Court affirms interpretation of Scripps trust
Fri, January 30, 1998 by Rich Boehne
CINCINNATI, Ohio - An Ohio probate court today ruled that The Edward W. Scripps Trust need only hold a majority of The E.W. Scripps Company’s closely held Common Voting Stock to "insure" its control of the company.Control of the company is required by the trust agreement, which was created 76 years ago by the firm’s founder, Edward W. Scripps.The current trustees, in a pleading filed last March, had sought a declaratory ruling affirming their interpretation that the trust agreement requires them to hold a majority of the company’s outstanding shares of Common Voting Stock, but does not require them to hold a majority of the publicly traded Class A Common Stock. The ruling also affirms the trustees’ interpretation that the trust is not required to hold a majority of the company’s total outstanding shares (Class A and Common Voting Stock combined) to insure control of the company.In his ruling, Butler County (Ohio) Probate Judge Randy T. Rogers agreed with the trustees and noted that "no party to this action has filed any objection to that interpretation of the ‘Trust Agreement.’"The trust currently holds 83 percent of The E.W. Scripps Company’s Common Voting Stock, which is not publicly traded, and 53 percent of its Class A Common Stock, which is traded on the New York Stock Exchange under the symbol "SSP."Since the company went public in 1988, the trust has gradually reduced its holdings of outstanding Class A Common stock from approximately 77 percent to today’s 53 percent.The probate court’s affirmation of the trustees’ interpretation allows the trust to further diversify its assets and the company to issue Class A Common stock if needed for corporate purposes.Class A shareholders are entitled to elect the greater of three or one-third of the company’s directors but are not entitled to vote on any other matters except as required by Ohio law. Holders of Common Voting Stock are entitled to elect all remaining board directors and to vote on all other matters.The ruling in Butler County, where the trust was originally filed, marks the third time in the trust’s history that the trustees have asked the Butler County court to affirm their understanding of the agreement. By its terms, the trust will terminate upon the death of the last survivor of four persons specified by the trust agreement, the youngest of whom is now 73 years of age.Upon termination of the trust, more than 80 percent of the Common Voting Stock of the company will be subject to the terms of a Scripps Family Agreement entered into by those who will inherit the assets of the trust, other cousins and the company.The Family Agreement will restrict transfer and govern voting of Common Voting Shares of the company held by family members.The E.W. Scripps Company operates 20 daily newspapers; nine network affiliated television stations; two cable television networks, Home & Garden Television and the Food Network; two television programmers, Scripps Howard Productions and Cinetel Productions; and United Media, a worldwide syndicator and licensor of news features and comics.