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SPECIAL REPORT / CROSSING THE LINE

Crossing the Line

A Los Angeles Times Profit-Sharing Arrangement With Staples Center Fuels a Firestorm of Protest in the Newsroom--and a Debate About Journalistic Ethics

December 20, 1999|DAVID SHAW | Times Staff Writer

No. He had spoken to Parks and Arthur and "I assumed that it was being taken care of. . . . I thought that there would be an announcement forthcoming that we would kill it. . . . They should have killed it. . . . Revenue-sharing with a news source? You gotta kill it."

Like many who played, or could have played, crucial roles in this episode, Dwyre says he now has "huge regrets" about not having been more aggressive with Parks.

But no one was aggressive with Parks before the magazine was published.

Short, for example, was in Reno, where the magazine was to be printed, when Avetesian told Heikes about the profit-sharing, and when Heikes filled her in, she says she, too, spoke to Lindsay. She didn't mention it to Parks until they had lunch perhaps a week later, though, and she didn't urge him to publish a disclosure of the profit-sharing arrangement either. Still, she and her staff were devastated and infuriated. They had done the issue against their will, but they had worked hard on it, putting in long days and nights and weekends, canceling vacations and giving short shrift at times to spouses and children. Now everything they had done had been besmirched.

For the Record
Los Angeles Times Monday December 27, 1999 Home Edition Part A Page 3 Metro Desk 2 inches; 39 words Type of Material: Correction
Investment conference--Participants in the Philadelphia Inquirer investment conference are selected by members of the paper's newsroom staff but, contrary to what was reported in The Times last Monday, they are invited by Morningstar, the co-sponsor of the conference.

The advertising department was also angry about the controversy.

"This was our first kick-ass year in a long time, the first time we can feel really proud, and then this comes along and dampens the whole thing, and we don't even get a chance to feel excited," says Beth Sestanovich, advertising director of the Los Angeles region.

Word of the arrangement began to spread after Avetesian's two mid-September visits. Heikes says that he sent interoffice computer messages about it to a number of colleagues at the paper. Several editors say that they heard either authoritative reports or vague rumors about the profit-sharing before the magazine was published. Dwyre mentioned it to several members of his staff. David Colker, a reporter in the San Fernando Valley office of The Times, heard about it from someone in the department and discussed it with his city editor, Steve Clow. Everyone who heard about it was upset. Everyone said they thought it was wrong. No one did very much about it.

Did Clow, for example, call his bosses downtown to inquire or complain?

No.

"I always figure when we hear something out here, it's days and days after people know it at Times Mirror Square," he says.

Praise From Parks

On Oct. 10--six days after Colker and Clow had their conversation, three weeks after Avetesian visited Heikes and Jaffe, 26 days after Parks and Downing say that they had their first conversation about profit-sharing--the Staples Center issue of the magazine was published. The next morning, Parks sent the entire editorial staff of the newspaper one of his periodic messages of praise. It began: "The Magazine and Sports staffs combined to put out a great magazine Sunday on the new Staples Center and what it will mean not only for fans but for the resurgence of downtown L.A. Very nice work indeed!"

Parks could have used the occasion of that message to disclose his discovery of the profit-sharing arrangement and to condemn it, even if only in passing, after the compliments. He didn't do so.

Even the most severe critics of the magazine acknowledge that there were at least two good stories in it--the Tony Perry piece on the impact of arenas on downtowns and an article by David Wharton and T.J. Simers on how the deal to build the arena was put together. But even people who worked on the magazine worried that too many stories were too soft and that the overall issue was too promotional.

Ironically, Tim Leiweke said in an interview after the Staples controversy broke that he wasn't crazy about the issue either. He says he didn't like Perry's story and one or two others. He wasn't happy that the cover photo didn't show the name of the arena. He would have preferred a publication with no date on its cover so he could sell it indefinitely at the arena. He didn't like seeing ads in the magazine from companies that compete with his founding partners.

Shortfall in Profits

Leiweke couldn't have been too displeased with the magazine, though; he got 10,000 copies from The Times, sent some to founding partners, put one in each of Staples Center's 160 luxury suites every night for the first month the arena was open and is still giving copies away at The Times kiosk in the lobby. Still, he says, having favored an advertorial or a stand-alone souvenir book from the beginning, his reaction when he'd heard that the magazine was to be the revenue-sharing project was: "Why the hell are they doing that?"

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