From last Sunday's Pittsburgh Post-Gazette comes a story of a multifaceted legal conflict, which has all the makings of a soap-opera-ish TV movie of the sort one can see on cable's Lifetime network. (One of the disputants even has the name "Battle." How Dickensian!)
The article begins with a dispute between the publishers of Pittsburgh's rival newspapers:
Attorneys for Tribune-Review publisher Richard M. Scaife have filed court papers demanding the Pittsburgh Post-Gazette return documents related to the divorce of Mr. Scaife and his wife, Margaret Ritchie Battle Scaife.The juicy details are left until later in the article and exhibit the sizzling passions one expects from television melodrama:
In response, the Post-Gazette, arguing that no court has the right to force a newspaper to surrender documents lawfully in its possession, has posted those documents on its Web site, with some personal, financial and third-party information removed.
"Mr. Scaife has asked the court to do something unprecedented: stop a newspaper from writing about documents that were publicly available and highly newsworthy," said David M. Shribman, executive editor of the Post-Gazette.
"That effort is newsworthy in and of itself. As we will advise the court, such a prior restraint would be a clear violation of the First Amendment and of press prerogatives and freedoms that all newspapers cherish. In the meantime, we have posted the most significant of those documents on our Web site and will continue to evaluate whether additional postings should be made."
Mr. Scaife's attorneys say the Post-Gazette article describes "at length various highly confidential and personal matters contained in the record, none of which have any news value nor are legitimate subjects of public scrutiny."Dognapping? Derogatory yard signs? Those alone might raise eyebrows, but check out the dispute about assets and alimony:
But the Post-Gazette countered that the story is newsworthy, given the Scaifes' high profile in the community and the large amounts of money involved, particularly the enormous monthly support payments. The newspaper argues that Mr. and Mrs. Scaife have already put their divorce in the public domain with arrests for trespassing and assault, accusations of dognapping, and derogatory yard signs.
Mrs. Scaife, 60, contends that the Pittsburgh Tribune-Review, one of a half-dozen local Tribune-Review Publishing newspapers owned by Mr. Scaife, 75, should be considered a hobby or personal cause rather than a business investment because the paper has lost $20 million to $30 million annually since it began publishing in 1992.Taxpayers, take note: If you lose money on your business, it becomes a hobby. Think about it -- publishing as philately, real estate as recreation, capitalism as camping.
The IRS defines a hobby or not-for-profit activity as an activity not pursued for profit. "An activity is usually considered a business if it makes a profit during at least three of the last five tax years, including the current year," according to the IRS.
Mr. Scaife's lawyers say those losses should be counted against Mr. Scaife's aggregate monthly income in determining support payments. That would put his 2005 yearly income at $17 million.
Mrs. Scaife's attorneys say that, discounting the Pittsburgh paper's losses, his real income in 2005 was $45 million.
If he treated the Tribune-Review like his other investments, "the Tribune-Review would have been gone long ago," Mrs. Scaife's lawyers stated in the documents.
"In fact, if his real investments performed like the Tribune-Review, [Mr. Scaife] would be penniless instead of a billionaire, and attempting to collect support from his wife," her attorneys said.
The divorce documents show that Mr. Scaife has subsidized the Pittsburgh paper -- one of the few Tribune-Review Publishing properties not showing a profit -- for more than $140 million. Attorneys for Mrs. Scaife say the figure is actually $244 million.
A court hearing officer has ordered Mr. Scaife to pay his estranged wife $725,000 per month in preliminary temporary support and Mr. Scaife's lawyers have sought to have the payments reduced.