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Goddard shot down in attempt to immediately stop Citizen closure

A federal judge on May 19 refused Attorney General Terry Goddard’s request to immediately stop the state’s oldest continually publishing newspaper from shutting down operations.

In a May 15 filing, Goddard asked the U.S. District Court for the District of Arizona to immediately halt the shutdown, and he filed a separate lawsuit arguing that closing the Tucson Citizen illegally creates a monopoly for the region’s remaining major newspaper.

Since 1940, both the Citizen and the Arizona Daily Star have had independently operated newsrooms and separate parent corporations. But, the competing newspapers mutually agreed to delegate printing, publishing and marketing to a jointly owned entity.

The Citizen is owned by Gannett Co., Inc., while the Daily Star is owned by Lee Enterprises. And on Jan. 15, the corporations agreed to shut down the Citizen and share profits generated by the Daily Star, despite the fact numerous potential buyers offered to purchase the Citizen, according to the Attorney General’s Office.

The agreement, which leaves the Daily Star as Tucson’s only daily newspaper, has the anti-competitive effect of reducing both the quantity and quality of newspapers and increasing prices to readers and advertisers, according to Goddard.

Goddard’s lawsuit against the corporations still remains, although it is not clear what path, if any, will be pursued after the May 19 decision by Judge Raner Collins to refuse a temporary restraining order intended to stop the Citizen from laying off employees and ceasing publication.

In a three-page ruling, Collins ruled that Goddard did not meet the legal burdens required to obtain a temporary restraining order or a preliminary injunction, such as displaying a clear likelihood of success on the merits of his lawsuit.

Collins noted the Citizen was shut down only after the U.S. Department of Justice conducted a seven-month investigation while Gannett shopped for potential buyers, and that no evidence suggested there were any “fair and reasonable” bids for the value of the newspaper’s assets.

The federal Newspaper Preservation Act allows joint-operational agreements for newspapers, and it even permits owners to engage in price-fixing and other violations of anti-trust laws as long as editorial competition is maintained, Collins said.

“While regrettable that the Citizen‘s illustrious legacy must come to end, it can not be said at this time the decision to close the Citizen involves an anti-trust violation,” he said.

In paperwork filed as part of the lawsuit, Goddard’s argues the agreement between Gannett and Lee Enterprises violates a federal prohibition against unreasonable restraints on trade and commerce found in the Sherman Act, as well as interstate and foreign commerce protections of the Arizona Uniform State Antitrust Act.

The Citizen, according to Gannett, was established in 1859 and was the oldest continuously published newspaper in Arizona. The paper reported on legendary events such as the 1881 gunfight at the OK Corral and the 1934 arrest in Tucson of famed bank robber John Dillinger.

Anne Hilby, a spokeswoman for Goddard, said the Attorney General’s Office is now determining how or if it will proceed with the lawsuit that challenges the closing of the Citizen.

“Along with thousands of ‘Citizen‘ readers and subscribers throughout Tucson, we are disappointed with the judge’s ruling,” she said. “At this time, we are reviewing the decision and determining how best to proceed with the anti-trust litigation.”

Collins ordered Gannett, Lee Enterprises and TNI Partners, the newspapers’ shared publisher to respond to Goddard’s lawsuit by June 15.

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