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L.A. Times Turns Up Heat on O.C. Register

LOS ANGELES (CN) - The Los Angeles Times won a temporary protective order against the Orange County Register, claiming that the troubled newspaper owes it $2.5 million in delivery fees.

Superior Court Judge Robert H. O'Brien on Dec. 5 entered a temporary protective order against the Register, which has been beset by financial problems.

Property subject to the order includes the Register's bank accounts, stocks, bonds, securities and brokerage accounts, real estate and real property, including computers and vehicles.

The Times sued the Register for breach of contract in October, claiming that after the Times agreed in 2009 to deliver the Register, the Orange County paper started to fall behind on payments in April 2013.

The Times says while it "waited patiently for months to get paid" it continued to deliver the Register's newspapers.

According to the lawsuit, during negotiations, former Register publisher Aaron Kushner offered $1 million to settle the debt, with strings attached: the Times should offer him a favorable rate to deliver the publisher's ill-fated L.A. Register.

When the Times turned down the offer, the Register allegedly agreed to pay the Times in installments. After paying $600,000 it "quickly broke its promise," and made no more payments, the Times said in its lawsuit.

In a May 13 email attached as an exhibit to the complaint, Eddy Hartenstein, chairman of the board of Times corporate parent Tribune Publishing, appears to be losing patience with Kushner.

"The Register is behind on its payments to The Times. This has been an ongoing problem - as we discussed a few months ago. I was hoping that the situation would improve, but it has gotten worse," Hartenstein wrote. "We could have sent out notices of default quite a while ago and been well into a cure period, but instead we've been patient and given the Register the benefit of the doubt that it would catch up on its amounts owed. At this point, however, something needs to be done to address this situation," according to Exhibit A.

In a July 7 email under the subject line "quick update" Kushner told the Times it had to delay again, according to Exhibit B.

"I wanted to let you know proactively that we were not able to send an additional payment above our weekly payments this week. As has been well-covered in the news, we're digesting a major staff restructuring with more severance and final vacation payouts than originally anticipated," Kushner wrote, according to Exhibit B.

According to a copy of the email, he signed off: "Thanks for your patience as we do our best."

The Register is the flagship newspaper of Kushner's Santa Ana-based media company, Freedom Communications.

After the Times filed the lawsuit, former Las Vegas casino marketer Rich Mirman took Kushner's place as the flagging newspaper's new publisher.

Kushner remains the principal of Freedom Communications, which he owns through a private equity firm he founded in 2010, the Times reported in October.

On Oct. 28, an entity called Raymab filed an unlawful detainer against the Register, according to the Courthouse News Service database. The Register reportedly fell behind on payments for the offices of the Register's Anaheim Bulletin. Raymab claims that the Register owes more than $100,000 in rent, according to the OC Weekly, which has covered the Register's financial problems for some time.

Neither Times attorney Jean-Paul Jassy nor the Orange County Register immediately responded to requests for comment.

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