Conrad Black has been hit with a new lawsuit from his newspaper enterprises, claiming he siphoned off more than twice as much as originally alleged – amounting to $484.5 million in damages.
The suit, filed late yesterday in Chicago federal court by Hollinger International Inc., also accused Black and his pals on the board of his holding company of engaging in racketeering.
The new allegations turn up the heat in the long-simmering legal battle and also allow the newspaper group to seek triple damages against Black – a total of $1.25 billion.
The claim singles out Black, along with certain directors and former directors and officers of his holding company, Hollinger Inc., as well as Black’s affiliated companies.
The new action amended an original lawsuit filed against Black and others on Jan. 17. In the original suit, more than $200 million in damages were sought, plus interest.
In the new action, a total $484.5 million is sought, including $380.6 million in damages and $103.9 million in prejudgment interest.
For the first time, Hollinger International claimed Black and others violated federal racketeering laws by diverting company funds through improper bonus schemes and fees, and with transfers of newspaper assets at below-market values.
Black blasted the racketeering allegations, calling them “tabloid journalism masquerading as law.”
“Overreaching use of the [racketeering laws] has been frowned upon in virtually every circuit court in the United States,” he said in a statement.
Hollinger International’s assets include London’s Daily Telegraph, Sunday Telegraph and The Spectator magazine, and the Chicago Sun-Times.