Sunday, 13 November 2011

2180 James Murdoch defends his position before House of Commons Culture Select Committee

It is Thursday 10th November 2011 it is after 2pm and I am digesting the two and half hours of questioning of James Murdoch by the House of Commons Culture Committee, after which the chairman stated that in his judgement the Committee was now in a position to reach conclusions and report to Parliament. I write and then decide I need to undertake further work.

It is now Saturday and I have revised my preliminary reactions and read the draft transcript and dipped into those of the previous hearings as well noting the media reactions immediately following the hearing and subsequently. I feel able to compile my own draft report which will be considered again after the official report is published before the Christmas Parliamentary Recess.

I also need to finish work on the Home Affairs Hearing on Police large scale disorder before concentrating on the Leveson Inquiry which begins public hearing next week. I also need to devote time to the recent move of the right wing of the Conservative Party together with the Labour Opposition to de-stable and then force the collapse of the Coalition before the next scheduled General Election. Both are untreatable in their approach but tactically wrong.

As someone outside the informed political and administrative elite I appreciate that the official reports will only be a partial account and that despite the retention of documents the full story may not become known a hundred years from hence when most of papers will have been released.

This was brought home to me by another controversy, the assassination of President John F Kennedy when I watched the little known 2002 Independent film using the documentary small hand held camera and style of the Blair Witch project called Interview with the Assassin and which purports to be an account of an out of work film cameraman who was asked by a neighbour said to be a former marine dying of cancer who was alleged to be the second gunman who claimed to have fired the shot from the Knoll which actually killed John F Kennedy in Dallas, Texas. Although the film alleged to be a true account and the neighbour was convicted and imprisoned for an attempt on the life of a contemporary president, killed by others prisoners and with the cartridge he claimed used disappearing from the testing laboratory given into safe keeping for subsequent matching with the bullet killing the president, the merging of fact and fiction in this way also helps to prevent the truth emerging.

I can say with confidence that the general public, and this includes the general Members of the House of Commons, will never be given full account of the extent of the illegal actions by Journalists and contracted investigators employed by the Murdoch media companies and by other news media despite the Leveson Inquiry which like the Warren Commission will cover up certain aspects on grounds of Nation Security.

As a member of a judicial led and formal inquiry thirty years ago when the three lay advisers produced our own report from that of the Chairman we agreed with the decision shared with all the legal representatives of the parties not to disclose some information because of the potential impact in the future on innocent parties. Because all the truth is not disclosed it does not mean that the greater part of what happened, and why, cannot be disclosed.

One significant piece of information emerged from the hearing. A director of the Murdoch parent company has agreed to ensure that the company checks for the possible contract of the illegal surveillance through computer hacking. Mr Watson added that Operation Tuleta ahs contacted him regarding the seizure of some electronic devices and they asked for further information to rule him out from having his computer hacked. In the context of this subject he also mentioned an Operation Millepede established by the Serious Crime Division. He asked Mr Murdoch if computer hacking had been an aspect of any of the civil damage cases settled to date. I separately obtained information that there is major concern that the latest technical devices used by the official security services have fallen into the hands of international criminal organisations and presumably may also become available to independent security and investigation firms, if not already.

It also evident that certain interests are misleading the public into believing that the use of physical surveillance by private investigators is always legal. This is not so and it can and should lead to criminal prosecution when for example there is proof that it was part of a conspiracy to pervert the course of justice as may be the instance of those who attempted to intimidate members of the past and present House of Commons Parliamentary Committee as well as two lawyers and their families acting for victims of illegal actions by the parent company. The chairman of the Committee has already called to see the available evidence and Mark Lewes one of the two lawyers and indicated he has initiated action.

Shortly before the hearing Mr Lewes and Mr Watson disclosed that they had been given a copy of the record of an inquiry agent and former police officer which listed the 153 contracts with the Murdoch company over an eight year period, nearly twenty a year which is said to have covered Members of the Royal Family, leading politicians, Members of the House of Commons investigating the Murdoch companies and the two lawyers.

