Hollinger International Announces Settlement of Class Action Lawsuits Related to Chicago
Group Circulation Inflation
Chicago, IL, September 16, 2005 -- Hollinger International Inc. (NYSE:HLR) announced today that it has reached a tentative
global settlement of the consolidated class action lawsuits brought as a result of the previously announced inflation of
circulation at the Chicago Sun-Times and two of its sister publications.
Counsel for the Chicago Sun-Times and the attorneys for the plaintiffs in the consolidated class actions have filed a joint
motion to approve the tentative settlement, which would resolve nearly all remaining advertiser claims arising from the
newspaper’s previously announced inflation of the paper’s audited circulation. The proposed settlement has been preliminarily
approved by the Court subject to a fairness hearing in December 2005. The settlement was the result of a six-month mediation
effort, facilitated by the Honorable Abner J. Mikva, who served as the Court-appointed mediator and involved extensive
discovery by class counsel.
Earlier, pursuant to Court order, the Chicago Sun-Times was permitted to negotiate settlements with nearly 400 of its largest
advertisers that resolved approximately 58% of advertiser claims for an aggregate consideration of approximately $10 million of
cash and $6.8 million of advertising benefits to advertisers continuing to advertise with the paper at specified levels.
The proposed settlement in the consolidated class action lawsuits will provide the plaintiff class with aggregate consideration of
approximately $7.7 million in cash and up to $7.3 million in free advertising or discounts. The Chicago Sun-Times has agreed
to pay the fees and expenses of the firms representing the settlement class, as approved by the Court, up to a total of $5.575
million. The Chicago Sun-Times will also pay all the costs associated with the administration including publication of notice,
mailed notice and distributing the benefits to class members. Neither the administration costs nor the attorneys' fees will reduce
the benefits to the class. The settlement will not cover the claims of advertisers who are plaintiffs in four separate lawsuits or
the claims of four advertisers with whom the Chicago Sun-Times has been in settlement negotiations. The advertising
expenditures of these excluded claimants represent approximately 3.5% of the Chicago Sun-Times’ advertising revenue during
the relevant settlement period applicable to major advertisers.
The parties have requested a hearing on their motion for final court approval of the settlement in December 2005. If the
settlement is approved without material delay, settlement payments will be made in early 2006. The claims for commercial
advertisers in the consolidated class action proceedings will be calculated using the same circulation estimates that were used
in the newspaper’s settlements with its major advertisers. As with major advertiser settlements, advertisers in the class action
settlements will also have the additional option to accept all of their settlement consideration in the form of additional free
advertising. The settlements will be administered by Rust Consulting, Inc. an independent, third-party claims administrator
agreed to by the parties.
Publisher John Cruickshank stated: “Since our voluntary reporting of the problem, the Chicago Sun-Times has been committed
to make fair and equitable restitution to our advertisers. The class action settlement is consistent with the settlement principles
announced in connection with our major advertiser settlement program and is intended to treat all advertisers fairly.”
About Hollinger International
Hollinger International Inc. is a newspaper publisher whose assets include The Chicago Sun-Times and a large number of
community newspapers in the Chicago area as well as in Canada.
Cautionary Statement on Forward-Looking Statements
Certain statements made in this release are "forward-looking statements" within the meaning of the Private Securities Litigation
Reform Act of 1995 (the "Act"). Forward-looking statements include, without limitation, any statement that may predict, forecast,
indicate or imply future results, performance or achievements, and may contain the words "believe," "anticipate," "expect,"
"estimate," "project," "will be," "will continue," "will likely result" or similar words or phrases. Forward-looking statements involve
risks and uncertainties, which may cause actual results to differ materially from the forward-looking statements. The risks and
uncertainties are detailed from time to time in reports filed by Hollinger International with the Securities and Exchange
Commission, including in its Forms 10 K and 10 Q. New risk factors emerge from time to time and it is not possible for
management to predict all such risk factors, nor can it assess the impact of all such risk factors on the Company's business or
the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in
any forward-looking statements. Given these risks and uncertainties, investors should not place undue reliance on forward-
looking statements as a prediction of actual results.
Molly Morse / Jeremy Fielding
Kekst and Company