Posted on 05/18/2004 11:47:44 AM PDT by jmstein7
As I have posited, we should focus all of our firepower on the NYT, as it is the epicenter of the mainstream media – the NYT leads, and everyone else follows.
I have a way that we can get at them directly – and perhaps there is a taker out there.
The New York Times Company is set up in a very clever way to insulate it from outside influence. There are two classes of shares – voting and non-voting. The voting shares are privately held and cannot be acquired. This prevents any outside influence on the board of directors or the company.
The non-voting shares are available on the NYSE. However, there is a way to get at the NYT by acquiring even a small number of non-voting shares. Here is a failproof method to get at them.
1. Purchase NTY shares on the NYSE. They trade at around $50/share. The NYSE symbol is NYT.
2. The Board of the Times has a fiduciary duty to maximize shareholder value. In English, that means that anything the Board does that can be remotely seen as damaging the “bottom line” can be challenged by a shareholder.
3. Of late, the shares of the Times, and their bottom line, has suffered significantly – that is why you see them advertising so much. A large part of the problem is that people, and small vendors, have been canceling subscriptions because of the perceived bias. That is, media bias is hurting their bottom line. This is actionable by shareholder.
4. Any shareholder can sue “in the name of the company” when the Board has breached a fiduciary duty. The normal route is to send the board a demand to bring suit in the name of the company and/or investigate the claim. Obviously, the Times board would never entertain such a demand, but there is a way around that too.
5. The “Futility Doctrine” is an exception to the demand requirement. Essentially, if a majority of the Board has a monetary, family, or material interest that would be affected by the demand (a conflict of interest), then there is no need to make the demand – you can go ahead and just sue. This applied to the NYT, because the Board is family controlled – by “Pinch’s” family. There would be no need to make a demand here… you could go right to suit.
6. Once the elements of futility are met, a court will go directly to the “merits” of the case. And the standard applied to the review of the Board is “strict scrutiny,” i.e. the most stringent standard (also called “Intrinsic Fairness”). This is an extremely exacting standard imposed on the Board, and boards put in this position almost never win.
7. The bottom line is, well, “the bottom line.” Therefore, any claim with minimal proof that the editorial bias in the Times hurts the bottom line (and shareholder value) will succeed. In that case, almost any equitable remedy is available to the shareholders – e.g. removing board members, reorganizing the voting rights of the shares, etc.
This is a real lay-up, and I strongly suggest pursuing this course of action.
End Media Bias BUMP!
if ti is such a slam dunk, then go do it yerself.
If only there could be a substantial amount of subscribers
cancel their subscription (ie for a week or even longer) to further hit their pocketbook.
I wish I could, but I still have a year before I take the bar, and I can't afford a lawyer.
Maybe Mark Levin would do it pro bono.
Fastest way to hurt them is for ALL so called conservatives and or GOP voters to STOP buying the damn paper
What is the current circulation of the NYT? How many hits to their website? Has their circulation dropped recently, how about add revenues?
if it's such a sure thing, then you wouldn't have any trouble finding one to handle it in a contingency basis.
Can the current shareholders be polled to see if some want to go for a class action?
You can only get the to do it on a contingency basis when you are seeking a legal -- i.e. monetary -- remedy. The remedy here is equitable, and NO lawyer would do that on a contingency basis because there is no money in it for them.
This just isn't true. I hope you like defending 12(b)(6) motions.
I think we need a big advertising campaign against them. We need to inform those not paying attention that their are being lied to. Remind the public just how leftist their endorsements are year after year, and do it just before their endorsements come out. As long as the public realizes the NYT is an arm of the DNC, then they can consider the source in context. It's the lying about it that harms us.
I think it's a great idea and I'd love to see the NYT body-slammed. But there may be a hole in your reasoning. What proof is there that the drop-off in NYT revenue is a direct result of media bias? As a lawyer, how would you create an argument for that premise that an opposition lawyer couldn't laugh off? Opposition possibilities: Bad economy? More people getting news on the internet? Bad publicity following the Jayson Blair scandal? If you can make an airtight argument you can probably find someone with the $$$ to bring the case.
A 12(b)(6) MTD would fail -- there is a viable claim upon which relief can be granted. The D would have to move for summary judgment, but they would lose because there are disputable issue of material fact.
Agreed, but that is a "discovery" issue.
I don't think so. You would get 12(b)(6)ed right out of court because no court is going to tell a company how to run its business. About the ONLY time you can sue the company's executives for a violation of fiduciary duty is in a case of fraud.
They are running the business in good faith. Unless you allege wrongdoing, you will lose a 12(b)(6) motion.
"Fastest way to hurt them is for ALL so called conservatives and or GOP voters to STOP buying the damn paper"
Coffee spills at newstands. I'm such a clutz. Funny how it happens everytime I get near the NYT.
You're wrong, in a way. As you know, the Business Judgment Rule only applies if you make a demand on the board. Here, you don't have to because of futility.
The only way the NYT would get the deferential "Business Judgment" standard would be to appoint a "Special Litigation Committee." And that would cost the BIG TIME and give them all sorts of bad press.
I don't know enough about stocks and lawsuits to evaluate the merits of this proposal, but damn me if I am not going "hrmn..." all the same.
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