A group of former LA Times employees has settled their lawsuit with GreatBanc Trust, the trustee for Tribune Company’s employee stock ownership plan, for $32 million. The employees alleged that Sam Zell’s leveraged buyout and subsequent bankruptcy of the Tribune Company defrauded employees, who had gained an ownership stake in the company through its employee stock ownership plan. As is par for the course when big companies commit some kind of wrongdoing these days, GreatBanc and Tribune Co. admitted no wrong doing as part of the settlement.
The suit was brought largely through the impetus of former LA Times auto columnist Dan Neil, who now works for the Wall Street Journal. “Whatever money comes to the members of the class isn’t much cash, but at least it was acknowledgment that they were wronged,” Neil told the Times. “This was a horrible deal for the employees of Tribune.”
About 13,000 current and former employees will split the settlement, minus about $8 million in attorney’s fees.