Over New Paper : Signal Owner Threatens to Sue Newhalls

The owner of the Newhall Signal has threatened to sue three members of the Newhall family who quit top posts at the newspaper last month, accusing them of raiding the Signal of key employees and advertisers in their effort to start a competing publication.

In a letter dated Tuesday, an attorney for the Signal accused all three Newhalls of breaching contracts not to compete with the newspaper.

The letter warned that unless the Newhalls agree to stop soliciting Signal employees and advertisers by noon next Tuesday, “we shall have no choice but to institute legal action against you.” The letter was signed by Beverly Hills attorney Allan Browne on behalf of Newhall Newspapers and its parent company, Morris Newspaper Corp. of Atlanta.

Scott Newhall, 74, the Signal’s former owner; his wife, Ruth, 78, the newspaper’s former editor; and their son, Tony, 47, the former publisher, quit the Signal Aug. 9 during a dispute over stock ownership in the publication. A few days later, the Newhalls announced plans to start their own newspaper.

Scott Newhall said Thursday the attorney’s letter contained “the most amateurish demands I’ve ever seen.”

Newhall said the agreement not to compete was made when he and his wife sold their interest in the Signal to Morris in 1978. Newhall said the agreement expired the first of this year.

Tony Newhall said he made the same 10-year agreement in 1983 when he sold the remaining 20% of the Signal’s stock to the corporation. His father said the family does not believe that agreement is valid under California law.

Scott Newhall, whose fulminating editorials appeared in the Signal for 25 years, said the family is continuing preparations to publish the competing newspaper, the Santa Clarita Valley Citizen. The twice-weekly publication will make its debut Sept. 11, he said.

Newhall said the family has hired several Signal employees, but denied that they were solicited.

“They all applied for work, and we’re pleased to take them on,” he said. “We didn’t go after anyone. They came to us.”

About the Signal’s advertisers, he said, “I had always thought it was a free press, that advertisers could put their money where they wanted . . . “

The letter demanded that Tony Newhall, the publisher of the Valley Citizen, disassociate himself from the new family venture. It also accused the Newhalls of using “proprietary and confidential information taken from the Newhall Signal without permission,” a charge the family denied.

“I believe the Newhalls are legally entitled to test their proposed venture in the marketplace . . . ,” wrote the Newhalls’ attorney, William J. Dowling, in a reply to Browne’s letter.

The family has been “aboveboard and straightforward” in their endeavors, Dowling said. The only interference in the Signal’s business is with the newspaper’s “unopposed status as the only community-produced newspaper in its area,” he said.

Browne said Dowling’s reply “does not in any way meet the various factual and legal issues in my letter.” He said the response “is completely unsatisfactory.”

But neither he nor Charles Morris, Morris Newspaper Corp. president, would comment on the charges contained in the letter to the Newhalls.

Earlier this week, Darell Phillips, publisher of five other Morris Newspaper Corp. newspapers in California, was named publisher of the Signal. Former Arizona Republic reporter Chuck Cook was named new editor of the paper.