My files in the U.K. had all been gone through, copied, and sent off to the SEC before the move. The faithful Rosemary had sent my personal ones (also all gone through in the U.K.) to Greenspan’s office while Barbara had sent most of her staggering number of boxes to our home in Toronto, where counsel examined, copied, and sent all relevant material.
By now, all my papers in 10 Toronto Street had been examined for more than a year and photocopied for the SEC, the inspectors, and the Special Committee as well as the new regime. Even annual reports were photocopied, to the distinct irritation of Joan, who saw this sort of thing as a pure make-work effort for the law firms’ billings. She was engaged in a constant battle to keep the voluminous material organized after files were taken out, copied, and dumped back in great piles on her desk or returned in the (dreaded) boxes. By now Joan doubted that there was a telephone message or Post-It that had not been photocopied and numbered. (And deliberately misplaced. Much of my most valued correspondence simply vanished, as part of the services furnished by the Toronto Street usurpers to the prosecutors. Letters from a great many interesting people (including every prime minister of Canada from Louis St. Laurent to Jean Chrétien, except Ms. Campbell, and even the letters I received on the deaths of my parents in 1976 disappeared.)
Joan sat in an outer office surrounded by filing cabinets. My inner office had been taken over by a law firm that had access to every scrap of paper and computer record and spent their days sifting constantly through all her files, which were never locked.
On May 20, six working days before we would be expelled from a building I technically still owned, I was working at home, hoping to avoid seeing the packing up of my office. Joan asked a security guard to move thirteen boxes to her car. The inspector representative on-site asked that they be moved back. Joan called me. I arrived at the building at about 3:30 p.m. and spoke with the inspector and the acting Hollinger Inc. president, the amiable Don Vale. With their agreement – and Joan’s assurance that any commercial papers in the boxes had come in from Greenspan’s office and were not in the building at the time of the first court order, and that the rest of the contents was personal and not in contravention of the second court order – I helped my driver, John Hillier, move them from the back door of the building to my car, parked a few feet away, fully aware that I was being filmed by security cameras I had installed, as well as by recently installed ones. I wanted to be filmed so there could be no suggestion of my trying to remove these boxes undetected.
I had no idea that the contents of the boxes, none of which I had selected or was even specifically aware of, could be of interest to any U.S. authority. We had already responded to five SEC subpoenas and sent 124,000 pages of documents, everything their subpoenas covered, more than a year before. It would turn out that there was not one commercially significant document in these thirteen boxes that the SEC did not already possess.
Walker, when the videotape of our removal was shown to him, sent Kelly scampering to court to accuse me of contempt of that court, which had to date avoided no opportunity to humiliate and pre-punish me. Campbell, adhering to his well-established policy, summoned my counsel Alan Mark on the briefest notice. He was abusive to him before the packed press corps. Then in a decision that was to have the worst possible consequences for me, Campbell permitted the playing of the tape, which because of its grainy quality and the poor lighting in the staircase had a shadowy black-and-white look. The court did not see the colour film from different cameras showing the parking lot was full and in blazing sunshine, and that I only handed the boxes to my driver, a distance of two feet. In any case, I was well accustomed to moving much heavier boxes and armfuls of books around my libraries.
With the allegations of Kelly ringing in the reporters’ ears, the tape became the definitive proof of a furtive and illegally motivated act in which I had been caught red-handed, rather than the film of a man, in the middle of the afternoon, simply moving his belongings after an eviction order from one known place to another in front of cameras he well knew were there. The watching press went into orbit. Frames from the tape were reprinted and televised throughout the world to inflict the maximum possible public relations damage on me and the media, which in this case, cannot be blamed for believing it.
For a time it was claimed that I had snuck into the building after hours, when it was deserted, and had been caught on cameras of whose existence I was unaware. The idea that I would move large boxes was disparaged as a sign of desperation.
It was a sweet moment for Walker: he was being patted on the head publicly by a Superior Court judge as he continued to collect $100,000 per month from the company for himself and each of his followers. I was expelled from our historic building, for which I had advanced nearly Can$20 million to Hollinger Inc. to prevent it from being seized by Hollinger International. Desiring to be sure I was seen removing the documents, I was rewarded for my guilelessness by being held up to the world as a thief.
There was no possible justification for this pandering by Campbell. That I was being unjustly expelled from a building I owned, where I had had my office for twenty-seven years, to make way for those who represented no one and had been milking the company was not much mentioned. Nor was the fact that what was being removed was not covered by the relevant court order. Some people recoiled at the one-sided presentation of this nonsense. Someone I did not know wrote the Globe and Mail that it was little wonder, given that newspaper’s coverage of me, that I had chosen to found a competing newspaper.
After Alan Mark called me, immediately after his return from the courthouse on May 25, I went out for a bicycle ride in the park near my home, as I had done thousands of times before. When I moved onto the normally hard-packed earth shoulder to avoid a bump on the paved trail, my front wheel sank into inexplicably marshy ground and stopped abruptly. I was thrown forward and sideways rather heavily. I was covered with mud, the bicycle was bent eerily, but I had only a slightly bruised knee. I walked the unusable tandem home, showered, had a glass of wine on my terrace, and wondered at how unpleasantly bizarre my life could become. I rarely had physical accidents, but this was the second after the fall in Seattle and did not augur well.
