Black Out | Bleader

Wednesday, July 21, 2010

Black Out

Posted By on 07.21.10 at 03:13 PM

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Conrad Black was released from a Florida prison Thursday after federal judge Amy St. Eve in Chicago set a $2 million bond that was posted a friend of Black's, Roger Hertog. Black can't leave the country, and he must appear before St. Eve this Friday. Black, former owner of the Sun-Times, has served 28 months of the 6 1/2 year sentence St. Eve gave him in 2007 after he was convicted on charges of fraud and obstruction of justice. The fraud convictions were undermined last month when the Supreme Court vastly reduced the scope of the legal doctrine of honest services fraud and remanded the case to St. Eve.

The phase of the Black saga launched by the Supreme Court ruling is noteworthy for the hysterical pronouncements of his admirers that he has been totally vindicated. Tuesday I offered Tasha Kheiriddin in Canada's National Post calling an appellate court decision to grant Black bail "a testament to the strength of the human spirit in the face of adversity."

Here's Seth Lipsky in the Wall Street Journal outdoing Kheiriddin.

"In a display of character that I perceive as heroic, [Black] shook off the temptation of cynicism and, in the face of predictions that it was a one-in-a-million gamble, pressed his appeal," writes Lipsky, appealing a conviction apparently being something that only the one felon in a million who is extraordinarily bold ever attempts. "One can call it his finest hour."

Lipsky concludes, "When the appellate judges [who upheld the conviction] look up, they cannot fail to note that not a single Supreme Court justice credited the prosecutors' reasoning—or theirs—in a case that has already destroyed one of the greatest newspaper empires of all time and wiped out hundreds of millions of dollars in shareholder value. I hope that when I next visit Conrad Black, he will be a free man. Even if he's not, his courage in standing for his own honor has helped spare others a similar fate."

Lipsky is zinging the prosecutors and appellate court for applying the law as the Supreme Court had told them to apply it, which is something prosecutors and lower court judges have no choice but to do until the Supreme Court tells them otherwise. As Seventh Circuit Judge Richard Posner noted, in his opinion rejecting Black's appeal, When the Seventh Circuit Court of Appeals, in an opinion written by Judge Richard Posner, rejected Black's appeal, "Only if honest services fraud were nullified as grounds to convict Black could he get a new trial." Honest services fraud was nullified and Black is free on bond.

As for the case destroying a fabulous newspaper empire, Black was convicted of enriching himself with bogus noncompete payments as he dismantled that amazing empire by selling off almost every single newspaper he owned. As for the shareholders, it was shareholders who rose up and threw him out.

Black to shareholders, 1998: "The controlling stockholder [Black] will do whatever is appropriate and necessary to achieve realistic value for the interests of all persevering stockholders."

Black to shareholders, 1999: "Last year was successful in most respects, except in the performance of the stock price."

Black to shareholders, 2000: "Last year was an unprecedentedly successful one in the Company's operations and in its tortuous struggle to fulfill the legitimate ambitions of the shareholders."

Black to shareholders, 2001: "This is the last time we will have to inflict upon our persevering shareholders (including ourselves in management) financial results that are apparently absurdly unsatisfactory."

Black to another Hollinger International executive, 2002: "There has not been an occasion for many months when I got on our [company] plane without wondering whether it was really affordable. But I'm not prepared to reenact the French Revolutionary renunciation of the rights of nobility."

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