The employees of Tribune Co. have plenty of reasons to be infuriated today—they're the ones who own the company through their Employee Stock Ownership Plan, not Sam Zell, who put just $315 million of his own money into last year's $8 billion deal that gave him control of the company. But the bankruptcy filing contains one detail that stands out as the unkindest cut of all: Tribune still owes $11.2 million to the former CEO of Times-Mirror (which Tribune bought in 2000) Mark Willes—a man most famous for massive layoffs and an ethical scandal of historic proportions:
Mark Willes got the nickname "Cereal Killer" because of his penchant for ordering huge job cuts, and because of his background as a General Mills executive in charge of the Cheerios division. He took over at Times-Mirror in 1995, and set about cutting costs. He laid off 900 total employees at the LAT and the Baltimore Sun. And he bragged that he wanted to take "a bazooka" and blast away the wall between the news and business departments.
That predisposition ultimately led to a huge scandal at the LAT in 1999, when it was revealed that the paper had made a deal to sponsor the new Staples Center arena in Los Angeles, and agreed to split advertising revenues from a special Sunday Magazine supplement about the Center with the center. In essence, the subject of the stories in that section was being paid from it. It was a big deal at the time, and it was part of Willes' legacy.
And now Tribune still owes him Retirement and Deferred compensation of more than $11 million. Chew on that, newsroom. [Although LAO points out the upside: all deferred compensation to former employees has been discontinued, so Willes will have to line up along with the rest of the creditors to plead for his money. Jon Fine lists more former execs in the same situation.]