by James O'Shea
I didn’t have much time or inclination to dwell on Zell’s antics. I still didn’t know from one paycheck to the next when the company might sever my only source of income. My expense payments finally got approved, but the company stonewalled any inquiries about the terms of my contract. I contacted Larry Feldman, Wolinsky’s lawyer in Los Angeles, who was itching to sue Tribune Company because he thought its layoff and buyout policies were blatantly ageist. Even he advised me to sign the non-disparagement agreement. “I’ve read your contract, and there’s no question you would win in court,” Feldman admitted. “But your legal fees in litigating this would probably exceed what they owe you.” Even with this counsel, my gut refused. I wouldn’t, couldn’t, sign it.
Weeks after I’d been fired, Hiller finally named Stanton to succeed me. I had lunch with Stanton shortly thereafter and gave him some advice. He was confident they couldn’t fire him but told me they had inserted something during the negotiations over his contract that he called “the O’Shea clause”—a non-disparagement agreement. He had signed it, and I wished him the best. He graciously attended a farewell party Kathy Kristof, by now a friend and one of the paper’s top financial columnists, gave for me at her home, and, as I prepared to leave Manhattan Beach, Stanton and the Times, unintentionally I’m sure, did me a huge favor.
The paper ran an investigative story in March disclosing new information supporting rapper Tupak Shakur’s claims that he had been assaulted by associates of music executive Sean Diddy Combs in a 1994 incident in New York. The new information in the story was a police report that was soon exposed as a fake by a blogger who had done a little journalistic legwork. Critics eviscerated the Times, which had to retract the story. I called Cohn and said we should call the Tribune lawyers and ask them if they really wanted the former editor of the Los Angeles Times filing a lawsuit against them at a time like this. Shortly thereafter, Tribune lawyers called Cohen and indicated they might be interested in settling our differences. The company didn’t pay me all that I was owed, but I never signed the non-disparagement agreement. Soon I heard that Hiller and Stanton ordered cuts that would take newsroom staffing levels from around 920 journalists to the mid-600 range. Within weeks, rebels in the Times newsroom covertly unfurled a huge three-story banner on the side of the paper’s downtown Los Angeles headquarters. In big, thick, red-and-black capital letters it read: “ZELL’S HELL.”
Journalists in Los Angeles might have had it bad, but at least they were 1,000 miles away from Tribune Tower. As I returned to Chicago, I encountered editors and journalists who had Zell and Michaels breathing down their necks. Lipinski had honed her skills as a reporter in City Hall and developed the ability to instinctually pick up on subtle signs that something might be amiss. In April 2007, shortly after the company had agreed to the Zell deal, Lipinski’s first doubts about Zell surfaced during her lunch with him in the small, private dining room in his real estate office across town. Initially, the lunch involved a good conversation about journalists and how they think. Zell proudly told Lipinski how many people he’d made millionaires, and she advised him to focus on more than wealth when talking to the newsroom: “I told him you need to know that’s not enough. Ideally, we all want to make money and have great journalism, but making money without great journalism won’t go well.”
Midway through the lunch, the conversation turned sharply when Zell brought up the profile that Greg Burns had written about him for the Chicago Tribune Sunday Magazine in 2004. “He remembered everything about it,” Lipinski recalled, and his complaints about the story elevated into a screed against journalists, sentiments that would be expressed with increasing frequency over time.
Not long after the deal closed, Lipinski suffered one of the first casualties caused by the new owners—George de Lama, my good friend and longtime deputy who had succeeded me in running the newsroom at the Tribune. Proud of his heritage as a Latino and loyal to the Chicago Tribune, de Lama decided to leave the paper in May 2008. He didn’t like the way the new owners disparaged a journalistic heritage of which he was proud, but an incident on Zell’s road trip convinced him to give notice.
