Businesses owed money by Alaska Dispatch News had a chance to personally question owner Alice Rogoff about the company's financial situation in federal bankruptcy court in Anchorage on Thursday.
The "meeting of the creditors" marked the first time since ADN filed for Chapter 11 bankruptcy protection on Aug. 12 that Rogoff has appeared in court. She previously had testified by phone.
Meanwhile, after questioning by a reporter, ADN bankruptcy attorney Cabot Christianson said a new group of potential buyers of the newspaper and digital news site had traveled to Alaska to investigate the operation ahead of a scheduled auction of assets Monday.
Many details about the identity of the members of the group and their level of interest remained unclear.
The Binkley family of Fairbanks stepped in as potential buyers in August. They have been running the paper's daily operations through bankruptcy, though they still could be outbid at an auction scheduled for Monday.
On Thursday, roughly 25 people ranging from attorneys representing major creditors to a fedora-wearing blogger gathered in the downtown Anchorage federal bankruptcy court on Fourth Avenue for the creditors' hearing.
Such meetings are a routine part of bankruptcy cases, allowing businesses which say they are owed money to ask the debtor about assets and liabilities, under oath, Christianson said. Rogoff and ADN finance director Erin Austin testified sitting side by side. A U.S. Bankruptcy Court trustee, Kathryn Perkins, presided.
GCI, Northrim Bank and other businesses that together are owed millions by ADN questioned Rogoff through attorneys.
Rogoff said the bankruptcy filing was "a combination of a lot of adverse financial conditions."
GCI's move to evict ADN from the GCI building on Northway Drive, where it has been printing the newspaper on an old Anchorage Daily News press, pushed the decision, she said.
The questions also shed light on how the personal wealth of Rogoff — her husband, David Rubenstein, is a billionaire — paid for ADN's operations.
Austin testified that Rogoff was willing to personally funnel her money into ADN, which was operating at a loss.
"We'd let her know shortfalls and she'd transfer money into the account," she said.
The questioning did not lead to any revelations about the source of Rogoff's wealth. When asked about her "marital settlement agreement" and its value, she declined to answer.
"I'd rather not," she said. "It's personal."
Mark Miller, owner of M&M Wiring Service, which is embroiled in a separate legal dispute over electrical work done at a planned Arctic Boulevard printing plant for ADN, pressed Rogoff about how much money the newspaper was losing during the time his company started work on what was supposed to be a major renovation of a property on Arctic Boulevard to house a new press.
Was the ADN making money at the time? Miller asked.
"No, but we weren't expecting to," Rogoff answered.
The talk about a second possible buyer involved a group represented by a Canadian newspaper investor.
Christianson, the bankruptcy attorney, said he knew of a group from Vancouver, British Columbia, that had traveled to Alaska to investigate buying the newspaper at auction.
He said he believed the same group bid on the Fairbanks Daily News-Miner when it was for sale a few years ago.
The group's representative in Anchorage was identified as Steven Malkowich, a Canadian newspaper executive.
Malkowich is associated with an investor group or groups that have purchased newspapers in the United States and Canada, including two California operations: the Lodi News-Sentinel in 2015 and the Antelope Valley Press this year.
Anchorage bankruptcy attorney David Bundy said he represents a client who has traveled to Anchorage to explore buying the newspaper.
"He has been talking to various people regarding the possibility of buying it," Bundy said. "I have no decision to tell you about."
Bundy wouldn't name the client.
Though Christianson has proposed rules of the auction that would require another bidder to put up $1 million in earnest money in advance, a judge has not yet ruled on that proposal.
"Right now I'm not sure anybody who wants to bid is required to do anything other than show up on Monday and bid," Bundy said.
The Binkley family said they were aware of a potential competing buyer but knew few details.
"We assume there will be another bidder. We knew all along that was a possibility," said Ryan Binkley, speaking outside the courtroom after the hearing. "We're hearing somebody else has conducted some due diligence, and rightly so."
The auction will happen at a hearing scheduled for Monday morning.