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The legal grudge match over the sale of a newspaper group has been resolved.
On one side is David Phillips, the former owner of six small-town newspapers in southeastern Minnesota. Meanwhile, Jason Sesle, owner and publisher of the Fillmore County Journal, bought the newspapers in 2020 and shut them down.
Ms. Sessle felt that Mr. Phillips acted in bad faith and breached the terms of sale when he gave his old computer to a former employee and used the files to start a competing newspaper in Chatfield. Ta. So in 2021, Mr. Sessle decided not to pay Phillips the $78,000 that Phillips had been required to pay as part of the sale of his three-year consulting business.
Phillips hired a lawyer to sue Sesle. The two have been fighting in court ever since.
The battle ended last week when a Fillmore County judge sided with Phillips, saying Sesle was obligated to pay the money stipulated in the agreement.
Fillmore County District Judge Jeremy Klinefelter wrote in his Feb. 13 ruling that “(Sessle) did not use the non-compete agreement to cover conduct that was not written to cover it. We are asking the court to find that there is, but that is not something the court can do.”
Mr. Klinefelter likely violated the spirit of his contract with Mr. Sesle when Mr. Phillips gave a nearly 20-year-old computer to Pam Bloom, who formerly worked for Chatfield News for nearly 40 years. It is written.
Phillips said that although he didn’t know it at the time, the computer contained more than just old notes about Bloom’s story. It contained the subscriber list and the software needed to create and ship the newspaper to third-party printers and distributors. Bloom used these files to start his Chatfield News Company, printing a new newspaper and keeping the same name as his former employer.
Sesle declined to comment Thursday on the court’s decision. However, he told the Star Tribune in 2020 that he believed the files on Mr. Bloom’s computer belonged to him.
“We purchased [the files]”We own all the intellectual property,” Sesle said. She just came in and took over something that wasn’t hers. ”
It is unclear whether Sesle will appeal the decision. Sesle sued Bloom shortly after starting the newspaper, but later asked a judge to dismiss the lawsuit.
Neither Mr. Phillips nor Mr. Sesle proved in court exactly what was on the computer or how it harmed Mr. Sesle’s business. Additionally, these files were not specifically mentioned in the purchase agreement when Sethre acquired his Phillips company.
However, because the sale took place during the onset of the coronavirus pandemic, Phillips’ $78,000 consulting contract was part of the deal, which began in 2021.
“It’s been a long time,” Phillips said Thursday. “I’m finally relieved now, but it was a very long process.”
Phillips was bound by a non-compete agreement not to work for the newspaper. It expired in January. Although he is enjoying his retirement, he may consider freelancing for other newspapers in the future, he said.
Chatfield News continues to print and has grown to just over 1,000 subscribers, Bloom said. She is still using the same computer that caused all the problems in the first place.
“I keep paying my bills and I don’t have to borrow money, knock on wood,” she said. “I’m saving money to buy a new computer.”
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