Tuesday, 1 May 2012

If Murdoch thought the worst was over, he was wrong

If Rupert Murdoch believed his appearance at the Leveson judicial inquiry last week would quell the ever louder outcry over his and his company's conduct, he was wrong. By far the most damning judgement of this report is reserved for the 81-year-old chairman and chief executive of News Corporation. By concluding that he is unfit to run a major international company (the majority verdict of the five Labour MPs and the Liberal Democrat MP Adrian Sanders, but not – interestingly – of its four voting Conservative members) the Culture Committee has dramatically increased the pressure on the tycoon. He already faces a shareholder revolt at News Corp's next annual meeting in October, where there is a motion to unseat him. The US Department for Justice may also take into account the committee's findings when considering whether News Corp directors permitted or wilfully ignored a newsroom culture that bribed police and public officials in the UK – potentially a criminal offence punishable by a fine or five years in jail under the US Foreign Corrupt Practices Act. Demanding that News International lifts legal privilege on the work done by its lawyers Burton Copeland during the original phone hacking investigation in 2007 will focus attention on the tantalising and presumably important secrets contained in that hitherto undisclosed file – which might tell us much more about just how high up the cover-up went. The verdict that its subsidiary News International "corporately" misled Parliament will not help News Corp to win public sector contracts to educate children in the UK, US or elsewhere. Ofcom, the media regulator, will use these parliamentary words in its assessment of whether or not News Corp should continue to hold its 39 per cent controlling stake in BSkyB – by far its most lucrative business in the UK. More broadly, the report raises the stakes for politicians defending their previous relationship with the Murdochs, and sets the bar high for Lord Justice Leveson for his report on how things went so badly in British newspapers. The MPs' verdict is clear, at least as far as Rupert Murdoch is concerned: collectively his company and his executives orchestrated a cover-up which repeatedly misled Parliament, the rest of the press and the public about the scale of vast law-breaking at Wapping.