James Murdoch to Parliament: 'I Didn't Know'

In today's hearing, the younger Murdoch remained calm in the face of searing accusations 



LONDON--When James Murdoch appeared before a parliamentary committee investigating the phone-hacking scandal today, the stakes were high, including his future at News Corp, which was founded by his father, Rupert. Additionally, the general expectations were that the young Murdoch would be embarrassed, at least, and probably bloodied, by questions from the committee, which had questioned him in July, and was now armed with further damaging documents.

For more than two and a half hours, starting at 11:00 AM, and without a coffee break or for lunch, Mr. Murdoch displayed remarkable confidence and equanimity, as he maintained that he had no knowledge of widespread phone hacking at the News of the World, and that he had never misled the committee. Seeming to ensure that the scandal will not die, however, Murdoch suggested that two other company officials had misled the committee in their previous testimony.

The last time James Murdoch appeared before the committee, he was flanked by his father, and behind them was the senior Murdoch's wife, Wendi Deng, who delivered the hearing's most memorable moment when she threw a roundhouse punch to a man who had smashed a pie into her husband's face.

This time, the 38-year-old James, in a blue suit, broad collar white shirt, and green tie, sat alone at a cream-colored table, the four green chairs on each side of him empty. He didn't fumble, stumble, stutter, or even hesitate. He had prepared and prepared well.

Not even when a questioner compared him to a mafia don was Murdoch knocked off stride.

"You must be the only mafia boss in history who didn't know he was running a criminal enterprise," said Tom Watson, a Labour Party member of the committee, who has been at the forefront of the investigation into practices, and as such has become a hero to the anti-Murdoch legions.

"Mr. Watson, please. I think that's inappropriate," Murdoch said.

Watson's perhaps intemperate remark might be explained when it emerged later in the hearing that private investigators hired by News of the World had put him, and other members of the committee, under surveillance and had sought to dig up dirt on them.

Watson said, in a question to Murdoch, that he had been told that the editor of the News of the World when the phone hacking was at its most active, Rebekah Brooks, had sought to smear him in a conversation with then Prime Minister Tony Blair She told Blair that Watson was "mad" and "absolutely pathological."

Murdoch said he was not aware of this, and he agreed that it was "despicable" and "appalling" that the News of the World had conducted surveillance on lawyers for phone-hacking victims. (The News of the World was closed last year, in the wake of the scandal, and Brooks was forced to resign her executive position with News Corp.)

Mr. Murdoch was questioned at length about the settlement that News International had entered into with one phone-hacking victim, Gordon Taylor, chief executive of the Professional Footballers' Association. Taylor sued for invasion of privacy, and the Murdoch company paid £700,000 to settle the case‐ £450,000 in damages and £250,000 in attorney's fees.

This was far more than a British court has ever awarded in an invasion of privacy case, and a prominent lawyer hired by the company to advise on the case said that it was unlikely that a court would award more than £250,000.

In the same memo, the lawyer, Michael Greenleaf, wrote, "There is a powerful case that there is (or was) a culture of illegal information access at NGN [News Group Newspapers] in order to produce stories for publication."

In light of this memo, Murdoch was asked today how he could maintain that he was not aware that phone hacking was widespread.

Murdoch said he had never seen the memo, that it had never been shown to him, and that he had never asked to read it, even though he had had to approve the settlement with Taylor.

No matter how many committee members asked the question or how they phrased it, Murdoch was steadfast: He had not seen the memo. He had only been briefed on it by a company lawyer, Tom Crone, and Colin Myers, editor of News of the World.

That brought this from one of the most conservative members on the panel, Philip Davies: "I find it incredible, absolutely incredible that you didn't say, let me have a look." Any "self-respecting" chief executive would have wanted to read the memo on which he was authorizing a settlement of £700,000 (well over $1 million), Davies said.

Mr. Murdoch continued to insist that he hadn't read it.

In early testimony to the committee, Mr. Crone and Mr. Myers aid that they had made Mr. Murdoch aware that phone hacking at the News of the World went beyond one rogue reporter.

Did you mislead the committee, or did they, Murdoch was asked?

They did, he said.

Even more pointedly, a committee member said, either you lied, or they did.

Murdoch didn't want to say they "lied," but reiterated what he had previously said, that they had misled the committee.

Tomorrow's newspapers will surely have rebuttals from Crone and Myers. No‐given the world of blogs and web news, the denials will likely come sooner.

So, while Murdoch probably didn't lose any ground with company shareholders today, the scandal will go on.