(AP) Hearst Corp. said it will have to put the Seattle Post-Intelligencer newspaper up for sale after a judge refused to move up the Sept. 12 hearing date in a lawsuit between Seattle’s two daily newspapers.
On Monday, Judge Greg Canova rejected a request by Hearst to move up the hearing date in its lawsuit to prevent The Seattle Times Co. from ending a 20-year joint operating agreement with the P-I and seeking to shut down the Hearst-owned paper.
Under the agreement, The Seattle Times handles non-news functions such as printing, marketing, and distribution for both papers in exchange for a greater share of the profits.
Lawyers for Hearst, the Times, and the Committee for a Two-Newspaper Town — a citizens group that intervened in the case — have been unable to agree on an earlier date, court bailiff Angela Ashley-Smith said.
Hearst contends that without an earlier date, it will need to start efforts to sell the 140-year-old P-I. Hearst says the P-I cannot survive without the JOA and that under the agreement, Hearst must try to sell the newspaper before a shutdown could occur.
“As stated in previous papers filed in court, we will be required to find a buyer for the Seattle Post-Intelligencer as a result of a provision triggered by The Seattle Times Co.,” said Debra Shriver, Hearst’s chief communications officer, in an e-mail to a P-I reporter.
The Times said it is not involved in the decision on trying to sell the P-I.
The Times, majority-owned by the Blethen family (with a 49.5% share held by Knight Ridder), contends the agreement is no longer economically viable and that the paper has lost money for the past three years. The P-I challenges the Times‘ financial claims.
On April 29, the Times filed formal notice that it had lost money for three straight years, launching an 18-month negotiating period during which the Times and P-I must try to come to terms on publishing one paper.
If those negotiations fail, the JOA ends, and the P-I would have to begin doing its own advertising, marketing, circulation, and production. Hearst has said the P-I would not survive if the agreement ends.
Originally, Canova scheduled a July 18 hearing to consider Hearst’s claim that the Times‘ losses in 2000 are not legally recognizable for the purpose of ending the JOA because they were caused by extraordinary circumstances — including such events as the Sept. 11, 2001, attacks, the prolonged recession, and the strike at both papers in late 2000 and early 2001.
That hearing was postponed to Sept. 12 after the judge allowed the Committee for a Two-Newspaper Town to intervene.