Eddie Greenspan took over the contempt case (which was never launched against me). Walker claimed that I was unaware of its existence, and he let it be known that they intended to ask for a jail sentence for me. Greenspan and I both felt that this might be the time, finally, to take the offensive. It was another demeaning and humiliating episode, but I was now inured to these things and took little notice of the endless prattling and nasty caricatures in the press. I knew logically that it could not go on forever. The New York Times at least gave me credit for physical stamina in lifting the boxes, and most accounts did refer to Greenspan’s assurance that there was no violation of court orders in the removal of personal papers that had not been in the office when the initial order was produced.
I had also been so extensively defamed for so long, I did not fully appreciate the graphic, symbolic damage of this practically irrelevant sideshow.
There were opéra bouffe diversions even in these fraught days. Peter White and I were sitting in my office on the afternoon of May 24 when one of the loyal executive assistants informed us that, since one of the directors had phoned in to the meeting then underway in the boardroom between the independent directors and the Ravelston receiver, they could arrange for us to hear the meeting on Peter’s speaker phone. We did so.
This was their first meeting with the receiver. I had the pleasure of hearing from Kelly that I would be personally bankrupt within a few weeks. Walker demonstrated his political instincts by accepting the receiver’s right to name directors and by renouncing the notion that the directors’ previous pay level was justifiable because of the strains of privatization but never intended to be durable. Then came the highlight: an ex-Mountie whom Walker had hired to ensure security (at a prodigious salary) was introduced around. This was the man who would
cost $50,000 per month, but this was justified to ensure that no piece of paper that might make a difference, said Walker, “of hundreds of millions of dollars” in their imbecilic lawsuit would not be removed. And this was the man who would prevent them from being bugged.
Of course, while dealing with such imbeciles, bugging was superfluous, not only because we listened to them without recourse to espionage, but also because they were quite predictable. Strosberg, speaking loudly from ignorance, had sold Walker and Kelly the fable that we were heavily indebted to Ravelston and could be seriously inconvenienced if the loan were called. Their disappointment crackled through the telephone when the receiver told them that our indebtedness to Ravelston was non-recourse straw debt, easily cancellable. Their request that the receiver claim a receivership against me personally melted like a snowflake on a warming spring day. The dominoes stopped rolling at Ravelston. The Marx Brothers would have been wittier but no more entertaining.
But they were winning. A few days later, Campbell sustained Walker’s decision in throwing Peter White off the Hollinger Inc. board. Campbell had bought the line that we were tainted characters and that our 78 per cent shareholding was a toxic waste area that could not be exercised and whose holder could not even be informed of what was happening in the company. There had been no adjudication of the main issues, no due process, just Campbell following the Globe and Mail’s view that I was bad. With the National Hockey League on strike, I seemed to be the Globe’s replacement game. Globe and Mail reporter Richard Blackwell volunteered to Peter White’s lawyer, David Wingfield, that he would like to focus more on the role of Walker and Campbell but that his editors wanted all focus to be on the crucifixion of me.
With immense relief, Barbara and I retired as Hollinger International directors on June 7, 2005. Barbara had been longing to retire since this began but had been urged to stay on in order to keep one oar in should I be turfed before she was. Neither of us wished to participate any longer in the charades of meetings (all decisions were taken at Breeden’s Corporate Review Committee) or to legitimize the Paris-Seitz regime. I also assumed that Walker would eventually revoke our status (as Hollinger Inc. still had the right to remove Hollinger International directors by resolution). Never again would the shareholders see the sort of generous offers I had arranged for them with the Barclays and with the privatization process.
An offer came in promptly for our apartment in New York, well above its cost to us and $2 million above an appraisal of just nine months earlier. I did not regret leaving our home in New York as I had London. Manhattan is not a place to sojourn for long if you have no real job – unless you are a genuine New Yorker. We had no job and no reason to be there any longer. If our Florida real estate agent could move out Palm Beach at close to the asking price, I would at least have a war chest adequate to get through any emergency. This would be the definitive end of the financial crisis that had hovered over me for eighteen months and came back with terrifying vengeance after the collapse of the privatization effort.
BRENDAN SULLIVAN AND GREG CRAIG visited the U.S. attorney’s office in Chicago in June 2005. It was the main service I got from Sullivan, whose firm I paid more than $8 million in 2004 and 2005. They met with the rather large and unanimated Robert Kent, and his hyperactive, compulsively pugnacious sidekick, Eric Sussman. Sullivan phoned me from the lobby of the federal courthouse in Chicago, which was a milieu I would come to know well, and assured me that “they are a thousand miles from laying a charge.” Craig had assured me there was no sign of any grand jury activity, and that if any began, I would receive a suspect letter and then a target letter.
