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Sisters in Register Fight Lose a Round in Court

September 16, 2003|E. Scott Reckard | Times Staff Writer

Three Freedom Communications Inc. heirs lost a round Monday in their court battle to stop a trustee from voting a key block of Freedom shares this fall, when stockholders are scheduled to decide whether to sell the family-owned empire that includes the Orange County Register.

The shares once belonged to James H. Hoiles, who died in 1964 and left assets including 3.8% of Freedom's stock in a trust with the income going to his widow, Patricia G. Hoiles. In the event of her death, the income would go to James' sisters: Judith Ann Hoiles Threshie, Patricia E. Hoiles Wallace and Mary Elizabeth Hoiles Bassett.

The three sisters, part of a group opposing a sale, contend that in a 1989 settlement of a previous dispute, trustee Paul Egly gave up his right to vote the shares. But Egly, a retired Los Angeles County Superior Court judge, says he is entitled to vote the shares. The 1989 settlement, including the language governing Egly's authority, is sealed.

At a February vote asking Freedom shareholders whether to ask for bids from buyers or investors, Egly voted the trust's shares in favor, giving the measure the support of holders of a narrow majority of Freedom's shares, participants said. A sale would end nearly 70 years of Hoiles family ownership of the Register.

An attorney for the sisters, Amir M. Kahana, asked Orange County probate judge Linda Martinez on Monday for an immediate decision keeping the terms of the settlement sealed while the sisters attempt to win a court order barring Egly from voting his shares.

Martinez declined, telling Kahana to make his arguments to keep the case sealed at a hearing scheduled for Oct. 3. This month, Martinez rejected a motion from the sisters seeking a temporary restraining order against Egly, again saying the Oct. 3 hearing was the appropriate time to address the matters.

Final bids for Freedom's 28 daily newspapers, 37 weeklies and eight TV stations, along with proposals from investors who would provide funds to buy out family members who want to sell shares, are due Monday.

A special committee of independent Freedom directors will winnow those offers and the full board will consider the final bids Oct. 1.

A shareholder vote is anticipated in early November.

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