Rupert and James Murdoch said repeatedly during their extended testimony before a parliamentary committee in Britain that their involvement in managing the News Corporation’s response to the phone hacking scandal was limited. Rupert Murdoch said he felt let down by “the people that I trusted and then, maybe the people they trusted.
James Murdoch, the 38-year-old News Corporation deputy chief operating officer who oversees News International, the News Corporation’s British subsidiary, told members of Parliament that he was “as surprised as you are” to learn that the company had been paying the legal fees of Glenn Mulcaire, The News of the World’s phone hacking specialist, and Clive Goodman, the tabloid’s royal reporter. Both men pleaded guilty to phone hacking charges and went to jail in January 2007. At another point, Murdoch described himself as “surprised and shocked” when he was told about the legal aid to the former employees.
James Murdoch also told Parliament that he did not know how much Mr. Mulcaire’s legal fees have cost or whether the payments have stopped.
Pressed by members of the committee, Mr. Murdoch seemed open to the idea that the company would stop paying Mr. Mulcaire’s legal fees. “I would like to do that,” he said. “I don’t know what the status of what we are doing now or what his contract was.”
But both he and Rupert Murdoch said such “contracts” could make it difficult to stop the payments. They did not provide more detail about the contracts, including who authorized them or whether they had the ability to terminate them.
Since his release from jail in the summer of 2007, Mr. Mulcaire has never spoken publicly about his role in phone hacking — or what his superiors might have known about his activities. With his wife and five children, Mr. Mulcaire lives in a modest home in Cheam, south of London. For four years, he has steadfastly refused constant requests for comment from the news media and has invoked his right against self-incrimination in every lawsuit.
James Murdoch said Tuesday that he had been given an oral briefing on the Taylor case and “did not get involved directly” in the negotiations. Asked whether he was aware that hacking was illegal, James Murdoch acknowledged, “That was my understanding.”
He declined to answer a question, put to him several times, as to whether he would release Mr. Taylor and his lawyers from the confidentiality clause in the agreement so that they might speak publicly about their knowledge of the negotiations.
“It is a confidential agreement,” he said.
Mr. Murdoch also denied that the settlement was motivated by a desire to keep the matter from becoming public. His father said he knew nothing about it until he read about it in July 2009, although he stopped short of naming the newspaper that had first published it (The Guardian).
James Murdoch said the decision to settle was a pragmatic one because he had been advised by outside lawyers that his newspaper would lose in a judgment at trial, and damages and legal costs were estimated to run as high as £500,000 to £1 million, or $800,000 to $1.6 million. At that time, settlements in privacy violation cases typically ran in the tens of thousands of pounds, and legal fees rarely ran that high, lawyers who handle those cases said.
Indeed, when the Formula One boss Max Mosely later won a £60,000 settlement ($96,000) in a privacy case, it was considered a record payout in such cases.
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