Pulaski County Circuit Judge Chris Piazza on Monday denied Red Alert Media Matrix's offer of $18 million plus unregistered stock to buy photo archives formerly owned by John Rogers of North Little Rock.
Piazza's decision was made in a case filed last year by First Arkansas Bank & Trust of Jacksonville against Rogers and his various businesses.
"We're not going to sell at this point," Piazza said.
If the offer was good, everyone would have approved of it, Piazza said.
But there were attorneys representing at least 13 parties to the case who spoke in opposition to Red Alert's latest offer.
In January, Atlanta-based Red Alert offered to pay $59 million in cash for the archives, which include more than 60 million photos from more than 50 newspapers. In April, Red Alert changed its offer to $28 million plus what it valued as $1 billion in unregistered, untraded stock in Red Alert.
Earlier this month, the offer fell to $18 million plus the stock because one of the largest portions of the archives from Fairfax Media Management was no longer included in the package. Fairfax owns newspapers in Australia and New Zealand.
Generally, Rogers got access to the archives by making agreements with the newspapers to digitize the photos in exchange for getting rights to sell the prints and negatives. Rogers relinquished ownership of his businesses to his ex-wife, Angelica Rogers, in a divorce settlement in October.
In an amended complaint it filed early this month, First Arkansas Bank & Trust added Angelica Rogers and others to its list of defendants. First Arkansas said it is entitled to a judgment against Angelica Rogers for $15.2 million.
The biggest obstacle Monday to Red Alert's latest offer was the stock.
Amy Stewart, a Little Rock attorney representing David Hoffman, said the stock "has no value as far as I can tell." Hoffman, of California, is a documentary filmmaker who sold a collection of photos and footage of President John F. Kennedy to Rogers.
"These shares are paper that [investors] could do nothing with," Stewart said. "I don't understand how this is an OK deal."
The Red Alert deal "has nothing good in it," said Jess Askew, who represented receiver Michael McAfee.
"This deal doesn't smell right," said Kevin Keech, who represents Arthur and Paul Jaffe, intervenors in the case. If Red Alert was allowed to buy the archives, "we may be going from one scheme to another," Keech said.
Allen Dobson, who represented several newspapers in California, among others, said his clients are not sure where their archives are.
"We would like our archives back," Dobson said. Almost 1.8 million photos from the Oakland Tribune are "one-of-a-kind photos," Dobson said, because there are no negatives backing up the pictures.
"We believe portions of our archives are being sold on the Internet," Dobson said.
In an interview after the hearing, Rickey Hicks, an attorney for Red Alert, said he was "incredibly disappointed."
"My client was willing to pay $18 million in cash for an asset that nobody else was offering any money on," Hicks said. "The vast majority of these people who had objections had no judgment, they don't have any secured interest, and their voices prevented the matter from being approved. Ninety-five percent of the asset holders -- Mac Hogan, John Conner and First Arkansas Bank & Trust -- pretty much approved of the deal."
Red Alert said it would take 30 days to close the deal.
First Arkansas Bank & Trust suggested that Piazza approve the offer or if Red Alert didn't meet a firm deadline to close the deal, it would "go away."
"From the bank's standpoint, the assets are still there," Roger Rowe, First Arkansas' attorney, said in an interview after the hearing. "The judge decided not to sell them at this time."
Business on 06/16/2015