Alt-Press Gets Nailed

Slam-Dunk Antitrust Case—or Power Grab?

Here in proverbial bohemia, we like to stick it to the Man. But now the Man has stuck it to the Voice! Last fall, a team of federal and state prosecutors and the L.A. County district attorney launched an antitrust investigation of Village Voice Media and New Times, the two big chains of alternative newsweeklies. On January 25, the companies signed a consent decree, admitting no guilt, but agreeing to pay fines of at least $375,000 each and to sell assets to government-approved start-ups.

Busted! But what does it mean?

The investigation centered on an October 2002 agreement between VVM and NT to shut down Cleveland Free Times and New Times LA, their respective newspapers in Cleveland and L.A. Columbia Journalism Review called the deal a "double homicide," while prosecutors saw a blatant violation of antitrust law, which prohibits companies from conspiring to divide markets.

Last fall, VVM CEO David Schneiderman told reporters that he felt the deal was legal and that his goal was for LA Weekly, which is owned by VVM, to soak up ad dollars in L.A. In a company memo released Monday, Schneiderman said the deal had been approved by outside counsel and repeated that "these were legitimate transactions driven by valid business considerations." In an interview, he stressed that VVM is in "good financial shape, performing well in a tough environment and to the satisfaction of our investors and lenders."

Over the last month, as prosecutors took depositions in Cleveland and L.A., speculation flew about the motivations of the dealmakers and the feds. According to the prevailing theory, the deal was illegal on its face, which made prosecuting it a slam-dunk. A competing theory suggested the investigation was politically motivated, with Attorney General John Ashcroft pulling the strings. Until Monday, when The New York Times broke the news of the settlement, the best source of information was the Los Angeles Times.

Prosecutors focused on how the deal impacted advertising clients of VVM and NT, maintaining that if ad rates rose in either city as a result of the deal, competition had to be restored. (In a letter to The Wall Street Journal published January 23, New Times executive editor Michael Lacey countered that as a result of the deal, rates at New Times papers fell.) Another test was whether the two companies had, in effect, paid each other to get out of town.

Prosecutors also scrutinized the viewpoint of the defunct papers, especially neocon New Times LA. Supposedly to restore lost diversity, the feds proposed a remedy by which the chains would be fined and ordered to sell assets to fund other alternative voices. Enter former L.A. mayor Richard Riordan, who is preparing to launch a weekly newspaper that will be aimed at upscale Angelenos and could fill the niche left empty by the closing of New Times LA. Other newcomers: A group of former Cleveland Free Timesemployees wants to relaunch that paper, and an alternative newspaper in Silver Lake, California, has announced plans to double its circulation.

If any of this strikes you as fishy, consider the positions advanced by critics so far. Arguably, the settlement might represent a violation of the First Amendment, the Fifth Amendment, and/or the prohibition on selective prosecution. Let's take these one at a time.

The First Amendment prohibits the government from giving money to any group to promote a particular viewpoint. LA Weekly's Harold Meyerson hinted at this last week, when he questioned the propriety of directing money to Riordan's paper in an attempt to restore the diversity of political viewpoints in L.A.

The Fifth Amendment "takings clause" prohibits the feds from taking private property for public use without just compensation. New Times' Lacey mentioned a "taking" in his WSJ letter, calling the investigation "a stunning grab for unprecedented federal power."

Finally, prosecutors are supposed to apply the law equally, not selectively. Summarizing this position nicely, Association of Alternative Newsweeklies executive director Richard Karpel told The New York Times he found it "odd that the government decided it must prevent two small newspapers from closing after it stood on the sidelines for years as the AOL Time Warners of the world swallowed entire industries." Amen.


Who Spun It?

Who coined the phrase "Axles of Evil," now playing in headlines everywhere? It wasn't The New York Times, which used it to grace a January 19 story on the anti-SUV ad campaign ("Spinning the Axles of Evil"). Or Reason.com, which posted an SUV defense on January 17 under the headline "Axles of Evil." Or TNR.com, where "Axle of Evil" appeared as a headline on January 10.

Last week, I attributed the phrase to Reason.com editor Tim Cavanaugh, but he does not claim to own it. In fact, it's been around almost as long as "axis of evil," the slogan Bush introduced around this time last year. "Axis of evil" refers to Iraq, Iran, and North Korea. Headline writers now see the enemy as an "axis of oil" . . . but we digress.

Slogan provenance is a touchy subject. For example, back in the 1980s, several people claimed to have invented the phrase "I ♥ New York." Then last spring, writer Danielle Crittenden boasted that her husband, former White House speechwriter David Frum, gave birth to "axis of evil." In a mass e-mail leaked to Slate, Crittenden wrote, "It's not often a phrase one writes gains national notice . . . so I hope you'll indulge my wifely pride in seeing this one repeated in headlines everywhere!!"

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