Avon Pension Fund and others who owned News Corp stock from mid-February to mid-July 2011 charged in the class action suit that Rupert Murdoch, James Murdoch, former News Of The World editor Rebekah Brooks, and other execs at News Corp (before it split into two companies) committed fraud when the UK hacking scandal was unfolding. They told the public — including in testimony at Parliament — that it was just an isolated problem, and it wasn’t. When the widespread extent of the hacking became known in mid-2011, News Corp shares fell 17%, and it derailed the company’s plan to buy British Sky Broadcasting. But a U.S. District Court in New York dismissed the case today, Reuters reports. The problem? Judge Paul Gardephe said that the News Corp execs couldn’t be held liable for statements made before the period when the plaintiffs said that they lost money.”To hold otherwise would require adopting an ‘endless breach argument,’ which would permit plaintiffs to circumvent the well-settled rule that defendants are liable only for those statements made during the class period,” Gardephe says.
Lachlan And James Murdoch Given Big New Roles At News Corp, 21st Century Fox; Fox Nets Group’s Peter Rice Extends Contract
UPDATE: Below the original post is a copy of Rupert Murdoch’s memo to staff at 21st Century Fox regarding today’s appointments. In it, he notes that the evolution of the company’s leadership, “underscores the considerable planning that both the Company and the Board have undertaken to ensure a vibrant future for 21st Century Fox and its shareholders.”
PREVIOUS: In what looks like a clear sign that Rupert Murdoch is putting his succession plans in order, News Corp and 21st Century Fox made big announcements early Wednesday morning outlining changes to their boards and executive structure — and each involving Murdoch’s sons. Lachlan Murdoch has been named Non-Executive Co-Chairman of News Corp and has been given the same title at 21st Century Fox, the media and entertainment company. Also at 21st Century Fox, James Murdoch has been elevated to Co-Chief Operating Officer. Further, Fox Networks Group Chairman and CEO Peter Rice, who has close ties to the Murdoch family, has extended his contract for an unspecified term. “Under Peter Rice’s leadership Fox Networks Group has continued to push creative boundaries across the company, and has grown tremendously with successful channel launches including Fox Sports 1 and FXX, an increased international footprint and enhanced sports offerings across the world,” James Murdoch said.
The Stateside phone hacking-scandal suit that a former body double for Angelina Jolie filed against News Corp last summer looks likely to end up in the U.K. if a federal judge doesn’t change his mind. Before a hearing Monday on the company’s motion to dismiss, Judge Michael Fitzgerald said in a tentative ruling that Eunice Huthart‘s case belonged in “the courts of England and Wales” not the U.S.
Alleging that her phone was tampered with in 2004 while living with Jolie in L.A., Huthart’s initial complaint on June 13 was the first hacking scandal suit filed against News Corp and its UK Press arm in the U.S. Back in September of last year, News Corp and News International filed their motion to toss the case or have it move to Britain. After issuing his tentative and hearing arguments from lawyers representing the English-born stuntwoman and the media corporation, Judge Fitzgerald said he would take the matter under submission (read it here). Though it happens, it is very unusual for a judge to reverse himself after issuing such a clear tentative.
Rebekah Brooks, the former chief executive of Rupert Murdoch’s News International (now News UK), took the stand for the first time today in London’s long-running phone-hacking trial. This was Brooks’ first time in the witness box since the criminal trial stemming from the phone-hacking scandal at the now-shuttered News Of The World began in October. After nearly four months, prosecutors rested their case this week and the defense is just beginning. According to local media reports, the presiding judge, John Saunders, instructed jurors that Brooks is to be found not guilty on one of the five counts against her. She was acquitted on the single charge of conspiring to commit misconduct in a public office related to payments The Sun allegedly made for a picture of Prince William wearing a bikini at a costume party. “There is no case to answer for Mrs Brooks” on the charge, the judge said. The Guardian reports he told the jury his decision was “a matter of law.” He did not provide further detail, but The Associated Press reports Saunders said there was “considerable uncertainty” about the photo’s provenance. The photo was taken when William, now the Duke of Cambridge, was at Sandhurst Military Academy and Brooks was editor of The Sun.
