When Robert Sengstacke was a boy in the 1950s, he used to hang around his father’s office, looking at pictures of dead men hanging from trees. They were photographs of lynching victims, tucked away in a filing cabinet in the offices of his father’s newspaper on Chicago’s South Side, and Robert — out of morbid fascination — liked to look at them. The photos were relics from the storied past of the Chicago Defender, once the nation’s most widely read and influential black newspaper, and a legacy Robert Sengstacke thought he would one day inherit.
His great uncle, Robert Abbott, who founded the Defender in 1905, published those photographs — accompanied by lurid headlines and calls for black people to defend themselves against lynch mobs — at a time when it was very dangerous to do so (the founders name as published has been corrected here and in subsequent references in this text). For much of its 97-year history, the Defender was the newspaper of record for black America, reaching 1 million readers a week at its peak with muscular, tabloid-style reporting on black life.
The Defender’s sustained editorial campaign during the 1910s and 1920s, urging Southern blacks to relocate to Chicago, is widely credited with instigating the Great Migration of Southern blacks to Northern cities.
In 1940, Abbott died and left the paper to his nephew, John Sengstacke, Robert’s father, who would become one of the most powerful black entrepreneurs of his day. President Truman appointed him to a seat on his commission overseeing the desegregation of the armed forces, and he played a role in getting Jackie Robinson signed by the Brooklyn Dodgers.
Robert Sengstacke went looking for those lynching photographs again a few years ago. They were gone, as are the Defender’s glory days. John Sengstacke died in 1997, and today the paper is near bankruptcy. A complex and bitter court battle over the paper’s future has raged for four years and shows no signs of ending soon. It has left the Defender, one of the great icons of black American culture, editorially and financially paralyzed.
“Getting this institution back on its feet is going to take something like a miracle at this point,” says Robert, guiding a reporter on a tour of the Defender headquarters on South Michigan Avenue. At noon on a wet midwinter day, one of the two clock faces on the modern gothic building’s clocktower reads 9 o’clock. The other reads 2:30.
At the heart of the dispute is whether the Defender will continue to be run by the Sengstacke family, or be sold to the highest bidder. When John Sengstacke died five years ago, he left behind what has become an insoluble puzzle: He willed a controlling 70 percent interest in his company, Sengstacke Enterprises — which, in addition to the Defender, includes the Michigan Chronicle, the New Pittsburgh Courier and the Tri-State Defender in Memphis — in trust to son Robert’s six children (he left Robert 9 percent of the company).
He also left an estate tax bill of roughly $3 million. And, according to his granddaughter Myiti Sengstacke, he made a deathbed request that the newspapers stay in the Sengstacke family. Since neither the company nor any of John Sengstacke’s grandchildren have $3 million handy, those three bequests are incompatible: The only way to pay off the tax bill, it would seem, is to sell the company.
But when the Northern Trust Co., which John Sengstacke had designated as trustee, set about doing just that shortly after his death, Myiti raised a revolt. Though several buyers came forward offering as much as $15 million, Myiti marshaled her brothers and sisters to exercise their option, as beneficiaries, to oust Northern as trustee, citing what she said were her grandfather’s wishes and the Defender’s family legacy.
In a legal maze
The matter wound up in Cook County Circuit Court in March 1998, where it remains today. There is a new trustee in charge of the Defender — Chicago diversity consultant James Lowry — but little else has changed. The case is still in court, the taxes are still unpaid, and Myiti Sengstacke is still angry.
“We just want what is already ours to be left alone,” says Myiti, Robert’s eldest child, who has taken the lead among her brothers and sisters when it comes to the Sengstacke trust. “We’ve tried to work with the court, the trustee, the management. Working with everybody’s not working. We need to say to hell with everybody.”
Myiti and her father say they have been dispossessed of their birthright. They have a point. After all, they are John Sengstacke’s kin, and he left them large shares of Sengstacke Enterprises.
Before his death, John sent Myiti to work at the Michigan Chronicle to get some newspaper experience in preparation for a job he had planned for her at the Defender.
And Robert grew up at his father’s side, mopping the newsroom floors and eventually becoming a photographer for the Defender. “Nobody knows better than we do what this paper needs,” says Myiti. Her brother Omahri, who is, like his sister, a recent graduate of Columbia College, concurs. “It should stay in the family,” he says. “It’s been in the family all these years.” (Myiti also speaks for her brothers Saief, who lives in New York, and Hasani, who is studying at Oral Roberts University in Tulsa, Okla.)
But because of the way John Sengstacke constructed his trust, neither Robert nor his children have much say in how their family business is run. That falls to Lowry, the trustee, who, they say, is running the Defender into the ground.
Lowry’s chief sin, in Myiti’s eyes, is that he is willing to sell the company outside the family. “I will do all I can to make sure that it doesn’t get sold,” she says. “Selling is just an easy way for those who came in from the outside to get paid” — a reference to the trustee fees Lowry is owed, which are unlikely to be paid unless the company goes on the block. “It’s not a way to get what John Sengstacke wanted,” she says.
