Latest Round of Options Studied in Magazine Fracas

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NEW YORK ( -- Tensions between Rosie O'Donnell and her magazine's publishing partner, Gruner & Jahr USA Publishing,
Photo: AP
Rosie O'Donnell had no comment about her ongoing squabble with Gruner & Jahr.
have mounted to the point that the publishing company is considering selling its stake to the ex-talk show queen.

"I'm sure Gruner & Jahr would make it attractive" for Ms. O'Donnell to take over Rosie, said one person familiar with the situation. "What's unclear is whether she has an interest in doing that." But this person estimated the likelihood of that happening as being roughly equal with "three or four" other possibilities.

'One day at a time'
Asked if Ms. O'Donnell might assume full ownership, Ms. O'Donnell's spokeswoman said, "I don't think we're there yet. We're taking it one day at a time," and termed such talk as "jumping the gun."

Lawyers from both sides held discussions throughout the week over what Ms. O'Donnell's spokeswoman terms "creative differences" and "contractual questions."

The spokeswoman said Ms. O'Donnell was unavailable for an interview. The lawyer handling the situation for G&J declined to comment. A spokeswoman for Mary Jo White, the former star prosecutor who Ms. O'Donnell hired last month, referred all requests for comment to a prepared statement.

Last week, G&J President-CEO

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Dan Brewster cut short a vacation. Through his spokeswoman he declined interview requests. She would only say that "we are working things through, and would like to continue to publish a successful magazine."

In an Advertising Age interview last month, however, Mr. Brewster appeared to distance himself from Rosie, describing the decision to relaunch McCall's with Ms. O'Donnell as "a long shot." Also in that interview, he said: "I can't pretend to tell you what, exactly, [Ms. O'Donnell's] ultimate intentions are."

'Mutual distrust'
"There's a lot of mutual mistrust," said one person familiar with the situation.

A visit by Ms. O'Donnell to the magazine Aug. 15 required G&J lawyers to be present before a meeting between Editor Susan Toepfer and Ms. O'Donnell could take place, said people familiar with the meeting, which was described as uneventful. (Ms. Toepfer would not comment.)

The "creative differences" between G&J and Ms. O'Donnell intensified significantly following the June ouster of Editor Cathy Cavender. An unpublished "editor's letter" from Ms. O'Donnell -- which her spokeswoman says was just "venting" -- described that move as "a mistake. A big one." Persons familiar with the discussions portray Ms. O'Donnell as threatening non-cooperation or worse if contractual language isn't rewritten to give her the right to fire Ms. Toepfer and bring back Ms. Cavender.

A memo from Mr. Brewster dated July 15, apparently referring to a spat with Ms. O'Donnell over the September issue, led with the statement: "I cannot and will not tolerate verbal or emotional abuse of any G&J USA employees related to his or her job responsibilities."

For her part, an early August internal e-mail from Ms. Toepfer quoted another editor's frustration with the situation: "Why can't we simply say there has been an ongoing struggle with Rosie about what is appropriate and professional?"

Ms. O'Donnell's spokeswoman refused to comment on any of these e-mails, and referred contractual questions to Ms. White.

Others, meanwhile, watch warily.

Media buyers watch and wait
"We have not seen anyone pull the trigger and say 'Pull out,'" said Marianne Foxley, executive vice president and chief investment officer of media buyer Bcom3 Group's Starcom Worldwide, "but they are more on the watch."

"When it gets into the press that both sides have hired lawyers, it's hard to sit back and say 'This will just blow over,'" she added.

"As long as it's viable, I'll continue to contribute," said Rosie contributor Dr. Lauren Slater, a friend of Ms. O'Donnell who sent a missive resigning -- that she later rescinded -- over her concerns the future direction of the magazine was getting away from Ms. O'Donnell's vision. "I don't know exactly what the magazine's future is."

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