TORONTO - Conrad Black's fraud convictions Friday will provide a solid basis for at least some of the civil and securities cases pending against him, a leading Ontario lawyer says.
The convictions announced in a Chicago court, if not overturned on appeal, would likely speed up a fairly quick finding of liability in the Ontario Securities Commission hearing, scheduled for November, and a U.S. Securities and Exchange Commission suit, as well as the civil lawsuits, said James Morton, president of the Ontario Bar Association.
But if Black's fortune is seized by authorities, that could also stall the lawsuits or halt them altogether, Morton observed, since there wouldn't be any money left to take.
Morton said he highly doubted liability insurance will cover any damages awarded against Black since directors of companies are only protected in the event of negligence, not theft.
Meanwhile, socially, Black will encounter ostracism, Morton said.
"Canada's business and social elite will consider him to be nothing more than a convicted criminal,'' Morton said, noting however some famous criminals, such as Charles Colson, President Richard Nixon's former chief counsel, who managed to make a comebacks after being imprisoned for Watergate-related charges.
Widely loathed, Colson later established a non-profit organization devoted to prison ministry called Prison Fellowship, and has received fifteen honorary doctorates.
"People forgive, but they required demonstrated change in the individual and that needs time. You can't do it in a year and a half,'' Morton said.
For Black's three co-defendants -- former Hollinger International vice-presidents John Boultbee, 64, of Vancouver and Peter Atkinson, 60, of Toronto, as well as Chicago lawyer Mark Kipnis, 59, could alll face further troubles -- including possible disbarment as lawyers -- after they were all found guilty of mail fraud.
Tony Merchant, a Regina lawyer pursuing a class action lawsuit on behalf of disgruntled Hollinger shareholders, predicted Black would be happier serving his jail time in Canada than in the United States or the United Kingdom.
"Things will never be the same for Lord Black but they will be less bad in Canada than in England,'' Merchant said. "If in jail, serving time on an exchange in Canada would be preferable to an exchange with England, but once convicted, exceptions would have to be made to allow him to regain Canadian citizenship.''
Black will also likely return to his passion for history, an occupation that could be pursued even behind bars, Morton said.
"It might act as something of a rehabilitation. Generally his works are well-written and scholarly,'' he said of the writer, who recently penned a well-respected tome on former U.S. president Franklin D. Roosevelt.
"Long term, his reputation is probably going to be based on his historical work any way. A hundred years from now, people may well remember his biography of Roosevelt and have only the faintest recollection that he ran into some trouble in business towards the end of his career.''
"Who remembers Cicero's personal legal problems? One remembers his speeches. What you're remembered for in historical terms is not your business life, it's your written work,'' Morton said. "And maybe that's where his final redemption will be.''
Some pending civil lawsuits and regulatory and legal actions involving Conrad Black:
Others vs. Black
- Sun-Times Media Group Inc., formerly Hollinger International, is suing Black for US$542 million, accusing him and other former executives of stealing hundreds of millions of dollars from the company. Suit alleges they engaged in racketeering, allowing the company to seek triple damages under U.S. anti-corruption laws.
- Toronto-based Hollinger Inc. (TSX:HLG.C) is suing Black, claiming damages of more than US$700 million, including breach of contract, conspiracy, unjust enrichment and unlawful interference with Hollinger's economic interest.
- Sotheby's International Realty Inc. claims Black owes US$557,000 in commission on the sale of his Park Avenue apartment.
- U.S. institutional investor Cardinal Capital is involved in several suits against Black's companies, including a Chicago-based lawsuit alleging federal securities violations filed by a group including a Louisiana teachers' pension fund.
- Canadian investors have launched $4-billion class-action lawsuit against Black, his wife Barbara Amiel Black, David Radler and others, alleging they suffered market losses that may have been caused by the controversies surrounding Black's management.
Black vs. others
- Black has filed a libel suit in Ontario against members of the Hollinger International board committee, which produced a 2004 report accusing him of looting the company. Seeking $1.1 billion in damages.
- Black is seeking $20.6 million plus interest relating to money he paid to Sun-Times Media Group in July 2004. Hollinger Inc., which was formerly controlled by Black and which retains an equity and voting interest in Sun-Times Media Group, said in December it disputes Black's claim for damages and "believes that, in any event, it has a valid basis for offsetting any successful claim by Black against various amounts it has claimed from Black.''
- Black is suing the U.S. government, claiming the Federal Bureau of Investigation improperly seized US$9 million from the sale of his Park Avenue apartment.
- Black has an outstanding an $11-million libel suit against British author Tom Bower, claiming his book "Conrad & Lady Black: Dancing on the Edge,'' is "vindictive, high-handed, contemptuous, sadistic, pathologically mendacious and malicious.''