Luckily for Myiti, in the current economic environment, few people are breaking down Lowry’s door to buy a small chain of struggling black newspapers. “There are always offers on the table,” Lowry says, “but no one’s putting up any cash.” Robert’s cousin Thom Picou, who worked for much of his life at the Defender and who lived under John Sengstacke’s roof after his parents died, has made an $8 million bid to buy the company, one that Robert and Myiti support as a way to keep the papers within, at least, the extended Sengstacke family (Picou says that Robert and Myiti would be a part of his management team for the Defender if the deal goes through). But Lowry calls it a “non-deal”: Picou only offered $3 million up front, with the rest to be paid after five years. “Come up with the money,” Lowry says.
Ready to sell
Lowry insists that he will gladly sell the Sengstacke papers upon receipt of a check, and even encourages reporters to give out his numbers to potential buyers. In the meantime, he says, “We have to do the best we can. I’ve asked present management” — including Jerome Butler, whom Lowry installed as chief operating officer for Sengstacke Enterprises — “to deal with the existing product, which isn’t perfection.” As for why he’s staying on as trustee in the face of the family’s hostility, Lowry cites professional pride. “I have a fiduciary responsibility laid out by the court to run this thing,” he says. “I am professionally trying to do the best I can. I’m not doing this for an ego trip.” In lieu of any offers that Lowry views as acceptable, he’s set about trying to attract financial and moral support from local leaders in the black community for the Defender. On Tuesday, Jan. 22, Lowry called a meeting of about 20 black business and community leaders — including Valerie B. Jarrett, the executive vice president of the Habitat Co., Georgina Heard, an executive with United Airlines and Rev. Willie T. Barrow, co-chair of the Rainbow/PUSH coalition, as well as representatives of AON Corp. and ComEd — to discuss ways to turn around the Defender’s finances. Lowry asked them to donate time and business expertise to keep the paper going, and the ad hoc group is drafting an open letter asking the black community to come to the Defender’s aid for publication as a full-page ad in Chicago dailies. (Lowry says he invited Myiti to the meeting, but that she didn’t show). Lowry is planning another meeting later this month with local journalists to explore ways to turn the paper around editorially.
Of course, there’s been no lack of community goodwill for the Defender thus far, and it’s unclear exactly how meetings and open letters can serve as a substitute for the cash that the Defender desperately needs (not to mention the fact that a good newspaper arguably ought to be irritating the sort of powerful community leaders that Lowry is gathering, rather than being beholden to them). Lowry says he’s “exploring a debt instrument” to pay off the estate tax bill, and he still sees selling the papers as the quickest path to solvency.
Fallen on tough times
But insolvency looms. The Defender reportedly lost $750,000 in 2000, and its paychecks have bounced in recent months. In November, 12 Michigan Chronicle employees wrote a letter to Judge Bernetta Bush, who is overseeing the probate case, complaining that since Lowry took over as trustee in 1998, the Chronicle has failed to pay its postal delivery bills and has been in imminent danger of losing phone and electricity service. “In 98 years of business,” Myiti says, “we never bounced a check until James Lowry showed up.”
In December, Butler told a staff meeting of Michigan Chronicle employees that he believes the Sengstacke papers will go to a “fire sale,” according to minutes taken by someone who was there. (Butler had traveled to the Chronicle to rebut the accusations in the letter to Judge Bush and to chastise the employees for sending it.) According to the minutes, Butler also informed employees that the Chronicle’s revenues were down $50,000 in September against the year before, and that the Chronicle is the only Sengstacke paper with positive cash flow. Butler also told the assembled employees, the minutes say, that many wealthy black personalities, including Oprah Winfrey and Jesse Jackson, had been approached to buy the papers. Butler declines to discuss the meeting on the record, noting that the minutes are not an official transcript. Lowry says Butler’s “fire sale” comment was an acknowledgment of the possibility that the papers might be sold under pressure, not a prediction. Still, Lowry says, it is not an impossibility. “When you talk about $3 million,” says Lowry, referring to the estate tax bill, “that’s not Monopoly money. It has to be paid.”
Editorially, the situation is no better. The Defender has become a glaring irrelevancy in Chicago’s media landscape, notable only for its noble history and its competent coverage of high school sports. Its propensity for typos and misspelled names has earned it the moniker “The Offender,” and it was recently castigated in a Chicago Tribune editorial for repeating, without refutation, the anti-Semitic canard spread via e-mail that 4,000 Jews who worked in the World Trade Center were warned of the Sept. 11 attacks ahead of time. Timuel Black, a professor emeritus at the City College of Chicago and lifelong Defender reader, says the paper has become a dull rehash of the city’s major white-owned dailies. “For young people, if I was in that age group, I’d say, `What do I need to read this for?'” he says. “The same stuff’s in the Tribune and the Sun-Times.”