Lex Fenwick had joined News Corp’s Dow Jones & Co in February 2012 coming from a long run at Bloomberg Llp. He will be replaced on an interim basis by News Corp COO William Lewis while the company reviews its institutional strategy, according to a News Corp release announcing the shift. Fenwick had overseen Dow Jones’ DJX information service, which has been in beta since its launch last year. “We’re reviewing the institutional strategy of Dow Jones with an eye towards changes that will deliver even more value to its customers. As part of that, we’re planning improvements to DJX,” said News Corp CEO Robert Thomson, who also signaled greater flexibility in Dow Jones’ product offerings is likely in the works soon. Lewis, meanwhile, joined News Corp in 2010 as Group General Manager at News International (now News UK), and was appointed COO at News Corp last year. The one-time Sunday Times and Financial Times journalist will help with the review while the search for permanent replacement is completed.
Global Showbiz Briefs: China Lifts Video Game Console Ban; Fox Turkey Appointment; News Corp Commits To London; Sports Rights; ‘Downton’
China’s State Council has temporarily repealed a ban on selling foreign video game consoles, Reuters reports this morning. The move had been expected and will open up a path for the likes of Sony, Microsoft and Nintendo to sell their wares after a 14-year block. Now, “foreign-invested enterprises” will be allowed to make game consoles within Shanghai’s free trade zone and sell them in China after inspection by cultural departments. Consoles were initially banned in 2000 over concern that gaming would harm young people. Reuters says the growing market is worth a potential $14B.
Fox Turkey has appointed Shebnem Askin as EVP of programming. She was previously SVP of international acquisitions and sales at Fox International Productions and will take up her new role immediately. Her mandate will cover building on Fox Turkey’s entertainment offering and commissioning, acquiring and scheduling film, drama, factual, kids and event entertainment programming in addition to working with Fox Turkey’s channel partners in the increasingly hot TV territory. At FIP, Askin was a key player on co-productions and acquisitions including Mexico’s Academy Award entry Miss.BALA; Gaumont’s upcoming Mea Culpa directed by Fred Cavaye; and Sundance prize winner Metro Manila.
While the phone-hacking trials involving a number of its former staff continue in Britain, News Corp Monday signaled its “long term …
NBC News this morning named ITV News’ international editor Bill Neely as its new Chief Global Correspondent, based in London. The hire reunites Neely with NBC News president Deborah Turness, who was formerly editor of ITV News from ’04-13. You’ve already seen Neely appear with some regularity on NBC News, through the news division’s partnership with ITN. Neely, who has spent more than two decades with ITV, will cover major international news and events for all of NBC News’ broadcasts and digital platforms. Neely previously served as ITV News Washington Correspondent for six years, covering five of the last six presidential elections, as well as the Oklahoma City bombings, the Atlanta Olympics, and superstorm Sandy.
Global Showbiz Briefs: New Revelations In Phone-Hacking Scandal; Claire Danes To Host Nobel Peace Prize Concert; More
Hacking Trial Lawyer: Brooks And Coulson Had 6-Year Affair
The phone-hacking trial taking place in London was the source of new revelations Thursday as prosecuting attorney Andrew Edis told jurors that defendants Rebekah Brooks and Andy Coulson carried on a six-year “secret” affair from 1998-2004. Brooks is the former head of News International (now News UK), the British press arm of Rupert Murdoch’s News Corp, and Coulson was editor of the now-closed News Of The World before leaving to join Prime Minister David Cameron’s team as his communications director. As part of his opening remarks, Edis stressed that he was not bringing up the relationship between Brooks and Coulson, which the prosecution said was evident from a letter to Coulson that was found on one of Brooks’ computers, to intrude on their privacy or pass judgment. “The point that I’m going to make in relation to that letter is that over the relevant period, what Mr Coulson knew, Mrs Brooks knew too. And what Mrs Brooks knew, Mr Coulson knew too — that’s the point.” He told the court the affair spanned the period covered by the phone-hacking conspiracy charges the pair is facing, according to The Times. “Mrs Brooks and Mr Coulson are charged with conspiracy,” Edis said, “and, when people are charged with conspiracy, the first question a jury has to answer is how well did they know each other? How much did they trust each other?” At the time of the letter in 2004, Brooks was editor of The Sun and Coulson was at NOTW.
