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Weekly UpdatesA request by lawyers for The Sun-Times Media Group of Chicago to close the bankruptcy court during testimony about what the company thinks it can garner from its sale -- and how $1.8 million in bonuses will be distributed to 20 top employees when and if a sale goes through -- was denied on Wednesday in Delaware.
Sun-Times, which declared bankruptcy on March 31, was fought on the point by the U.S. Trustee and the Internal Revenue Service, which is the company's largest creditor, as well as by a lawyer representing The Newspaper Guild/CWA.
"Am I the only one seeing the irony in the Chicago Sun-Times seeking to seal the courtroom?" Judge Christopher Sontchi was quoted by The Associated Press as asking. The wire service said the judge told the company's lawyer, David Agay, that he would have to meet an "extremely high burden" to get the privacy the company requested.
Agay told The A.P. that he and his clients would "have to absorb the judge's decision and decide what to do next."
Sun-Times Media, which owns the Sun-Times as well as seven suburban Chicago titles and various web sites, wants to keep the price it hopes to fetch for itself secret because if the number got out, it might "jeopardize the debtors' ability to obtain the highest possible sale price for all the debtors' creditors."
The judge did rule that the company could keep the names of those who would get the cash bonuses and their amounts secret, against the objections of the lawyers for the Trustee and the Guild. Sontchi further ruled the entire issue as pending, so that the company wouldn't be forced to disclose any of it until further discussions could be held next month, at the next regularly scheduled bankruptcy session.
The other Chicago newspaper bankruptcy -- this one at Tribune Co. -- also continues to be messy. After a back-and-forth about whether creditors will seek to dump Sam Zell (the man who took Tribune private) from the post-bankruptcy business, the Wall Street Journal reported on its bankruptcy blog last week that creditors are looking long and hard at the Cantigny and McCormick foundations -- which were major stockholders in the public company and cashed out their shares in Tribune during Zell's leveraged buyout -- as places to get some of their money back. The foundations' lawyers are putting up a spirited defense.
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