Willis Carto archive

Including information about his associates

Carto Bankruptcy — Willis Carto’s letter to letter to his attorney (4/1/1999)

April 1, 1999

Re: Settlement offers

  1. The liquidation value of LIBERTY LOBBY as fixed by an independent accountant is $203,222. The only thing of salable value owned by LIBERTY LOBBY is the mailing list. Intangibles include the working staff, reputation and goodwill accumulated. The staff would quit if LIBERTY LOBBY were to be taken over by hostiles and outside support would vanish. The weekly newspaper could not possibly be kept going except by substantial subsidation. Advertisers would desert and would place ads in a competing newspaper that would be set up immediately by staffers, including yours truly.
  2. Nonetheless, to get the chapter 11 behind us and avoid additional time and legal expense, debtor has made three offers:
    1. The sum of $500,000 (up $90,000 from previous offer) with immediate payment of $15,000 and with advertising in The SPOTLIGHT of $50,000 value which can be used or sold. That leaves $435,000 to be paid in 72 months @ $6042 mo. 55% of cash pmts to the west coast group and 45% to their atty Daryl Clark in escrow to be paid when and if we lose the Maine appeal. If we win, they would repay the cash they have received but not the advertising. If LIBERTY LOBBY defaults, and becomes 30 days or more in arrears, the entire amount becomes due and payable. They will drop their actions against the Furrs and the Cartos. The balance of the settlement follows the terms of Mark Lane’s letter to Clark of January 8.
    2. A payment of $500,000 in one lump sum from the estate of Bill Kefer from the first monies made available directly to the west coast group: they to pick up ½ of the legal expenses necessary to procure the funds from the estate. Or, they can hire their own attorney and so would LIBERTY LOBBY. They will drop their actions … (see above).
    3. The Carto house, they to give the Cartos reasonable time to find another domicile and move. As Sampson estimates the value to be in excess of $600,000, this represents an increase of at least $100,000 from (b). They will drop their actions … (as above).
  3. We are willing to consider dropping our actions vs the Weber group and that would be the total quid pro quo. No cash could be paid in addition. With five defaults being issued at this time it is but a matter of time before sizable judgments are entered which will be far more than the Maino judgment.

Faxed to Brian Urtnowski
Faxed to Mark Lane
Faxed to Paul Pearlstein
Faxed to Morrison & Hecker DC