Canada: Black Sues Hollinger For $173m

Publisher Name: 
The Independent

Lord Black of Crossharbour, the disgraced media baron, has launched a new round in his legal battle with Hollinger International, with a $173m claim for fees and damages.

Ravelston, a private Canadian company controlled by Lord Black, filed a lawsuit with the Ontario Superior Court after Hollinger International, the company that owns The Daily Telegraph, stopped paying Ravelston millions of dollars in fees for "management services" in November. Hollinger International has declared that these fees were excessive and has demanded in a separate court case that Lord Black and other Ravelston directors return $200m of this money.

Ravelston is claiming fees that it says it is owed, plus money for wrongful termination of the management agreement and $150m for "deliberately and wilfully ... causing economic harm" to Ravelston by cutting off its only source of income.

It is alleged by Ravelston that the aim of cutting off these fees was a "plan" to "destroy" Ravelston's 73 per cent voting stake in Hollinger International. Ravelston had debt to service but its only source of income was the management fees. A default on this debt would have led it to be stripped of the majority voting stake.

The latest legal salvo follows a spectacular court defeat for Lord Black in Delaware last month, where he was seeking to defend a deal to sell his shares to the Barclay brothers.

Separately, a committee of journalists has been formed at The Daily Telegraph, led by the editor Martin Newlands, to try to influence Hollinger International when it decides who to sell the paper to.

AMP Section Name:Money & Politics