Conrad Black’s Lawyer Quizzes Government Witness

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Former press lord Conrad Black’s defense attorney grilled the government’s leadoff witness Thursday about hefty paychecks and a stock deal he got when he joined the Hollinger International newspaper empire.

Defense attorney Edward Greenspan sought to portray investment banker Gordon Paris as being just as thoroughly drenched in corporate opulence as Black, who is accused of swindling Hollinger out of $84 million.

“I’m going to suggest to you that you were making $15,805 a day in ’05,” Greenspan told Paris, who took command of Hollinger after the company ousted its longtime president and CEO amid shareholder complaints.

Greenspan never got an answer to his question because U.S. District Judge Amy J. St. Eve sustained an objection to the question. But he did get Paris to admit that he was paid $511,375 by Hollinger in 2003.

Black, 62, and three other men are charged with swindling Hollinger out of millions of dollars by selling off hundreds of community newspapers in the United States and Canada and pocketing payments from the buyers.

The payments were for promises not to compete with the new owners in markets where the papers circulated. Such “noncompete” payments are not unusual but prosecutors say Hollinger should have gotten the money.

Black’s lawyers maintain that nothing he did was illegal and any misdeeds were the fault of his longtime No. 2 man, F. David Radler, who has made a deal with the government and is now its star witness.

Paris joined Hollinger International’s board in 2003 at Black’s request to conduct an investigation of management fees, noncompete payments and other matters that already were raising shareholder concern.

One of the biggest shareholders, the investment house of Tweedy, Brown, was demanding such an investigation.

Greenspan scored points when Paris, who portrayed himself as highly knowledgeable about the company, described Tweedy, Brown as the second-largest shareholder; the Canadian lawyer then got Paris to admit that another investment house might have been second and Tweedy, Brown third.

Greenspan also tried to rattle the witness when Paris gave a lengthy answer and the Black attorney referred to “that speech you just made.”

That brought lead prosecutor Eric H. Sussman to his feet with an objection.

The government called Paris to the stand to testify that Black was well informed about the financial operations of Hollinger International. Prosecutors plainly wanted to refute any claim that Black was so busy in London running the Hollinger-owned Daily Telegraph and dabbling in politics that he left the nuts and bolts of the company to Radler.

Besides the Telegraph, Hollinger International during Black’s era as boss owned the Chicago Sun-Times, the Toronto-based National Post and the Jerusalem Post, as well as hundreds of community papers in North America.

All of the big papers except the Sun-Times have been sold and the name of the company changed to Sun-Times Media Group Inc.

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