Ka-Ching!

The Guardian has complained about the Weekly's high costs, and even asked Judge Miller to issue an injunction preventing the paper from selling below cost in the future. The Guardian has yet to say which journalists or salespersons the Weekly should lay off in an effort to "live within its means," a favorite Guardian catch phrase during the trial. The paper has had plenty to say, however, about New Times' alleged ill intentions, despite having produced no smoking-gun evidence of a plot.

The potential for loose talk about hypothetical conspiracies involving a competitor is one reason federal courts rarely let predatory-pricing claims go to trial. At the federal level, such claims must pass a common-sense smell test, and the plaintiff must demonstrate that the defendant has a reasonable chance of recouping the money it lost as part of the scheme.

But the Guardian's rhetoric at trial often veered dangerously far from rational thought. Its damages expert, Clifford Kupperberg, told the jury that the paper was entitled to a judgment that far exceeded all the profits it has earned in its entire existence, despite the fact that the Guardian has a long history of scratching out paltry returns, even during the boom period of the late 1990s.

But the Guardian's own record of collectivist inefficiency didn't prevent it from openly advocating that Soviet-style economic shackles should be placed on its competitor.

A common question asked of Weekly witnesses, for instance, was whether the New Times paper realized that if it sold ads cheaper than the Guardian, such activity might harm the Guardian — a query that seemed to turn the American free-market system on its head.

However, if the Guardian's rhetoric occasionally appeared to have been piped in from the Politburo, many of those arguments were actually within the letter of the California law. Alldredge made that clear before the trial even started, telling a reporter for the local Daily Journal that the Unfair Practices Act made predatory-pricing claims a cinch.

Among other things, that law — which was passed in the 1930s in an effort to prevent Safeway from driving out independent grocers by offering low food prices — allows plaintiffs to recover attorneys' fees if they win, but forces defendants to pay their own attorneys' fees regardless of the outcome.

It's the equivalent of an open invitation for plaintiffs to roll the dice, and the Weekly isn't the first Bay Area paper to be sued under the statute. In fact, in the 1990s, a local jury awarded the San Francisco Independent millions in a judgment against the San Francisco Newspaper Agency. That judgment was reversed by a San Francisco appeals court.

"All you do is take all of their costs and divide that by the number of inches of advertising space they sold," Alldredge told the Daily Journal in January, describing the convenience of the Unfair Practices Act. "That tells you how much the cost is per inch. Whenever they sell below that cost, under California law, they've committed a violation."

In fact, the law is written so strongly in favor of plaintiffs that the jury in the Weekly's case received a jury instruction that was tantamount to declaring the Weekly's guilt before deliberations even began. "If you find that any defendant sold advertising space below cost, and any below-costs sale(s) injured the Bay Guardian as a competitor, it is presumed that defendant's purpose was to injure competitors or destroy competition," Instruction No. 21 read. The instruction goes on to say that the presumption of guilt "may be overcome by other evidence." That language essentially requires the Weekly to prove a negative.

Weekly attorneys H. Sinclair Kerr Jr. and Ivo Labar did their best, arguing at trial that the Weekly and the Express always got the most they could for their ads, and that the extremely competitive Bay Area media market combined with the dot-com bust, the events of 9/11, and the flow of advertising to Internet sites exerted powerful pressure to keep prices low.

The attorneys produced numerous exhibits and witnesses who described a media economy in which all print papers are suffering, and also offered undisputed evidence that revenues and overall ad count in both the Guardian and the Weekly had dropped since 2001. The fact that both papers rose together prior to 2001 and fell together from that point forward proved that the Weekly hadn't gained at the expense of the Guardian, the Weekly attorneys argued.