Lawyers off the leash

Lawyers are returning to bite the Murdochs on their posteriors ... James Murdoch's pants are on fire ... Commons committee wants an explanation (a better one this time) ... Lawyers are off the leash   

Murdoch: perfecting the humble lookFor Rupert and James Murdoch to shaft long-serving Nudes of the World lawyer Tom Crone and commercial law shop Harbottle & Lewis will turn out to be a significant error of judgment. 

The father and son tag-team told the Commons CMS committee last week they had no idea of the extent of the criminality within their newspaper company until very late in the piece. After all, the lawyers, among others, had given assurances that everything was kosher.

Tom Crone and former Screws editor Colin Myler have come out and as good as said James Murdoch lied to the parliament.

If that is so the line of defence being spun by the Murdochs, that they knew nothing and were betrayed by hirelings, has collapsed. 

The culture, media and sport committee of the Commons now wants a further and better explanation from James Murdoch. 

We are at that point in the fast moving scandal where the cover-up is rapidly unstitching. Former allies who were once part of the conspiracy are swimming for the plank in the shipwreck (tabula in naufragio), while their old paymasters are taking on water. 

This sort of catastrophe usually entails three painful stages before the final dreadful humiliation (resignation and/or prison): denial-excuse; collapse of excuse; and exposure of lies to official inquiries (perjury, contempt, perverting the course of justice).  

Two particular denials are in contention here. 

*   *   *

Gordon Taylor's settlement

Gordon Taylor was chief executive of the Professional Footballers Association. His phone was hacked by the News of the World prior to James Murdoch's appointment as executive chairman of News International in late 2007. 

However, Murdoch signed off on the settlement the following year, for £700,000 (£425,000 damages plus costs). With NI's costs on top the whole exercise would have amounted to over £1 million. 

Gordon Taylor: News anxious to settle at any priceTaylor's solicitors in early 2008 had obtained copy of an email, handed over by the police, detailing a transcript of hacked phone messages.

The transcript was marked "for Neville", Neville Thurlbeck, the then (since arrested) chief reporter of NOTW. 

The "for Neville" email destroys the defence that phone hacking had been the work of a lone reporter, royal correspondent Clive Goodman Goodwin and his investigator Glen Mulcaire.  

NOTW had been refusing to pay Taylor, but as soon as the "for Neville" email surfaced the company was desperate to settle, at almost any price. 

The previous highest payment in a privacy action was £14,600 to Catherine Zeta-Jones. Shortly after the Taylor settlement Max Mosley was awarded £60,000 in his privacy case against NOWT. 

Not only was the size of the Taylor's settlement to be kept confidential, but NI arranged for the court file to be sealed with the plaintiff forbidden to reveal that any sort of settlement had been made at all. 

Crone: James Murdoch mistakenWhen asked by MP Tom Watson at the select committee hearing last Tuesday whether he had seen or knew about the "for Neville" email, James Murdoch insisted that he had not.

He was, he said, advised to settle for this amount by editor Colin Myler and Tom Crone, and only told that the money had to be paid, otherwise they would lose the court case. 

Two days later Myler and Crone decided enough was enough. They issued a statement, saying: 

"Just by way of clarification relating to Tuesday's culture, media select committee hearing, we would like to point out that James Murdoch's recollection of what he was told when agreeing to settle the Gordon Taylor litigation was mistaken." 

If this is so then James knew that criminality at the newspaper had spread beyond Goodman and Mulcaire, but he failed to ensure it was reported to the police. 

As media observer David Carr said in Monday's (July 25) New York Times: "James Murdoch is done. He and his father both know that."  

*   *   *

The joint statement by Myler and Crone also raises another question - what did the long-serving NOTW lawyer know about the extent of the paper's criminality? 

It seems inconceivable that a lawyer giving pre-publication advice each week on whether stories can be successfully defended would not at least have suspicions about the strength of the information relied on and from where it came. 

In order to stand-up a story a lawyer in that position would ask the journalist what witnesses were available, was the source reliable, and so on. 

After years of doing this work, Crone would have a strong sense of what was going on in the newsroom.  

For Crone this public rebuttal of James Murdoch's testimony is a brave step into the unknown. 

*   *   * 

Harbottle & Lewis

Murdoch: accused of misleading parliamentAfter prevaricating NI has reluctantly agreed to waive client privilege and allow Harbottle & Lewis, the West End law shop, to explain to the Commons CMS committee and the Met what they were asked to do by NI. 

