The Deal from Hell (42 page)

Sure enough, my failure to show up would result in yet another visit by FitzSimons and more penguin meetings. On the surface, the whole exercise seemed innocent enough. Who, after all, could argue with a company examining the way it did things to determine if the status quo had become harmful? But in months of navel gazing, the Kotter project unleashed pent-up anger in the Tribune's management ranks, igniting a civil war within the company between journalists and the business side, precisely when we desperately needed to work
together to address the problems that were dogging the industry. More often than not, the transformative change meetings devolved into acrimony, particularly at the
Los Angeles Times
, where journalists felt they had targets on their backs.

At one session on the first floor of the
Times
headquarters, managing editor John Arthur, a seasoned veteran, vigorously challenged the argument that news decisions should be affected by market rather than straight-up journalistic standards. But folks from ad sales and marketing pointed out that the
Times
had to change because “the consumer was now in charge.” Reports generated by the penguin initiative were loaded with phrases like “Retool Everything” and “Change the Culture,” implying that traditional journalistic standards had to go. There were meetings and pre-meetings and MBAs from marketing who asked questions like: “You said you want to improve local coverage. When should I benchmark that?” Hiller had hired a consultant to facilitate the evolving debate who kept saying everyone should “get on the bus,” until I told her I didn't want to “get on a bus” that was heading off a cliff.

The acrimony in the ranks was nothing compared to what was playing out between Zell and FitzSimons. Soon after the grave dancer had joined the Tribune board, FitzSimons let him know who was in charge of the cemetery. By Zell's account, his instructions from FitzSimons were, “You are on the board, you sit in the board. You don't sit on any committees. You don't have anything to do with it until it is a real deal.” Tensions flared again when both men went to Washington to lobby the FCC and key congressmen to support the transfer of broadcast licenses that they needed for their deal. When a reporter at the
Times'
Washington bureau asked Zell a provocative question regarding his views on “current management,” he gave an extremely elusive reply. Afterwards, FitzSimons let Zell know he was dealing with someone who grew up in the same space as Joe Giaimo: “I told Sam in no uncertain terms,” FitzSimons recalled “that that wasn't acceptable because while I was running this company, I was running this company, and I didn't need anybody undercutting me. It was a little bit more
colorful than that.” Even after FitzSimons knew he was out of the picture as the deal was about to close, he sat in Zell's office and refused to budge, telling him: “I'm not doing anything. I'm not giving you any power until it closes, and I don't think it's going to close. I'm not moving because I'm not moving. If it doesn't close, then I'm still CEO.”

For all of Zell's in-your-face persona, FitzSimons couldn't goad him into a confrontation he didn't want. Behind the scenes, he had asked his trusted aide, Pate, to write a detailed plan outlining what the Zell team should do during the first hundred days after it had taken over Tribune. And one of Pate's strongest recommendations was to dump FitzSimons. Pate felt that FitzSimons wasn't taking the concerns about the solvency of the company seriously enough. In addition to getting rid of FitzSimons, Pate recommended that the company devise some plans on what it would do if the second phase didn't close.

But Zell didn't seem concerned with solvency issues. Zell had planned a major role at the company for Randy Michaels, a former shock jock he had met when he took over a Cincinnati radio company in the 1990s. He asked Michaels to come up with his hundred-day plan for what they should do with Tribune. The plans couldn't have been more different.

In his blueprint, Pate urged Zell to remove not only FitzSimons but numerous other members of his executive team who he criticized for rushing to close the deal, concerned only about the bonuses they'd receive. He recommended meeting with Jack Fuller about the idea of recruiting him to a new board, a move that would signal journalism's place in the pie. And he suggested sharply downsizing the centralized corporate staff at the Tower and delegating to executives involved in operations decision making and profit responsibility. He went so far as to suggest meeting with Burkle and Geffen to assess their interest in buying the
Los Angeles Times
. “If their interest is below $1.5 billion, then pass. The
Los Angeles Times
media group could be a real winner if separated from the Tower,” said Pate.

Michaels had something else in mind. In nine pages of bullet points, he reflected a purge mentality with frank suggestions such
as: “Identify change leaders and resisters within Tribune, promote and eliminate as appropriate.” Michaels saw the biggest challenge as changing the culture of the place: “Begin the process of creating products focused on consumer interest and demand as opposed to some idea of what the citizens ought to know. It's not what they need; it's what they'll read, what they'll watch, what they'll click on, and what they want delivered to the deck of their cellphone.” In his plan, Michaels disparaged Tribune newspapers as “staid, grandfatherly and dated” publications holding the company back, although he gave no hint of how he'd engineer change. He recommended identifying people in the company they could get to “drink the Kool-Aid.” Finally, he suggested they should conduct a road show “to major business units aimed at resetting the culture. Meet, shake hands with, and answer the questions of as many team members as possible.” Journalists and the Tribune took themselves too seriously for Michael's money. In his report, he said they should “have fun.”

Although I didn't know about any plans for a road show, a preview came to Los Angeles after Pate called and said Zell had received a request for a meeting with a prominent group of Los Angeles citizens worried about what was going on at the paper, including the late Warren Christopher, the former Secretary of State and probably the only high-level member of the Los Angeles community that could rally the disparate political, commercial, and cultural factions of Los Angeles. “They said Dennis wouldn't come out and meet with them,” Pate said, “but I don't see anything wrong with Sam coming out and meeting them, do you?” I agreed that a meeting would be fine.

