Chicago Sun-Times 11-16-2006 (Inflated Circulation)
Sun-Times’ settlement nets charities $4.8 mil.
Reserve from circulation fight to help 10 groups
By David Roeder
Business Reporter
Ten public-service organizations will share a $4.8 million donation from the Chicago Sun-Times as part of a legal settlement with advertisers who sued the paper for inflating circulation numbers under previous management.
The agreement, approved Wednesday by Circuit Court Judge Bernetta Bush, assists organizations that provide legal aid to the poor. Other grants support literacy programs and medical research.
The money is unclaimed from a reserve set aside to compensate the advertisers. About $1 million will remain in the account for unreceived claims.
Attorneys in the case said the charitable donation is believed to be the largest arising from a class action lawsuit in Cook County. Bush praised all parties for agreeing on the goals for the donations, and for finding worthy organizations to support.
“I salute the Sun-Times,” the judge said during the hearing. “Something that could have been a real zoo has been a real pleasure.”
Receiving the largest donation, $2 million each, will be the Chicago Bar Foundation and the Abraham Lincoln Marovitz Lend-a-Hand Program.
The bar foundation will assign the money to a program that pays the law school debts of graduates who opt to work in legal aid programs, said Joseph Dailing, executive director of the Illinois Coalition for Equal Justice. The hope is that the program will encourage more young lawyers to seek satisfaction in the low-pay field of legal aid.
A study the bar foundation issued Wednesday said about half of Illinois legal aid attorneys are planning to leave their positions within three years. With an average starting salary of $38,5000 a year, but law school debts often topping $60,000, many legal aid lawyers are struggling to get by, the study said.
Lend-a-Hand, backed by the Chicago Bar Association and its foundation, supports youth mentoring programs. Its board chairman, attorney James Morsch, said the Sun-Times gift will have “an unprecedented impact” on its grants, allowing it to expand its giving beyond a current level of about $30,000 a year.
Bush approved the Sun-Times settlement with its advertisers last January. The $4.8 million remained from a total compensation set aside of $31.8 million, of which $24.5 million was to be in case and another $7.3 million in related benefits, such as free or discounted ads.
Sun-Times Publisher John Cruickshank and Editor in Chief Michael Cooke were recognized in court for their roles in selecting the charities, and in satisfying the advertisers.
Burton Weinstein, a lawyer for the advertisers, said of Cruickshank, “From the time I met him in an adverse situation, he always wanted to do the right thing.”
Cruickshank disclosed the circulation fraud, which he said was directed by former publisher F. David Radler and involved falsified circulation of up to 50,000 copies a day. The settlement with advertisers covered claims from April 1997 through September 2004.
NOTE: Chicago attorney Thomas A. Zimmerman, Jr., of the Zimmerman Law Offices, P.C., was co-class counsel for the plaintiff’s class in the litigation.
