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Judge gives green light to San Francisco paper sale
AP, SAN FRANCISCO
Sunday, Jul 30, 2006, Page 11
A federal judge declined to block McClatchy Co's plan to sell three San Francisco-area newspapers to MediaNews Group Inc.
The decision comes amid allegations that the US$1 billion deal -- which includes the US$737 million sale of the Monterey County Herald, San Jose Mercury News and Contra Costa Times -- would give the Denver-based MediaNews chain a monopoly in the area.
US District Judge Susan Illston's decision came in response to an antitrust lawsuit brought by San Francisco real estate magnate Clint Reilly, who sought to temporarily block the transaction. Reilly was concerned that MediaNews could have a monopoly on readership and advertising.
Illston ruled that newspapers face competition from other news sources that also advertise. She ruled: "As an initial matter, there will continue to be other sources that continue to provide consumers with `news, editorial, entertainment and advertising content' such as the television, radio and the Internet."
The judge left open the possibility that she would entertain arguments in the future challenging the assumption.
Joseph Alioto, Reilly's attorney, said he would still proceed with his client's lawsuit.
Illston's decision does not mean the deal will go through in the end. Justice Department regulators have not signed off on the deal and the government has not indicated when it will conclude its own antitrust investigation.
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