Warren Christopher and his group had been quite supportive, urging me to stand by my statements that I would not let the paper deteriorate. They believed that a first-class city needed a first-class newspaper and that the
Los Angeles Times
should be on a par with papers out East. “We view you as someone who we hope will hold the line and maintain the paper's stature,” Christopher told me. So I worked with Hiller on a plan to stage a lunch in a large room that was once Dorothy Chandler's personal apartment at the
Times
.

A few weeks later, Zell showed up at the
Times
for the lunch wearing his signature jeans and open-collared striped shirt. “I was going to wear a suit and tie,” he told the guests, “but I decided not to because I wanted you to see me the way I am.” About two dozen women and men sitting around the large U-shaped table seemed charmed at his open and folksy manner. Zell fielded polite yet pointed questions with blunt but respectful replies. The guests came from the world of politics, business, culture, and film, men and women of accomplishment who cared about their community and its newspaper.

Over dessert, when Christopher, the gray eminence, spoke, he diplomatically told Zell of the group's concerns about cuts at the newspaper, particularly rumors of cuts in the
Los Angeles Times
foreign bureaus: “You know, Sam, we view our community as the gateway to the Pacific and we think foreign coverage is quite important.” Without missing a beat Zell shot back, “You know, Warren, I don't give a fuck what you think. What I give a fuck about is what David Hiller here thinks, because from now on he's in charge of this newspaper, not some bureaucrat in Chicago.”

The room fell silent and all eyes turned to Christopher in his tailored blue suit, French cuff shirt, and tasteful tie, exactly the kind of wardrobe that Zell and his team disparaged. “Well, Sam,” Christopher replied, “we appreciate your frankness.”

I had scheduled a meeting in my office between Zell and several editors eager to bend his ear. Midway through the session, I asked Steve Lopez to come in to meet the new boss, and both handled the situation with grace and humor. As we walked to the Globe Lobby in the
Times
where Zell's driver was to pick him up, he grabbed my tie and said, “What's with this?” I replied that I wanted him to see me the way I came to work every day and that I was sure he would not want me to dress down just for him. He smiled, pulled out a cigarette, and left for the airport.

N
ot long after Zell requested hundred-day plans from Pate and Michaels, Wolinsky walked into my office and shut the door, announcing that there was something he had to tell me. Hiller, Wolinsky said, had been inviting groups of people to tell him how they thought I was doing as an editor, and how well I related to the newsroom.

The news didn't come as a shock to me. A few days before, Davan Maharaj, the paper's business editor, had cryptically told me, “There are people who are supposed to be watching your back who are not watching your back.” And several others had appeared in my office in recent days with similar reports, indicating that Hiller was also asking people what they thought of Russ Stanton, the editor I had placed in charge of the newsroom's Internet efforts and a favorite of both Hiller and FitzSimons. I knew Hiller and I knew how he operated; he'd often asked me about people in the same fashion. I knew that he and FitzSimons liked Stanton because he wasn't, well, like me.

I sat down and fired off an e-mail to Hiller letting him know that the reports had gotten back to me and that he was undermining
me, feeding newsroom speculation that he was looking for an excuse to depose me. If that's what he wanted, he, of course, had every right to replace me. But I preferred to deal with him head-on. Hiller denied he had any such intentions. But I knew by now that the penguin initiatives championed by FitzSimons drove his almost frantic pleas for change for change's sake.

After I had failed to show up for his Chicago meeting, FitzSimons came to the
Los Angeles Times
for a party hosted for KTLA's anniversary. The Zell team had made it increasingly clear that FitzSimons would not be the CEO once the deal closed. Frantz, the managing editor appointed by Baquet, had decided to step down, and I had appointed two new managing editors, John Arthur and John Montorio. I set up a lunch for them to meet FitzSimons. The night before the four of us would sit down, FitzSimons sent me an odd journalism review article regarding how journalists laid off at Belo papers in Dallas had found new, rewarding paths in life. When one editor heard FitzSimons was coming to Los Angeles again, he quipped: “I guess he wants to piss on the fireplug one more time.”

The next day FitzSimons and I both arrived early, and we had a “frank exchange of views.” He recited his litany—he wasn't too impressed with me, thought that I'd betrayed Hiller, and I should have kept silent about bonuses. I'd heard this all before. But this time FitzSimons extended another jab, voicing his dismay at my tolerance for a newsroom that had videotaped my introductory speech and put it online before clearing it with me. “If someone had done that to me, I would've fired him,” FitzSimons said. Given that almost everything I said in the newsroom was simultaneously published in
LA Observed
, the incident hadn't bothered me. Besides, I thought firing someone on my first day as editor for covering a story in my own newsroom wasn't a good idea. And then, of course, he attacked Wolinsky.

I told FitzSimons that my initial views about the
Times
had changed once I got to know the paper and the people better, particularly Wolinsky. “When I first got here,” I told him, “I thought he would be someone that would be a problem for me, but he actually turned out
to be a help.” FitzSimons retorted that no one else shared my view of Wolinsky, an assertion that was patently untrue.“What is this with you and Leo?” I demanded. “He's a one of my deputies. Why are you, the CEO of this company, so obsessed with him? I'd think you'd have better things to do.”

FitzSimons came right back, letting me know he thought my refusal to fire Wolinsky revealed my reluctance to make an unpopular decision and my ultimate desire to “play to the staff.” “We go back a ways,” FitzSimons said, “and I just wanted to come here and talk to you honestly.” When at last Montorio showed up, things returned to civil ground, and we made our way through lunch. In the end, I think FitzSimons felt he owed me a thumb in the eye. Just before he left, I asked him if there was a hidden message in the journalism review article he'd sent me. He laughed and said, “No. I just wanted you to see that all of the news about layoffs isn't bad.”