On October 14, Rupert Murdoch tweeted: “Big media trials in London in 2 weeks. Remember, everyone innocent until proven guilty, entitled to fair trial in most countries.” Murdoch was referring to the criminal trial related to phone hacking at his now defunct News Of The World tabloid. This morning, eight defendants including former Murdoch employees Rebekah Brooks and Andy Coulson made it to court amid a media frenzy for what some are calling the “Trial of the Century.” It may feel like a century once the proceedings wrap sometime around Easter 2014 and after an expected 100 witnesses have been called. Jury selection began today with the prosecution starting later in the week.
While Murdoch, Brooks and Coulson are no longer linked professionally, the outcome of the trial has the potential to impact the mogul’s business going forward. Even the News Corp-owned Wall Street Journal wrote that the courtroom drama “could further embarrass both the media giant and the British government.” One of the lines of questioning during the Leveson Inquiry into UK media ethics, the probe hatched by Prime Minister David Cameron in the wake of the News Of The World scandal, focused on the relationships between politicians and newspaper proprietors and editors. With Brooks and Coulson now standing trial, this could put News Corp’s relationship with the UK government back into the spotlight. Brooks was head of News Corp‘s UK press arm, News International (now News UK), until the phone-hacking scandal first exploded at the News Of The World in July 2011. She has denied the five charges against her including conspiracy to hack phones, conspiracy to commit misconduct in a public office by paying officials for stories, and conspiracy to pervert the course of justice. Coulson was formerly editor of News Of The World. He went on to become Cameron’s spin doctor, a post he vacated in 2011. He is facing three charges related to phone hacking and conspiracy to commit misconduct in a public office. They are joined by six other defendants who have all pleaded not guilty, including Brooks’ husband Charlie, a longtime Cameron friend.
News Corp has paid out nearly $200 million in the past year alone in settlements related to the ongoing phone hacking scandal. Late last week, the company made it very clear that it doesn’t intend to make a payment to Eunice Huthart, a former body double for Angelina Jolie. In a June civil complaint, Huthart became the first person to file a hacking-scandal suit against News Corp and its UK press arm News International in the U.S. On September 20, News Corp filed back, asking the federal court to dismiss Huthart’s privacy violations case on a series of grounds. “The Court should dismiss the complaint on the grounds of lack of personal jurisdiction and failure to state a claim. But it need not even reach those issues — instead, the Court should dismiss this lawsuit under the doctrine of forum non conveniens with instructions that it be re-filed, if at all, in the United Kingdom,” said the motion by the company (read it here). A hearing in the case is scheduled for January 6.
John Malone’s Liberty Global acquired the UK’s Virgin Media in a $23B deal in June. In the past year, Britain’s No. 2 pay-TV operator has added 1,000 extra customer service roles while its rival, 21st Century Fox-controlled BSkyB, said in May that it plans to add 550 jobs to meet demand and serve a growing customer base. Now, Virgin is looking at streamlining its senior and middle management ranks with the possible axing of 600 positions. The cuts would amount to about 4% of the company’s workforce and are intended to “find the best shape” for Virgin and help build an “agile and efficient” organization, I’m told. After the acquisition by Liberty, Virgin CEO Neil Berkett exited the company and Tom Mockridge, coincidentally the former CEO of News Corp’s News International, came aboard to replace him. Regarding the job cuts, Mockridge said today, “Like organizations across the public and private sector, Virgin Media is making sure it has the structure it needs to meet the needs of its customers. These proposals are designed to take advantage of the opportunities that come with being part of the world’s largest cable operator and create an organization that’s fit for growth.”
