Tuesday, February 8, 1983 Daily Nebraskan
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By Kevin Hankcn
Oral arguments in the anti-trust lawsuit filed by the
Sun Newspapers Inc. of Omaha will begin Feb. 15 before
U.S. District Judge Warren Urbom in Lincoln.
Defense attorneys for the Omaha World-Herald were
given one week to submit a written brief detailing the
evidence to Judge Ui bom. following Thursday morning's
hearing. The hearing began Jan. 31 .
The Sun Newspapers are seeking an injunction against
the World-Herald and its subsidiaries to try to limit their
operations in Douglas and Sarpy Counties.
The lawsuit, filed Nov. 30, charges the World -Herald
with illegally monopolizing the Omaha newspaper's ad
vertising market to try to drive the Sun Newspapers out of
business.
Sun owner Bruce Sagan of Chicago testified earlier
this week that Sun Newspapers is losing $30,000 to
S40.000 a month, and unless the court decides in the
sun's favor, the newspaper will be forced out of busi
ness within weeks.
The Sun contends that World-Herald business practi
ces violate the Sherman-Clayton anti-trust laws. A Chicago
marketing research firm employed by the Sun papers
estimated that in 1981, the World-Herald and its subsid
iaries received 82 percent of all revenue from Omaha
area print advertising. The Sun's share was only 7 per
cent .
In 1980, the World-Herald purchased the Papillion
weekly newspapers, which included the Papillion Times,
LaVista News, Ralston Recorder, Springfield Monitor and
the Gretna Breeze.
In the spring of 1981, the World-Herald purchased
Rapid Printing, which at that time was printing the Step
Saver, a free publication of Sun Newspapers featuring
mostly advertising. Sagan said he purchased both Sun
Newspapers and Step Saver in February of 1981 .
WSOOD
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John Brown, Rapid Priming's president, testified Wed
nesday that before the World -Herald's purchase, he and
Sagan had discussed the possibility of Rapid Printing
printing for Sun Newspapers and a few of its subsidiaries.
Brown testified that although he told the World-Herald
of those discussions, he gave them no information about
the Sun's advertising customers.
Under the World -Herald's ownership, Rapid Printing
began offering "marriage-mail" advertising circulars.
Marriage-mail advertising - mailing advertising circulars
separately or inserted in newspapers - is allowed by new
postal regulations and reduces advertising mailing costs.
Rapid Printing gave advertisers low prices and the
opportunity to have inserts sent to selected parts of
Douglas and Sarpy Counties.
The World-Herald began offering marriage-mail ad
vertising to its customers with the option of placing their
ads in the newspaper and also sending those ads to non
subscribers using marriage-mail circulars.
Sun General Manager Dixie Cavener testified that
she had been told by an advertiser that the World-Herald
had purposely reduced prices to get advertising business.
The World-Herald has denied such allegations and
said that competition between the two publications
"has Wen open and above-board."
John Gottschalk, a World-Herald vice president, testi
fied Wednesday that in the spring of 1981, the paper
felt it needed to expand its advertising to the entire
Omaha area, and that the idea of marriage-mailing ad
vertising was an initiative of their advertising personnel.
He denied that Brown participated in any of their dis
cussions. Sagan testified that because of Rapid Printing's
advertising practices, the Sun lost 13 advertising custo
mers who accounted for $352,443 in annual revenue.
Brown said he was certain that another company
would begin mailing advertising packets if Rapid Print-
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ing were ordered to stop mailing the circulars.
The Sun would be among those companies consider
ing marriage-mailing, Sagan said.
A similar lawsuit has been filed by the Anti-Trust
Division of the U.S. Department of Justice against the
Orlando Sentinel-Star in Orlando, Fla., to force the
Chicago Tribune to sell its five weekly publications in
Orlando.
In the May 27, 1982 edition of The New York Times,
the Orlando suit was described as possibly having "wide
repercussions in the newspaper industry." The Times
said the suit was the first challenge to daily newspapers
acquiring or purchasing weeklies or shoppers in the United
States. That suit is still pending.
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