Competing Newspapers Make Big Issue of Tiny-Type Legal Ads

It’s not quite a newspaper war, and big bucks aren’t involved, but feuds are brewing among South Bay community newspapers over legal notices.

That’s right, legal notices--the tiny-type items buried in the classified-ad sections of most newspapers. State law requires governments to use them to announce new ordinances, public hearings and requests for bids.

In the South Bay, the money cities spend on legal notices is not much, ranging from about $400 a year in Palos Verdes Estates to about $36,000 in Torrance. The figures vary according to the amount of advertising and the newspaper used. Cities that use the Palos Verdes Peninsula News pay less than $4 a column inch; the Daily Breeze in Torrance charges nearly $12 a column inch.

Although the money isn’t much, community newspapers seek legal ads because, as one publisher put it, “Every penny counts in this business.”

Official Newspaper

And, as Jack Harpster, advertising director of the Breeze, said, “It’s important to get the legal notices for a city because then you’re recognized as the official newspaper of the city.”

The newspapers’ quest for money or prestige or both has reached a point that the New Times in Torrance, a year-old weekly newspaper, last month bought out the Lomita Headlight, a 4-year-old weekly, primarily for the right to run legal notices for Lomita, according to Miguel (Mike) Cano, general manager of the New Times.

And the Breeze, the largest newspaper published in the South Bay and its only daily, is having a legal tiff with the area’s largest weekly, the Easy Reader, over which paper should get about $30,000 in legal notices from Redondo Beach. The Breeze is also attempting to protect its contract for Torrance’s notices by challenging in court the New Times’ effort to get them.

(The Los Angeles Times receives few legal notices from South Bay cities, a spokesman for the newspaper’s advertising department said. The cost, $84 a column inch for an ad in all editions, makes it prohibitive for most cities looking to meet their legal obligation as cheaply as possible.)

Adjudication Needed

Only newspapers that have been “adjudicated” by a Superior Court judge to be general-interest papers in a particular city can run government ads, as well as legal notices from individuals, such as bankruptcy filings and notices of intent to do business under a fictitious name. The court must find that the newspaper has been published for 52 consecutive weeks and that advertising does not make up more than 75% of its content more than 50% of the time. The newspaper also must have some paid subscription.

A paper can be adjudicated for only one city, although through newspaper mergers and buy-outs a single newspaper could become adjudicated for additional cities. If a city has one or more adjudicated newspapers within its boundaries, it must place its ads in one of them. However, a city can also place ads in additional papers if it wishes to reach a larger circulation. If there is no adjudicated newspaper within a city, the city is free to advertise its notices in neighboring newspapers, usually the lowest bidder.

Private legal notices can be placed in any adjudicated newspaper, regardless of where the advertiser lives.

Bid Against Breeze

If the New Times succeeds in its effort to become adjudicated in Torrance, it could bid against the Breeze for the city’s contract next year. The New Times had asked Torrance officials to withhold awarding this year’s contract to the Breeze until the New Times received its adjudication, but the request came to late.

The New Times was scheduled to go to court last week for adjudication, but its attorney, Frank Rorie, asked for a postponement to Sept. 3 after Copley Press Inc., owner of the Breeze, filed an objection.

According to Cano of the New Times, his newspaper would have offered Torrance a bid of less than $6 a column inch, compared to the Breeze’s $11.90 a column inch. Copley’s attorney, Robert Tyler, said the petition challenges the New Times adjudication primarily on the grounds that the New Times, which is printed in Gardena but has offices in Torrance, is not published and printed in Torrance and does not have a bona fide list of paid subscribers.

Court Ruling

(The state Court of Appeal ruled last month that a newspaper does not have to be printed and published in the same city to be adjudicated for that city. The court said other factors, such as amount and type of news coverage, could be used to determine if a paper is generally circulated in a given city. Tyler said he has not reviewed the decision.)

Rorie said he has not studied the Breeze’s claims and could not comment on them, but said he was not surprised by the objection.

“It’s a matter of economics,” he said, alluding to the Breeze’s potential loss of the Torrance contract to the New Times.

Economics are of concern to Cano, too. His lower bid would have brought his paper about $18,000 a year, he said, which could have made a difference for the struggling newspaper, which has yet to break even.

“For us it would have been a big deal,” Cano said. “We could have hired someone to deal exclusively with legal ads.”

Salt in the Wounds

Adding salt to his wounds, Cano had to shell out $900 to run a legal notice announcing his adjudication court hearing--in the Breeze. The New Times purchased the Headlight after the notice ran.

The New Times had mistakenly thought it could use the Headlight’s legal adjudication in Lomita to bid against the Breeze for this year’s contract in Torrance, Cano said.