In the wake of revelations of a secret recording of Rupert Murdoch addressing staff at his Sun tabloid, the UK’s Department of Culture, Media and Sport in July invited the mogul to discuss the matter at an official hearing. (The comments inlcuded Murdoch talking about his company’s handling of bribery and hacking charges at his UK newspapers.) Murdoch accepted the invitation, but no date was set at the time given the impending summer recess. Now it looks as though Murdoch’s appearance could be postponed by as much as a year. According to The Guardian, the hearing was shelved after the attorney general and Murdoch’s own lawyers intervened. With criminal trials about to begin in relation to the activities of News Corp’s UK press arm, News International (now News UK), there was a consideration on both sides that any testimony could prejudice those proceedings. Eight defendants go to trial on October 28, including former Murdoch lieutenant Rebekah Brooks. A further three trials are scheduled, with the last expected in June 2014. The Guardian says that Murdoch wrote to the committee this week saying lawyers advised him not to submit to questioning until all the criminal trials were finished. Committee chair John Whittingdale confirmed receipt of the letter and said, “At the same time, the committee received its own advice that there was a risk that any questions might prejudice the trials. …
Global Showbiz Briefs: UK To Charge Ex-Newspaper Staffers In Bribery Scandal; Yahoo Taps Dawn Airey For SVP Post; More
Ex-Daily Mirror, Sun Staffers Among 9 Charged In Bribery Scandal
Britain’s Crown Prosecution Service said today that nine people would be charged in relation to allegations of illegal payments to public officials. Among them are former Daily Mirror journalist Greig Box-Turnbull, and ex-Sun staffers Graham Dudman, John Troup and Vince Soodin. Box-Turnbull is being called up on two charges of conspiracy to commit misconduct in public office with regard to alleged payments to prison officers for information. The prison officers also are being charged as co-conspirators. Dudman is alleged to have requested the authorization of payments to one or more police officers and to have authorized payments to public officials in his capacity as Sun managing editor. Troup is charged as a co-conspirator. Soodin will be charged with conspiring with a police officer to commit misconduct in public office. The remaining defendants are a police officer and a hospital employee. All will appear before Westminster Magistrates’ Court on September 5. The new charges come a few days after the revelation that Scotland Yard is actively investigating Sun owner News International (now News UK) for possible criminal violations related to the phone-hacking scandal and allegations of illegal payments. News UK is the British press arm of News Corp.
Dawn Airey Tapped As Yahoo’s SVP Europe, Middle East And Africa
Yahoo has appointed UK television veteran Dawn Airey as SVP Europe, Middle East and Africa. Beginning November 1, Christophe Parcot, who has served as Yahoo’s interim lead of EMEA, will take on a new role focused on expanding the web giant’s business in the region. Airey joins Yahoo from RTL Group. She has also held high-level executive positions at Five, ITV, BSkyB and Channel4.
