Skip navigation

The Battle of Black

Continued from Page 1

The turncoat: Lord Black's lawyers will zero in on David Radler and pick apart his testimony. They can be expected to point out that Mr. Radler signed a plea agreement with prosecutors -- who offered leniency in return for his testimony. And they will probably argue that whatever wrongdoing occurred at Hollinger was Mr. Radler's responsibility, because he was the day-to-day operator in Chicago, while Lord Black was based largely in London. If Lord Black's lawyers can discredit Mr. Radler's testimony, they will go a long way toward winning their case.

The legal standard: So-called related-party transactions -- such as selling Hollinger newspapers to companies owned by Hollinger executives -- are not uncommon in the business world, many legal experts say. This means that prosecutors could have a hard time proving the Hollinger deals were criminal, even if whatever happened at Hollinger might be grounds for a civil case or regulatory probe.

The board: Hollinger was not a one-man show. The company had a board of directors stacked with luminaries such as former U.S. secretary of state Henry Kissinger, former White House adviser Richard Perle and a host of other ex-diplomats and ex-politicians. His lawyers can be expected to argue that they approved the transactions at issue in the trial and that everything was done by the book. And Lord Black and other shareholders presumed they were doing their jobs.

It's legit: There is nothing improper about "non-compete" payments. These fees are typical in the newspaper industry because someone buying a newspaper wants to be sure the seller won't start up a rival in the same community. When CanWest Global Communications bought virtually all of Hollinger's Canadian newspapers in 2000 for $3.2-billion, for example, CanWest allegedly demanded that Lord Black sign a non-compete agreement. The non-compete clause was a key part of the deal for CanWest, Lord Black has argued.

The faulty witness: A key witness for the prosecution is expected to be former Hollinger director Richard Burt, an ex-diplomat who was once U.S. ambassador to Germany. Mr. Burt allegedly heard a confession about wrongdoing by Peter Atkinson, one of the accused. Mr. Atkinson has denied the allegations and his lawyers argue that Mr. Burt's recollection is suspect because he had brain surgery just before the alleged confession. Mr. Burt has acknowledged in court filings that the surgery resulted in "some short-term memory loss," but he has insisted that he is fully recovered.

The advice: Hollinger had teams of lawyers and accountants who pored over the deals cited by prosecutors. In most cases, they signed off on the transactions and the fees. Lord Black's lawyers can be expected to argue that company advisers did not sound the alarm.

The rulings: Lord Black's lawyers have already succeeded in their efforts to rein in the prosecutors. The trial judge has turned down their bid to broaden the case to include allegations made against Lord Black 25 years ago. The judge also said the prosecutors can't go into allegations he improperly used Hollinger money to make charitable donations or to purchase $9-million (U.S.) worth of Franklin D. Roosevelt memorabilia.

Jurisdiction: One of the charges against Lord Black involves allegations that he took 13 boxes from his office in Toronto despite a 2005 Ontario court order prohibiting the removal of documents. Lord Black returned the boxes a few days later, but prosecutors claim his action amounted to obstruction of justice. Lord Black's lawyers will continue to question how he can be tried in Chicago for alleged conduct that occurred in Toronto.

Spending: While the prosecutors may push Lord Black's lifestyle, his legal team will probably argue that it is irrelevant to the case and not extreme by the standards of other big business people. They can also take comfort knowing that lavish spending arguments don't always sway juries. Dennis Kozlowski, former head of Tyco, faced criminal charges that he looted the company out of $600-million (U.S.). That case included stories about a $2-million birthday party and a $6,000 shower curtain. Mr. Kozlowski was convicted, but jurors said later that the tales about his lifestyle was not a big factor.

Edward Genson: While Toronto lawyer Edward Greenspan gets most of the attention in Canada as Lord Black's lawyer, the former media baron's ace in the hole could be his Chicago counsel. Mr. Genson, 65, has a folksy, friendly manner that will no doubt go over well with jurors. He's been practising law in the city for four decades and is well known to the locals.



Conrad Black has retained Toronto litigater Peter Atkinson since the 1970s -- eventually appointing him executive vice-president of Hollinger International. When a special committee of Hollinger directors challenged non-compete payments to Lord Black and his key executives, Mr. Atkinson agreed to repay his share. And, according to a deposition filed in a Delaware court, after one session with the special committee, "He said that he had been asked to lie, cover up . . ." In 2005, Mr. Atkinson was indicted on six counts of mail and wire fraud. He has pleaded not guilty.

Recommend this article? 0 votes

Back to top