Rogoff to give deposition over claims at Arctic Blvd. warehouse
Former Alaska Dispatch News owner Alice Rogoff gave a deposition June 6 after six months of delays in a state Superior Court lawsuit brought by an Alaska electrical company.
On June 4, Rogoff also was in U.S. Bankruptcy Court Alaska Division for a mediation hearing that was closed to the public. A possible outcome of mediation could be an agreement to settle millions in unpaid debts after the public trustee in the case found evidence of wrongdoing among transactions that led to the 2017 bankruptcy of the Alaska Dispatch.
The state court case was brought by M&M Wiring Service, which first filed a lien June 1, 2017, on a warehouse where it had completed electrical contract work for the Dispatch. The warehouse, owned by Arctic Partners, is also named as a defendant in the M&M lawsuit.
M&M owner Mark Miller submitted invoices that went unpaid and unacknowledged, according to his complaint. He then filed the June 2017 lien against the property, contending that Rogoff’s actions nearly forced his company into a bankruptcy of its own.
In the wake of unpaid contract work, he laid-off two employees and paid thousands of dollars out of pocket for subcontract work completed at the 5900 Arctic Blvd. warehouse.
Now, more recently M&M filed a foreclosure suit based on a mechanic’s lien against Arctic Partners for the unpaid payments owed to M&M by Arctic Partner’s former tenant, Rogoff.
Arctic Partners attorney Jason Kettrick has argued the building’s owners are victims themselves in the bankruptcy case because Rogoff breached her lease contract and stuck them with a printing press left behind during the liquidation phase of the case. A nearly 30,000-square foot warehouse is unusable to the owners until the giant press and all its pieces are hauled out. That job is underway now.
“It is certainly worth noting that Arctic is the only party against whom no blame can be cast for the issues underlying this case. It was neither contracted with the Dispatch to install its new printing equipment, nor ran it financially into the ground,” Kettrick wrote in one of many filings in the case.
Arctic Partners has filed its own case, this one leveled at Rogoff personally, for breach of lease and fraudulent transfers. Kettrick is arguing on his clients’ behalf that Rogoff anticipated bankruptcy and improperly paid Alaska Dispatch revenues toward the balance of her personally-guaranteed Northrim Bank loan of $13 million.
The loan was used to help purchase the Anchorage Daily News from the McClatchy Co., in 2014.
Though Rogoff paid $34 million to McClatchy, she also sold the Anchorage Daily News’ headquarters building that also housed the printing press on Northway Drive to GCI for $14.5 million.
This was the first business move that caused her company to slip downhill into a bankruptcy that was filed Aug. 12, 2017, because she rented out additional office space for her staff on C Street as well as the eventual leasing of the Arctic Boulevard warehouse and the purchase of a new printing press to go into it.
The massive overhead from staff and real estate costs caused losses totaling as much as $4 million per year, and the company was sold to the Binkley Co. for $1 million a month later on Sept. 11, 2017. (The Binkley Co. also now owns the Alaska Journal of Commerce after purchasing it from Morris Communications in a deal that closed Feb. 23.)
In the meantime, other lawsuits besides the bankruptcy have moved along at a slow pace. M&M’s is one of four: Arctic Partners v. Alice Rogoff is another; GCI also has a breach of contract lawsuit related to unpaid rent and utility bills at the Northway Drive building; former business partner and Alaska Dispatch co-founder Tony Hopfinger alleges she owes him some $900,000 of a $1 million agreement signed on a restaurant napkin to purchase his share of the company after she merged the website with the Anchorage Daily News.
M&M vs. Rogoff
The original invoices for unpaid work completed by M&M amounted to nearly $600,000, but in his proof of claim filed in March with the U.S. Bankruptcy Court, owner Miller tripled the amount, as allowed under Alaska’s Unfair Trade Practices and Consumer Protection Act.
He is alleging Rogoff’s contract for his work was signed with the Dispatch when the company was losing $125,000 per week, which means she knew she could not pay even upon hiring him. This constitutes deceptive business practices, Miller says in his claim, and violates the act.
On June 6, Rogoff appeared at a deposition hearing to answer questions about her finances.
Rogoff has thus far refused to respond to Miller’s questions about whether she acknowledges his 22 work invoices, his suit alleges. He asked whether the invoice was received, whether M&M furnished the items identified with the project, whether the Dispatch approved invoice payment and whether the invoice was paid. These four questions were asked in filings on each of Miller’s invoices.
But Rogoff refused “in good faith by responding with inappropriate objections and by hiding behind the boilerplate response,” Miller’s attorney Wayne Dawson wrote in court filings.
Rogoff’s standard reply has been “this request for admission appears to be directed to the ADN; therefore Rogoff in her individual capacity is not in a position to respond.”
A reference to perjury comes into the back-and-forth, Miller asserts, because Rogoff already testified on Sept. 6, 2017, during bankruptcy proceedings that she acknowledged the debt to M&M, and further listed it as a debt in her bankruptcy filing.
“For Rogoff to allege in this case that she does not know the amount due to M&M is perjury,” Dawson argued on Miller’s behalf. Then on Sept. 12, 2017, Rogoff also wrote of her challenges in the Dispatch about building the new printing press plant on Arctic Boulevard.
“But what turned out to be our fatal challenge was the need to build a new printing plant at an affordable price… and then the retrofitting of the building for the printing presses ran into one setback and after another, one cost overrun too many… A series of misjudgments on my part caused the construction to grind to a halt in the spring,” Rogoff wrote.
This sounds like a person who likely held oversight of the construction going on at the Arctic Boulevard warehouse, Dawson wrote, countering Rogoff’s claim that she was more distant from it.
By deploying a formulaic reply, she is thwarting M&M’s “legitimate discovery efforts and prejudices its ability to have the lien foreclosure action tried without unnecessary delay,” Dawson argues.
Rogoff’s attorneys in this case, David Karl Gross and Mara Michaletz of Birch Horton Bittner &Cherot of Anchorage, filed an objection on June 1.
In this one, Rogoff is claiming M&M or Mark Miller is a bully.
“M&M’s allegation of perjury is frivolous, has no basis in law or fact, and was made for the purpose of harming and embarrassing Rogoff. This accusation is consistent with M&M’s global litigation strategy of using bullying tactics and open hostility as a means to gain an advantage,” her attorneys wrote.
As to the invoices and work completed, Rogoff’s attorney says “considering that Rogoff visited the warehouse infrequently, she cannot be expected to have this level of knowledge, making her responses appropriate.”
The chain of command on the work site meant project manager Ed McCoy would have overseen the work. Any invoices would have gone to company vice president Margy Johnson. The attorneys argue that M&M’s remedy is “too harsh” and ask Superior Court Judge Eric Aarseth to deny the motion.
To handle the confidentiality of Rogoff’s personal finances in this case, Aarseth ruled that sealed exhibits are to remain in his chambers.
Rogoff has used the defense that limited liability corporation laws protect her personal right to privacy where an analysis of her finances is concerned. But both the bankruptcy case and this Superior Court cases have proceeded on the ruling that not all of her personal finances should remain off limits.
She has admitted using her own money to cover the Dispatch’s annual losses, and lists herself as the largest unpaid creditor in the ongoing bankruptcy case.
Naomi Klouda can be reached at [email protected].