Finally. At last. The case concerning The Dallas Morning News' phony circulation numbers is no longer in legal limbo, where it's resided for the past three years. Because today, a federal judge refused to dismiss the lawsuit, despite Belo Corp.'s best efforts to get the case tossed. So what does that mean? Depositions? Discovery? Seems awfully likely, to say the least.
Less than an hour ago, U.S. District Judge Sidney Fitzwater cut loose three defendants -- Jack Sander, Belo's president of media operations since 2004; Dunia Shive, a Belo exec VP; and Dennis Williamson, Belo's senior corporate VP and CFO since 2004 -- but allowed the rest of the suit to stand. His memorandum opinion and order can be read here, in its entirety.
Three long years ago, several lawsuits were filed against Belo for its having juiced its circulation numbers in 2003 and 2004, if not well before that. That suit has since been consolidated into one securities fraud case: Todd Fener v. Belo Corp.
As you no doubt recall, on August 5, 2004, Belo chairman and CEO Robert Decherd admitted that the paper had overstated its daily circulation numbers by 1.5 percent and its Sunday numbers by 5 percent. As a result of that admission, Belo had to cough up nearly $30 million to advertisers who'd been charged higher rates based on those phony numbers.
And, as a result of that admission, Belo got slapped with a few lawsuits from stockholders who bought their shares between May 12, 2003, and August 6, 2004, claiming Belo had been lying to them as well about the worth of their stock. --Robert Wilonsky
