David Radler took the stand Monday to testify against his long-time business associate Conrad Black, saying the two men worked closely together as they built their media empire.

"We discussed every aspect of every newspaper we had," he said after being sworn in at the Chicago courthouse.

"I discussed with Mr. Black on any major decision (that) could be considered an executive decision."

The prosecution alleges Black and three other executives swindled Hollinger International Inc. out of $84 million, mostly through selling small newspapers and pocketing "non-compete" payments from those who bought them.

Black, 62, and co-accused John Boultbee, Peter Atkinson and Mark Kipnis maintain they didn't break the law and disclosed the payments.

Radler is expected to testify that the defendants cooked up the non-compete plan after realizing other sources of income were running out and that they knowingly breached their fiduciary duties to do so.

Radler pleaded guilty to charges connected to this alleged conspiracy. Under his deal with U.S. federal prosecutors, he will serve 29 months in prison and pay a fine of $250,000 in return for his testimony.

As he prepared to testify on Monday, Radler acknowledged his plea bargain, saying: "I pled guilty to fraud. I pled guilty to taking money from Hollinger International under illegal circumstances."

"My obligation is to tell the truth,'' Radler then told the court.

Radler's testimony Monday focused on how he first met Black, and their ensuing business relationship that lasted for almost four decades.

When Radler mistakenly testified he first met Black in 1971, Black leaned in and spoke some words to his lawyer, Eddie Greenspan.

"Radler caught that move out of the corner of his eye, realized the mistake and said, 'I'm sorry,' and corrected the record, so that was the first little bit of drama we've seen so far," reported CTV's David Akin.

Radler then told jurors he met Black in 1969, when he was 27 and Black was 25. He said they decided to go into business together by buying the Sherbrooke Record newspaper in Quebec for $6,000.

"I was impressed with Mr. Black's knowledge and his ability and I thought he'd be a great partner to have,'' Radler said.

They lived in Sherbrooke, a mostly French-speaking city, worked very long hours, and sometimes socialized afterwards, he recalled.

Radler said he and Black were friends, even going on a trip to New Orleans together.

Defence lawyers objected to the line of testimony that framed the men as having a friendship.

"Defence attorneys will try to paint a picture that it was really all Radler's doing, that Radler and Black led separate business and social lives," Akin said.

The two would go on to build Hollinger into a newspaper empire that, at its peak, ranged from Vancouver to London, England, to Jerusalem.

As he spoke, Radler averted his gaze from Black. Black, for his part, did not look at Radler at all when he entered the courtroom, Akin said.

"Conrad Black is sitting towards the back of the witness table, so he's about as far away as he can be from the witness stand and yet not be in the gallery."

Black arrived at the courthouse at about 10 a.m. Monday, along with his wife, Barbara Amiel Black, daughter Alana Black and son James Black. Radler arrived about one hour later.

Radler seen as key

The trial so far has included weeks of technical testimony related to millions of dollars in non-compete fees allegedly pocketed by Black and the others to avoid taxes. Experts believe that Radler's testimony will be key to U.S. government allegations that Black and other executives swindled tens of millions from the former Hollinger International media empire.

"The prosecution's case is floundering right now. I could compare it to the Titanic, searching for an iceberg. But that of course can be rescued by one witness and that witness is David Radler," legal analyst Steven Skurka said Sunday.

But although Radler has pleaded guilty to charges related to the alleged conspiracy, he has not been sentenced yet.

"It's a very un-Canadian way to do things. He's pleaded guilty, he'll testify, and the prosecutors will assess the quality of his testimony, and then in June, he'll be sentenced," said Skurka.

"The risk is you don't get truthful testimony. You get helpful testimony."

For that reason, added Skurka, Greenspan is waiting to drive a "Sherman tank" through the credibility of David Radler and ask: "How can we put any faith in this man's evidence?"

There will have to be some physical evidence -- in the form of memos, emails or other documents -- to back up Radler's testimony, he said.

"If it's just the testimony of David Radler, the prosecution has huge problems."

Some analysts think Black's defence team will try to raise a geographic division of responsibilities as a defence. They say the defence will argue Radler was in charge of the Western Canadian and U.S. newspapers, and deals involving the current charges are all associated with the U.S. papers.

"That's where the defence has stumbled somewhat, because a lot of witnesses have said this is artificial," Skurka said.

Greenspan will have to prove that such a division did exist, he said.

With a report by CTV's Joy Malbon and files from CTV's David Akin and The Canadian Press