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Murdoch: Fool or Knave – you choose?

November 11, 2011

It was darned nice of the BSkyB board to back its chairman James Murdoch as he, once again, testified to Parliament over the lamentable and illegal events at News International.

The praise they heaped on him was particularly fulsome given that – no matter how good and personable he is day-to-day – he must have been effectively ‘missing in action’ for months, first having to rule himself out of most critical decisions because of his dad’s bid for full control, and now having to spend so much time defending himself and trying to rebuild his credibility.

Appearing before the Commons media committee again Murdoch was, in effect, asked to choose for himself between admitting dishonesty about his previous testimony or to being fooled by his subordinates and being a fool – at the least – in his resolute and scarcely believable lack of curiosity over what had been going on in the business he was chairman of.

Murdoch leans heavily on the fact the wrongdoing itself was not on his watch (more accurately the wrongdoing admitted and discovered so far wasn’t). But that’s not the point. The smoking gun is the so called ‘for Neville’ email uncovered in the discovery process for the civil damages claim by Gordon Taylor the soccer players union CEO. The email was in the possession of NI’s senior legal and editorial execs – they say they showed it to Murdoch, he says they didn’t. It has now emerged that as a result of that email’ the lawyers got a QC’s opinion that said the email proved hacking was endemic and widespread at the paper and would be devastating if revealed in a court case. In other words if you don’t want this to come out, you must settle out of court. Cue a £750,000 settlement – up from an original £150,000 offer (the sum was £350,000 damages plus the costs for both sides.)

So, Murdoch – who is meant to have believed absolutely the official line at the time (and the one pushed by hard by his newspapers) that hacking was about one rogue reporter and only involved royals – signed off £750,000 for Taylor, presumably realising he wasn’t Prince Gordon, without asking what the evidence was, or if there was any further legal opinion more complicated than “we’ll lose”. He claims he simply waved it through because ‘why not?’ if we were going to lose anyway, and ‘no’ it was not to cover up the truth (which he didn’t know) about behaviour in his company.

Whatever the truth, it is for sure the hacking scandal isn’t going to go away; there are dozens of civil cases and several criminal trials – including probably for a former News of the World editor and a CEO. So Murdoch’s problems with distraction and negative baggage aren’t going to go away. For Sky and, indeed, News Corp, their boards’ ignoring of the complaints and opinions of shareholders is going to look increasingly tin eared.



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