By: Mark Fitzgerald
Hollinger Inc.’s periodic court-required status updates are usually repetitive affairs, but Thursday’s made an intriguingly opaque reference to the removal of documents from an obscure subsidiary of the holding company Conrad Black used to control.
For several months, Hollinger has been under court order to submit to a forensic accounting inspection by Ernst & Young. After discussing the cost so far of the inspection — C$11.65 million, or U.S.$9.78 million — the status update follows with this narrative:
“Upon learning that certain documentation relevant to the Inspection might be located at premises in British Columbia (the “B.C. Premises”) owned by 2821354 Canada Inc., a wholly owned subsidiary of Hollinger, Hollinger took steps to secure the B.C. Premises on August 18, 2005. Subsequently, certain persons gained access to the B.C. Premises and certain items and documents were removed. On August 19 and 22, counsel to Hollinger and others appeared before Mr. Justice Campbell for an order relating to this incident and an Order was issued by the Court on August 25, 2005 requiring, among other things, the return of the removed items.”
There is no further discussion of what the certain items are, or who the certain persons were. Calls to a Hollinger spokesman were not answered, and there was no immediate answer to an e-mail inquiry.
The incident occurred the same day U.S. Attorney Patrick Fitzgerald in Chicago announced grand jury indictments for fraud against former Hollinger key executive and Chicago Sun-Times Publisher F. David Radler, who maintains offices in Vancouver, B.C., as well as against former Hollinger International general counselor Mark Kipnis and a Black- controlled holding company Ravelston Corp.
In May, Black was caught on security cameras removing boxes from Hollinger Inc.’s Toronto offices. He returned them five days later after Hollinger went to court complaining the removal was in contempt of orders not to take anything from the offices.
Also in the status update, Hollinger Inc. said Ontario Superior Court on Thursday extended the time for calling its long-delayed annual shareholders meeting to Dec. 30, 2005.
Also Thursday, the court approved the appointments of David Drinkwater and David Rattee to the board of directors of the holding company deposed press baron Conrad Black had used as part of his complex corporate structure to control his newspaper holdings. Hollinger Inc.’s principal asset is a 17.4% equity interest and 66.8% voting interest in Hollinger International Inc., which publishes the Chicago Sun-Times and dozens of other Chicago-area papers.