Mr Watson was also advised Mr James Murdoch that he has been given permission to interview the former News Editor Neville Thirwell, and the believed recipient of the For Neville email which disclosed that the illegal behaviour went beyond one Royal Correspondent although it is my understanding that he denies the implied involvement claiming that he was sent the email to divert attention from someone higher in the organisation. Mr Watson also named other private investigators employed by the company as Jonathan Reece, Alex Leighton and also Barry Beardall. James Murdoch intervened to mention that Reece was employed by several national newspapers and was put down with the point that these papers had employed him before he served a seven year sentence foe a serious offence. The News of the World employed him after he left prison.

Mr Watson also said that a former member of the intelligence service has been put under surveillance together with 11 of his associates. It was during this second series of questions that Mr Watson asked James Murdoch if he was the only Mafia boss in history who did not know he was managing a criminal organisation with its traditional vow of silence.

There were those who immediately criticised Mr Watson for going over the top with this remark and which so offended him, as was the evident intention to provoke him. Interestingly the former Conservative Minister David Mellor appeared to stun the BBC questioner when on Five Live on Thursday afternoon he declared the comment reasonable in the circumstances as did Chris Bryant Member of Parliament another strong critic of the News of the World and its parent company.

James Murdoch also appeared put out, one of the few instances in a session where he appeared at times to be enjoying his ability to defend the accusations and criticisms, by the raising of the response of the Sun Newspaper to the Hillsborough disaster. He fully apologised for their inaccurate and upsetting headlines based on lies from senior police officers attempting to cover their incompetence. He also sent shivers among the staff of the Sun when asked what he would do if it shown that the Sun has also used illegal and unacceptable methods to obtain stories he said that all options would be considered including closure. A journalist from the Sun has been charged with the reported offence of corrupting a police officer believed to be in relation to the Mill Dowler phone hacking and where an officer is known to have been suspended. The Mafia are well known for their corruption of the police.

It also unlikely that the general public will ever know if the monumental failure of the police and prosecution service to understand and draw attention to the full enormity of the information then available to them arising from the prosecution of Goodman and Mulcaire was staggering incompetence or something more sinister involving corruption. The police as did politicians placed themselves in the firing line for such accusation by accepting regular hospitality, recruiting half their extraordinary large public relations department from former Murdoch employers or as in the case of Assistant Commissioner Hayman taking employment within a short time of retirement. I am not saying that evidence of illegal activity has been disclosed but in the context of the illegal activity which is known to have taken place the closeness of police and politicians with leading figures in the Company can be deemed, admittedly with hindsight, as being unwise.

Having made these points I also have some sympathy with the personal position of Mr James Murdoch in the sense that he is being asked to take responsibility for the sins of his father and for the sins of everyone else in the News Corp and News International as well as the guilt of Governments past and present who turned a blind eye to the same sins because of their wish to gain the approval and support of the proprietor and all those members of the public who purchased the papers and revelled in the accounts of people exposed for their human frailties, especially when they held positions of power or influence over others. Those holding power to day, in the media in general and the public affected by what happened to the victims of the culture now need sacrifices in the form of resignations, show trials and imprisonment.

James Murdoch is reported to have no interest and commitment to the printed media and one suspects he would have rid his spectacular profit making parent company of the UK newspaper interests long ago but for his father’s understandable wish to preserve enterprises which enabled his family’s present wealth and power and which also rescued the loss making Times and Sunday Times from oblivion.

What struck me from his appearance before the Committee is that he epitomises everything which the international capitalism and “enlightened” sections of all three major political parties in the UK aspire to namely the single minded and professional pursuit of profit which results in providing 50000 jobs world wide and giving considerable freedom to his executives to conduct the business as long as they maintained the profit numbers and put out the local fires before they became uncontrolled infernos.

The first problem has been the difference between James Murdoch’s admirable contemporary professionalism and his father’s more traditional approach of treating his long term employees as extended family and showing admirable loyalty to them irrespective of their mistakes and effects on the long term standing and profitability of the business.

