Media

Shady business?

 

alice rogoff wilson center

Alice Rogoff/The Wilson Center

For the first time, a federal judge has used the f-word – fraud – in connection with the maneuverings of Alice Rogoff, the former owner-publisher of the bankrupt Alaska Dispatch News and now owner-publisher of Arctic Today.

 

As a practical matter, Rogoff’s Alaska Dispatch News/ADN is dead and gone as a news organization, replaced by the resurrected Anchorage Daily News/ADN owned by the Fairbanks-based Binkley Company.

But the wreckage of the Dispatch News is still being picked over in the federal Bankruptcy Court with Rogoff, a friend and confidant of Alaska Gov. Bill Walker and Lt. Gov. Byron Mallott, doing her damnedest to keep secret her personal financial dealings.

A suggestion that the millionaire Rogoff might not have played fair in leaving creditors holding about $2 million in debt came Wednesday from Bankruptcy Court Judge Gary Spraker in an opinion ordering Rogoff to turn over to a bankruptcy trustee the details of how she obtained a mutli-million dollar personal loan from Northrim Bank to complete her purchase of the Anchorage Daily News from The McClatchy Company in 2014 for $34 million.

“…How Northrim expected to be repaid a $13 million loan is a legitimate area of inquiry for this estate,” Spraker wrote….”The financial information obtained, and relied upon by Northrim clearly relates to a number of possible claims including constructive or actual fraudulent conveyance or some variation of breach of fiduciary duty.”

Spraker underlined that he wasn’t registering a decision on whether that happened or not, but that he recognized there are legitimate questions.

“To be clear,” he wrote, “the court expresses no opinion as to the existence of viability of any such claims. Rather, at this initial stage, the trustee is entitled to understand what Northrim had before it when it decided to loan Rogoff $13 million.”

Northrim’s personal loan to Rogoff has become a major issue in the bankruptcy because Rogoff never made payments on it. Instead, the Alaska Dispatch News LLC, a limited liability company wholly owned by Rogoff, picked up about $2 million in payments before the company went under.

That is generally considered a legal no-no.

Had to do it

“Rogoff offers a defense…arguing the debtor (Alaska Dispatch News) received a benefit from paying her debt to Northrim as it enabled her to make additional loans to the debtor to continue its operation,” Spraker wrote. “The court need not, and will not, engage in a discussion of potential defenses to potential claims. The salient point for the limited matter before the court, however, is that Rogoff’s proffered defense relies upon her financial ability to make those loans. In essence, Rogoff’s argument calls into question her financial ability.”

While the owner of the Dispatch News, Rogoff was reportedly getting $5 million per year from then-husband David Rubenstein in accordance with a marital separation agreement. Rubenstein, a financier estimated to be worth almost $3 billion, and Rogoff are now divorced.

The terms of their divorce agreement have never been publicly revealed, but she is thought to have received upwards of $100 million. The couple has three grown children.

As owner of the Dispatch News, Rogoff’s claims to have loaned the newspaper $23 million over the course of three years to keep it afloat, and lost it all. If true, the number would suggest she lost about $8 million more than Rubenstein was fronting her over the course of those years.

Months before Rogoff took the Dispatch News into bankruptcy, she told friends that she was “broke.” The true state of Rogoff’s financial affairs were never clear to anyone. At times, she was a penny pincher. At other times she spent lavishly.

As the Dispatch News began spiraling into financial ruin in only its second year of operation, then company president Tony Hopfinger suggested at times that Rogoff was ignoring the business. She didn’t want to hear reports the company was losing money, and she adamantly refused suggestions to reduce staff and cut costs to get the company in the black.

There wasn’t much anyone could do about it. The operating agreement for the newly purchased newspaper stipulated that the company would be run “by a Manager, who initially shall be Alice Rogoff….The manager shall have the sole and exclusive right to manage, control and conduct the business affairs of the Company.”

While Rogoff was running around Anchorage claiming limited editorial control over the newspaper – she suggested that was wholly in the hands of the editorial department – she was bound by an agreement that held her responsible for managing everything to do with the newspaper.

The operating agreement even included a “conflict of interest policy.” It basically said Rogoff could do anything she wanted, including avoid showing up for work unless she so desired.

conflict

 

BFF no more

The relationship between Hopfinger – who co-founded AlaskaDispatch.com with then wife Amanda Coyne in 2008 – and Rogoff – who bought a controlling interest in the online startup a year later – did not long survive the purchase of the Daily News from McClatchy only four years later.

At the Alaska Dispatch, Hopfinger worked under a contract that gave him full editorial control. At the Dispatch News, the contract was gone, and he worked for Rogoff. A lousy yes-man, Hopfinger fairly quickly managed to shift editorial responsibility over to David Hulen, a long time employee of the Daily News.

Once the best of friends, Rogoff and Hopfinger were starting to grow apart by May 2015 when Rogoff attended Hopfinger’s wedding.  A year earlier she’d signed a napkin agreement pledging “in the presence of her lawyer and Hopfinger, that she would pay Hopfinger $100,000 per year for ten years at the end of each calendar year, starting in 2014,” according to a summary by Alaska Superior Court Judge Andrew Guidi. 

Rogoff made one payment. Hopfinger kept pushing her to formalize the contract, and regularly suggested in various ways that she hire a publisher to take over management of the financially failing company. Rogoff refused and by the end of the year Hopfinger was out.

He subsequently sued Rogoff to collect on the napkin contract. They are now set to meet in an Anchorage court room in November.

Rogoff has a busy court schedule. Along with dealing with Hopfinger and the Bankruptcy Court, she’s also in court fighting separate suits with GCI, the Anchorage communications company; Arctic Partners, who own the building in which Rogoff planned to put a new press; and M&M Wiring, the company preparing the new building for that press.

They collectively claim they are owed several million dollars, and then there’s the tangled mess with Northrim Bank, which is slowly being teased out in bankruptcy court.

Rogoff “discloses that she pledged various forms of collateral to Northrim to secure her $13 million loan,” the latest court order says. “Northrim originally did not expect repayment from the debtor (Dispatch News) as it was neither a borrower, nor a guarantor.”

And yet the company, which Rogoff controlled, eventually signed onto the Northrim loan, assumed the $13 million liability, and pledged its assets to cover the loan. The chain of events does raise interesting questions as to what Northrim thought of the state of Rogoff’s personal finances at the time.

 

 

 

 

 

 

 

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3 replies »

  1. If she wants to do good for the people of the Arctic, she should set an example and do good for herself. She should pay her debts. The people of the Arctic are not dumb. The people of the Arctic will not take Rogoff seriously knowing that she is a dirt bag.

    Like

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