Published on Tuesday, 31 August 2010 15:32
There were reports of tremors in the Chicago western suburbs earlier today. Those minor quakes may not compare to shakes happening and coming soon to downtown Chicago's Tribune Tower, headquarters of Tribune Company.
Here is the latest developments in that troubled company's legal struggles...
Last Friday, Tribune representatives were supposed to file a new reorganization plan to replace the past ones which have been rejected and fought by numerous creditors. None was filed. Instead, Randy Michaels emailed out a memo to Tribune employees stating that they wished to have more discussions with the unhappy creditors first.
In the meantime, the unhappy creditors do not wish to talk with Tribune representatives any more. They are now preparing for a take-over of the company. The rumors last week about creditors looking to install Michael Eisner as CEO
have now gone beyond the rumor stage. According to the website The Wrap
, Eisner as CEO is a done deal, with an announcement coming next week, after the Labor Day weekend. The lenders will be taking over control of the entire Tribune Company and all of its many properties, forcing out the current regime.
Hoping to somehow placate the angry creditors and a bankruptcy court that is seemingly no longer favoring them, Tribune Company's Board of Directors have formed a special committee made up of four Board members who joined the Board after Sam Zell took over. The idea behind this four person committee is that these four would have no conflicts of interest in any investigation looking into wrongdoing with the former Board's sale of the company to Sam Zell.
What is not said is that this board does have a conflict of interest when it comes to their loyalty to CEO Sam Zell and COO and Board Director Randy Michaels. The members of this committee are Frank Wood, CEO of Secret Communications and former CEO of Jacor Communications Inc., Maggie Wilderotter, CEO of Frontier Communications, Jeffrey Berg, Chairman of International Creative Management, and Mark Shapiro, former CEO of Six Flags Inc. Frank Wood, in addition to being the former head of Jacor, has also reportedly had close business ties to both Zell & Michaels since his Jacor days with both men.
Since a recent independent examiner's report
concluded that the Tribune buyout was improper, which could cause numerous lawsuits, Zell & Michaels are hoping this new committee will calm the rough waters and oversee the reorganization process and settlements.
Assuming the creditors have not escalated the takeover process before then, they have until September 8th to file any complaints about this new committee.
According to the reports coming out of Los Angeles this afternoon, complaints about this hand-picked committee of Zell's & Michaels' are the least of their worries in the next few days.
Look for a lot of legal wrangling and upset people in and around Tribune Tower next week.