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Saturday, January 22, 2000

Star-Bulletin closing after 117 years

owner seeks damages
from state

Liberty Newspapers LP
claims it stands to lose up to
$10.2 million due to the delay
in the paper's closure

By Debra Barayuga


The owner of the Honolulu Star-Bulletin is seeking damages from the state for delaying the newspaper's closure.

In a complaint filed in U.S. District Court yesterday, Liberty Newspapers LP is asking the court to declare the state's lawsuit challenging the closure as illegal and unconstitutional.

It also asks the court to find that Liberty can cease publishing the Star-Bulletin, can enter into any agreement and receive any payment to end its joint operating agreement with the Gannett-owned Honolulu Advertiser, and not be required to put the afternoon paper up for sale.

Liberty is seeking damages and attorneys' fees and costs.

The owners of the Advertiser and Star-Bulletin entered into an agreement in September to end their joint operating agreement Oct. 30 and for Gannett to pay Liberty $26.5 million. However, it was not executed after the state sued and a federal judge issued a preliminary injunction.

The agreement expired Dec. 23 with no move by either owner to extend it. Liberty did not get its payment.

Because of the state-sought injunction barring the newspapers from carrying out the agreement, Liberty has been forced to continue publishing against its will and is incurring significant attorneys' fees and costs, its suit says.

Deputy Attorney General Jack Rosenzweig said he has not seen the complaint, and declined comment. The state has 20 days to respond.

Wayne Cahill, administrative officer for the Hawaii Newspaper Guild, which represents employees of the Star-Bulletin, called the newspaper's latest move "shameful."

By filing its complaint, Liberty is admitting to the allegations in the state's suit and is now trying to bully the state into dropping it, Cahill said.

The state's suit alleges the newspaper owners illegally conspired to create a monopoly and were paying Liberty to close the Star-Bulletin after failing to put it up for sale.

"And now the newspapers are saying they're going ahead with what the injunction prevented them from doing. It's deplorable," Cahill said. "Gannett and Liberty ought to be ashamed of themselves."

Diane Hastert, attorney for Liberty, declined comment.

Liberty's suit comes on the heels of a motion filed by the owners asking the state to post a $21 million bond to cover potential losses due to the delay in closing the Star-Bulletin. The state has posted a $10,000 bond.

The newspapers have yet to provide any evidence that the Star-Bulletin is losing money, Cahill said.

Liberty contends it stands to lose up to $10.2 million if the injunction remains in place until Sept. 30.

Trial on the state's suit is set for Sept. 19.

Bulletin closing archive

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