According to documents filed yesterday in bankruptcy court, the Tribune Company felt it would face protracted litigation from former VP & CEO Randy Michaels if it chose to contest his wrongful 2010 termination and bonus-due claims. (He was asked to resign last fall after allegations of workplace impropriety.) As a result, the company has decided to cough up $657,000 of the $900,000 he sought, plus $50,000 in legal expenses.

It’s not quite a done dunce-deal, as the bankruptcy court must still approve the settlement agreement. But it is more bad news for the corporate image of the LA Times parent; although layoffs at the paper have continued to occur since Michaels departed in a cloud of controversy, he gets to collect the equivalent of six plus years in star reporter salary.

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Andrew Rossi‘s Page One: A Year Inside the New York Times made its LA Film Festival debut last night and did not disappoint. The film really should have been called “A Year At the Media Section of the New York Times,” but we digress. It was great. The collapse of the newspaper business model, online competition from aggregators like Newser and click hunters like Nick Denton‘s Gawker network, and the challenges of no longer being informational gatekeepers are all discussed at length. No real surprises for anyone who works in the journalism world, but a nice primer for those outside the business.

Journos are bound to have their favorite moments in the film. Two immediately come to mind: Carr tearing the editors of Vice a new asshole during a salty (to put it mildly) interview, and media editor Bruce Headlam somehow managing to give an interview to Rossi, make last minute edits to a huge front-page WikiLeaks story and answer his phone all at the same time. Headlum’s not the star of the film, but there can’t be a journalist in America who saw that guy in action and wouldn’t kill to have him as an editor.
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Eddy Hartenstein, publisher of the Los Angeles Times Media Group, has been promoted to head honcho of the Tribune Company. His official title is Company President and Chief Executive Officer.

Oddly enough, Hartenstein will also keep his current job as LA Times publisher. And he’ll continue to live in Los Angeles, even though the Tribune Co. is headquartered in Chicago.

From the LA Times announcement:

“The board feels strongly that it is in Tribune’s best interest to have one person providing strategic vision and day-to-day direction for the company and its employees as we prepare to emerge from the Chapter 11 process,” said Sam Zell, Tribune’s chairman.

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The New York Times ran an extremely belated piece today on the struggles at the LA Times. Thanks to the Grey Lady we learn that since the Tribune Company took control of the LA Times, half the newsroom positions at the paper have been cut and the paper shut down its Orange County plant. Which is a bit like telling us Obama was elected president. We figured that one out quite some time ago.

LA Observed‘s Kevin Roderick says he was contacted for the piece over a month ago by reporter Jeremy Peters.

I never was quite clear on [Peters] rationale for writing that story now. I think my quip was that it seemed more like a peg for 2008. After reading his piece in Monday’s NYT, I’m still not sure why now.

Couldn’t agree more. News has been quiet on the LAT front since the LATExtra “innovation.” In fact, things seem to be looking up–no more Randy Michaels, all indications are Sam Zell wants nothing more to do with the print business, the paper is profitable. Sorry, Gray Lady, think you blew it on this one.

The Tribune Company submitted a new proposal to exit Chapter 11 protection on Friday, and some mighty interesting factoids were revealed in the filing. Among other tidbits, it was revealed the Tribune Company has spent $135 million in bankruptcy-related fees.

Hmmmm, wonder how many LA Times staff positions can you save with $135 million…

Also decided on Friday, bankruptcy judge Kevin Carey said he would allow creditors to sue Sam Zell, Tribune executives, advisers and, reports the Chicago Tribune, “other architects of the ill-fated leveraged buyout after Tribune Co. restructures. Junior creditors have charged that the two-step transaction, which was led by Zell, was a case of fraudulent conveyance, meaning it left Tribune Co. insolvent from the start.”

Also from the Tribune, in the wake of the resignation of CEO Randy Michaels, an apology to its readers for its morally bankrupt corporate culture.

[Our executives] conduct has embarrassed us in front of our readers, our advertisers, our business partners and our families. It has left us answering questions about whether reports of their actions reflect the environment in which we work. We want to tell you that Chicago Tribune employees, including those who work in our newsroom, don’t conduct themselves in the manner attributed to some Tribune Co. executives.

Late last night, The New York Times and The Chicago Tribune reported that the Tribune Company board may be planning to ask CEO Randy Michaels to resign. That it may happen at a board meeting taking place today. That Michaels’ successor and his golden parachute were already being discussed.

This is all according to inside sources who spoke to the media outlets on condition of anonymity. We are praying that they are reliable sources who are right about everything.

What seems to have motivated the board to consider ousting Michaels was not the prolonged downward spiral of the media properties under his management, but the embarrassing report by the NY Times detailing his inappropriate, sexist behavior, and the resignation of fellow exec Lee Abrams over an embarrassingly sexually explicit memo. From the Chicago Times:

Board members, sources say, began to worry about possible liability issues related to their fiduciary duties and started exploring Michaels’ fitness to run the company.

In other words, they woke up. Now when are they gonna get rid of the guy?

Previously on FBLA:

Chicago Tribune’s Phil Rosenthal writes:

Randy Michaels today was named chief executive of Tribune Co., succeeding Sam Zell, who remains chairman of the Chicago-based media concern that has been operating under Chapter 11 bankruptcy protection for nearly a year.

Michaels, 57, joined Tribune Co.’s executive ranks when Zell took the company private in a debt-heavy December 2007 transaction, becoming its chief operating officer half a year later. With the elevation to CEO, Michaels also will join the Tribune Co. board.

Read the whole post here.

TellZell has a few telling stories about Tribune Chief Operating Officer Randy Michaels. Not only is he an insensitive rube who mocks copy editors while they work (and makes exaggerated “sad faces” at them when reminded that 100 of them will soon be laid off), but he’s apparently the kind of guy who will lead those fired employees out of the building with his hand on their asses.

Tell Zell reports that after missing the Sam Zell/Randy Michaels press conference yesterday, he caught it and was unimpressed:

The entire argument collapses on a single point. No newspaper is losing money. Each paper takes in more cash than it pays out. The problem is, they don’t take in enough money to pay off Sam’s $13-billion debt.

(Extra points go to the InkStained Retch for linking to this Los Angeles Magazine piece.

The Hartford Courant wasn’t any easier on Zell:

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Randy Michaels sends this e-mail to LAT staffers (well, the ones who are left, anyway):

I want to let you know that David Hiller has decided to step down as publisher of The Los Angeles Times, effective immediately. David took over as publisher in October 2006, during a difficult period for the newspaper and has performed with distinction since that time. During the last six months, he has helped The Times begin making the transition to new ownership, facing new realities. Part of that transition must now include a new publisher.

We are already in the process of identifying the right person to lead The Times going forward. We expect to name a new publisher by the end of the summer. In the meantime, executive vice president and chief administrative officer Gerry Spector and I will oversee all operations at The Times. Russ Stanton and his team are well underway with their work on the redesign of the paper and that work will, of course, continue at a quick pace.

The Los Angeles Times is a great newspaper with a talented and dedicated staff. Let’s do everything we can to keep it focused on future success.

Randy

[Update: FBNY summarizes today's dizzying news here.]