By Editor & Publisher Staff
June 25, 2008
CHICAGO - Conrad Black lost his chance to get out of jail Wednesday as a three-judge panel of the 7th U.S. Circuit Court of Appeals in Chicago upheld his convictions in the looting of the parent of the Chicago Sun-Times.
The court also upheld the convictions of Black's three co-defendants, top executives of Hollinger International, now known as Sun-Times Media Group. Appellate Judge Richard A. Posner rejected a common argument of the defendants, that the jury that convicted them last summer was improperly given an "ostrich" instruction, allowing the jury to find a defendant guilty for actively trying to remain ignorant of criminal actions.
"If you receive a check in the mail for $1 million that you have no reason to think you're entitled to, you cannot just deposit it and when prosecuted for theft say you didn't know you weren't entitled to the money," Posner wrote.
Black and codefendants Peter Y. Atkinson, John "Jack" Boultbee, and Mark Kipnis were convicted of improperly pocketing phony "non-compete" fees in the sell-off of Hollinger's community papers. Black was also convicted of obstruction of justice for removing items from his office in defiance of a court order. He is serving a six-and-a-half prison sentence in Florida.
In a statement late Wednesday, Sun-Times Media Group President and CEO Cyrus F. Freidheim Jr. said the decision "allows the company to focus on its future."
"The company intends to proceed with its civil suits against the convicted defendants and others, and today's decision further supports the strength of the company's claims," added Gordon A. Paris, who chaired the board of directors special committee that alleged Black and others, including his long-time lieutenant, former Sun-Times Publisher F. David Radler, of running a "corporate kleptocracy" that looting hundreds of millions from the publishing company.
"While there are no assurances in any legal proceeding, we continue to be very confident that the company will prevail in its civil suits," he said.
Patrick J. Fitzgerald, the U.S. attorney for Chicago whose office prosecuted Black and the others, hailed the appeals court ruling.
"The court found clear evidence that all four defendants engaged in a brazen, multimillion dollar corporate fraud scheme and deprived the public shareholders of Hollinger International of their right to the executives' honest services," he said in a statement.
In an article on the Sun-Times Web site Wednesday, staff reporter Mary Wisniewski quoted Black's defense attorney, Andrew Frey, as saying the decision was "very disappointing."
"We are carefully studying our options as to what we can do to get things straightened out," Frey told the Sun-Times.
Among the options is appealing to the entire appellate court, or taking the case to the U.S. Supreme Court.