Justice: Black’s truth

Will prison change the way Conrad Black operates? A recent letter offers us a clue.

Conrad Black arrived at the Coleman Federal Correctional Complex on March 3 to begin serving a 6½-year sentence. In keeping with his defiant nature, he couldn’t resist penning the final word. In a column published in the National Post and New York Sun, he decried his “unjust” incarceration. This parting letter is noteworthy, in that it provides the most detailed account yet of Black’s downfall from his own perspective.

Several of Black’s assertions warrant skepticism. One is his emphasis that his successors at two of the companies he once controlled, Chicago-based Hollinger International (now called Sun-Times Media Group) and Toronto-based Hollinger Inc., grossly mismanaged while unjustly enriching themselves with lavish compensation. As Black and others correctly point out, both companies have performed abysmally in terms of financial performance, share price and other benchmarks.

Here the irony eludes Black. He and other executives were accused of shovelling money out International’s back door via shady non-competition agreements. At a 2002 annual meeting, Black’s responses to questions about the payments from shareholders prompted colleague (and, later, co-defendant) Peter Atkinson to comment that Black had lied. A jury convicted them of fraud during last year’s four-month trial in Chicago. Faithfully adhering to Hollinger’s rapacious tradition, their successors have similarly lined their pockets. The difference: there is no evidence of fraud or concealment. Had Black not been caught plundering his own company, that bounty could have been his.

Secondly, Black asserts that International violated the so-called November Agreement, not he. A little history is in order. In November 2003, Black reached a “restructuring agreement” with a special committee of International’s board. Among other things, Black agreed to resign as CEO but remained chairman and vowed to dedicate his time to a “strategic process” involving the possible sale of assets. Unbeknownst to International, however, Black was already negotiating to sell its parent company, Hollinger Inc.

If Black seeks to understand why so many have been reluctant to take him at his word, he need only recall this notorious deceit. In this month’s parting missive, however, Black indulges in some breathtaking, fanciful revisionism. “Within a few weeks, the Special Committee [of International’s board] had violated six of the eight clauses in the agreement,” Black wrote. In other words, he is the aggrieved party.

The Delaware Chancery Court considered this matter in 2004. In his written opinion, Judge Leo Strine concluded that Black violated the agreement through his back-room negotiations — immediately after signing it, even before a few weeks had passed. “During the course of his dealings,” Strine wrote, “Black misrepresented facts to the International board, used confidential company information for his own purposes without permission, and made threats.” Black provided no convincing evidence, then or now, to support his version of events.

It’s unseemly that Black blames others for his own dishonest acts. But this bald, reckless assertion has broader significance: it confirms the wisdom of lawyer Edward Greenspan, who recommended Black not testify last year in Chicago. Such assertions do not stand up under even cursory examination, much less aggressive cross-examination.

As their client settles in at Coleman, Black’s lawyers now turn to his appeal. While making no preliminary judgment, the U.S. Court of Appeals has said it has raised “a substantial question” concerning two fraud counts for which Black was convicted. He may yet exit his cell well before his projected release date of Oct. 30, 2013. And yet, by bending the truth, ignoring inconvenient facts and accepting not the slightest modicum of responsibility for his actions, Black’s letter loudly reminds us of the qualities that gained its author admission to Coleman in the first place. His dishonesty is a stain even the most sympathetic appeals court can never erase — and a character flaw no prison is likely to correct.