aimed at fostering a renewed constructive business relationship between the two parties, include a provision to name a senior circulation executive dedicated to monitoring P-I circulation and efforts to try to slow or arrest the circulation decline of the P-I. The settlement also calls for all current litigation and claims to be dropped and specifies that any future issues will go to binding arbitration.An issue for Hearst was its belief that the Times had mishandled circulation and promotion of the P-I in managing the business. "I honestly believe this is a good settlement for everyone," P-I Publisher Roger Oglesby said. "It preserves a 144-year-old newspaper, saves a lot of jobs and continues to give Seattle two daily newspapers." "We are happy to have found common ground," Times Publisher and Times Co. CEO Frank Blethen said in a statement. Times Co. President Carolyn Kelly called the settlement "a positive development for the people of this region, for our readers and advertisers, and for our employees." Hearst has been fighting through Washington courts since 2003 to block Times Co. efforts to end the federally sanctioned joint operating agreement (JOA), under which The Seattle Times also publishes the separately edited P-I. The Times Co. has been saying two newspapers, even with their business functions merged, cannot make money in Seattle, and it wanted to cease publishing the smaller paper. The two parties agreed to binding arbitration last year to settle Hearst's lawsuit in King County Superior Court. The arbitration was to begin today and last four weeks, with retired King County Superior Court Judge Larry Jordan to decide the arbitration by June 7. The proceedings were to be private but the decision was to be made public. The legal battle has taken a toll on the smaller, privately held Seattle Times Co., the controlling interest of which is owned by the Seattle-area Blethen family. The Times Co. owns The Seattle Times, the Yakima Herald-Republic, the Walla Walla Union-Bulletin, and, in Maine, the Portland Press-Herald and Sunday Maine Telegram, the Kennebec Journal in Augusta, and the Morning Sentinel in Waterville – plus weeklies, Web sites, real estate, and Rotary Offset Press in Kent, Wash. Hearst is a multibillion-dollar media company that owns newspapers, magazines, and television stations, among other holdings. Wrote Blethen and President Carolyn Kelly in a memo this morning to department heads at the Times:
Serious market challenges remain. Ultimately, advertising revenue and readership will determine our success and whether this market can continue to support two daily publications. Both parties want to preserve multiple metro newspaper voices in this market, but there are no guarantees. Going forward, our ability at the Times to adapt to marketplace changes, to innovate and to manage the business effectively will be critical to returning this paper to stability and profitability.
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