DOJ trying to stop California newspaper sale
March 18, 2016
The United States Department of Justice has filed a civil antitrust lawsuit in attempt to block the Tribune Publishing Company from purchasing the Orange County Register. The DOJ is also trying to halt the sale of the Riverside County Press-Enterprise to the Tribune.
Following a bankruptcy auction, Tribune Publishing has been selected as the purchaser of Freedom Communications Inc. In the Southern California market, Tribune publishing owns the Los Angeles Times and the San Diego Union-Tribune. Freedom Communications owns both the Register and Press-Enterprise.
Next week, the Tribune is scheduled to seek bankruptcy court approval of its acquisition of Freedom Communications.
On Thursday, the DOJ announced it filed a complaint in federal court in Los Angeles seeking a temporary restraining order. The DOJ says the Tribune’s acquisition of Freedom Communications would monopolize newspapers in Orange and Riverside counties.
The LA Times and the Register account for 98 percent of newspaper sales in Orange County, according to the DOJ. The Times and Freedom Communications’ newspapers account for 81 percent of English-language newspaper sales in Riverside County.
DOJ officials say the acquisition would allow the Tribune to increase subscription prices, raise advertising rates and invest less to maintain the quality of its newspapers.
“If this acquisition is allowed to proceed, newspaper competition will be eliminated and readers and advertisers in Orange and Riverside counties will suffer,” said Bill Baer, assistant attorney general of the DOJ’s Antitrust Division. “Newspaper continue to play an important role in the dissemination of news and information to readers and remain an important vehicle for advertisers.The Antitrust Division is committed to ensuring that competition in this important industry is protected.”
The DOJ complaint does not mention competition from online news.
Tribune Publishing is a Delaware corporation with headquarters in Chicago. The company publishes 11 major daily newspapers in California, Illinois, Florida, Maryland, Connecticut, Virginia and Pennsylvania.
In recent years, publishers have been purchasing clusters of California newspaper with the intent of sharing journalistic and business duties among sister publications located in the same regions. Tribune Publishing has been carving up the Southern California market. Denver-based publisher Digital First Media owns a cluster of Bay Area papers, and the McClatchy Company owns four Central Valley newspapers, as well as the San Luis Obispo Tribune.