Former Hollinger Exec Black Pleads Not Guilty

By: Mark Fitzgerald A scowling but otherwise relaxed-appearing Conrad M. Black pleaded not-guilty in a U.S. courthouse Thursday evening to charges that he schemed to loot more than $84 million from sales of Hollinger International, the worldwide newspaper empire he founded and later lost.

U.S. District Court Judge Amy St. Eve released Black on a $20 million bond secured by his Palm Beach, Fla., mansion and the $8.5 million seized from the sale of his Manhattan co-op.

In a bond agreement with federal prosecutors, Black agreed not to contest any extradition request and was directed to reside either in Canada, Chicago, or Palm Beach. Patrick Fitzgerald, the special prosecutor assigned to the CIA leak investigation, is the U.S. attorney for this district.

Black, dressed in a blue suit and shirt and yellow tie, stood straight and answered Judge St. Eve's questions in a mild voice.

St. Eve agreed to admit Black's longtime Toronto lawyer Edward Greenspan as an attorney in the case. Black's U.S. lawyer, Edward Genson, indicated that Greenspan would be the lead attorney in the case.

After the arraignment, Greenspan was asked by E&P if he agreed with Black's declaration last week that the indictment was "a massive smear job from A to Z."

"That is his viewpoint, and he said what he felt, and meant it," Greenspan said. "I think he expressed it too in his not-guilty plea."

After the arraignment, Black briefly took questions from reporters, but his answers could not be made out above the din of jostling camera operators and reporters. At one point, a reporter asked, "Is this a difficult time for you sir?" Black replied, "No." When asked if he was financially strapped, Black smiled and indicated that no, he was not.

CFO Peter Y. Atkinson, Hollinger International's former head of legal affairs, also pleaded not-guilty before Judge St. Eve and was released under $20 million bond and was released with the same conditions as Black's bond.

Atkinson and Black didn't speak to one another inside the courtroom and did not seem to acknowledge one another's presence.

In court, assistant U.S. attorney Robert Kent said that he had heard from the Toronto attorney of John "Jack" Boultbee that the former Hollinger CFO had attained a U.S. lawyer and intended to appear in court sometime next week. Kent said a date would be set soon.

Every seat was taken in the courthouse where Black was arraigned, reflecting intense media interest. In attendance were reporters from all of the major Chicago television stations, newspaper writers such as Chicago Sun-Times columnist Mark Brown, more than 20 reporters from Canada, and five courtroom sketch artists.

In September, David Radler, Hollinger's former CEO and long-time friend of Black, agreed to a 29-month jail term and a $250,000 (U.S.) fine in a deal with the U.S. attorney for pleading guilty to mail fraud. Other counts were dropped and Radler agreed to testify. Many charges relate to Hollinger's sale five years ago of newspapers to CanWest Global Communications Corp. The indictment says Black negotiated that deal while Atkinson and Boultbee helped review and complete it and that they were given hefty bonuses without paying proper Canadian taxes.

As Black entered the courtroom and entered the defense area, a reporter could be seen holding a copy of today's Chicago Sun-Times, now the flagship of the Hollinger chain. Emblazoned across the front page was a headline referring to a separate Chicago corruption conviction: "No One Is Untouchable, Especially in this Town."