A Reuters writer gets the law wrong on News of the World

A misleading item on a major news site.

Many people are rightly concerned at an alarmist blogpost at Reuters entitled "Is Murdoch free to destroy tabloid's records"?

In the post the Reuters writer attributes the following view to a named London lawyer:

Rupert Murdoch's soon-to-be shuttered tabloid may not be obliged to retain documents that could be relevant to civil and criminal claims against the newspaper -- even in cases that are already underway. That could mean that dozens of sports, media, and political celebrities who claim News of the World hacked into their telephone accounts won't be able to find out exactly what the tabloid knew and how it got the information.

If News of the World is to be liquidated, says the lawyer it "is a stroke of genius -- perhaps evil genius.

The Reuters writer adds:

Under British law, [the lawyer] explained, all of the assets of the shuttered newspaper, including its records, will be transferred to a professional liquidator (such as a global accounting firm). The liquidator's obligation is to maximize the estate's assets and minimize its liabilities. So the liquidator could be well within its discretion to decide News of the World would be best served by defaulting on pending claims rather than defending them. That way, the paper could simply destroy its documents to avoid the cost of warehousing them -- and to preclude any other time bombs contained in News of the World's records from exploding.

The lawyer is then quoted again:

Why would the liquidator want to keep [the records]? Minimizing liability is the liquidator's job. That's a very different scenario, [...] from what would happen if a newspaper in the U.S. went into bankruptcy. In the U.S., a plaintiff (or, for that matter, a criminal investigator) could obtain a court order barring that kind of document destruction. In the U.K., there's no requirement that the estate retain its records, nor any law granting plaintiffs [sic, claimants] a right to stop the liquidator from getting rid of them.

The Reuters blogpost is, however, misleading. It may well be that the lawyer quoted was misquoted, or that the context of his answers has been misrepresented. But the blogpost is, in my view, flatly wrong and it is to the severe discredit of Reuters that it is even hosted on its site.

To begin with, the blogpost asks in its title whether Murdoch would be free to destroy records. It then goes onto discuss whether the liquidator - a person independent from and not controlled by Murdoch - would have the power to destroy records. The title does not make sense in terms of what follows.

As I explained yesterday, the closure of the News of the World means merely that one branded product will no longer be offered to the market place. Indeed, that is all the official statement from James Murdoch actually says: the News of the World will not be published after Sunday. There is no mention of the appointment of any liquidators.

On the information available, the News of the World is not itself a corporation. For example, civil litigation involving the News of the World - including the CTB case - is in the name of News Group Newspapers Ltd. The terms and conditions of the News of the World website are also in the name of News Group Newspapers Ltd. News Group Newspapers Ltd also publishes the Sun.

A better legal view is that the civil and criminal cases are entirely unaffected by the closure of the News of the World, as I said yesterday. All the relevant evidence for criminal and civil cases should still be preserved.

The conduct of those at News of the World was bad enough without creating scare stories based on nothing other than wild supposition.

So to put it plainly: there is no suggestion, other than on this Reuters blogpost, that News Group Newspapers Ltd is about to be liquidated.

Indeed, such a statement can be defamatory of a corporation, and actionable if it is untrue. Ask any media lawyer.

 

David Allen Green is legal correspondent of the New Statesman

David Allen Green is legal correspondent of the New Statesman and author of the Jack of Kent blog.

His legal journalism has included popularising the Simon Singh libel case and discrediting the Julian Assange myths about his extradition case.  His uncovering of the Nightjack email hack by the Times was described as "masterly analysis" by Lord Justice Leveson.

David is also a solicitor and was successful in the "Twitterjoketrial" appeal at the High Court.

(Nothing on this blog constitutes legal advice.)

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Ken Livingstone says publicly what many are saying privately: tomorrow belongs to John McDonnell

The Shadow Chancellor has emerged as a frontrunner should another Labour leadership election happen. 

“It would be John.” Ken Livingstone, one of Jeremy Corbyn’s most vocal allies in the media, has said publicly what many are saying privately: if something does happen to Corbyn, or should he choose to step down, place your bets on John McDonnell. Livingstone, speaking to Russia Today, said that if Corbyn were "pushed under a bus", John McDonnell, the shadow chancellor, would be the preferred candidate to replace him.

Even among the Labour leader’s allies, speculation is rife as to if the Islington North MP will lead the party into the 2020 election. Corbyn would be 71 in 2020 – the oldest candidate for Prime Minister since Clement Attlee lost the 1955 election aged 72.

