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L.A. Times Merger Brings Swift Antitrust Suit

(CN) - Suing Thursday to keep a competitor of the Los Angeles Times independent, the Justice Department said Tribune Publishing is primed to enjoy "monopoly" control over English-language local newspapers in two California counties.

A Delaware corporation headquartered in Chicago, Tribune Publishing owns the Los Angeles Times and 11 major daily newspapers across seven states from Connecticut to California.

In California's Orange and Riverside counties, Tribune's only major competition for English-language newspapers comes from the Orange County Register and Riverside Press-Enterprise, both owned by Freedom Communications.

Freedom filed for Chapter 11 bankruptcy in the Central District of California on Nov. 1.

Though the Los Angeles Times said it received a warning from the Justice Department about the antitrust trouble acquiring Freedom's assets would bring, Tribune entered a winning bid of $56 million to begin the acquisition Wednesday.

The Justice Department's antitrust division responded swiftly today with a federal complaint and a bid to block the acquisition via temporary restraining order.

"If Tribune acquires Freedom, along with its Press-Enterprise and Register newspapers, it would obtain a monopoly in newspapers in Riverside County," the 21-page memorandum states. "Thus, competition for readers of English-language local daily newspapers in Riverside County would be substantially reduced or eliminated and newspaper readers in Riverside County would be likely to pay higher prices and receive lower levels of quality and service."

The acquisition will let Tribune jump from a 41 percent to 98 percent control of the local daily newspaper circulation in Orange County, and from 12 percent to 81 percent control in Riverside County, prosecutors say.

The Justice Department contends that this would not have been a concern had Tribune's competitors won the auction.

"Unlike Tribune, neither of the alternative bidders for Freedom would threaten competition in Orange County or Riverside County," according to the complaint.

Assistant Attorney General Bill Baer of the Justice Department's Antitrust Division said that blocking the acquisition is in the public interest.

"If this acquisition is allowed to proceed, newspaper competition will be eliminated and readers and advertisers in Orange and Riverside Counties will suffer," Baer wrote in a statement. "Newspapers continue to play an important role in the dissemination of news and information to readers and remain an important vehicle for advertisers.

A Tribune representative did not immediately respond to an email request for comment.

The action falls a little less than a week after the death of legendary journalist Ben Bagdikian, whose best known work "The Media Monopoly" argued that the ownership of most U.S. print, TV and radio outlets by a handful of corporations harms democracy and limits public debate.

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