacitly acknowledging that there was a chance the Weekly would lose, and he started attacking the law itself. In the end, he told me he "wasn't surprised" by the verdict — although for weeks his blog posts had taken the position that the Guardian couldn't possibly win.

The Weekly's lawyers essentially argued that their own client was unable to handle pressure from the Internet and unable to adapt to a changing marketplace. Expert after expert on the VVM payroll testified that both the Guardian and the Weekly had seen revenues drop because of outside market forces in San Francisco that apparently were completely beyond the coping ability of a national chain that was making money hand over fist in the rest of the country. In his closing arguments, H. Sinclair Kerr, the Weekly's lead attorney, insisted that the market for alternative newsweekly advertising had shrunk and that both papers were, in essence, failing.

That contrasted dramatically with testimony from the only expert witness for either side who had actually run a weekly newspaper. Bill Johnson, publisher of the Palo Alto Weekly, testified that the Internet was not destroying alternative papers and that it was entirely possible to make money in the Bay Area, even during a tough economy. He pointed out that, unlike daily newspapers that rely increasingly on wire-service stories, alt-weeklies offer unique content that can't be found anywhere else.

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