While at the South Florida Sun Sentinel in Fort Lauderdale, Zell made remarks that stuck in de Lama’s craw: “I remember what he said. He said, ‘You know we own this baseball team and we’ve got this mother-fucking schmuck that makes $25 million a year to play outfield and he can’t even speak English.’” Zell was referring to Alfonso Soriano of the Chicago Cubs, a Latino. Coming on the heels of his crude put-down of a Latina photographer in Orlando, de Lama thought the remark displayed a remarkably callous and ignorant view of the heritage of one of the Tribune’s largest pool of potential readers. “I could almost hear my dad saying to me, are you going to take that?” de Lama remembered. As he saw it, Zell and his henchmen had greatly disrespected a company for which he had risked his life as a correspondent. He resigned without another job.
In New York, de Lama’s cousin, Louie Sito, got a break when the judge overseeing the sentencing of Sito and eight others involved in the Newsday circulation scandal decided not to send any of them to jail, leveling fines and forfeitures of $115,000 for Sito to $15,000 for Garcia, who had ordered that Hoy circulation numbers be inflated.
Banar’s probe had taken on all of the trappings of an investigation that no one really wanted—long delays in sentencing, turnover of the staff in the trenches, and a U.S. Attorney who wanted to be a federal judge, not exactly a good posture from which to attack the local newspaper. The investigation started when Roslynn Mauskopf was U.S. Attorney for the Eastern District of New York, but she was appointed a federal judge in late 2007. By the time Sito and the others had been sentenced nine months later, Banar and most of her team had also moved on to other jobs outside of the government.
“I remain dubious [that the higher-ups at Tribune Company] didn’t know what was going on,” Judge Weinstein, who had presided over the Newsday case, told me. “I thought it would be unfair to give jail time to [lower-ranking employees].” He sentenced Sito and the others to probation and community service in addition to the fines. When asked what in the papers and records of the case made him think the prosecution didn’t go far enough, he smiled and said: “Eighty-seven years of life in New York City, working on the docks, being on the bench for 40 years. You know, you gain a certain amount of moxie.”
Lipinski was sorry to see de Lama go, but she remained determined to see the paper through a historic election in which a black man from Chicago was running for president of the United States. A gutsy and strong editor, Lipinski had done some unpopular things. I had watched her fire Bob Greene, a nationally known Tribune columnist, because she felt he had abused his position at the paper. She came under incredible pressure to back off, but she wouldn’t. She did what she thought was right. She had also displayed backbone by traveling to the Sudan to demand that one of her reporters, Paul Salopek, be released from prison for entering the country without a visa. Now she confronted a problem of a totally different nature, one she had never encountered at Tribune Company. Zell had placed his alter ego, Randy Michaels, in charge of day-to-day operations, and Lipinski had already found his conduct alarming and offensive.
Michaels, whose real name was Benjamin Homel, seemed to generate controversy wherever he went. One of his associates described him as a man who could take one look at a radio tower and recite its vital statistics. Michaels had a similar reputation for assessing women. Complaints of sexual harassment, crude jokes, and boorish behavior dogged Michaels wherever he went. Zell’s organization, including Larson and Pate, seemed mesmerized by Michaels, though, and to be fair, he was not without talent. He was a brilliant radio engineer, had made millions in the media and had helped Zell turn the 1993 acquisition of an ailing radio company named Jacor into an industry juggernaut. He and Zell peddled the company to Clear Channel Communications just five years later for $4.4 billion, a price tag that netted Zell a $1 billion profit. Within Zell’s Equity Group, Mich
aels was considered a creative force who could impose brutal cost cuts with the crack of a joke.
The hundred-day Tribune plan Michaels provided Zell was a remarkable document. In nine pages of single-spaced bullet points about what to do with a company that owned America’s best collection of daily newspapers, Michaels never mentioned the word journalism. If anything, he ridiculed the values for which Tribune once stood and targeted anyone who doubted his vision. “Empower opinion leaders who buy into the new vision,” the document said. “Eliminate negative resistance and counterproductive team members immediately. Hang the turf Gods publicly.” Michaels set out to rewrite the employee handbook and strip it of any policies that he viewed as politically correct. “Eliminate most of the HR Department,” he proposed. “Ratings, contributive circulation, revenue and expense control are the new politics.” And he advocated short, entertaining news stories focused heavily on attracting ad dollars. “We live in a ADD [attention deficit disorder] world,” he said, where news stories should be short and newspapers scannable. Tribune Company should emulate Matt Drudge and Fox News and discontinue stale sections like “Tempo” in the Chicago Tribune.“Tempo,” he said, “is so sixties. How about a section called ‘Strange’? What’s wrong with a section that holds news up to a funhouse mirror: ‘Knuckleheads in News’?”
