It's a bit complicated to explain how the corporate-controlled SF Weekly came to owe the independently-owned San Francisco Bay Guardian more than $20 million.
But the short of it is that in 2008, a San Francisco jury declared that the SF Weekly—and by extension its owner, Village Voice Media (VVM), which also owns the Seattle Weekly—had engaged in predatory pricing.
Essentially, the SF Weekly was found to have kept its ad rates artificially low in an effort to force the Bay Guardian out of business.
At present, the SF Weekly owes the Bay Guardian something north of $20 million (with interest accruing at a rate of about $5,000 per day). Its owner, VVM, isn't paying. VVM is also declining to put up a $20 million bond while it appeals the predatory pricing decision. And so the Bay Guardian has been allowed to start seizing some of the SF Weekly's assets: its delivery vehicles, for example, and its rent checks.
A Superior Court commissioner in San Francisco is expected to rule soon—perhaps as soon as tomorrow—on just how far the Bay Guardian can go to get the rest of its $20 million (and counting).
VVM owns 16 alt-weeklies around the country, including the Village Voice and the LA Weekly, and in 2007 the corporation was valued at around $191 million. Can the Bay Guardian reach beyond the available assets of the SF Weekly—likely worth much less than $20 million—in order to collect all of its money?
Tim Redmond, the Bay Guardian's executive editor, told me today that if the Superior Court commissioner gives his paper what it's been asking for, then his publication will end up with “a lien on all of [VVM's] assets, which is basically all the newspapers.”
A list of newspaper that includes, of course, the Seattle Weekly.
Does Redmond see anything of value at the Seattle Weekly offices down on Western Avenue? Anything he'd like to seize?
“Whatever is valuable that would help us collect the money that we’re owed," he said. "If the courts tell us we can go after papers outside of California, we will go wherever we can, wherever we have the legal authority to go, to pursue this debt, absolutely.”
We'll find out soon whether the debt collection leads him here.
(This post went up too late to reach anyone at VVM headquarters, but I'll give them a call tomorrow morning and have sent an e-mail to the Seattle Weekly to see what it makes of the troubles in SF.)