By Tim Redmond
New Times Media LLC, the holding company for the Village Voice chain, has failed in its attempt to suspend the charging order entered last week in San Francisco Superior Court in favor of the Bay Guardian.
The charging order gives the Guardian a lien on all of VVM’s newspaper properties and furthers the independent local paper’s efforts to enforce a $21 million judgment.
Commissioner Everett A. Hewlett, Jr., rejected the attempted Ex Parte Motion to Stay brought by New Times on the basis that New Times failed to show the existence of any emergency.
Commissioner Hewlett also held that to suspend the charging order, New Times would have to post an appeal bond as in any other civil case, instead of a much smaller amount that was sought by New Times' counsel.
New Times' attorney Randall S. Farrimond argued that New Times could not post an appeal bond for the full amount, because it was merely a holding company and does not have any assets.
But Bay Guardian attorney Jay D. Adkisson pointed to a financial analysis produced prior to trial by New Times, which showed that New Times claimed total assets of $191 million as late as December, 2007.
New Times and its subsidiary SF Weekly LP collectively owe the Bay Guardian nearly $21 million resulting from a jury verdict for predatory pricing that was entered in 2008.
In 2008, shortly after the jury verdict, New Times was successful in obtaining a temporary suspension of the judgment similar to the one that it unsuccessfully sought on Monday, but then refused to post an appellate bond.
New Times has instead attempted to rely on its complex corporate structure to defeat the collection of the judgment while it pursues its appeal.
In a statement posted on the website of the Association of Alternative Newsweeklies, VVM Executive Editor Mike Lacey and CEO Jim Larkin argue that the court order is “very limited.” Not so, says Adkisson; the ruling gives the Guardian considerable leverage to collect from the New Times papers. In fact, if the charging orders were so worthless, it’s surprising that the VVM legal team has spent so much time and effort fighting to block them on an emergency basis.
In the statement, Lacey and Larkin also insist that they simply want their day in court – that they don’t want to pay until the California Court of Appeals has rendered a verdict.
But that conflicts directly with what VVM and its lawyers have told the Guardian’s legal team on repeated occasions. Those communications have suggested that VVM doesn’t believe the Guardian will ever collect any money, since the chain has an asset-protection plan that would frustrate any creditor.
VVM has more than adequate assets to post an appeal bond – but if the chain posts a bond, and the Guardian wins the appeal, the bond guarantees that we’ll get paid. Posting a bond would render any asset protection plan moot.
Our position has been clear from the start: Either VVM should pay the judgment now, or it should offer a guarantee that the money will be there when the appeals are over. And over the past two years, in repeated legal rulings, four San Francisco judges have agreed.