San Jose Police were called to the headquarters of the San Jose Mercury News on Wednesday afternoon after an independent distribution firm discovered its news racks — along with those of other local publications — in a metal recycling dumpster behind the daily’s plant.
The container, about the dimensions of a mid-sized moving van’s cargo area, was mostly full, and more news boxes were stacked around the dumpster. The apparent operation to round up and destroy racks targeted the distribution channels of competitors to San Ramon-based Bay Area News Group (BANG), which owns daily newspapers from Marin to Monterey, and community newspapers in Silicon Valley.
“We’d been losing at least three a week,” said Tom Lilledahl, of Mountain View-based Circulation Management Inc. After racks disappeared on Willow Glen’s Lincoln Avenue and the Alameda in San Jose, CMI personnel went to the Mercury News’ Ridder Park Drive plant and found its missing property, along with news boxes of Metro, the Palo Alto Daily Post, the Mountain View Voice, Good Times, La Oferta, the San Francisco Chronicle and other publications.
Representatives of Metro and the Daily Post arrived at Ridder Park Drive shortly after the discovery and were ordered off the property by Mercury News personnel. Daily Post co-publisher Jim Pavelich was threatened with arrest by security guards if he didn’t put down a rack of his that he found in the Merc’s back lot, according to an article in today’s Post.
“This is every publisher’s worst nightmare,” said Palo Alto Weekly publisher Bill Johnson when he learned Thursday morning that his boxes were sitting in a San Jose scrap pile.
“What!” exclaimed an incredulous Kevin Babeaux, owner of the Belmont-based Pink Spots LGBT publication, when informed on Thursday of the confiscations. “That’s disgusting. That’s our property.”
The weekly newspaper Metro’s circulation department has also been suffering a plague of thefts of its newly-redesigned red stands. Metro’s Dan Pulcrano told the Post it was “the worst example of anti-competitive activities that I have seen in three decades of publishing.”
“They’ve been merging nameplates, reducing circulation, shuttering offices, selling off furniture, melting down newsracks and firing so many people that they may have gotten confused and forgot that there were a few publications left in the Bay Area that they didn’t buy up,” Pulcrano said. “They obviously wanted to shrink the independents too.”
Metro, an owner of San Jose Inside, sued the monopoly daily federal antitrust law violations in 1991 and settled the case in 1994 when the Mercury News agreed, among other requirements, not to interfere with Metro’s distribution. Circulation Management says it also sued the Merc for taking its property and received a written promise in 2004 not to touch its racks.
A number of publishers whose racks were taken expressed the opinion that the thefts were a criminal act. San Jose Police are investigating the Mercury News’ possession of their competitors’ racks as a civil matter.
Bay Area News Group circulation executive Jim Wilkenson said he didn’t know how the racks wound up in his company’s back lot. After police officers on the scene mediated the dispute, Wilkenson approached publishers and offered to remove the racks from the dumpster and allow publishers to come and pick them up.
The Mercury News released the following statement Wednesday to media critic Jim Romenesko:
Earlier this afternoon, representatives from a local newspaper came onto our property unannounced claiming that we had stolen their newsracks. To be clear, we have not stolen anyone’s newsracks. We were, however, recently contacted by local authorities and instructed to remove several newsracks that were not in compliance with a local rack ordinance. We complied with the request and notified the individual publishers whose racks we removed. The racks have been stored on our property since that time.
This is a normal practice in the industry that is recognized by the various municipalities as well as the publishers who place racks on the streets. This afternoon was the first time any of the publishers notified us that they were interested in retrieving the racks.
Given that we had not been provided with prior notice of their desire to retrieve the racks, after discussions with the publisher’s representatives and the San Jose police, we agreed earlier this afternoon to meet again tomorrow. At that time, we would make all the racks available for pickup by the publisher’s representatives, which had been our desire all along. Everyone was satisfied with this arrangement.
Given this prior understanding, we are unclear what led to the incident earlier this evening.
None of the publishers San Jose Inside reached for comment said they were contacted by the Mercury News about the news racks.