The father also appears to have enjoyed his cup of tea with Prime Ministers and to have influenced the course of politics whenever he found opportunity. Whereas the son appears to have had the primary objective of making money as a thing to do in itself his father appears to have wanted to make money to do the things such as influencing domestic politics unconnected with his business interests. Whereas the father can now step back and keep out of the limelight and enjoy his remaining years with his family and those things which interest people of wealth, it struck me that James appeared rooted in his job and therefore the idea of stepping aside means giving up everything that makes his life worthwhile outside that of his family interests.

Mr Murdoch tried in vain to explain to the Committee the nature of his Executive role in Europe and Asia. He was an easy target with one commentator ridiculing that he could not remember his precise title at one period in time. The point he was making and similarly in relation to other issues is that he and had father paid attention first and foremost to getting results and less to designations and rules and regulations. It is extraordinary that the Conservative led coalition is forever banging the drum about the need to reduce the regulations and paperwork which besets business and then criticises the Murdoch’s for showing what can be done if you Fast track your way to profits and in fairness the Labour Government was not far behind them in accepting the apparent wizardry of the speculators to make money and banish boom and bust. All gambling leads to personal and collective ruination unless you are able to fix the game.

It is also important to understand that the purpose of the Committee’s inquiry which was not to duplicate the various police investigations into the activities of the News of World: the bribing of police officers and the use numerous agents, including for various purposes, OR to duplicate the Leveson judicial Inquiry into the wider practice of such activities OR to establish if the Principals in the company were sorry for what had happened and taken appropriate action to ensure there was no repetition in the immediate future.

The purpose of the present Parliamentary Inquiry was to establish if it was mislead in the evidence previously presented by the Company to the Select Committee. It was an important but essential interim activity while the police pursued their criminal investigations and the Leveson Inquiry got underway.

In my judgement there is substantial evidence to say that collectively employees and now former employees misled to the point of lying to the Committee and that far from being genuinely contrite and open about what happened the company has been ruthlessly in trying to limit the damage and stop those persisting in their enquiries by what ever means possible, until the last months when the truth commenced to emerge.

It was previously known that a principal police officer from the Metropolitan Police had visited the Editor of he Guardian to argue that their campaign against the News of the World should be dropped because their was nothing in it. The Chairman of the Press Complaints Commission had also followed a similar line in rubbishing the continuing critics and Mrs Brooks told Tony Blair that Tom Watson was mad and presumably that his activities ought to be stopped.

The Executives of News Corp and International have understandably engaged in damage limitation. They now accept that that the News of the World engaged in illegal activity well as morally questionable activities in order to maintain and promote its readership. It was evident from the responses of Mr James Murdoch that he is yet to grasp the extent of the behaviour within the company over the past decade and one can presume for longer.

We know that company is accepting civil damage liability and that a class action is underway to determine the test of liability acceptance and damages to be applied. What happened from my own experience of being a principal witness on behalf of claimants in a class action is that one firm of solicitor’s acts as lead coordinator for the applicants who will be represented by several firms and that that the coordinating firm will collate all the evidence required and in consultation brief Counsel. The prior acceptance of liability limits the extent of legal costs which can be as much or than the damages paid. This is relevant in terms of the original payment which was made to first claimant who was not a member of the Royal Household and to which I will elaborate its significance shortly.

There are also three aspects to the approach of damage limitation which the company appears to have taken since executives first became aware that the full extent of News of World involvement in illegal activities. The first was to attempt to cover up as much as possible what had happened.

It may emerge who authorised and participated in the cover up. The Directors and shareholder have a vested interest in establishing this information because it can make a difference to the extent of their liability. If it can be shown that individuals acted without the authority of the senior executives then there is a treble advantage. The first is the exclusion from potential criminal proceedings; the second is limiting the extent of civil damages via vicarious liability. If it can be shown that the original actions together with the cover up is restricted to officers of a comparative junior level then Vicarious liability comes into play, this is where the company is liable to damages through the actions of employees who acted without authority, but where the damages are usually proportionally less. The third advantage is the limitation on the professional damage within and outside the business.

It is in this respect that Mr Murdoch was fighting for reputation on Thursday and where he faced a heads and tails lose predicament. The Committee concentrated on the discrepancy between his previous evidence and that of the Editor at the New of the World who followed from the Departure of Andy Coulson and came from outside the company Mr Colin Myler, and the long time legal adviser to the paper Mr T Crone. They both made statements that Mr Murdoch had known the contents of the email addressed to Neville Thirwell which confirmed that illegal activity that was wider than the one case which led to imprisonment of the Royal reporter and the private investigator, albeit for a short period of time.

