News

Rogoff settles

 

rubenstein-rogoff

Alice Rogoff and David Rubenstein in better times at the Annenberg Awards in 2008/FAPE photo

This is a developing story.

 

One of the richest men in the United States – David Rubenstein – is buying his ex-wife out of the wreckage of the would-be newspaper empire that collapsed around her in Alaska.

Former-spouse Alice Rogoff – the one-time publisher of the now-dead Alaska Dispatch News/ADN.com – has agreed to drop claims the failed business owed her $16.6 million and pay $1.5 million to settle claims lodged against the company when it went bankrupt last year, according to a flurry of court documents filed in the Anchorage Bankruptcy Court today.

One of those documents says, “Rogoff has made an irrevocable request to her ex-husband, who has agreed through his counsel, and in writing, to direct a portion of payments due to Rogoff pursuant to the document or documents setting forth the terms of the parties’ divorce settlement to be deposited” to pay Rogoff’s debts.

One of the founders of the Carlyle Group, Rubenstein, then 68, and Rogoff, 66, divorced late last year after a lengthy separation that saw her take up residency in Alaska while he remained on the East Coast.

The terms of the settlement were not disclosed, but it was thought be in the tens of millions if not hundreds of millions of dollars. As one of the financial masters of the universe, Rubenstein’s wealth has been estimated as high as $3 billion.

A marital separation agreement between Rogoff and Rubenstein provided her support for her first Alaska adventures, and she once told friends that if the couple went through with a divorce she expected to get half of Rubenstein’s billions.

She thought she was owed it, but there is no indication she got it.

Financially strapped in 2017 after her dreams of an Alaska journalism empire turned into a fiasco, she is believed to have settled for far less than $1.5 billion. Friends have indicated she was forced to negotiate on the divorce to get her hands on the money to clean up the mess she’d made in the 49th state.

Bad debts

And even after that, an attorney for the bankruptcy trustee sought Rubenstein’s backing of Rogoff’s debts because her credibility in Alaska is pretty well shot.

As publisher of the Dispatch News – which was sold to the Fairbanks-based Binkley Company about a year ago and reverted to publishing as the Daily News/ADN.com – she refused to pay rent or electric bills she owed GCI Inc., the telecommunications company that owned the building housing her printing press. GCI eventually took her to court to try to collect.

So did Arctic Partners, a company that owned an old, oilfield services warehouse in Anchorage’s Midtown where Rogoff hoped to build a new printing plant to replace the operation in the GCI building. Rogoff signed a 10-year lease with Arctic Partners with her newspaper teetering on the edge of bankruptcy, and then tried to get out of the deal with a bankruptcy filing.

Electrical contractor Mark Miller found himself caught in the fallout. Rogoff hired the small businessman and his crew to renovate the warehouse that was to house the new press, and then she refused to pay. Miller was left holding the bag on about $500,000. He too sued.

And then there was Tony Hopfinger, the guy who along with ex-wife Amanda Coyne founded the online-news, start-up AlaskaDispatch.com. Rogoff’s first Alaska journalism adventure was a buy-in at the website.

(Full disclosure: The author and his spouse were once friends with Rogoff and helped hook her up with Hopfinger and Coyne. The author later worked with Hopfinger and Coyne at the Dispatch and was good friends with Rogoff. The latter friendship ended in a dispute over Roland Maw, a member of the state Board of Fisheries now facing multiple felony charges for defrauding the Alaska Permanent Fund. Rogoff didn’t want the story reported in the Dispatch News. The author pursued it anyway.)

Ownership of a growing Dispatch.com helped Rogoff manuever herself into position to convince The McClatchy Company, a California-based newspaper chain, to sell her the Daily News for $34 million in 2014.

After the sale, Rogoff merged the Dispatch with the Daily News/ADN.com and renamed the new business the Dispatch News/ADN.com. She was then facing a deadline to get her press out of the old Daily News headquarters she’d sold to GCI for $14.5 million to help swing the McClatchy purchase. 

In debt to Northrim Bank for $13 million on the sale and without a building in which to put a new press, Rogoff was in trouble at the Dispatch News from the day she walked in the office. Hopfinger told her she needed to cut staff and costs to stabilize the newspaper’s business operation. She refused, arguing it would look bad to downsize the state’s largest newspaper.

Instead, she spent freely to expand the newspaper’s coverage in the belief that she could grow readership in an age when people everywhere were abandoning newspapers in favor of online news.

When Hopfinger, who had begun a new romantic relationship and was tired from years of dealing with Rogoff’s sometimes erratic behavior, said he wanted to sell his interest in the new, joint operation, Rogoff agreed to pay him $1 million, signed a now Alaska-famous napkin contract, and then reneged on the deal as she had reneged on other contracts before.

Hopfinger sued. Once BFFs with Rogoff, he and his old business partner are now slated to meet in the less-than-friendly environs of an Anchorage courtroom in November, although the woman who once had a reputation for a willingness to spend thousands of dollars on attorney fees to avoid settling up on hundreds of dollars in debt appears in a less litigious mood than in the past.

Along with settling with the federal Bankruptcy Court, she has been reported to have reached a deal with Arctic Partners on its lawsuit. The terms have not been publicly disclosed.

Hopfinger, reached by telephone at his home in Chicago today, would not say whether he has received any settlement offers from Rubenstein or Rogoff. He said he could not talk about his case and refused to talk about his past relationship with his former business partner.

Rogoff sometimes ran her businesses in odd ways. At one point in her Alaska Dispatch days, she wanted the company’s business manager fired for dating a man who was then also dating Rogoff’s daughter.

Deep troubles

None of her behavior, however – with the possible exception of crashing  her airplane into Halibut Cove – ended her in as much trouble as the bankruptcy case which once had a judge talking about possible fraud.

