The following day, July 29, 1999, Hearst advised Mayor Brown that it would "be pleased to meet with Florence Fang any time and any place." (PX 76.)

On August 6, Hearst announced its agreement to buy The Chronicle. Almost immediately the Fangs attacked the acquisition in The Independent, with the headline "Hearst Plots One-Paper Town" and an editorial entitled "Stop the Hearst Monopoly." (PX 97; PX 96.) At the same time, Ted Fang began a sub rosa campaign to obtain The Examiner, telling the Mayor and members of the Board of Supervisors that the Fangs very much wanted to acquire the paper from Hearst. Fang made such statements continuously and repeatedly to the Mayor and Supervisors. (T. Fang Depo., pp. 58-64.)

On August 30, the Mayor assured Hearst that he would not be voicing opposition to the purchase of The Chronicle unless pressured to do so by the Board of Supervisors or City Attorney. He said that the lawyer to whom the City Attorney had assigned the matter was a "lightweight" (PX 141), "who was not someone likely to lead a charge on a major issue." (PX 78.) In this time frame, the Fangs opened negotiations with Hearst about acquiring The Examiner.

These negotiations, however, were highly unsatisfactory and unproductive for the Fangs, who felt that Hearst’s efforts to sell The Examiner were "phony," and so told the Justice Department on November 9, in an effort to ratchet up pressure on Hearst. The Fangs then directly played their political cards.

On December 2, 1999, the Fangs’ attorney, David Balabanian, counsel of record in this case, called Hearst vice president James Asher "to explore a ‘package’ resolution of a variety of matters including the pending litigation, the sale of The Examiner and future relationship." As reported by Asher, the "package" offered by the Fangs had four parts: (1) settlement of preexisting litigation; (2) "The Fangs would ‘take The Examiner off our hands’" by taking assets and an annual payment of $35 million for six years, until the JOA expired, a total of $210 million; (3) Hearst would agree not to compete with the Fangs in the throw-away newspaper field; and

4. Assuming we reached agreement on all matters, the Fangs would use their extensive political connections to assist us in completing our purchase of The Chronicle. [PX 100.]