Early Motions Approved In Sun-Times Bankruptcy

RANDALL CHASE

WILMINGTON, Del. (AP) — Lawyers for the Sun-Times Media Group Inc. said Wednesday the company's Chapter 11 bankruptcy filing could result in either a restructuring or a sale.

The owner of the Chicago Sun-Times, which filed its petition on Tuesday, listing $479 million in assets and $801 million in debt, is the fifth newspaper publisher to seek bankruptcy protection in recent months.

On Wednesday, Judge Christopher Sontchi approved first-day motions in the case, allowing the company to pay employees and vendors, and to use its existing cash management system.

James Stempel, a lawyer representing the Sun-Times group, said its financial situation stems not just from the dramatic decline in advertising revenue that has plagued much of the newspaper industry, but also from the legacy left by former Chairman Conrad Black, including a contingent tax liability to the Internal Revenue Service of up to $608 million.

"That's the most significant liability we're looking at ... It is related to the activities of what I'll call the Black regime," Stempel told the judge.