Federal judge won't force Review-Journal to resume printing the Sun but finds Sun likely to win its antitrust case

What happened

On Wednesday, a federal judge turned down the Las Vegas Sun's request to make the Las Vegas Review-Journal resume printing and distributing the Sun while the papers' antitrust lawsuit moves forward, the Sun reported. The Sun is a party to the case. U.S. District Judge Anne R. Traum issued the decision in a 31-page ruling.

In the same ruling, Traum found the Sun "clearly likely" to prove that the papers' 1989 joint operating agreement is the valid, enforceable contract between them. She also found the Sun clearly likely to succeed on two claims: that the R-J broke antitrust laws in how it treated the Sun, and that it acted to illegally monopolize the local daily newspaper market.

Why the judge would not restore the print Sun

A high bar for an interim order

According to the Sun, the request faced a demanding legal standard because bringing back the old agreement would force a major change in how the papers operate. To win that kind of order, the Sun had to show extreme, irreparable harm. Traum ruled that financial losses and readers missing their preferred paper did not meet that standard. She noted that money damages could be addressed at trial.

The R-J stopped producing and distributing the Sun in April. Traum wrote that the Sun's readers "must go without their preferred newspaper until at least the end of this litigation." The Sun had asked the court to require the R-J to perform under the 1989 agreement and to bar it from ending the joint operation before 2040.

The fight over the 1989 agreement

Why the 2005 version does not apply

Traum cited a 9th U.S. Circuit Court of Appeals ruling that a court cannot enforce only parts of the papers' arrangement. The 9th Circuit had found a 2005 amendment illegal because it lacked the U.S. attorney general's signature, even though both sides operated under it for nearly 20 years. Traum noted that the 1989 agreement was indisputably approved by the attorney general.

Three R-J arguments rejected

The R-J first argued that the parties abandoned the 1989 deal by not following it for more than 20 years. Traum disagreed, writing, "Here, the 1989 JOA can still be followed." The R-J also argued that performance was impossible because no afternoon Sun exists and printing and delivery costs make it unworkable. Traum called that an argument that compliance would be unprofitable and said a contract is not voided simply because it becomes a bad deal.

On the third argument, Traum reaffirmed her earlier finding that the 2005 document amended the 1989 pact rather than replacing it. She wrote that the Sun is likely correct that the 1989 agreement "sprang back in its original form" once the amendment was invalidated. She added that the 1989 agreement binds the parties' successors and assigns, so later R-J owners took on its obligations to the Sun.

The antitrust claim and its history

Defining the market

Traum found the Sun clearly likely to show that the R-J violated Section 2 of the Sherman Antitrust Act of 1890, which bars monopolization. She relied on testimony from two Sun expert witnesses, antitrust economist Michael Katz and newspaper industry expert Robert Picard. Based on that testimony, she found the R-J holds a large share of the market for daily English-language print newspapers in the Las Vegas area, which is protected by high barriers to entry. She rejected the R-J's argument that online news belongs in that market.

How the dispute began

The papers combined their business operations in 1989 under the Newspaper Preservation Act. That law lets newspapers share business functions while keeping their newsrooms and editorial pages independent. In 2005, the Sun stopped publishing in the afternoon and became an insert of up to 10 pages inside the R-J's morning edition, and the profit-sharing formula changed.

The family of casino magnate Sheldon Adelson bought the R-J on Dec. 10, 2015, and the new owners began working to end the relationship, the Sun reported. According to the ruling, joint operation profits went negative in 2017 for the first time, and the Sun has not received a regular JOA payment since. In 2019, an arbitrator awarded the Sun more than $1.8 million over the R-J's improper accounting of editorial and promotional costs. The Nevada Supreme Court upheld that award.

What the Sun's lawyer said

Kristen Martini of Clark Hill PLC represents the Sun. She said the order confirms the case will go to trial, where the Review-Journal "and its ownership will face accountability before a jury for their anticompetitive conduct." She said the Sun looks forward to a trial at the court's earliest convenience.

What to watch next

• A jury trial on the Sun's antitrust and contract claims is still ahead. The Sun's report did not give a trial date.
• Traum said any financial damages to the Sun could be addressed at trial.
• Under the ruling, the printed Sun stays out of circulation until at least the end of the litigation.