David Copley names Hal Fuson as Union-Tribunechief operating officer

Profit margin slipps below 10 percent

— Harold (Hal) Fuson Jr., senior vice president and chief legal officer of Copley Press, has always called himself "the house liberal" -- out of step with the militaristically conservative hierarchy. Aboooouuuut faaaaaace! At the end of this month, the house liberal becomes de facto chief executive of the company.

He takes command of a ship sinking faster than its peers. In 2004, the Union-Tribune, almost all that's left of Copley Press, was the 19th-largest newspaper by daily circulation. It has now plunged to 23rd. But San Diego is the nation's 17th-largest market and was in 2004. For the year ended in March, only 2 of the top 25 dailies skidded more than the U-T's 6.6 percent drop in daily circulation, and only one paper dropped more than the U-T's 7.3 percent plunge on Sundays.

Worried staffers say the top brass are huddling in lengthy meetings almost daily, but nothing is ever announced. There are staff meetings at which employees are told they must do more with less, but there seem to be no initiatives to tackle major problems, such as the lack of cooperation between the electronic SignOnSanDiego and the newsprint side. The top executives who were in place during this dismal post-2004 performance remain in their posts.

On May 3, David Copley, nominally the chief executive, announced that so-called chief operating officer Charles (Chuck) Patrick, 58, would retire at the end of June and Fuson, 62, would take his position. It was a long-planned retirement; as the Reader earlier reported, Patrick bought a home in Santa Barbara several years ago and has been refurbishing it. "I look forward to Hal's help in steering our trustworthy flagship through today's choppy waters," said Copley in a note to his staff. Current and former insiders snickered: Copley has never been a hands-on executive and is even less involved now that he is spending so much time on his $33 million yacht. Patrick ran the company for years and was Copley's confidant on all matters. "Chuck was so involved with David's life," notes one former executive. "David went to him on everything."

Although moving from San Diego, Patrick will remain on the board of the privately held and tight-lipped company and continue to be a personal adviser to David Copley.

The transition from Patrick to Fuson will be a major one, although employees are so shell-shocked about the company's rapid decline that they haven't had time to ruminate on it. Patrick is rigidly right-wing in his politics. He is an accountant who did not spend time in the various parts of the newspaper -- editorial, circulation, advertising. "Patrick is just a bean counter. He doesn't have vision," says another former executive. "He was the biggest mistake Helen [the late Helen Copley] and David made." By contrast, Fuson has a master's degree in journalism from Columbia, taught the subject for 14 years, and toiled in a newsroom. During that time, he got a law degree. He has always favored balanced news coverage -- again, contrasting with Copley brass, who want tough coverage of hoi polloi such as labor unions but softball massaging of the establishment. Do not, however, expect honest reporting or editorial writing from the U-T. The organizational culture of distorting the truth to try to sway public opinion is far more deeply inculcated than the instinct of economic self-survival.

Six months ago, Fuson was telling people he intended to retire. But two months ago, he began claiming he had never said that. Some wonder if there was a change of plans regarding Gene Bell, president of the Union-Tribune, who has had a strained relationship with Patrick and is junior to Fuson in the pecking order. The taciturn Bell has been a favorite of the Copleys because of his antiunion activities but has not been in the inner circle, particularly the social circle. The company refuses to release Bell's age, but he has been in the newspaper business for at least 47 years, and ex-insiders say he is older than Fuson.

Former executives, from both the editorial and business sides, question whether the company needs both Fuson and Bell. After all, Copley Press has stripped down to almost exclusively the Union-Tribune. The remaining Borrego Sun, aging La Casa del Zorro resort, and Copley News Service are minuscule pieces of the pie.

"There would be duplication," says one former executive. Echoes another, "I wouldn't think the company needs both Bell and Hal. Either Hal will have a job that doesn't require much, or maybe Gene will leave." Fuson had been in the running for the top Union-Tribune job a couple of years before Bell showed up in 1992.

The company no longer needs the corporate headquarters in La Jolla, but former executives agree it will be retained because David Copley won't want to drive to Mission Valley on the days he is in the office. However, there will have to be severe layoffs at headquarters. Copley Press owns a half block of choice La Jolla real estate that would fetch a pretty price.

Copley top executives refuse to talk but have privately told San Diegans that financial woes have intensified in recent months. Middle managers were recently told that the profit margin has slipped below 10 percent. In the halcyon days, a couple of decades ago, the San Diego part of the empire would ring up three times that. Still, Copley is doing as well as other metropolitan dailies on the bottom line and better than many other industries. It's a vicious circle: as circulation plummets, advertising revenue goes with it, and nobody knows where the bottom might be.

David Copley has a dilemma. He revels in the ego gratification of being a publisher and owner, relying on others to do the grunt work, but he is seeing his fortune diminish by the day. This is a time when hedge funds and private equity groups have trillions of dollars burning holes in their pockets and are willing to toss money at doggy industries, including metro daily newspapers. (Thanks to the munificence of a combination hedge fund/private equity group, Copley Press got $380 million in cash earlier this year for a bunch of Ohio and Illinois newspapers. Much of that money will have to go to settle Helen Copley's estate taxes.) So David Copley's corporate ship is sinking at a time he would prefer to be cruising the seas on his yacht. If he doesn't sell now to giddy buyers, Copley Press's value could sink much more.

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