James Murdoch stuck in limbo

September 6, 2011

By Chris Hughes
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

The challenge to James Murdoch’s credibility remains serious.

Two former senior staff have repeated assertions that News Corporation’s European boss was made aware, in 2008, of evidence that phone hacking at his UK newspapers involved more than just a single rogue reporter. Murdoch has strongly rejected that claim. The truth of the matter remains unclear.

The dispute turns on what was discussed at a meeting between Murdoch and his two accusers — a former editor of The News of The World newspaper and a senior legal executive — more than three years ago. The meeting lasted only about 15 minutes. The outcome was that Murdoch approved a jumbo settlement to an alleged victim of phone hacking. The size of the financial settlement leads some to think that News Corp was buying silence. The key question, however, is whether Murdoch was told that phone hacking was more widespread than the company had previously maintained.

Murdoch’s accusers say that he was told. But the details are fiddly. Neither Colin Myler, the editor, nor Tom Crone, the lawyer, can recall the exact phrases used in the discussion. So Murdoch can say, and is saying, that he wasn’t explicitly told in plain language that phone hacking went beyond one individual.
The lack of decisive evidence regarding the 2008 meeting does not exonerate Murdoch. It is his word against the word of two others. He still has a case to answer and the allegation that he didn’t act on evidence, and later misled parliament, is very serious. Another grilling is likely.

To his advantage, however, Murdoch’s word has been more articulate and sure-footed to date. His explanation, that a 15 minute meeting could not have included any explicit references to such a serious matter, seems to have had force with at least one of the UK lawmakers investigating the affair.

Murdoch’s position at News Corp may be his own hands, given the shareholder control exerted by his family. But he faces a vote at UK broadcaster, where he is chairman. The latest phone-hacking hearings won’t do anything to settle the concerns of independently-minded investors at either company.

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