The California Superior Court has appointed a receiver to investigate the finances of SF Weekly’s parent company and develop a plan to pay the Bay Guardian the $22 million that the chain owes as a result of our predatory pricing lawsuit.
On May 25, Commissioner Everett A. Hewlett, Jr., entered an order appointing professional receiver David Summers to investigate the assets of New Times Media LLC and its subsidiary, SF Weekly LP.
New Times Media LLC is the holding company for the nationwide Village Voice chain of alternative weekly newspapers.
Summers has been ordered to develop a plan for the disposition of the company’s assets so the Bay Guardian can get paid.
"This is a very significant step forward in our collection efforts," said Bruce B. Brugmann, Bay Guardian editor and publisher.
After a six-week trial in 2008, a San Francisco jury found that the Weekly and New Times had intentionally sold ads below cost in an effort to damage the independently owned local competitor.
The jury awarded the Bay Guardian $6.39 million, and Judge Marla Miller trebled part of the damages and added on attorney’s fees. With interest accruing at 10 percent a year, the judgment is now more than $22 million.
New Times and SF Weekly Have appealed the judgment. The California Court of Appeal has set oral argument for 9 a.m. June 11.
Earlier this year, a lending syndicate lad by Bank of Montreal declared the Village Voice chain to be in default of their $77 million loan arrangements. Bank of Montreal claims to be daily sweeping the moneys earned by the Village Voice chain into a special account so as to protect the lenders' interests.
The banks in the syndicate that are holding the VVM debt (as of March, 2009) are Bank of Montreal, U.S. Bank, Wells Fargo, WestLB AG, Rabobank, BNP Paribas, and Brown Brothers Harrimann.
The Bay Guardian has already seized two of SF Weekly’s vehicles and the rent that the paper’s subtenants pay. The California Superior Court has previously ordered half the SF Weekly's advertising revenues diverted into an independent bank account, and placed a lien on New Times' interests in its subsidiaries to protect the Bay Guardian’s interests.
Andy Van De Voorde, spokesperson for VVM, didn't respond to an email requesting comment.
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