PAPER CUTS: Did Chicago Tribune Owner Cut Deal to Fire His Editor?

Feds say Blagojevich proposed deal to fire key editorial staff.

December 9, 2008, 2:25 PM

December 9, 2008— -- Illinois Gov. Rod Blagojevich believed the billionaire owner of the troubled Tribune Co. news empire agreed to fire a top editor at his Chicago paper in exchange for a tax break worth over $100 million, federal prosecutors alleged Tuesday.

Executives at the Chicago Tribune did not fire the editor, John P. McCormick, whom prosecutors believe Blagojevich had targeted. In fact, during the alleged machinations between the governor and the paper's owner, the paper's editorial staff was actually cooperating with the federal probe into the governor which resulted in his arrest Tuesday, by holding from print an exclusive story that FBI agents had secretly recorded the governor's conversations.

In a statement released Tuesday afternoon, the Tribune Co. said "the actions of the company, its executives and advisors working on the disposition of Wrigley Field have been appropriate at all times," and that "no one working for the company or on its behalf has ever attempted to influence staffing decisions at the Chicago Tribune or any aspect of the newspaper's editorial coverage as a result of conversations with officials in the governor's administration."

The Tribune Co. did not immediately respond to requests for comment. Calls to Blagojevich's offices were not returned. A statement released by his office did not address the allegations about his alleged deal with the Tribune, but assured Illinois residents that the charges against the governor "do nothing to impact the services, duties or function of the State."

In the criminal complaint against Blagojevich, federal prosecutors charged the governor attempted to use financial perks, including a lucrative "tax mitigation scheme," to convince Tribune owner Sam Zell to fire key editorial staff at the Chicago Tribune, including McCormick.

Zell is not named in the complaint, which identifies him as "Tribune Owner." The alleged scheme involved transfering the title to the historic Wrigley Field ballpark, owned by the Tribune Co., to a state agency. John Harris, an aide to Blagojevich, valued the deal "in the neighborhood of $100 million," according to the complaint.

Blagojevich's alleged pitch – to tell Zell, "maybe we can't do this now [indicating the tax scheme]. Fire those [expletive]s" – was handled by Harris, according to the complaint. Harris was also arrested Tuesday and charged in the affair.

According to the complaint, investigators secretly recorded a phone call in late November in which Harris told the governor that he had spoken with a senior Tribune executive – identified only as Tribune Financial Advisor in the complaint – regarding the deal.

Chicago Tribune Editorials Increasingly Irritating Blagojevich, Says Complaint

"[Tribune Financial Advisor] is on top of this, right?" Blagojevich asked Harris, according to the complaint.

"HARRIS replied that Tribune Financial Advisor said they would be 'downsizing the division or changing personnel' and that Tribune Financial Advisor understands and '[Tribune Owner]' understands," the complaint states.

Zell purchased the Tribune Co. in 2007, but took on massive debt to do so. Selling the Chicago Cubs was reportedly one way Zell considered to pay down on that debt. He was looking to the state government for money or other aid to improve the Cubs' financial lot, the complaint indicates.

At the same time, articles and editorials in the Chicago Tribune were increasingly irritating Blagojevich, the complaint indicates, and Blagojevich apparently decided his life would be easier with more supportive editors at the paper.

Or, as he allegedly put it in another secretly recorded phone call cited in the complaint: "our recommendation is fire all those [expletive] people, get 'em the [expletive] out of there and get us some editorial support."

In a statement released to the media, Chicago Tribune editor Gerald Kourn said the U.S. Attorney's Office had asked the paper on several occasions to hold stories relating to the long-running probe of Blagojevich's administration, called Operation Board Games. "In isolated instances, we granted the requests, but other requests were refused," Kourn's statement read.

"They didn't agree to all of our requests," said U.S. Attorney Patrick Fitzgerald at a press conference Tuesday after the arrest of the governor and his aide. But "I have to take my hat off" to the paper, he said, for holding the story about the recorded conversations for several weeks.

The Tribune Co., which owns radio and television properties, the Los Angeles Times and the Baltimore Sun, in addition to the Chicago Tribune, filed for bankruptcy Monday.

Emma Schwartz contributed to this report.

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