In the long legal fight over Sam Zell's dubious use of employee funds to acquire control of Tribune, the good guys have won, more or less. A federal judge in Chicago gave final approval today to a $32 million settlement that will put some money back in the retirement accounts of Tribune employees, present and past.
In 2008, Pulitzer Prize-winning auto columnist Dan Neil and some colleagues in the Los Angeles Times newsroom (as well as in the great LAT scattering that has occurred under Tribune and Zell) took a courageous step and sued the keeper of their paychecks. At issue was the hinky financing that leveraged their employee stock accounts to allow Zell to get control of the company. From the class-action announcement back then:
The lawsuit contends that, since the inception of the deal, it appears that Zell and his accessories have planned to enrich themselves, tax-free, by perverting laws passed by Congress intended to benefit rank and file American workers.
The Chicago judge approved the settlement tentatively reached last October. The roster of plaintiffs and the respondents have evolved through the years.Tribune, for instance, is no longer on the suit, though the company will apparently be chipping in some of the settlement. Of the journalists who sued, Neil and reporter Eric Bailey — who both left the Times during the suit's slow progress — remain on the case. Here is Neil's farewell email when he left for the Wall Street Journal in 2010.
From Bloomberg BusinessWeek today:
Tribune Co., the bankrupt Chicago- based newspaper publisher, is contributing $4.45 million to the $32 million settlement of an employee retirement-fund lawsuit that it’s no longer a party to.
U.S. District Judge Rebecca Pallmeyer today granted final approval to the settlement at a hearing in federal court in Chicago. The media company was dropped from the case after it filed for bankruptcy protection in December 2008.
The balance of the settlement money will come from Greatbanc Trust Co. of Lisle, Illinois, which was trustee and fiduciary of the retirement plan, and from Greatbanc’s and Tribune’s insurers, plaintiffs’ lawyer Daniel Feinberg said.
No objections were lodged against the proposed settlement, Feinberg told the judge today.