Reporters From Paper Suing Chief of Tribune

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A group of current and former reporters at The Los Angeles Times sued the owner, Samuel Zell, on Tuesday, accusing him of recklessness in the takeover and management of the newspaper's parent, the Tribune Company. The unusual takeover turned Tribune's stock over to an employee stock ownership plan, or ESOP, so the employees technically became the owners. But those employees were given no say on the deal, no seats on the board and no ability to sell shares for years to come. "By orchestrating what was clearly an imprudent transaction," the lawsuit states, Mr. Zell and the former Tribune management "breached their fiduciary duties to the employee-owners." It adds that Mr. Zell and his aides have compounded that breach in the way they have run the company, and by using money from the employees' pension fund to pay for buyouts and severance. The complaint seeks unspecific monetary damages and the removal of Mr. Zell and other board members. The complaint was filed in Federal District Court in Los Angeles and seeks class-action status to represent employees across the company. The plaintiffs include some of the best-known Times writers of the last generation, including Dan Neil, a Pulitzer Prize-winning automotive writer; Jack Nelson, a former Washington bureau chief; and Henry Weinstein, a longtime legal affairs reporter. In addition to Mr. Zell, the suit named as defendants the company as well as current and former board members. It accused the former management of profiting from a deal that it knew would cripple the company.


Reporters From Paper Suing Chief of Tribune Tribune, Zell Named in Employees' Suit (WSJ) Times reporters sue Zell, seek ouster from board (Reuters) L.A. Times employees sue parent firm Tribune, Zell (LATimes) Zell Calls Suit Claims 'Frivolous'