To implement his policies, Michaels began searching for opinion leaders within Tribune ranks who could sign on to policies to close news bureaus, eliminate middle management, downsize the staff, and create a news report that gave readers what they—and not some editor—wanted. Although Michaels’ plan contained strongly worded policies that treated “middle management” as a scourge to be scrubbed from the Tower, he didn’t highlight the replacements he had in mind—a platoon of cronies he recruited from his days in the radio business. In all, in less than a year, Michaels hired into senior positions more than twenty former associates, ranging from Marc Chase, a senior vice president of programming at Clear Channel Communications whom Michaels placed in charge of Tribune Interactive despite his dearth of Internet experience, to John Phillips, a traffic reporter for Michaels in Cincinnati who took over as building manager of Tribune Tower. When Tribune, which once had a strict policy on nepotism, hired Phillips’ fiancée, Kim Johnson, as a senior vice president for local sales, the press release jokingly described her as “a former waitress at Knockers—the Place for Hot Rocks and Cold Brews.”
“They tried to purge from the building and the company anything about the company’s legacy or history, all of the Colonel stuff,” recalled Mary Jo Mandula, who managed Tribune Tower until she was replaced by Phillips. “They started trying to get rid of the [First Amendment] Museum right away. I think they screwed up because they were getting a lot of rent for the museum.... Randy . . . wanted to get rid of everything that had anything to do with what we were.”
Michaels’ most celebrated hire was Lee Abrams, a fifty-five-year-old white-haired radio industry hotshot who was named chief innovation officer at Tribune. Abrams became known for his frequent, rambling stream-of-consciousness memos that declared news the new rock and roll. To his credit, some of Abrams’ observations—such as news organizations didn’t do enough to promote their unique content—were on the mark. But his uneven, randomly punctuated and capitalized notes invited ridicule. He wrote, introducing himself to the company’s staff:I start April 1st but I’ve been pretty engaged from afar. Thought I’d share some observations on TV, web and print. Small stuff, “think pieces” more than anything . . . not end alls, but when we re-think and maximize hundreds of little pieces within the framework of bigger pieces and it would be the part of the blueprint for something very powerful: NERVE TOUCHING. This is where you get people to stand up on their chair because you touch a nerve. One underused way is simply to play to passions.
Few knew what to think of Abrams. Lipinski had her doubts and didn’t invite him to any meetings involving an impending redesign of the paper.
Abrams, Michaels, Zell, and his team loved to portray themselves as iconoclasts who wore blue jeans to work and ridiculed anyone in a necktie. Yet they succeeded in creating an intimidating atmosphere for anyone who didn’t follow their dress code or their thinking. Shortly after he walked into Tribune Tower, Zell created a “Talk to Sam” e-mail box for employees to communicate directly with the boss. He told employees to “challenge authority” and speak out about the company’s weaknesses. “Talk to Sam,” of course, drew the inevitable sycophantic messages from people like Margaret Holt, who worked in the public editor’s office of the Chicago Tribune and who had heard Zell go after “arrogant journalists.” In her note to the big man, she suggested, “Ban—or sharply limit—journalism contest entries by Tribune newspapers.... This is heresy, of course, and would get me bounced from the fraternal order of journalistas if word leaked.”
But Zell’s “Talk to Sam” initiatives also courted notes from professionals like Jeff Coen, the Chicago Tribune’s solid, federal courts reporter who commended Zell for the shake-up he’d stirred. One of his more frequent correspondents was Jane Hirt, an editor at Redeye, the Tribune’s youth paper, who suggested that the company could increase revenue with a “Second Life for Cats” feature wherein the feline pets of readers could “ live out lives online, have alter egos, get married, get jobs, run businesses, etc.” Of course, most of the correspondents didn’t realize Zell was passing on their remarks to their bosses and they penned long rants complaining about career setbacks or rejection of their ideas by “arrogant newsroom leaders,” ratting out their colleagues in an atmosphere that soon turned crude and ugly, particularly once they started steep layoffs.
