U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 22781 / August 15, 2013
Securities and Exchange Commission v. Conrad M. Black, Civil Action No. 1:04 CV 7377 (N.D. Ill.)
SEC Obtains Final Judgment Against Conrad M. Black
The Securities and Exchange Commission announced that on August 13, 2013, the Honorable William T. Hart of the United States District Court for the Northern District of Illinois entered a final judgment against Conrad M. Black, the former Chief Executive Officer and Chairman of Hollinger International, Inc. ("Hollinger International").
The Commission's complaint alleged, among other things, that Black fraudulently diverted money from Hollinger International to himself and other corporate insiders in the form of purported non-competition payments in the PMG Acquisition ("Paxton") and Forum Communications Company ("Forum") newspaper sale transactions and made misstatements and omissions of material fact about these related party payments in Hollinger International's filings with the Commission. The complaint further alleged that Black misled the investing public in a November 17, 2003 press release about his intention to devote his time to an effort to sell Hollinger International assets for the benefit of all shareholders and not to undermine that process by engaging in transactions for the benefit of himself and Hollinger Inc.
The final judgment was the product of a settlement reached through a Court of Appeals mediation process after Black appealed the district court's October 9, 2012 judgment against him. The October 9, 2012 judgment granted summary judgment in favor of the Commission with regard to certain of its claims in connection with the Paxton and Forum transactions and the November 17, 2003 press release.
The final judgment permanently enjoins Black from violating Sections 10(b), 13(a), 13(b)(2)(A), 13(b)(5), and 14(a) of the Securities Exchange Act of 1934, and Rules 10b-5, 12b-20, 13a-1, 13a-13, 13b2-1, 14a-3 and 14a-9 thereunder; orders Black to pay disgorgement in the amount of $2,546,586.99 and prejudgment interest of $1,547,557.37 for a total of $4,094,144.36 to be paid to Chicago Newspaper Liquidation Corporation; and prohibits Black from acting as an officer or director of any public company. Black consented to the entry of the final judgment without denying the allegations of the Commission's complaint.