Does a statement written on a cocktail napkin constitute an enforceable contract?
That’s one question at the heart of a civil trial that kicked off Wednesday in Anchorage Superior Court, between two well-known former figures in Alaska’s news media landscape.
Tony Hopfinger, the former president and editor of the newspaper Alaska Dispatch News, filed a lawsuit against Alaska Dispatch Publishing LLC and its owner, Alice Rogoff, in 2016. He alleges that Rogoff failed to pay him money he says she promised to him.
Enter the cocktail napkin. In April of 2014, Rogoff wrote on a napkin: “I agree to pay Tony $100K at end of each calendar year (beginning ’14) for 10 years," totaling $1 million. She did pay Hopfinger the first $100,000 payment, in January 2015, according to the lawsuit.
In the courtroom Wednesday, an attorney representing Hopfinger presented a copy of that napkin to the jury, blown up and supersized on poster board.
“How do we know when parties have an agreement?” attorney Jeffrey Robinson said in his opening statement. “The strongest evidence that we expect you’ll hear in this case that the parties had a binding agreement is because Ms. Rogoff believed that the parties had a binding agreement. People don’t cut $100,000 checks unless they believe that they have reached an agreement.”
Robinson closed his opening statement with: “We’re confident that at the end of the day, you know what a promise is and you know who broke that promise. And that person is not Mr. Hopfinger. That person is Alice Rogoff.”
David Gross, an attorney representing Rogoff, said a significant part of what the napkin says is the part about the payments happening over 10 years. Hopfinger lives in the Chicago area now and has not been involved in the operations of the newspaper since 2015. (He moved to Chicago that year to be near his terminally ill mother, who died.)
The term “was an effort to lock Tony in to that 10-year period,” Gross said. “To commit Tony to work for the newspaper for that 10-year period so he that would be with her hand-in-hand to run this newspaper."
Gross told members of the jury to ask themselves, once they have all the evidence, if there was an enforceable contract in place.
“And if there was an enforceable contract in place," he said, “what was it for? What were the terms of this contract?”
He finished his opening remarks to the jury by saying that, come the end of the trial, “I’m going to tell you to pay Tony what he is owed in this case, which is nothing. I’m going to tell you to pay Tony what he earned, which is nothing. And I’m going to tell you to pay Tony what he deserves, which is nothing.”
In March 2014, Robinson said Wednesday, Hopfinger told Rogoff he wanted to be bought out of the company.
“His proposal was $1.3 million offered over a period of five years, she would buy out his shares,” Robinson said. “Alice Rogoff countered with $1 million over 10 years," plus stock options.
Hopfinger co-founded a news website called Alaska Dispatch in 2008 with his then-wife, Amanda Coyne. In 2009, Rogoff purchased a majority of Alaska Dispatch Publishing LLC. Hopfinger and Coyne each kept 5 percent of the company.
Then, in 2014, Alaska Dispatch bought the much larger Anchorage Daily News from the newspaper chain McClatchy Co. The name of the operation became Alaska Dispatch News.
The new Alaska Dispatch News enterprise experienced “massive and significant losses after Ms. Rogoff took control,” Robinson said, “about $400,000 a week” at some point within the first year.
Under her ownership, Alaska Dispatch News filed for Chapter 11 bankruptcy protection in August of 2017. It was bought by the Binkley family of Fairbanks and the name soon changed back to the Anchorage Daily News.
Rogoff took the stand later Wednesday. Robinson questioned her about the value of Alaska Dispatch and an employment contract Hopfinger had. He was eventually making $190,000 a year in his position at the newspaper, according to a detailed employment contract presented in court.
Rogoff also said in court that she and Hopfinger were at one point in “serious discussions” with Schurz Communications, the Indiana-based company that used to own Anchorage TV station KTUU, in hopes that that company might buy the Anchorage Daily News along with Rogoff.
The trial is set to continue the rest of this week and into next week.