Mr James Murdoch insisted that while he was told of the significance of the “for Neville” email this was only in relation to the case in hand and he was not told of the wider significance nor did he have cause to ask if there was a wider significance. He was aware that the amount under discussion was significant and made a point of mentioning that the officers handling the claim only and authority to approve expenditure of up to £10000. The Committee did not appear to follow up the point that someone in the company would have previously have been required to approve them offering the amounts greater than this. Mark Lewes the Solicitor gave evidence that from his meetings and communications he was under the impression that the offer had the approval of the Murdoch with being able to say of this was James or Rupert. James Murdoch did explain that during the period between the departure of Les Hinton to his appointment in New York and the appointment of Mr R Brooks as the Chief Executive in the London based office he presided as Executive Chairman over an interim control group of Chief Operating Officer, himself and a chief Financial officer. The implication therefore is that it was one of the two other officers who granted approval if it was not Mr Hinton for escalation in offers on the basis that the company has or was continuing to break the law and therefore the it was essential that sufficient of a sum was offered and accepted to ensure a confidentiality agreement and sealing of the papers so that the implications of the information was never known. It is alongside this perverting of justice that the failure of the Police and Prosecutions service to also bring to light the information in the Mulcaire records has to be viewed as well as the continuing payment of legal fees and costs of Mr Goodman and Mr Mulcaire.

While some Members the Committee expressed incredulity that James had not queried the payments or why, given that the complainant and others subsequent litigants were not members of the Royal family and therefore must have been dealt with by someone other that Goodman at the News of the World, other Members drew attention that his failure to raise these issues demonstrated management incompetence. James then denied this was an appropriate conclusion to be drawn.

I was struck by a correspondent from Fox New Broadcasting, owned by the Murdoch’s who was asked if the hearing was damaging to him replied in the affirmative although not going on to say it would immediately affect his position. She did say that his father and sister had suggested to him that he step aside from his Executive position while the inquiries continued.

I also read the record of the Daily Telegraph who followed the events live. The Crime Correspondent of the Telegraph identified 10 questions which Mr Murdoch needed to answer. This included the Counsel’s opinion in 2008 that there was widespread illegal activity conducted by the Newspaper. That Colin Myler had expressed a similar opinion to Tom Crone in 2009 and if he as not aware of these opinion should he not have been? Mr Murdoch said that he had only known that the two lawyers representing victims and Mr Watson of the Committee had been placed under surveillance until the last few days. The Telegraph predicted that if Mr Murdoch maintained his ignorance at the time to for Neville e mail he would be asked to state if it was Mr Crone the established lawyer for the Company and Mr Myler the Editor brought in to re-establish the reputation of the Company after the Goodman case that has misled the Committee. A further question related to the evidence of Julian Pike a lawyer acting for the News of World who stated that Mr Murdoch had said he was waiting for Counsel’s opinion before deciding whether to pay the Taylor claim or not which by implication means that he must have known of the Opinion before or at the meeting with Mr Myler and Crone who authorised increasing the offer to avoid a trial hearing. One question was not raised at the Committee is the claim that under pressure from his sister, his father asked him to set aside. The final question would be on the involvement of the sun newspaper following the arrest of its reporter James Pyatt.

In other information provided before the hearing the paper mentions that a former Managing Editor of the News of the World Stuart Kuttner was arrested on August 2nd in connection with the police investigation

The paper reminds that the Goodman Trial ended in January 2007 that is over four years before the truth commenced to become public.

In the post hearing comments the Telegraph notes that the Committee steered clear of making references to either Mrs Brocks or Mr Coulson.

The general conclusion appears to be that in fact not much had changed since the his previous appearance and it boiled down to who did one believe. I do not think it is a simple as that. My impression is that this was in fact only a preliminary to any future criminal and civil trials and the judicial hearings of Lord Leveson after all criminal prosecutions have been completed.

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