SEATTLE SETTLEMENT CHECK SENT.
Starting in April 2003, the Times sought to shut down the JOA; Hearst pre-emptively sued the Seattle Times Co. -- and the Times Co. counter-sued Hearst -- because of a codicil in their 1988 JOA that provided for a shuttering of the JOA should one party lose money for three consecutive years. The two litigated the disagreement for a couple of years and then agreed to submit to binding arbitration; a week before the arbiter was to hear the case this spring, the two companies agreed to a comprise.
The Times Co. agreed to pay Hearst $49 million to drop its suit and give up a provision in the JOA which gave Hearst on-going income from the Seattle operation even if the Post-Intelligencer shut down, while Hearst agreed to pay the Times Co. $25 million to release it from Times Co. claims and for the Times Co. to stop trying to shut down the JOA until 2016.
The result was that Times Co. owed Hearst just under $24 million. The P-I reported last week that the check had been received by Hearst.
It was probably one of the most painful checks that Frank Blethen, head of Seattle Times Co., has ever written. But Hearst really must have had a much stronger case than previously thought, or the deal would never have been struck.