News International, the British newspaper division of News Corp which was recently renamed News UK, is being actively investigated by Scotland Yard, say reports from Reuters and The Independent. The probe is said to be seeking possible criminal violations related to the phone-hacking scandal at the now defunct News Of The World as well as allegations of illegal payments to public officials by journalists. Since 2011, police attention has appeared focused on employees of the Rupert Murdoch-controlled businesses, but The Independent says investigators are treating News International as a “corporate suspect.” Reuters, quoting a source familiar with the matter, said detectives and prosecutors are also actively considering action against News Corp as a corporation. Were corporate action to be taken, Reuters opines, it would lead to more expense for News Corp as well as potentially further tarnishing its image. If company directors or executives were held accountable, it could impact News Corp’s ownership of BSkyB since broadcast license holders have to be deemed “fit and proper.” However, BSkyB no longer has ties to the press business, having become part of the entertainment company after News Corp split into two entities. According to the reports, News Corp’s Management and Standards Committee was informed more than a year ago that action was being considered. The reports say it was this revelation that led News Corp to scale back its cooperation with …
Audiences Fail To Embrace BBC In 3D
The BBC is suspending 3D programming after a lackluster response from viewers who found it “quite hassly,” BBC head of 3D Kim Shillinglaw said. A two-year 3D trial period started in 2011 and included the Olympics but only half of the 1.5M Britons with 3D-enabled sets watched the games that way. The Doctor Who 50th anniversary special will be one of the last programs aired in 3D in November. Shillinglaw said the broadcaster will “see what happens when the recession ends and there may be more take up of sets, but I think the BBC will be having a wait-and-see. It’s the right time for a good old pause.” ESPN in June said it was scrapping its 3D channel.
Global Showbiz Briefs: Rupert Murdoch Eyeing Financial Times?; Ruling On Hacking Appeal; ‘Either Way’ Helmer’s Next Pic
Report: Rupert Murdoch, Abu Dhabi Media Group Eyeing Financial Times
A report out of Malaysia circulated this morning which claimed Rupert Murdoch and the state-owned Abu Dhabi Media Group are in talks to acquire The Financial Times Group for $1.2B. News Corp. said, “This is completely untrue” and FT owner, Pearson, also denied the report saying, “The Financial Times is not for sale, and Pearson is not in any talks to sell it.” The talks, reported by Malaysian political and business magazine The Edge Review, cited financial executives familiar with the negotiations which had purportedly been going on for the past month. The Financial Times Group includes the flagship Financial Times newspaper as well as The Economist magazine. Per AFP, the report said the Abu Dhabi group is eyeing a 75% stake with Murdoch’s new News Corp. taking 25%. News Corp. officially split into two entities today. In an interview published in the FT website on Thursday evening, chief executive of the publishing business, Robert Thomson, said News Corp. could use its $2.6B of net cash for acquisitions, but there was no mention of the FT, and he also played down expectations of a bid for the Los Angeles Times. Thomson is a former U.S. managing editor of the FT.
Judges Deny Appeals To Drop Charges Against Hacking-Scandal Figures
In other News Corp.-related news, former News International chief Rebekah Brooks, and former News Of The World editor Andy Coulson have both been denied appeals to have criminal charges against them dropped. Neither appeared in a London court Friday, but three judges there dismissed the appeal that had been brought by Brooks, Coulson and three others, The Guardian said. Brooks and Coulson’s trials begin in September, when they will face charges related to phone hacking. The appeals were fashioned on the grounds that the law does not extend to voicemails that already had been listened to.
Just ahead of News Corp.‘s official split into two entities, its UK press arm, News International, is rebranding. The company that’s parent to The Sun, The Times and The Sunday Times, will henceforth be known as News UK. The new name and logo are “designed to convey a more coherent and logical identity for the new parent company across the globe,” News UK said. News International spiralled into controversy when the phone hacking scandal broke open in July 2011; the company has since shuttered tabloid News Of The World. Mike Darcey, CEO of News UK, said the company was beginning “a bright new chapter.” Referring to the scandals, Darcey said the rebrand “follows the fundamental changes of governance and personnel that have taken place to address the problems of the recent past. News International apologized to its victims and set up a compensation scheme; closed the News Of The World and co-operated with all the relevant authorities. New policies and procedures are in place across the company, its main titles are all under new leadership and the executive team has been transformed.”
Eunice Huthart, a former body double for Angelina Jolie, has become the first person to file a phone-hacking lawsuit against News Corp. in the U.S. Huthart, a British national whose most recent credit is as stunt coordinator on Disney’s upcoming Jolie-starrer Maleficent, filed a civil complaint (read it here) against News Corp, and its UK press arm News International, in federal court on June 13 alleging right to privacy violations. Those include “intrusion into, interception of and interference with” voicemail messages left on her phone while she was working as a double for Jolie in the U.S. in 2005. The suit seeks damages for violations of federal and California laws.