Sullivan made it clear to Kent and Sussman that there was no serious case against me, that any charge would be resisted with extreme strenuousness, and, that to the extent Kent was relying on Breeden’s report, the prosecutor would be making a terrible mistake that would bring the Justice Department into disrepute. Kent said that if a discussion of substantive issues seemed appropriate, he would call. Sullivan confimed his view that Kent knew little about the case and that his sabre-rattling with Eimer had just been the usual opening shot.
What concerned us was that, when setting up the meeting, Craig had been told by Kent that the latter would seek a tolling agreement from us that would extend the statute of limitations (five years) on any charges. The statutory end of the period for prosecuting the disputed transactions was close. We had no intention of agreeing to such a thing, but when they met, Kent did not raise it. He did express curiosity about whether I would accept U.S. jurisdiction if charged and whether Williams & Connolly would accept a subpoena for documents on me. This seemed to imply that they were really cranking up to indict soon.
Sullivan’s view was that Kent would be insane to do so, as he obviously knew nothing about the case, but that if he did, we should go to the speedy trial provisions and require that the case be brought on in ninety days. There was at least a very strong feeling with Sullivan, and with Greenspan, that if I were charged, I would win. Under any circumstances, it was a chilling prospect.
I was in such unfamiliar territory that I still stuck to a totem theory that placed confidence in a deus ex machina personality, the supreme expert who would deliver me from evil. Sullivan was widely regarded as America’s greatest trial lawyer; surely I could trust his judgment, and the U.S. attorney would not wish to tangle with him. That was what I got for the $8 million that Barbara and I had had to scramble like famished wolves to produce: a false sense of confidence.
My early legal strategy failed, but at least it got me through psychologically. The death watch on my financial condition subsided again, but when I left Palm Beach in May 2005, I did not expect to see my house there again.
I prepared yet another partial counter-attack, as part of my fighting a Bataan-like retreat. Eddie Greenspan, with my vociferous encouragement, had determined to try to force Campbell to recuse from our case because of his evident animus, which was clear in every case except the privatization hearings.
An attack on Campbell would, at the least, be like Roosevelt’s attack on the Supreme Court in 1937; even if it did not succeed, it might frighten him into more reasonable behaviour. I reviewed Greenspan’s draft and removed every use of the adverb “respectfully.” Unfortunately, this wasn’t pursued either. We kept hoping we would get clear of the Canadian courts. But we would soon have more to fear from Campbell than ever.
The Ravelston receiver, RSM Richter, would be the next unsurprising disappointment. It is well understood that litigants against a company are not stakeholders and I warned Richter that both Inc. and International would try to base their claims as stakeholders on the spurious lawsuits they had taken, which included Ravelston among the defendants. This should be resisted at all costs. They agreed and made firm noises. The key, I pointed out, was for Richter to assert control. Ravelston had 78 per cent of Hollinger Inc. and could use that to remove Walker and his sidekicks.
By now, I didn’t actually believe there was a chance of that happening. Bobby Kofman, the Richter partner serving as the Ravelston receiver, came to my home on June 9, 2005, with two of his counsel, and two of ours. Kofman responded to our exhortation to use his shareholding to force the issues by saying that there was “hair” on Ravelston’s 78 per cent control block – “hair” meaning a compromised aspect and specifically the lawsuits.
I pointed out that this was not the case. He was to represent the stakeholders, who did not include the litigants, and the litigants should rejoice at the maximum state of prosperity they could achieve for Ravelston, as it would then be a juicier target for their claims, rubbish though they were. As the Richter group seemed concerned about how their invoices were going to be paid, I thought our strongest card was to appeal to their financial interest. I told them, for about the tenth time, that the only way to get bills paid – and save Ravelston – was to assert themselves at Hollinger Inc. by getting rid of Walker and his gang, then at Hollinger International. Chicago was perfect
ly able to pay for the receiver, inspector, Special Committee, and so forth. Eventually, we should be able to repossess what was left of the company and rebuild its strength. At the very least, instead of using the company and its resources to attack the people who had built it, we should use it to attack those who were destroying it.
If there had been a chance of getting anything like a fair hearing from any Ontario court I would not have put the company into receivership. As it was, this seemed to be the best way to get rid of Walker and stabilize the company until we could sort out some of the problems.
And so it would have been, if Richter had not scampered down the well-trodden path to the U.S. attorney in Chicago in exchange for a go-ahead to suck every cent of cash out of the company it was there to protect. The only moment of their decisiveness came when, as I counted on, Walker infuriated them and Bobby Kofman and his advisor Max Mendelsohn overcame their penchant for the mousey and consensual. Walker and Carroll had been trying to negotiate a settlement with International, which consisted of giving away Inc.’s super-voting rights in exchange for 5.25 million new single-voting shares, information that we got through our Toronto Street sources and gave to the receiver. The deal blew up. International told Walker they would not deal with him, and that was the end of Walker’s fantasy, in which he would become a prominent director of Hollinger International and the trustee of Hollinger Inc.’s International shares, hobnobbing with Henry Kissinger and having lunch with the former governor of Illinois. (A more soporific conversation would be hard to imagine.) Fortunately for posterity, Walker put much of these ambitions in emails, which loyalists sent me.
Conrad Black Page 34