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MyspaceMontecito Bank & Trust has filed suit against the Santa Barbara Daily Sound, alleging the company has breached a contract and not been paying back an $80,000 loan it took out two years ago. According to the suit, the five-day-a-week newspaper (for which this reporter once wrote) was to make monthly payments of $806 to the bank, but the last payment the bank had received came on October 13, 2010. “Although demand therefore has been made, no part of said sum has been paid,” the lawsuit said.
The suit names Daily Sound owner Jeramy Gordon, his brother Kyle, and their parents Cynthia and Michael Gordon and alleges breach of written agreement, breach of guaranty, indebtedness, and unjust enrichment. Jeramy Gordon said the paper’s attorneys are working with the bank and “hopefully we’ll have this resolved before our February 2 court date.” Including interest and attorney fees (the bank has hired the Thousand Oaks-based firm of Spiwak & Iezza, which touts itself as “debt collection specialists”), the bank is seeking $99,759.
Last fall the Daily Sound lost its two veteran reporters, Colby Frazier and Eric Lindberg, and has yet to replace them. Longtime News-Press reporter Joshua Molina, who had been freelancing for the paper for a time, was hired as the paper’s editor-in-chief and the paper has used a variety of college students and interns as correspondents to supplement his reporting.
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Comments
Tough stuff; I hope they can get back in the good graces of the bank.
Although I rarely read the paper, they are a hard-working bunch putting out a useful addition of the Santa Barbara newscape.
binky (anonymous profile)
January 13, 2011 at 12:35 a.m. (Suggest removal)
Maybe Montecito Bank & Trust - who is so interested in supporting the community and it's many non-profits - should consider forgiving this loan and helping a struggling paper survive? Just a thought...they pass out lots of checks and have a very good profit, that local bank. So why not support a local paper and stake an interest in it even?
summerlandian (anonymous profile)
January 13, 2011 at 7:13 a.m. (Suggest removal)
Banks are not in the business of giving out loans for charity
SBLoc (anonymous profile)
January 13, 2011 at 8:45 a.m. (Suggest removal)
The Daily Sound is not a charity, in any case. It's a for-profit business. That's how banks make money, interest on loans. Supporting non-profits is done for tax benefits and social prestige, neither of which would accrue from investing in a small daily newspaper.
Nitz (anonymous profile)
January 13, 2011 at 9:13 a.m. (Suggest removal)
Newspapers and news media are a conundrum because competitive journalism and their publications are a public service, not just a commercial enterprise.
And then there is the News-Mess, which is neither.
David_Pritchett (David Pritchett)
January 13, 2011 at 9:31 a.m. (Suggest removal)
Summerlandian makes a god point. But then so does SBLoc. The nature of banks is to rape & pillage---er, fend for themselves at all costs. Which is why they dime & dollar you to death at every juncture for the "privilege" of banking with them.
I loathe banks. Just read the daily headlines and you can understand why. Banks foreclosing on houses they knowingly made, bought, & sold bad loans for. Crashing & failing themselves, they go to the government for relief and get it.
I long for the day when this current model of banking goes the way of the black & white TV. Fire your pirate banks. Use cash & prepaid debit cards for purchases. Done.
Draxor (anonymous profile)
January 14, 2011 at 7:05 a.m. (Suggest removal)
Difficult to take sides in a situation like this... Both are valuable assets to the community. I hope they can work out their differences fairly.
Nockamixon (anonymous profile)
January 20, 2012 at 2:18 p.m. (Suggest removal)