While Corbyn is said to be enjoying the role at present, he still resents the intrusion of much of the press and dislikes many of the duties of the party leader. McDonnell, however, has impressed even some critics with his increasingly polished TV performances and has wowed a few sceptical donors. One big donor, who was thinking of pulling their money, confided that a one-on-one chat with the shadow chancellor had left them feeling much happier than a similar chat with Ed Miliband.

The issue of the succession is widely discussed on the left. For many, having waited decades to achieve a position of power, pinning their hopes on the health of one man would be unforgivably foolish. One historically-minded trade union official points out that Hugh Gaitskell, at 56, and John Smith, at 55, were 10 and 11 years younger than Corbyn when they died. In 1994, the right was ready and had two natural successors in the shape of Tony Blair and Gordon Brown in place. In 1963, the right was unprepared and lost the leadership to Harold Wilson, from the party's centre. "If something happens, or he just decides to call it a day, [we have to make sure] it will be '94 not '63," they observed.

While McDonnell is just two years younger than Corbyn, his closest ally in politics and a close personal friend, he is seen by some as considerably more vigorous. His increasingly frequent outings on television have seen him emerge as one of the most adept media performers from the Labour left, and he has won internal plaudits for his recent tussles with George Osborne over the tax bill.

The left’s hopes of securing a non-Corbyn candidate on the ballot have been boosted in recent weeks. The parliamentary Labour party’s successful attempt to boot Steve Rotheram off the party’s ruling NEC, while superficially a victory for the party’s Corbynsceptics, revealed that the numbers are still there for a candidate of the left to make the ballot. 30 MPs voted to keep Rotheram in place, with many MPs from the left of the party, including McDonnell, Corbyn, Diane Abbott and John Trickett, abstaining.

The ballot threshold has risen due to a little-noticed rule change, agreed over the summer, to give members of the European Parliament equal rights with members of the Westminster Parliament. However, Labour’s MEPs are more leftwing, on the whole, than the party in Westminster . In addition, party members vote on the order that Labour MEPs appear on the party list, increasing (or decreasing) their chances of being re-elected, making them more likely to be susceptible to an organised campaign to secure a place for a leftwinger on the ballot.

That makes it – in the views of many key players – incredibly likely that the necessary 51 nominations to secure a place on the ballot are well within reach for the left, particularly if by-election selections in Ogmore, where the sitting MP, is standing down to run for the Welsh Assembly, and Sheffield Brightside, where Harry Harpham has died, return candidates from the party’s left.

McDonnell’s rivals on the left of the party are believed to have fallen short for one reason or another. Clive Lewis, who many party activists believe could provide Corbynism without the historical baggage of the man himself, is unlikely to be able to secure the nominations necessary to make the ballot.

Any left candidate’s route to the ballot paper runs through the 2015 intake, who are on the whole more leftwing than their predecessors. But Lewis has alienated many of his potential allies, with his antics in the 2015 intake’s WhatsApp group a sore point for many. “He has brought too much politics into it,” complained one MP who is also on the left of the party. (The group is usually used for blowing off steam and arranging social events.)

Lisa Nandy, who is from the soft left rather than the left of the party, is widely believed to be in the running also, despite her ruling out any leadership ambitions in a recent interview with the New Statesman.However, she would represent a break from the Corbynite approach, albeit a more leftwing one than Dan Jarvis or Hilary Benn.

Local party chairs in no doubt that the shadow chancellor is profiling should another leadership election arise. One constituency chair noted to the New Statesman that: “you could tell who was going for it [last time], because they were desperate to speak [at events]”. Tom Watson, Caroline Flint, Chuka Umunna, Yvette Cooper, Andy Burnham and Liz Kendall all visited local parties across the country in preparation for their election bids in 2015.

Now, speaking to local party activists, four names are mentioned more than any other: Dan Jarvis, currently on the backbenches, but in whom the hopes – and the donations – of many who are disillusioned by the current leadership are invested, Gloria De Piero, who is touring the country as part of the party’s voter registration drive, her close ally Jon Ashworth, and John McDonnell.

Another close ally of Corbyn and McDonnell, who worked closely on the leadership election, is in no doubt that the shadow chancellor is gearing up for a run should the need arise.  “You remember when that nice Mr Watson went touring the country? Well, pay attention to John’s movements.”

As for his chances of success, McDonnell may well be even more popular among members than Corbyn himself. He is regularly at or near the top of LabourList's shadow cabinet rankings, and is frequently praised by members. Should he be able to secure the nominations to get on the ballot, an even bigger victory than that secured by Corbyn in September is not out of the question.

Stephen Bush is editor of the Staggers, the New Statesman’s political blog. He usually writes about politics.