Newsprint vendor sues Tampa Bay Times over defaulted $340K debt - SaintPetersBlog

Newsprint vendor sues Tampa Bay Times over defaulted $340K debt

A newsprint vendor is suing the Tampa Bay Times, claiming the paper owes more than $340,000 in debt from the acquisition of the Tampa Tribune last year.

Emails submitted in the suit show a story of increasing disarray with vendors at the 121-year-old Trib leading up to the May 2016 purchase.

In April 2015, the Tribune issued a promissory note to Boise Packaging acknowledging an unpaid debt of nearly $600,000 for newsprint. Boise Packaging is a subsidiary of Packaging Corporation of America, an Illinois-based manufacturer of corrugated boxes and paper products.

The note came about three years after Revolution Capital Group, led by Robert David Loring Jr., purchased the struggling paper for $9.5 million.

Court records show the Tribune agreeing to weekly payments until the debt was clear. Boise’s credit manager Steve Grant, in a series of emails in 2015, communicated with Revolution Capital chief financial officer Stanley Huang about the Tribune’s unpaid debt.

On June 8, 2015, Grant wrote to Huang: “My patience has run out. Last chance to begin paying $10,000 a week without fail. Failure to do so will result in legal action. The ball is in your court.”

Huang responded with several excuses — including the postponed sale of the Tribune’s headquarters and unexpected employee health-insurance claims — for the paper’s failure to make payments.

“I can definitely appreciate and understand your frustration,” Huang responded. “To be honest, you weren’t at the bottom of the list. There were other current vendors that didn’t get paid this week. The medical claims typically come in around $50K a week, but this week it skyrocketed to $110K and ate up all the availability we had on paying vendors.”

“I wish people didn’t get sick and we didn’t have to pay these medical costs that just automatically get drawn,” said Huang’s email of June 26. “I don’t ever call in sick and rarely do I go to the doctor so I wonder where do all of these medical claims come from.”

“Hopefully you won’t find a lawsuit necessary,” Huang said.

Nevertheless, when the Tampa Bay Times took over the Tribune, it was with a stock deal in which the Times assumed the Trib’s liabilities.

By then, the Tribune owed Boise $403,773, plus interest.

Soon after, Times chief financial officer Jana Jones promised Grant the paper would set up a repayment plan, saying the previously agreed upon arrangement “is likely to work for us as well.”

A May 26 email from Jones acknowledges the Times acquired the debt to Boise Packaging, asking for a few weeks to set up a new plan.

“Things haven’t really settled down … it is very busy,” she wrote. “In addition to the systems/operations integration, we are still untangling all of the past due invoices from various vendors. Candidly, it’s taking longer than anticipated.”

However, Jones noted, the debt remained obligations of the Tampa Media Group.

“That company remains active,” she said. “We are not transferring obligations to Times Publishing Company.”

In July 2016, the Times promised Boise monthly payments ranging from $15,000 to $25,000 until December 2017, when the debt would be fully retired.

In the suit, filed Feb. 22 in Hillsborough County Circuit Court, Boise claims the Times defaulted on the revised repayment plan, making only two such monthly payments.

A legal notice sent to Jones from Boise Packaging attorney Monica Cockerille points out that while the vendor did receive payments for July and August, they did receive one for September, and — at the time of the letter, Oct. 25 – no payment for October.

The suit, which names the Tampa Bay Times, Revolution Capital, and Tampa Media Group, is asking for $340,983 in unpaid principal, plus interest.

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Peter Schorsch is the President of Extensive Enterprises and is the publisher of some of Florida’s most influential new media websites, including SaintPetersBlog.com, FloridaPolitics.com, ContextFlorida.com, and Sunburn, the morning read of what’s hot in Florida politics. SaintPetersBlog has for three years running been ranked by the Washington Post as the best state-based blog in Florida. In addition to his publishing efforts, Peter is a political consultant to several of the state’s largest governmental affairs and public relations firms. Peter lives in St. Petersburg with his wife, Michelle, and their daughter, Ella.
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