Within six months of the close of the Tribune deal, the economy started to nose-dive in earnest, and Zell, in a near panic, began talking of a crisis. He had acquired big papers in Florida and California, two states hit particularly hard by the subprime mortgage debacle, and the company’s cash flow suffered along with the rest of the industry. He had built a financial cushion into the deal in case projections fell short, but his cushion disappeared as the slump in the economy devoured spare cash, forcing him to order deep budget cuts and layoffs, a sharp contrast to his optimistic forecasts made just months before.
Tribune Tower had been a pretty buttoned-down place that Michaels promised to change so people could have some fun. He commissioned jukeboxes, pinball, and air hockey machines. Mandula couldn’t believe the company was spending $40,000 to $50,000 on games when Tribune was laying off people, but she soon got a taste of the kind of morale-building exercises Michaels and his team intended to offset any bad news. While at the company’s Freedom Center printing plant, Mandula received a call that a beer truck had shown up wanting to deliver twenty cases of beer:I didn’t know what this was for so I checked it out and found out that Marc Chase had ordered it for Friday beer parties at Tribune Interactive. I told them not to deliver it yet because . . . we didn’t have a liquor license and parties had to be catered. Marc Chase went to Randy and told him I wouldn’t let them have their beer.... Pretty soon he [Michaels] comes into my office, closes the door and starts screaming at me. He called me the “Queen of No.” You say no to everything, to jukeboxes, to pinball machines, to parking spots for people and now to beer. You can easily be replaced. I asked him, “Are you done yet?” and then told him that I did get him his pinball machines and I did get them their beer. He actually apologized to me.
It was hard to believe she was talking to the top corporate officer at one of America’s largest media companies. But the bizarre incidents continued, she recalled, “They wanted people in Tribune Interactive to come up with $1 million revenue ideas. So they told me they wanted me to get $1 million in cash so they could put it on the floor and people could roll around in it and get their picture taken. It was stupid, and a stunt. It was expensive, too. I had to get a Brinks truck to deliver it, get extra security.”
The good times didn’t roll for people with long and solid ties to the Tribune Company, thoug
h. They had reason to fear for their futures, unless, of course, they swore allegiance to Michaels and his cronies from Clear Channel, which Michaels had left after clashing with the family that controlled the company. Even Kern called Lipinski and said he was sick of the foul language and compared them to Brownshirts, using words like “evil” and “stupid.” But it didn’t take long for Kern to realize he had already developed a policy that fit right into Michaels’ playbook. The new boss embraced Kern’s plans for a centralized news desk that produced cookie-cutter foreign and national coverage for all Tribune papers with far fewer “journalists” than those Kern had counted as they ran around the nation and world covering stories for Tribune papers, particularly the Los Angeles Times. Kern’s star soon began to rise and those Brownshirts seemed more like khaki. Bob Gremillion, the transformative change czar under FitzSimons, began championing Kern’s ideas, and both became fixtures of Michaels’ team.
The antics spawned disbelief and guffaws on the blogs following the doings in the Tower, but they were not funny. Michaels created an atmosphere of fear. At one point, Michaels installed a sign in the lobby outside the Chicago Tribune newsroom headlined: “The Perils of Modern Journalism: Should Political Correctness Trump Accuracy.” The line on the sign, “A customer is the most important visitor on our premises,” was attributed to Mahatma Gandhi. To most people, the idea that Gandhi was into customer service was a stretch. The pep talk about the customer continued, “He is not dependent on us. We are dependent on him. He is not an interruption of our work. He is the purpose of it. He is not an outsider to our business. He is part of it. We are not doing him a favor by serving him. He is doing us a favor by giving us the opportunity to do so.”
