“Sideshow” Must Stop in Philly Newspaper Case

The "sideshow" will stop in the bankruptcy case of Philadelphia's newspapers, but the secret taping investigation will go on.

Brian Tierney, CEO of the parent company of the Inquirer and Daily News, has testified that he caught an executive for one of the creditors secretly taping a high-level meeting before the bankruptcy filing.

Tierney wanted permission from the court to hire an outside law firm to investigate.

The judge said no to that request. Instead, she told the law firm representing the unsecured creditors that they'd have to use in-house attorneys to pursue the investigation.

Tierney testified that he was "upset and puzzled" when he discovered a representative for CIT Group Inc., was secretly taping the meeting. Last week, Tierney testified that he confronted the man on the spot and later took the matter up with CIT attorneys in a very heated discussion. After that, the spirit of negotiations turned sour and difficult, according to court documents. Philadelphia Newspaper company attorney Larry McMichael said, "The tone changed completely from constructive to very hostile discussions, that led ultimately to the bankruptcy."

Judge Jean FitzSimons on Monday said bankruptcy proceedings need to stay focused on reorganizing, financially.

The creditors called the investigation a fishing expedition. An attorney for the group said the judge had one main message: "Stop getting distracted by this nonsense. Get on with the task at hand, which is reorganizing the debtors," said Abid Qureshi.


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