Black strikes out in bid for new trial, lawyer gets break

Conrad Black struck out Monday in his bid for a new federal fraud trial but the judge did provide a slight break to a lawyer who worked on some the former media mogul's million-dollar deals.

Black and three co-defendants were convicted July 13 of three mail fraud counts for pocketing millions of dollars prosecutors said belonged to shareholders in his Hollinger International newspaper empire.

Black, once one of the most powerful men in the newspaper publishing business, was also convicted of spiriting boxes of documents out of his Toronto offices even though he knew federal prosecutors wanted them.

"The government introduced more than enough evidence to support each defendant's convictions on the mail fraud counts and defendant Black's obstruction of justice conviction" with one exception, Judge Amy J. St. Eve said in a 39-page ruling.

St. Eve did acquit Chicago attorney Mark Kipnis of one mail fraud conviction. The jury found him guilty along with Black and two co-defendants of swindling shareholders out of $600,000 the company had received as part of a deal in which some of its community newspapers were sold to Paxton Media Group and Forum Communications Co.

The money had been billed by the executives as "supplemental payments" to assure that they would not return to the circulation areas of the newspapers and go into competition with the new owners.

But prosecutors said they were thinly disguised bonuses. St. Eve held that there wasn't enough evidence to convict Kipnis on the charge.

"No rational jury could have found that Kipnis had the requisite intent to defraud in connection with supplemental payments," she said.

The heart of the case against Black involved millions of dollars that were paid to him and other Hollinger executives by companies that bought Hollinger's community newspapers in the United States and Canada.

Federal prosecutors said that the money should have gone to Hollinger shareholders and not to Black and fellow executives F. David Radler, John Boultbee and Peter Y. Atkinson.

St. Eve allowed to stand mail fraud convictions against all four men in connection with $5.5 million in so-called non-competition payments they received from the American Publishing Co.

Prosecutors had proven that the payments were not connected to the sale of any newspapers but were merely bonuses, she said.

"There was no seller, no buyer, no closing, no transaction," she said.

Black, Boultbee, Atkinson and Kipnis are due to be sentenced Nov. 30. Radler, who had pleaded guilty and was the government's star witness at the trial, was to be sentenced later.