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Wednesday, July 20, 2011

Rupert's attention threshold

Reading a New York Times analysis of yesterday's appearance by Rupert Murdoch, James Murdoch and Rebekah Brooks before a House of Commons committee, you might be forgiven for wondering, "Who's running this insane asylum?"

The Guardian noted that James Murdoch did not trouble his father with some information:
James Murdoch denied the large out-of-court settlements to the PFA chief executive, Gordon Taylor (£700,000), and publicist Max Clifford (£1m including legal costs), authorised by him in 2008, had not been pitched so high to buy their silence. He insisted the settlement level was based on legal advice, or in the case of Clifford due to the ending of a wider contract.

James Murdoch also revealed he had authorised the settlements but had not told his father until 2009 after the case became public, saying the payments were too small to be reported to a higher board.
(The New York Times also included this information in an early summary of the Murdochs' testimony, but the reference vanished when I refreshed the article.)

This begs the question: what sum would have gotten the board's, and Rupert Murdoch's, attention?

I don't know how often companies the size of News Corporation have to reach private settlements with litigants, nor what size such settlements usually are, but it strikes me as odd that you wouldn't advise the chairman and founder of the company that million-pound settlements had been reached. These weren't nuisance lawsuits, after all: they involved high-profile claimants with serious grievances against the company. I say this shows that Rupert has decided that if worse comes to worst, he'll hang James out to dry -- and James has agreed to this arrangement, undoubtedly for an as-yet undisclosed price (though probably not for the chairmanship of News Corp., if James is sacrificed for Rupert).

Oh, and as for the payments not being "pitched so high to buy their silence"? Spare us. News Corp. legally insisted on their silence as part of the settlements.

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