Two partners in the ownership group behind the Philadelphia Inquirer,
Daily News and the website Philly.com can move forward with their state court case against the other co-owners of the media company arising from the firing of the Inquirer’s top editor, court records show.
Philadelphia Common Pleas Court Judge Patricia McInerney ruled late last week that a lawsuit by Lewis Katz and H.F. “Gerry” Lenfest can move forward in the Philadelphia Court of Common Pleas, rebuffing an argument by the defense that the matter belongs in Delaware Chancery Court, which is where the media company is incorporated.
The Delaware court is recognized the nation over as a venue well equipped to handle business and corporate disputes.
In an Oct. 31 order, McInerney ruled that the litigation could proceed at Common Pleas Court because she is capable of applying the laws of the State of Delaware in her courtroom.
In a case that has generated headlines across the regional business world, Katz and Lenfest are suing Interstate General Media, the company that owns the media outlets, over the ouster of editor and veteran journalist William Marimow.
The plaintiffs claim that IGM, comprised of co-owners George E. Norcross, III and three other owning partners, were complicit in the firing of Marimow by publisher Robert Hall.
Katz and Lenfest allege that the defendants breached a partnership agreement when they failed to inform the plaintiffs about Marimow’s firing by Hall, who says he alone made that decision.
Marimow, a Pulitzer Prize-winning journalist who was fired from his editor job in early October, is not a party to the litigation, but Hall is named as a defendant in the case.
Court records show that plaintiffs Katz and Lenfest collectively own a minority stake of nearly 43 percent of Interstate General Media.
The Inquirer has reported that Hall fired Marimow over “philosophical differences,” with a memo that had been circulated to employees stating that Marimow had been resistant to changes at the paper.
The Inquirer has also reported that Hall cited Marimow’s supposed refusal to fire five members of the newsroom’s management team in his decision to terminate Marimow.
Hall, who has been the Inquirer’s publisher since early May 2012, is not a member of IGM, according to court filings.
In an Oct. 18 filing, attorneys David H. Pittinsky, Burt M. Rublin and Jonathan Selkowitz, of the Philadelphia firm Ballard Spahr, who represent Hall, stated that Marimow was actually fired because of his “longstanding ineffective job performances, which entailed his stubborn and indeed often insubordinate refusal to follow directives or implement much-needed editorial, journalistic and personnel changes at The Inquirer, resulting in a significant decline in circulation and morale problems in the newsroom during his second troubled tenure as The Inquirer’s Editor.”
(The Inquirer, meanwhile, reported Friday that its paid online daily circulation nearly doubled, and its Sunday digital circulation increased 72.5 percent, in the year that ended Sept. 30).
The defense filing says that Hall and Associate Publisher Michael Lorenca, along with Lenfest, met with Marimow in July to warn him that a failure to improve his job performance would result in his termination.
Marimow still reportedly receives his salary and benefits under his employment agreement.
In their complaint, the plaintiff’s allege that Hall’s termination of Marimow was improper under the IGM agreement because it was not approved by Katz, who is one of the two members of IGM’s Management Committee, the other being Norcross, an insurance company executive and Democratic Party leader in southern New Jersey.
The defense filing says that Hall’s firing of Marimow was appropriate because the move was a “paradigmatic editorial and journalistic decision that was within Hall’s exclusive prerogative as Publisher, and outside the carefully delineated authority of the Management Committee.”
The defense filing goes on to note that when Marimow was fired by the Inquirer’s previous publisher, Gregory Osberg, in October 2010, and when he was terminated from his editor position with The Baltimore Sun back in early 2004, Marimow himself “repeatedly and publicly acknowledged in the press that the termination of an Editor is within the ‘absolute prerogative’ of the Publisher.”
Hall and the other defendants in the litigation argue that Katz often interferes in editorial policies and decisions of IGM in violation of the management agreement.
“This entirely groundless lawsuit represents the latest and most egregious manifestation of such improper interference, and the extensive publicity this lawsuit has engendered is causing significant reputational harm to IGM and The Inquirer,” the defense lawyers wrote.
Last week, in addition to overruling the defense’s preliminary objections, which sought to transfer the lawsuit to Delaware, McInerney, the Philadelphia Common Pleas Court judge overseeing the matter, set Nov. 13 as the day when oral arguments will be heard in her courtroom concerning a petition for a preliminary injunction seeking to have Marimow reinstated to his previous position.