By: E&P Staff
The Sun-Times Media Group said late Wednesday that it had received a $50 million payment settling a 2003 lawsuit brought by a big shareholder against Henry Kissinger, former Illinois Gov. James Thompson and other independent directors of the publishing company formerly known as Hollinger International.
The derivative action had been filed against the company by stakeholder Cardinal Value Equity Partners, accusing certain directors of breaching their fiduciary duties by doing nothing while former Chairman Conrad Black and other key executives allegedly plundered the company through improper fees, contracts, and other fraudulent methods.
The settlement had been agreed between the publisher of the Chicago Sun-Times and Cardinal in May 2005, and approved by the Chancery Court in Delaware last November.
In a statement, the Sun-Times said of the $50.27 million it received — which included interest of $267,870 — it paid $2.525 million to Cardinal for legal fees, resulting in net cash proceeds of $47.7 million.
The settlement will be funded by the company’s executive and organization liability insurance policies, the company said.
In addition to Kissinger and Thompson, the former directors who are parties to the Cardinal settlement are Richard R. Burt, Shmuel Meitar, Dwayne O. Andreas, Raymond G. Chambers, Marie-Josee Kravis, Robert S. Strauss, A. Alfred Taubman, Lord Weidenfeld, and Leslie H. Wexner.
As part of the settlement, they neither admitted nor denied wrongdoing.
Sun-Times Media Group stock closed unchanged at $4.46 on the New York Stock Exchange Wednesday.