Two weeks after publicly saying he would fire the general manager of Newspaper Agency Corp., Salt Lake Tribune Publisher Dominic A. Welch gave Joseph H. Zerbey IV his walking papers Monday under protest by the NAC's two owners — MediaNews and the Deseret News.
But Zerbey isn't going anywhere.
Immediately following the notice of termination, Tribune owner MediaNews Group Inc. named Zerbey president and chief executive officer of Kearns-Tribune LLC, the limited liability company set up by MediaNews as owning entity when it bought the newspaper from AT&T for $200 million last December.
This essentially means that Zerbey is now Welch's boss, but given the various legal actions surrounding the acquisition of the Tribune and its relationship with the Deseret News due to the two newspapers' joint operating agreement and co-ownership of the NAC, Zerbey will not attempt to fire the man who fired him.
But though Zerbey has no intention of firing Welch, he said Welch can be given a 30-day notice if he violates the court's order that he manage the Tribune "in the best interests of its owner," MediaNews.
NAC is the printing, advertising and circulation entity for both newspapers, and each owns 50 percent of it. Zerbey was named general manager earlier this year by the NAC board of directors.
Welch is also president of Salt Lake Tribune Publishing Co. LLC, a management company that has a contract to manage the Tribune until the contract expires in July 2002. Welch and other former Tribune owners contend they have a right to buy back the Tribune at the contract's expiration, a contention that is the subject of a lawsuit.
Welch represents the former owners who sold the Tribune to Tele-Communications Inc., which was later acquired by AT&T with the Tribune as a minor part of the deal.
Deseret News Publisher Jim Wall said Monday that he and the newspaper are on record as protesting Zerbey's firing, first threatened in a Tribune story published July 17.
"We think an independent general manager of the NAC is essential to both owners being treated fairly," Wall said. "We think the only reason (Welch) is doing this is because the general manager is giving the Deseret News equal treatment with the Tribune. Unfortunately, he (Welch) made a decision without our concurrence, and we do not concur."
Zerbey said Welch came into his office Monday morning, made some small talk, and then told him he was being terminated effective Tuesday, July 31. Zerbey said he asked Welch why he was being fired and was told it was a "cost-cutting move."
"I said, 'Dominic, that is silly and you know it,' " Zerbey said.
Zerbey now sees his role as a watchdog for the Tribune's owner, and that's what he intends to be.
"They (Welch and his associates) have to manage the company to the best interests of the owner, MediaNews," Zerbey said. "I will now monitor their ability to continue to make cuts, improve the company, grow circulation of both newspapers and take care of the employees. I'm going to be very vigilant about that."
According to Zerbey, Welch and Salt Lake Tribune Publishing Co. are trying to drive down the value of the Tribune so they will have to pay MediaNews less for it next July if the court rules that their right to buy the paper back is valid.
"This is just another step in their concentrated attempt to devalue the company that they think they will have the right to buy back," Zerbey said. "It doesn't take a degree in economics to figure out that if you are going to buy back a property, you sure as heck don't want to make it worth more. There is no incentive for them to increase the value of the company."
Zerbey also sees himself as a scapegoat for Welch and Tribune Publishing. "They say to the judge, 'We kept the Singleton guy on board but he couldn't do anything in the five long months he's been here.' Actually, we had begun to make progress with revenue-generating ideas."
His reference to "Singleton" is Wm. Dean Singleton, president of MediaNews Group.
"We had found land for a new press operation, had been talking to press manufacturers, had addressed cost-cutting without layoffs or wage freezes. . . . It had become harder for them to say Zerbey isn't doing the job so they decided let's get him out now."
Welch's view of the firing is that Singleton was putting pressure on him to cut costs. "I told him to give Joe more time to get it done. He said it wasn't Joe's responsibility, it was mine. So I said if it's my responsibility I will take back the authority and Joe's cost is my problem. We decided to take care of it quick," Welch told the Deseret News Monday.
The general manager title was reinstated by Welch when Zerbey was brought on board last winter. Welch said he would not replace Zerbey but would resume managing NAC as its president, as he did prior to Zerbey being hired. "I did it before and I can do it again," he said.
Zerbey's office is directly across the hall from Welch's in the Tribune building. Zerbey says he's staying put, but Welch said "I may move him to a different floor."
As for Zerbey now being his boss, Welch said he sees him "as being in charge of Kearns Tribune, and I will discuss any issues that affect Kearns Tribune with him. But he will have no contact with NAC."
Welch dismissed Zerbey's contention that he is being made a scapegoat for NAC's problems with a single word: "Hardly."
Prior to moving to Utah in January, Zerbey had been president and CEO of York Newspaper Co. in York, Pa., a JOA that handles the business operations of The York Dispatch and The York Record, both owned by MediaNews Group.
Sale of the Salt Lake Tribune - Read Deseret News' archive stories and see related links about the sale of the Tribune.
E-MAIL: max@desnews.com