Black bids to stop plea in U.S. court

Conrad Black’s former holding company, Ravelston Corp., is not insolvent, Black’s lawyer argued yesterday as he tried to show that the former media baron has no ulterior motives for his appeal of a recent court ruling.

“ Lord Black has a legitimate financial interest in these proceedings,” lawyer Alan Mark told a three- member Ontario Court of Appeal panel.

Black is Ravelston’s largest shareholder.

Black, who was not in court, is asking the appeal court to overturn a recent ruling by Ontario Superior Court Justice James Farley. The decision allows Ravelston to plead to criminal charges from the U. S. Attorney’s Office, which alleges Ravelston participated in a scheme to defraud Hollinger International Inc. — the company that once operated Black’s media empire, and still publishes a variety of newspapers — of more than $32 million ( U. S.).

Ravelston sought bankruptcy protection and fell into receivership in April, putting it under the supervision of the Ontario Superior Court.

Its receiver, RSM Richter, was put in charge of the company’s operations at that time.

Ravelston’s only asset is the shares it holds in Hollinger Inc., a holding company whose chief asset is an interest in publisher Hollinger International. Ravelston is currently barred from cashing in those shares.

“Effectively, this company doesn’t have any cash on hand today and won’t for the foreseeable future,” said Alex MacFarlane, a lawyer for the receiver. The receiver wishes to face the U. S. criminal indictment and enter a plea of not guilty — a move Farley approved, but which the receiver has not carried out pending the outcome of Black’s appeal.

Lawyers for both sides have acknowledged that a guilty finding in the criminal case could snowball into numerous findings against Ravelston in other lawsuits — and into hefty fines.

Black’s lawyer, Mark, said the receiver and Hollinger were insinuating Black was appealing for other reasons by attempting to show that there is no money in Ravelston left to fight for.

“This company is not insolvent,” Mark said.

Black has not yet been named in the U. S. criminal case. However, his former right- hand man, David Radler, settled with the U. S. Attorney’s Office and has agreed to testify in any related future cases. Former Hollinger lawyer Mark Kipnis has plead not guilty to related charges.

Black’s lawyers argue that the U. S. government has no authority or jurisdiction to prosecute a Canadian company that has no office in the U. S., and that to voluntarily enter a plea would be ‘‘ reckless” and “ foolish.” The panel of justices adjourned to consider whether to allow the appeal to proceed.