[Zell, seen offering proof today that the Trib pension funds are intact.]
Other Cub news worth reporting comes from the Cubs’ financial sector. First, a real North Side “business guy,” who no doubt employs half a dozen unskilled Sox fans, has informed me that the unverified amount Mark Cuban is rumored to lead the pack of Cub suitors by is $300,000,000. That’s almost enough to pay the day shift at Lehman Brothers a half-hour’s severance pay, so if true, you know Cuban is serious.
Then there’s the unhappy rabble that used to feed the mighty Tribune media corporation its Republican rhetoric who are now suing Cubs/Tribco’s owner and (as reported on CSTB) fellow GOP fan boy, Sam Zell. These embittered ex-staffers accuse Zell of buying the Trib Corporation for a classic Gordon Gekko smash and grab buyout. Ie, that once Zell put up a comparative pittance for Tribco, he will rake in billions selling off the assets.
In return, I accuse these crybabies, out to selfishly safeguard decades worth of their families’ future, pension, and health funds, as short-sighted in the extreme. Can’t they see how their current situation has put the Cubs 9 games in front of the Brewers and guaranteed a .259 hitter like Kosuke Fukodome a $48 million contract? And they want to put up some geezer’s retirement years against that glory? No way, Jose! This bunch of greedy, disgruntled, and me-me-me whiners is exactly what I hate about the Bush years. Variety‘s account of their smear against Cub hero Sam Zell reads like this:
The suit noted that of the $8.2 billion he used to take Tribune private, Zell put up $315 million of his own funds and used the ESOP (without the consent of employees) to finance the rest — leaving the new entity with nearly $13 billion in debt. As a result, the plaintiffs allege, Zell’s redirected Tribune’s operations from running newspapers to servicing the new debt.
They also noted that Zell’s deal entitles him to 40% of the company — valued at more than $8 billion at the time the ESOP took ownership — for as little as $500 million.
“It’s a classic grift, played out under the cover of legal technicalities,” the plaintiffs said. “The real losers in this deal, however, are Americans who rely on news and information collected and disseminated by the respected Tribune news organizations.”
Neil told Daily Variety that the event that precipitated the filing of the suit came following July’s announcement that the Times would slash 150 editorial jobs, or more than 15% of the staff.
Plaintiffs also include former Times staffers Corie Brown, Henry Weinstein, Myron Levin and Walter Roche Jr. along with Jack Nelson, the former Washington, D.C., bureau chief. Defendants also include Greatbanc Trust Co., EGI-TRB and eight members of the Tribune Co. Employee Benefits Committee.
Tribune Co. spokesman Gary Weitman said, “We have not seen the lawsuit and will decline comment.”
The plaintiffs are seeking class-action status. In the suit they allege that through “destructive management and self-dealings,” Zell and his co-fiduciaries have breached their fiduciary duties to the ESOP beneficiaries. It also alleges that Zell has defunded employees’ retirement packages, raided the employee pension fund for more than $400 million and eliminated more than 1,000 jobs at the Times, Baltimore Sun and Chicago Tribune.