Ex-Tribune managers want LDS judge off case

Deseret News, Jan. 23, 2003
http://www.deseretnews.com/
By Angie Welling, Deseret News staff writer

      As former chief of staff to Gov. Mike Leavitt and a member of The Church of Jesus Christ of Latter-day Saints, U.S. District Judge Ted Stewart is not qualified to oversee the lawsuit over ownership of the Salt Lake Tribune, former Tribune managers assert in court documents calling for Stewart’s removal.

      Salt Lake Tribune Publishing Co. filed the motion Wednesday, saying Stewart has both a financial stake in the outcome of the case and prior personal knowledge of the facts leading to the dispute.

      The filing accuses the Deseret News, the Tribune’s business partner in a 50-year-old joint operating agreement, of conspiring with former Tribune owner AT&T and new owner MediaNews Group Inc. to wrest control of the paper away from SLTPC.

      Former managers allege the Deseret News, which is owned by the LDS Church, made moves to purchase the Tribune in 1999 from AT&T in an attempt to silence criticism of Utah’s dominant religion.

      SLTPC claims that AT&T agreed to sell the Tribune to the News and “secretly informed” Gov. Mike Leavitt about the plan.

      “Gov. Leavitt did not object and may have given tacit approval to the deal, even though it was publicly known that the Tribune was under option to SLTPC,” the motion states.

      Leavitt has testified in a deposition that he had no specific recollection of discussing the proposed sale with his staff.

      In denying a May request to disqualify himself from the case, Stewart said that although he was aware of telephone conversations between AT&T CEO Michael Armstrong and Leavitt, he believed the two men simply talked about the expansion of AT&T’s cable services in the state.

      “I do not recall being informed of any telephone call or other communication by Mr. Armstrong to Gov. Leavitt regarding a pending sale of the Salt Lake Tribune to the Deseret News,” Stewart wrote. “I believe that if I had been informed of such a communication, I would have remembered it.”

      Still, according to Wednesday’s motion, the lack of recollection does not matter. “The judge’s state of mind is not the issue; it is the public perception that governs.”

      Ultimately, AT&T put the Tribune up for auction, the Deseret News declined to bid, and Denver-based Media News was the high bidder.

      SLTPC immediately filed the federal lawsuit to enforce a 1997 option agreement that was signed during a multimillion-dollar, tax-free stock swap between TCI and the principal owners of SLTPC.

      Stewart has upheld that agreement — which gives managers the right to purchase the Tribune after July 31, 2002 — but ruled it cannot be exercised without the consent of the Deseret News. The News declined to grant consent, citing SLTPC’s mismanagement of Newspaper Agency Corp., the company responsible for the advertising, printing and circulation of both newspapers, as well as consistent blocking of Deseret News plans for morning publication.

      SLTPC has appealed the judge’s decision to the 10th U.S. Circuit Court of Appeals.

      In March 2002, Stewart found SLTPC’s claims of a conspiracy between the Deseret News, AT&T and MediaNews to be “highly attenuated,” ruling that any evidence pointing toward discussions between AT&T and the News was irrelevant because “these various proposals never became final.”

      Stewart later dismissed all of SLTPC’s claims against the Deseret News, something Tribune managers allege he could not have done with impartiality.

      If monetary damages were levied against the Deseret News, Stewart, as a member of LDS Church, also stood to lose money, they claim.

      “If the court does significantly contribute to the LDS Church or actively participate in its affairs, it is certainly not unreasonable to think that the court would have an interest in seeing that church funds, including its own contributions, were not depleted,” the motion states.

      LDS members are encouraged to contribute 10 percent of their income to the church.

      Deseret News attorney David Jordan said: “This motion adds nothing new to a similar motion previously denied, and rejected by the court as baseless, and it smacks of desperation.”

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