The Headlight purchase did, however, give the New Times the right to run ads for Lomita, which annually buys about $3,000 in legal notices, and got the right to run individual legal notices, which newspaper officials said are more lucrative than city ads. The New Times paid about $4,000 for the four-page weekly Headlight, which was adjudicated in 1982 as a general circulation newspaper for Lomita.

While the Breeze is preparing for its tussle in Torrance, its row in Redondo Beach with the Easy Reader is close to being decided.

Routine Award

According to Easy Reader Publisher Kevin Cody, Redondo Beach had been routinely awarding its legal notices contract to the Breeze for many years, everyone assuming that the paper was adjudicated in that city.

Last year, however, the city asked the Breeze to produce its adjudication after the Easy Reader, which is published in Hermosa Beach, asked that it be allowed to bid for the contract. It was then discovered that the Breeze was adjudicated only for Torrance and the Redondo Beach contract appeared to opened for bids.

The contract was later awarded to the Easy Reader, which bid about half what the Breeze proposed. For the Easy Reader, which bid $6.50 a column inch compared to the Breeze’s $11.60, the contract means about $17,000 for the year.

In June, the city solicited bids for its advertising contract for 1985-86, and again the Easy Reader’s bid was half that of the Breeze.

Asked for Delay

The Breeze, however, asked for a delay in the awarding of the contract because the paper said it owned a newspaper that had been adjudicated for Redondo Beach. The Breeze said the Redondo Reflex, adjudicated in 1934, is one of 10 former community newspapers incorporated into weekly advertising handouts, called Lifestyle, that are distributed by the Breeze to non-subscribers. Redondo Beach legal ads would run in both Lifestyle and the Breeze, according to the Breeze bid.

Redondo Beach City Atty. Gordon Phillips said the crux of the problem is whether the Reflex still qualifies as the city’s general circulation paper, and whether the city is required to do business with it.

“This is an area where most lawyers don’t have much experience,” he said, explaining that he has scoured the state government code and the city’s Charter looking for an answer.

Hostility Downplayed

The Breeze’s Harpster downplays any hostility between his paper and the Easy Reader, and said the Breeze lawyers got involved simply because “we have corporate attorneys, regardless of the issue, whose job it is to look into daily matters.”

Harpster said the money may mean less to his paper than to the Easy Reader, but said, “Obviously any given amount is going to be more important to smaller newspapers. Just like any amount would be more important to the Breeze when compared to the L.A. Times.”

The Easy Reader’s Cody, who has had to hire an attorney to counter the Breeze, is not so amiable.

“They are trying to discredit my newspaper, and then the next year they try to pass themselves off as a newspaper no one has ever heard of,” he said. The Redondo Reflex is “clearly not published in Redondo Beach. All it is is the Breeze’s ego. A little paper did a better job than them. Having to bid competitively is the last thing they want to do. If they can stop me from hiring another reporter it’s worth it to them.”

Circulation Disputed

Each paper claims to have higher circulation in Redondo than the other. Cody said he distributes 13,000 free copies on newsstands in Redondo Beach. Harpster said the Breeze’s audited paid circulation in the city is 10,500, in addition to Lifestyle, which carries the name Reflex in small type on its nameplate. Each has accused the other of inflating its figures while deflating the other’s.

Redondo Beach City Manager Tim Casey, who last year unsuccessfully recommended awarding the city contract to the Breeze rather than the Easy Reader despite the higher cost, still favors the Breeze. “For the extra dollars involved we get greater outreach with a daily than with a weekly,” he said. “I’m also compelled by a public opinion poll taken by the city that said more people get their news about the city from the Breeze.”

Casey said he believes that many people read legal notices and that they should be aimed at a wide audience, although he acknowledged that most city suppliers are notified by mail of requests for bids, and City Council watchers keep abreast of public hearings without the notices.

Read by Few

Cody does not agree. He said the notices are simply “legal requirements” that few people read. “I would think a city would want to go the route where it spends less money,” he said.

Meanwhile, City Atty. Phillips is agonizing over the recommendation he is to make to the Redondo City Council on which paper should get the contract.

“I’m just not sure what I’m going to do,” he said. “If you’ve got any ideas, let me know.”

Phillips said he hopes to make his recommendation to the council Monday, when the council is expected to make a decision.

Estimated Expenditures for Legal Notices--1985-1986

Avalon $12,000 Lomita 2,500 Carson 12,000 Manhattan Beach 3,000 El Segundo 2,000 Palos Verdes Estates 400 Gardena 5,000 Rancho Palos Veredes 1,000 Hawthorne 14,000 Redondo Beach 25,000 Hermosa Beach 14,000 Rolling Hills 3,000 Inglewood 6,000 Rolling Hills Estates 3,000 Lawndale 5,000 Torrance 36,000

SOURCE: City officials