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Parties in Jewish Times dispute scolded by judge

Trustee could be named to run business

By Arthur Hirsch, The Baltimore Sun

8:26 PM EDT, September 22, 2011

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A federal judge on Thursday scolded both parties vying for control of the company that publishes the Baltimore Jewish Times, giving them 30 days to develop a plan to take the company out of bankruptcy — or else a trustee would be appointed to run the business.

After a three-day hearing in U.S. Bankruptcy Court in Baltimore, Judge James F. Schneider rejected plans offered by Alter Communications Inc., which runs the Jewish Times and other publications, and by its former printer, H.G. Roebuck & Son, saying neither one was likely to save the weekly magazine. He said he meant to preserve the nearly century-old Jewish Times, which he considered "an institution vital to the community."

Schneider said the bankruptcy case — which emerged in spring 2010 amid a contract dispute between Alter and Roebuck — is "more like a divorce than it is like a bankruptcy, and the parties seem to want to keep on fighting."

Schneider acknowledged that it was a "sensitive" case because it involves an ethnic publication, but he took exception to testimony asserting that because the Roebucks are not Jewish, they are less qualified to publish the Jewish Times. Alter Communications is owned by a Jewish family that launched the publication in 1919.

"Religious or ethnic identity is not going to make any difference" in his decisions, Schneider said.

With a circulation of 8,500 for the print edition and more online, the Jewish Times is the flagship publication for Alter, which also puts out Style magazine and several custom publications. It's a mainstay for the area's Jewish community, offering personality profiles, holiday recipes, and reports on local, national and international events.

The future of the publication was in the balance as the two sides went into the hearing with competing plans to run the company while settling debts under Chapter 11 bankruptcy protection. The Alter plan would have left complete control with the current owners. White Marsh-based Roebuck proposed a 55-45 split in its favor, while giving current owners the option to pay extra for a 50 percent share.

The plans also differed in the terms offered to creditors. Schneider said that while both proposals had their "merits and demerits," they were "calculated to raise objections on the part of the other party."

Either course, he said, was likely to lead to "liquidation" of the company. He said both sides would have to give something up to reach agreement. He said that Roebuck was not going to get anything close to the nearly $1.77 million it claims it is owed, and Alter must cut the amount it proposed paying certain creditors.

Schneider made clear that he would not approve any plan giving Roebuck a majority share of the company.

Maria Ruark, lawyer for Alter, said she'd been optimistic that its plan would be approved because it had the support of advertisers, a majority of the 40 creditors, the employees and the community. She said Alter would begin work on a new proposal.

William Hallam, lawyer for Roebuck, said Schneider had provided "direction," and the company would now work to settle differences with Alter.

The conflict by all accounts has grown increasingly bitter, said Andrew Alter Buerger, chief executive officer of Alter, with each party acting to "inflict as much pain as we can on the other side."

Roebuck and Alter have done business together for 50 years, but things went sour in 2009 when Alter shifted to another printer to save money at a time of declining revenues.

Buerger has said he tried to pay Roebuck to dissolve the contract, but they failed to agree on a settlement. Roebuck sued Alter for breach of contract and won a $362,000 judgment in Baltimore County Circuit Court. That is part of the sum Roebuck claims it is owed.

Alter filed for Chapter 11 bankruptcy protection in April 2010, claiming that the judgment made a bad financial situation worse.

arthur.hirsch@baltsun.com