EXCLUSIVE 9 AM, 4TH UPDATE 11 AM WRITETHRU (new details): News Corp Chairman/CEO Rupert Murdoch filed for divorce from wife Wendi Deng Murdoch this morning in New York State Supreme Court, Deadline learned at 9 AM. The divorce will not impact Rupert Murdoch’s mega-media holdings, according to insiders, and was deliberately announced for maximum transparency before News Corp spins off its publishing assets into a separately traded company by June 28th. (Murdoch will control both of these entities.) Wendi is perhaps most vividly and fondly remembered by the general public in July 2011 for standing up for her husband and clocking Jonathan May-Bowles after he threw a pie at Murdoch during his highly publicized British parliamentary testimony in connection with the News International phone-hacking scandal. (“Mr Murdoch, your wife has a very good left hook,” the chairman of the House Of Commons panel said admiringly. Wendi quickly earned the nickname of ‘Tiger Wife’ on Twitter.) Today’s divorce news comes despite numerous denials by PR man Steven Rubenstein and News Corp PR woman Julie Henderson to me as recently as April and May. (“We get this phone call once every 3-6 months,” Rubenstein and Henderson said at the time, pointing to the fact that Wendi and Rupert had recently hosted a dinner at their home for Oscar-winning Twentieth Century Fox director Ang Lee and were going away together on Spring Break.) But legal sources insisted to Deadline that the Murdochs’ divorce was being planned at the same time that a change in Wendi’s behavior towards Rupert was observed during the Academy Awards in February and after. ”She was snippy with him during Oscar weekend, and she’s really impatient with him these days,” a source told Deadline then. I received a call from an insider telling me, “Now I’m hearing it might be true. Call me,” On the heels of that, for the first time, not even Murdoch’s reps were denying yet another rift between Rupert and Wendi, saying to me there had been marriage trouble but stressing ”it feels like its past whatever that was.” A source who had dinner with them shortly after in NYC told me they were “fine. They’re two people who move a lot in different directions. I don’t know if it’s the marriage I’d want.” But another insider acknowledged to me, “I can’t say it might not be true that they’ll divorce. They have ups and downs. Right now it feels to me, having spent time with them, that they’re in a good place.” There is no question that despite divorce clouds Murdoch’s #1 priority was the News Corp split, not his from Wendi’s, and ”to get it done and get it done right. So he’s had a lot on his plate. What was once one is now two,” an insider explained to me at the time. “The company is so big, so diverse, so complex, and now he has to recalibrate and reaggregate these businesses while the Street determines their true value.” Today I’m told by insiders that, at that time, there were still no divorce proceedings underway so the denials were issued in good faith. “The divorce happened very quickly,” an insider told me today without details.
Media moguls routinely divorce, and Deadline doesn’t cover Hollywood’s personal lives, but this split is notable only because of its possible impact on the News Corp split or the Murdoch family succession vis a vis its corporate holdings given the patriarch’s age of 82. “I don’t see anything to indicate that shareholders have a lot at stake if Rupert and Wendi split,” one prominent media analyst tells me. “News Corp paid her $92,000 in 2010 to provide some ‘strategic advice’ regarding MySpace in China. But that’s not even pocket change, and ended three years ago, She’s not on the board, and not an executive. And since she and her kids don’t have voting rights in the family trust, she doesn’t have leverage to influence succession. I suppose that investors might become nervous if she decided to spill some News Corp secrets, or distracted Rupert so much that he’d spend less time taking care of business. But that’s thin gruel.” As for News Corp’s obligations to keep Wall Street and shareholders up to date on this kind of personal matter, “They have to report ‘material’ information on a timely basis. A lot of wiggle room there.”