Newspaper President May Have Paid Conrad Black for Legal Protection
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CHICAGO — The president of a Kentucky company that bought 27 community newspapers from Hollinger International Inc. conceded yesterday he may have received “some legal protection” by paying $500,000 to a Canadian holding company owned by former press lord Conrad M. Black.
The president and CEO of Paxton Media Group Inc., David Paxton, said the non-competition agreement he received from Torontobased Hollinger Inc., a sister of Hollinger International, was largely valueless in a business sense.
Prosecutors who have charged the 62-year-old Lord Black with racketeering and fraud claim such non-competition payments were merely a device he used to siphon millions of dollars from the farflung Hollinger media empire.
Mr. Paxton, who testified last week, returned to the stand yesterday as the third week of Lord Black’s trial began. He said that, when buying the newspapers for $59 million, he wanted a promise that Hollinger International wouldn’t move back into the circulation markets and compete with him.
Mr. Paxton testified last week that $2 million of the $59 million purchase price was designated for non-competition agreements. Of that sum, $1.5 million went to Hollinger International and $500,000 to Hollinger Inc. Under cross examination by defense attorneys, Mr. Paxton said he had not been interested in a non-competition deal with Hollinger Inc.
