Twin Cities Intrigue Sign of Larger Issue

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By: Jennifer Saba

Those following the tribulations at American newspapers certainly witnessed a strange summer. In the Dow Jones auction, for example, the loony waffling of the Bancroft family was even enough to inspire sympathy for that “devil” Rupert Murdoch. Amidst the swapping of properties, the layoffs, and the dismal ad results was the saga that played out in a St. Paul, Minn., courtroom.

What gained the most attention was Par Ridder, the publisher of the St. Paul Pioneer Press, admitting that when he crossed the Mississippi to take the same post at the Star Tribune in Minneapolis he bogarted a whole slew of documents, charts, and templates on his laptop and other such proprietary information and delivered the goods to the CFO of the Star Tribune. E&P obtained the transcripts from the trial, and after poring over them found that one of the more bizarre aspects to this case ? and trust me, there were many ? related to another issue: Ridder’s noncompete agreement, which existed when he was publisher of the Pioneer Press.

Ridder claims it had been waived, a concession he requested in late 2005 as Knight Ridder was preparing itself for a sale. One of the questions presiding Judge David C. Higgs must determine is whether that noncompete is valid.

During the three days of the trial in late June, Ridder revealed some astonishing facts: He signed the noncompete on April 19, 2004 ? but didn’t read it first. He contemplated letting his assistant Barbara Cartalucca shred this document at her home, along with other such agreements signed by Pi-Press executives (some of whom Ridder wanted to hire at the Strib), then had second thoughts. He even chased her down in the parking lot to retrieve the papers, Law & Order-style.

Then the trial veered off into more of a family drama. The defense showed a video deposition of Tony Ridder, the former CEO and chairman of Knight Ridder. He’s also Par’s father. Whatever your thoughts about the elder Ridder, you have to feel for the man for being put in such an awkward position.

Tony Ridder said, among other things, that he was unaware of noncompete agreements at Knight Ridder. “To the best of my knowledge, I did not know that we had any noncompete agreements anywhere in Knight Ridder, zero,” he stated in his deposition. He later added he didn’t believe in them: “We don’t own the services of people, I mean, they’re not slaves of Knight Ridder, they’re free to move. That has always been the case.”

Besides, he claimed, his son didn’t need permission from Art Brisbane, then Knight Ridder’s senior vice president, or any other executive at corporate to deep-six the noncompete. Par had testified that Brisbane gave him a verbal OK, but Brisbane was uncertain about that. But for reasons never fully explained, Par had the power to dissolve the agreement of his own accord, his father asserted.

Tony Ridder’s deposition caught the attention of some former Knight Ridder employees, especially one former top manager at the Pioneer Press. Walker Lundy served as the paper’s editor from 1990 to 2001, and later became editor of The Philadelphia Inquirer. He recalled that in the late 1990s, word came down that all corporate division directors at the Pi-Press were required to sign noncompete agreements. “I signed mine,” Lundy says. “The Star Tribune was never a place I considered as a potential employer.”

Lundy didn’t think much of it until he read some excerpts from the trial, and references to the noncompete jogged his memory. “I have exchanged e-mails with a number of people who worked at St. Paul and Knight Ridder, and they were astonished” to learn that Tony didn’t know about the noncompetes, Lundy says. “It is almost beyond belief.”

In his eyes, if corporate knew, Ridder knew. “He was not a hands-off CEO,” Lundy adds. “It was very surprising for me to learn all these noncompetes were floating around and he knew nothing.”

E&P contacted several former executives who worked for some of Knight Ridder’s former properties. No one recalls having to sign a noncompete other than those working in St. Paul.

Although he can’t recall any real secrets at the paper, Lundy says he can’t fathom Pi-Press employees, especially the publisher, high-tailing it to Minneapolis. As Lundy frames it, “It’s a little like the president of South Korea going to be the president of North Korea.”

But those were gentler times. As if people in the newspaper business weren’t already on edge, this saga has surely touched a nerve. As Barbara Cohen, president of Kannon Consulting, told me, the industry is under so much pressure that it’s really not surprising that cutthroat behavior has seeped into a gentlemanly atmosphere. The days of loyalty, even to one’s family legacy, are obviously over.

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