Judge Limits Evidence in Freedom Newspapers Suit

An Orange County judge ruled Thursday that dissident shareholder Harry H. Hoiles cannot raise a number of controversial issues during the upcoming trial of his lawsuit to dissolve Irvine-based Freedom Newspapers Inc. and take one-third of its assets.

Superior Court Judge Leonard Goldstein granted, without comment, four of six defense motions to exclude certain evidence that Hoiles sought to introduce, including testimony from a business psychoanalyst and a law professor.

He also granted a defense motion for a separate trial to decide the critical issue of how many shareholders the media chain has. That trial is scheduled to begin Jan. 5, before the main trial.

When Hoiles’ dissolution suit was filed in 1982, about 50 heirs of founder R. C. Hoiles had 88 shareholder accounts. But Hoiles claims his family and the families of his sister, Mary Jane Hoiles Hardie, and his late brother, Clarence H. Hoiles, consistently voted in family blocks, thus constituting three shareholders. Each family branch owns about 33% of the closely held, family-owned company, which owns the Orange County Register, 28 smaller daily newspapers and five television stations.

If Hoiles prevails on his three-shareholder claim, he would have an easier time of proving his case because he would be able to argue simply that his interests had been threatened without having to show that the other two families abused their authority as majority owners.

Defense lawyers Robert E. Currie and Leonard A. Hampel were cheered by the judge’s rulings, saying it will “considerably” shorten the trial, which had been estimated at three to four months.

A Hoiles attorney said that the judge denied defense motions to exclude the most important evidence--bylaw changes and offers in 1981 to divide the company.