Court records filed today note the tangled financial affairs involving a variety of Rogoff limited-liability companies referred to as the “Rogoff Entities,” Rogoff herself, and Northrim.

The documents defend the settlement in the case by citing “the existence of a hotly contested dispute as to the (bankruptcy) trustee’s various claims against Rogoff, Rogoff Entities, and Northrim. Thus, ‘probability of success’ is uncertain.  While Northrim’s ability to pay a judgment is undoubted….Proof of actual fraud would be required to recover additional interests payments made before the two-year, look-back period.”

Northrim ended up ensnared in the Rogoff mess when she used company funds to make payments on her personal debts to the bank. Rogoff and the bank contend the payments were really just part of a stream of Rogoff “loans” to ADN flooding through the paper as she tried to spend the newspaper to success.

Between the time she bought the Daily News in early the spring of 2014 and filed bankruptcy in the late summer of 2017, she is believed to have lost a total of somewhere between $29 million and $30 million.

“We’re in ‘investment mode,'” she opined in a March 2016 ADN commentary as the ADN bled money. Friends said at the time she was already starting to sound a little like Adolph Hitler in his bunker at the end of World War II.

At one point when Hopfinger tried to explain to her the dire state of the newspaper’s finances, she told him she just didn’t want to hear if it was going to be more bad news. Within a year of the investment proclamation, she was trying to get out from under the costly business of running a newspaper.

The crisis appeared to come when she realized she didn’t have Rubenstein’s billions to lose and her millions were gone. She told friends at one point in 2017 that she was “broke.” She ordered ADN employees to stop paying some bills.

She made an effort to try to sell the newspaper, but wanted to keep the ADN website. No one was interested in that kind of deal. The Binkleys tried to buy the operation then, but a sale couldn’t be arranged.

Rogoff later suggested that was all part of some sort of set up by the Fairbanks family to sabotage her.

The bankruptcy trustee thought some of Rogoff’s pre-bankruptcy behavior looked potentially fraudulent, but today’s settlement will end any further investigation of that possibility.

“Rogoff disputes the additional claims the trustee asserts against Rogoff,” the bankruptcy settlement says. ” The trustee’s other claims against Rogoff require proof of various types of wrongdoing and are likely to require an extensive trial, particularly given the evidence that Rogoff provided $16.6 million of personal money to the debtor (ADN) documented by loans which the Debtor did not repay.

“Any litigation would be complex and involve at least three parties (the trustee, Rogoff, and Northrim), one of which (Northrim) is not an owner, officer, or director of the debtor (ADN).  With regard to the best interests of creditors, the settlement provides a substantial recovery to unsecured creditors from an estate that currently has no assets to distribute and no substantial assets to sell.  Importantly, Rogoff’s agreement to waive her claim for $16.6 million of money she furnished to the debtor documented by promissory notes will significantly increase the recovery percentages of the rest of the creditor body by substantially reducing the claims pool, in which Rogoff is the largest creditor.”

Contact the court

The Bankruptcy Court is now in the process of determining how to reimburse Rogoff’s creditors.

After the Seattle law firm that was called in to help investigate Rogoff’s dealing gets it contingency fee, there should be about $1 million left to spread among creditors, some of them mom-and-pop Alaska businesses, owed about $2 million.

Many of them had given up hope of collecting anything as the bankruptcy dragged on. Reached in Seattle today by telephone, Attorney Christine Tobin-Presser, the woman who brought Rogoff to the bargaining table, said she feels she got the best deal possible.

“We believe the settlement is in the best interest of the estate,” she said, although the trustee did give in and let Rogoff escape the collapse of the Dispatch News with her most prized possession: “Arctic Now,” a website set up by the ADN to focus on coverage of the Arctic.

Given the global interest in the region, Rogoff once told Hopfinger and others she was confident the website would “make millions.” Like her other journalism enterprises, it appears to be making nothing.

“The trustee, on behalf of the estate, will quitclaim to Rogoff website names and other intangible and intellectual property utilized by Rogoff in operating Arctic Now and then Arctic Today following the conversion of the debtor’s bankruptcy case from Chapter 11 to Chapter 7, and take no action that would prevent Rogoff from continuing such operations,” the court documents say.

“Whether Rogoff converted or was in possession of assets of the estate through her operation of the Arctic Now website (and then the Arctic Today website) following the conversion of the bankruptcy case to Chapter 7 (is unclear).  Further, whether there were any monetary damages owing to the estate in conjunction with such operations given Arctic Now’s and Arctic Today’s track record of operating at a loss (is unknown.)”

Tobin-Presser appears to have used the Arctic website/websites mainly as leverage to help push Rogoff toward a settlement. Personally, the woman from Nantucket Island is deeply invested in her self-image as something of the queen of the American Arctic.

She will take the stage at the Arctic Circle Assembly in Iceland later this month.  The topic of her presentation?

“Improving global reporting about the human climate change impacts throughout the warming Arctic,” according to the program agenda, which bills Rogoff as “publisher and editorial director, Arctic Today.”

A socially well-meaning woman, Rogoff has vacillated between wanting to develop the Arctic to provide jobs in rural communities plagued by unemployment and the dysfunction that accompanies joblessness, and a desire to save the same people from global warming.

 

 

 

 

 

Advertisements

4 replies »

  1. Looks like her stink remains. Recall, she got Walker elected and one of her last attempts may be to have the Permanent Fund give money to her bitch boy(s) at PT to manage.

    Like

  2. So you got away with about 50 cents on the dollar. Not shabby at all Alice. I sure hope you recover financially, as I do the humans you fleeced.

    Enjoy the Arctic, please refrain from future fleecing.

    Like

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s