Newspaper battle becomes a must-read in northern Minnesota

It's a tale of two strong-willed Minnesota newspaper publishers, riddled with accusations of misdeeds and revenge, money made and squandered. Decades-old tensions are about to head to a courtroom this week.

And the fate of a beloved community newspaper hangs in the balance.

The Timberjay, an award-winning northern Minnesota newspaper, is facing what its publisher calls a retaliatory lawsuit from a couple that owns a stake in the paper — and publishes one of its direct competitors.

Gary and Edna Albertson, who run the Cook News Herald and the Tower News, also own 46 percent of the Timberjay. They allege in a lawsuit filed in August that they've been cut out of the Timberjay's business dealings and have received "absolutely nothing" for their investment, among other things.

Marshall Helmberger, the Timberjay's publisher, is calling the lawsuit, which has its first court hearing this week, a "very desperate" ploy to exit the business and shed their stake in the paper — or a way of getting back at their rival paper.

The Cook News Herald, which dates back to the turn of the century, was the main paper in Cook, Minn., for nearly 90 years. So when the Timberjay came around in 1989, it became a direct competitor.

"They had a very nice monopoly with the Cook News Herald for years" before the Timberjay came along, Helmberger said. His relationship with his competitors was terse from the start.

Gary and Edna Albertson declined to comment on the case or the paper, citing the ongoing lawsuit.

Their lawyer, John Colosimo, said the Timberjay's leadership declined an opportunity to settle the suit out of court. His relationship with Helmberger and the Timberjay is fraught, too: He represented the St. Louis County School District against the Timberjay in a contentious fight over public records. Helmberger claims Colosimo's involvement in the current case is a quest for retribution. Colosimo said that's "hogwash."

Retaliatory or not, the suit against the Timberjay pulses with old tensions, clashing personalities and the complexities of life and relationships in towns of about 500.

Without the insurance to cover legal expenses for a case like this, the Timberjay set up a crowdfunding effort in late August — and raised more than $11,000.

"Having to defend a lawsuit for a small enterprise can be pretty onerous," said Rick Edmonds, a media business analyst at the Poynter Institute, a school for journalists in St. Petersburg, Fla.

And if the Albertsons win, it could kill the Timberjay.

Their claim asks for a court order to either sell off the company or force Helmberger and his wife, Jodi Summit, who is also general manager of the paper, to buy out Gary and Edna Albertson's stock in the paper and pay "a reasonable return."

When Bill Arthur and Madonna Ohse started the Timberjay in 1989, they had a simple goal, Ohse said: They wanted to create a voice for the small communities that dot the region. It started by covering the northeastern Minnesota towns of Cook and Orr.

There was a built-in tension from the start. Cook, a town of about 800 in those days, already had a paper: the News Herald, run by Gary and Edna Albertson.

The friction was palpable and the competition was real.

"Certainly it makes businesses think twice about how they're going to spend their advertising dollars," Ohse said.

The tiny Timberjay staff did everything in those days but physically print the paper.

"We were working for nothing," Ohse said. It was an "all-nighters-for-three-days-in-a-row kind of operation."

Helmberger and Summit got involved with the Timberjay about two months after it started. They built up their shares of the paper in the next few years.

In 1997, Ohse was ready to leave the paper. When she sold her 46 percent stake in the Timberjay, Gary and Edna Albertson bought it, leaving Summit and Helmberger with the rest. Helmberger and Summit say they weren't aware of the sale. Ohse says she didn't mean to be secretive; she just wanted out, and the Albertsons were willing to buy.

The newspaper business was still strong in the late 1990s. Circulation was generally high, Craigslist hadn't killed off classifieds and local advertising was strong.

And despite the apparent conflict, it wasn't uncommon for newspaper companies to own substantial minority shares in their competitors, said Edmonds, the media business analyst.

"The idea was that if business did well, your investment would appreciate," Edmonds said. Former media giant Knight Ridder bought just under half the Seattle Times' shares, he said, when the Times was among the country's largest independent newspapers. A sale like that brought with it another advantage, he said: If a paper's owners wanted out for any reason, the other company would already have a foot in the door.

"As time went on, that didn't seem to be such a great strategy," Edmonds said. Newspapers have since crashed as money-makers. Helmberger can attest: He and Summit, he said, have never paid themselves their full salaries.

Gary Albertson wouldn't talk for this story, but people who know him describe him as a shrewd businessman. The Timberjay purchase could have been, as Helmberger suggested, another ploy to quash a competitor — or it could have just been a smart 1990s-era business move.

Jake Benson works with Gary Albertson to run the Floodwood Forum newspaper. He's publisher of several small northern Minnesota newspapers, and knows Helmberger, too.

Northern Minnesota, where Benson works, is a rarity in the publishing business: Some of its tiny towns sustain two newspapers — an uncommon situation for even most major metro areas. The Timberjay offers Tower-Soudan, Ely-Babbitt and Cook-Orr editions. Ely has another paper, The Echo, and so do Tower and Cook — the Albertsons run them both.

But unlike other rural regions in Minnesota, papers in the northern Arrowhead region don't often work together, Benson said.

"Maybe we're fiercely independent up here," he said, laughing. Still, he said he's puzzled by the whole matter.

"My gut reaction was, 'Why?' and 'Really?'" Benson said. "I'm not exactly sure I know what the intention of Albertson is, other than that he does like a good fight."

So does Marshall Helmberger. But that's about where many of their the similarities end. The Cook News Herald tends to be a right-leaning paper in its news and opinion pages, some readers say. The Timberjay has more straightforward approach to news and leans toward more liberal, progressive opinion pages.

The papers sometimes appear to reflect their publishers' personalities — both of whom represent often opposing sides of the news industry: Albertson the business person, Helmberger the journalist.

"Mr. Albertson is a bit staunch in his positions," Ohse said, adding that he prefers to work in an "isolated" way.

Helmberger favors transparency — a trait that's gotten him into legal battles before.

In 2009, the St. Louis County School District was trying use taxpayer money to pass a controversial bond referendum, Helmberger said. The school was later required to file a campaign finance report on the expenditures.

The district filed the report, but Helmberger said it was "wholly inadequate" — so he continued pushing, all the way up to the state Office of Administrative Hearings.

Over the course of the proceedings, John Colosimo began representing the school district.

By May 2015, the Office of Administrative Hearings ruled on the case. Colosimo and the school district had lost.

About six months later, Colosimo was serving a lawsuit against Helmberger and Summit on the Albertsons' behalf, Helmberger said.

Helmberger said he thinks the suit is baseless and that the ruling pushed Colosimo to pick up the case. He said he's certain it will be dismissed, and said he's supplied documents refuting all the Albertsons' claims.

Some of the Timberjay's readers agree, penning letters to the editor criticizing the Albertsons and praising the Timberjay.

"I applaud Marshall and Helmberger and Jodi Summit for their contributions to community improvement as well as developing such a high quality newspaper," said one of those recent letters decrying the Albertsons' suit.

Helmberger said he thinks the only reason the Albertsons found a lawyer to take the case is because of his history with Colosimo.

"I don't think on their own that they would've got an attorney to touch this with a 10-foot pole," Helmberger says.

The attorney vehemently denied the notion, tossing criticism back at Helmberger.

"It seems to me, regrettably, that Marshall wants to litigate this matter in the newspapers or radio," Colosimo said, adding, "I mean, this is not where it belongs."

The case spills from the media into the courtroom soon, with a scheduling conference Thursday and a hearing next Tuesday in district court.