Black to the future
Could Conrad Black regain his media empire with an acquittal? Experts say the press baron could return to prominence, but overcoming the 'loss of status' wouldn't be easy
"Even if there are technical grounds for acquitting someone, it's hard to imagine there wouldn't be a loss of status," said Edward J. Zajac of Northwestern University's Kellogg School of Management.
Black, former chief executive of what was then known as Hollinger International, faces up to 20 years in prison if convicted of federal charges that accuse him of helping to steal millions of dollars from the media company.
The jury in the case begins its sixth day of deliberations today.
Black's longtime business partner, former Sun-Times publisher David Radler, testified against Black after reaching a plea deal with prosecutors. Also, to settle civil claims by the company, Radler agreed to pay back about $63 million.
Both Black and Radler left Hollinger in late 2003 amid questions about "non-compete" contracts stemming from sales of newspaper properties. Such agreements prohibit the seller from setting up a competing business in the same territory as the buyer's.
Hollinger International's $500 million lawsuit against Black, his wife Barbara Amiel Black, Canadian parent company Hollinger Inc. and other former Hollinger executives is pending until the criminal case is over.
Black, 62, has called the charges against him an "unholy onslaught" and said he expects complete vindication. His defense team told jurors he didn't steal from the company; that, instead, the company was stolen from him.
One roadblock to Black regaining power at the Sun-Times is that he owns shares in the company through a Canadian company called Ravelston, which is now in receivership. Ravelston has pleaded guilty to fraud. Black would have to work with a Canadian court to allow him to exert control over Hollinger interests.
Sun-Times spokeswoman Tammy Chase declined to comment on "what ifs" related to Black's criminal trial.
"Our focus is on our company's future," Chase said.
Stephen Presser, a professor at Northwestern's law and management schools, said he likes Black and is "extremely dubious" that a crime was committed. But Presser said it would be a "reasonable call" for the Sun-Times Media Group board to think Black might have put his own interests ahead of those of the business.
"If I was a board member, my guess is I'd be reluctant to have him back," Presser said. "I think it's safe to say we won't see him running the operation anytime soon."
That doesn't mean Black couldn't make a success elsewhere, said Scott Meadow, a clinical professor of entrepreneurship at the University of Chicago Graduate School of Business. Meadow said that, as a venture capitalist, he recruited "fallen" executives who had lost money or had other problems.
Meadow said an executive who stumbles can be even more successful than before because he's learned to be cautious and "not put his hand on the stove" again.
"But it takes some time," Meadow said. "It requires someone to lower their expectations, gain some humility and start getting in touch with the fact they really enjoy the day-to-day activities of business, rather than the trappings of being a giant in industry."
If Black is convicted of any of the 13 charges against him, he might have to continue his civil battles from prison. It's possible that Black, now out on a $21 million bond, could immediately be taken into custody as a flight risk while he pursues an appeal.
Assistant U.S. Attorney Eric Sussman declined to comment on whether the government would ask for Black to be taken immediately into custody.
The Sun-Times has paid millions of dollars in defense costs for Black and the other three executives on trial. Convictions would mean the company will try to get that money back.