Judge Rules in Favor of Indy Editor

Judge Denise deBellefeuille granted the injunction sought by Santa Barbara Independent co-owner and editor-in-chief Marianne Partridge in her ongoing contract dispute over the sale of the weekly newspaper with Independent publisher and majority owner Randy Campbell. The injunction effectively bars Campbell from selling or distributing his shares of The Independent until the conflict with Partridge over the sale of his shares is finally resolved. While the legal skirmish was preliminary in nature, Judge deBellefeuille ruled that Partridge demonstrated she had a “reasonable probability” of prevailing on the merits of the case, should the matter ultimately go to trial. In addition, deBellefeuille ruled that Partridge was at greater risk of being harmed if the injunction were not granted than Campbell would be if it were. Campbell argued that the injunction was unnecessary because the corporate by-laws governing The Independent precluded him from selling without permission of his three fellow owners.

In November, Campbell announced he intended to sell his 51 percent of the company to Southland Publishing, which prints The Independent and owns a weekly newspaper in Ventura and Pasadena as well as San Diego CityBeat, for $1.37 million. Partridge and the two other co-owners, Richard Parker and Richard Grand-Jean, opposed the sale. They maintain that The Independent’s corporate by-laws require Campbell to give the other partners an opportunity to match Southland’s offer. When Partridge and Parker attempted to do so, according to the “buy-sell” provision of their agreement, Campbell declined to turn over his share of the stock, and Partridge and Parker sued for breach of contract. Campbell has countered that Partridge and Parker were premature in seeking to exercise their rights of first refusal and that he never activated the buy-sell provisions of The Independent’s corporate by-laws. For that to occur, he argued, 100 percent of the shares would need to be on the table. In this instance, he maintained, only his 51 percent were at issue. Campbell has also noted that Southland made it explicit that its offer was not binding. After Campbell relayed Southland’s offer to The Independent board, he sought to secure new and better terms. By that time, Partridge and Parker argued, they’d already notified Campbell of their intent to buy his shares. They also argued Campbell was explicit in activating the buy-sell agreement in his written communications with his partners. Judge deBellefeuille agreed. “Campbell characterizes his offering notice as something other than what it purports to be on its face,” she wrote in an eight-page opinion. “Campbell’s assurances aside, there is evidence that his compliance with the buy-sell agreements presents a moving target for the minority shareholders. He has invoked the buy-sell agreement and then has claimed not to have done so.”

[EDITOR’S NOTE: The comment function for articles related to The Independent’s ongoing internal lawsuit have been disabled. As a relatively small and tight-knit company, we feel unable to objectively monitor and police comments related to this situation, and have determined that this is the most neutral policy.]