Placing blame
Many involved in the case blame Myiti for the Defender’s current bind. “The beneficiaries of the trust are standing in the way of doing the right thing,” says former Judge R. Eugene Pincham, the attorney for Thelma Montgomery, who was John Sengstacke’s mistress. Sengstacke left instructions that Montgomery be paid $100,000 plus $2,000 per month out of the trust. Four years later, she has received only $6,000. Pincham, who himself sold copies of the Defender “for pennies” as a child, says the Defender should have been sold — and the company’s bills paid — long ago, but that Myiti’s “juvenile mentality” got in the way. “She doesn’t have the training or experience in operating a newspaper,” Pincham says. “The paper’s going to end up broke if they don’t hurry up and do something.” And according to the minutes of Butler’s December meeting with the Michigan Chronicle staff, Butler placed responsibility for the company’s woes on Myiti’s shoulders, saying “potential buyers don’t want to buy and share ownership with the family” because “no one is willing to partner with Myiti.”
“All the family wants is to maintain the legacy and keep the newspapers going,” Myiti says. “We know there are financial troubles, but we have a plan.” That plan, contingent upon Thom Picou’s (unlikely) purchase of Sengstacke Enterprises, is long on legacy and short on details. Success boils down, they say, to taking bold stands on issues of importance to everyday black life, like police brutality. “We need to address the needs of the African-American community,” Robert says. “Once we do that, we don’t have to have the numbers.”
It is not Myiti’s first plan for the Defender. An exquisite irony of her predicament is that Lowry was her handpicked trustee. After ousting the Northern Trust, Myiti engineered a complicated recapitalization plan for the Defender whereby Michigan financier Don Barden would provide $10 million in financing to run the papers while the family retained control of the Defender.
Barden and Lowry are old friends, so Myiti asked the judge in the case to appoint Lowry trustee. “We asked Jim to help us put the Barden deal through,” Myiti says. “It was only supposed to last a month or so.” But the Barden arrangement fell through when Myiti’s own father refused to support it because it didn’t offer him enough money for his 9 percent stake in Sengstacke Enterprises. “In the end,” Robert says, “what the Barden deal offered was unacceptable to me.” Myiti insists that the Barden deal did not cause a family rift — “We disagreed,” she says, “but it was nothing like `I hate you Dad'” — and today father and daughter are aligned in their efforts to keep the Defender in the family.
Robert has reason to resent his current position. He has had a hard life, and though he has had some success as a photographer, working for many years for his father’s Defender, he says he has struggled with drugs and alcohol and spent some time in rehab.
Stopped the paychecks
When his father died, Robert was on the Defender payroll — in an arrangement he and his father had worked out that, Robert says, “did not designate me as an employee” of the company — and living in a live-work loft in a building adjacent to the Defender’s South Michigan headquarters and owned by Sengstacke Enterprises.
When the Northern Trust took over John Sengstacke’s affairs, Robert says, it put a stop to the paychecks (he says he has since worked out a freelance deal as a Defender photographer). And he was later evicted from his home so the building could be sold to pay off company debts.
“People used to tell me, `All you’ve got to do is wait till your Daddy dies and you’ll be rich,’ ” Robert says.
“But a lot of people were surprised when he died that there wasn’t a lot of money.”
One way that Robert tried to raise money might wind up costing him his stake in his father’s company.
In the summer of 1999, Robert hired a company to cut down some trees on Yellow Lake, a woodland property in Michigan that John Sengstacke owned and where Robert used to spend summers as a child, and sold the lumber. John Sengstacke left Yellow Lake in trust to the Chicago Defender Charities, which is run by his brother Fred Sengstacke and sponsors the popular Bud Billiken parade each year. The Defender Charities hopes to sell the property, but can’t because the current estate tax bill on Sengstacke Enterprises is secured by a lien on the property.
John Coleman, the attorney representing Defender Charities, argued in court that cutting down the trees devalued Yellow Lake and secured an order from the judge restraining “any party before this court who may be removing trees from Yellow Lake Michigan property.”
Another battle
Coleman says he might try to sue Robert for his 9 percent stake in Sengstacke Enterprises to recoup the damages to the property; Robert’s attorneys argued in court that the trees were “crops and, therefore, [Robert’s] personal property and were properly removed” from the property. Lowry, who, as trustee, also oversees Yellow Lake, disputes that line of argument: “John Sengstacke did not leave Yellow Lake to Robert. That’s a fact.”
Robert says he had no choice. “The money from the trees went to my children and to fix my teeth,” he says. “I harvested some trees to help my family.”
Family unity aside, the future of America’s premier black newspaper still appears to be in limbo.
For some, like Pluria Marshall Jr., who owns black papers in California and Texas and who offered $15 million for the Defender in 1998 (his financing has since fallen through) only to be rebuffed by Myiti, that’s right where they want it.
Marshall says he still has his eyes on the paper, but now he’s bargain shopping.
“Everybody is telling me just wait until it goes into bankruptcy,” he says.