Harbottle & Lewis is keen to address the damaging accusations by the Murdochs, in evidence and elsewhere, that it was part of a cover-up of the News of the World's criminal conduct. 

Following the conviction of the NOTW's former royal correspondent Clive Goodman in 2007 Harbottle & Lewis was asked by News International to review about 2,500 emails to and from Goodman. 

The firm's managing partner gave a one paragraph letter to NI's in-house lawyer, Jon Chapman:

"I can confirm that we did not find anything in those emails which appeared to us to be reasonable evidence that Clive Goodman's illegal actions were known about and supported by both or either of Andy Coulson, the editor, and Neil Wallis, the deputy editor, and/or that Ian Edmondson, the news editor, and others were carrying out similar procedures." 

The Murdochs and News International have used that advice, for four years, to bolster the rogue reporter defence. 

After the scandal escaped from the bag and the police had launched a fresh investigation Lord Macdonald, the former DPP, was called in by Harbottle & Lewis, acting for the board of NI, to look at the emails. That was in April this year. 

On July 19 Macdonald told the home affairs select committee that it took him "between three to five minutes" to discover there was evidence of criminal activity. 

It was "blindingly obvious" that corrupt payments had been paid to the police by NI.  

"It was evidence of serious criminal offences." 

He told the home affairs committee that when he gave his opinion to the board of News Corp, "they were stunned". 

The material has now been handed to the police. 

It appears that the advice from Harbottle & Lewis, dated May 29, 2007, was confined to information relating to Goodman's phone hacking, and completely ignored his payments to police. 

Before his appearance at the Commons' committee Rupert Murdoch told the Wall Street Journal that in not finding evidence of wrongdoing Harbottle & Lewis had made a "massive mistake". 

In a statement after the Murdochs gave evidence to the CMS committee Harbottle & Lewis said it wanted NI to waive client confidentiality so it could "respond to any inaccurate statements" and to explain to both the select committee and the police the exact nature of the brief from its client. 

This looks very much like a case of garbage in ... garbage out. In other words, confine the material and the brief so as to get the advice the client wants. 

Rupert Murdoch, at the CMS hearing, also criticised NI's former director of legal affairs, Jon Chapman: 

"Mr Chapman, who was in charge of this [the advice from Harbottle & Lewis], has left us. He had that report for a number of years. It wasn't until Mr [Will] Lewis [an NI executive] looked at it carefully that we immediately said, 'we must get legal advice, see how we go to the police with this and how we should present it'." 

James chipped in: 

"I understand that the legal executives, I think it was Mr Chapman at the time, along with Mr Myler [former NOTW editor] who testified to this effect, took a report. 

From then, the opinion was clear that as to their review, there was no additional illegality in respect of phone hacking in that file. As to their review, that opinion was clear." 

Myler: never reviewed Harbottle's opinionMyler issued a statement straight after the hearing saying this was nonsense and that, "he had no part in commissioning, meeting with or reviewing Harbottle & Lewis or their work". 

The Guardian reported on July 20 that Chapman is understood to be writing to the chairman of the select committee, John Whittingdale, "to set the record straight". 

Angry lawyers, with expensive reputations to protect, are lining-up to demolish the Murdochs' carefully crafted story boards. 

Lawyers off the leash will prove dangerous. 

Update on Tuesday, August 2, 2011 by Justinian

Far from Harbottle & Lewis making a "massive mistake", as charged by Rupert Murdoch, the advice of May 29, 2007, was the result of careful negotiations between News International and the law firm. 

The New York Times reported on July 29, that NI had "huge anxiety" about the wording of the letter. 

NI had rejected earlier drafts during a back-and-forth struggle to achieve a more carefully crafted version that excluded wrongdoing for the client's editors at News of the World. 

The NYT quoted a source familiar with the negotiations, who said: 

"They wanted to bury those emails, and they wanted Harbottle & Lewis to give them a letter to indicate there was nothing incriminating in the file... They knew exactly what they were doing." 

The discussions focussed on finding a way for the firm to say it had looked into allegations made by Clive Goodman about hacking and had found no evidence connecting the editors.  

This creatively ignored the numerous emails that pointed to illegal payments made to police by Goodman, with the knowledge of senior editors. 

The home affairs select committee of the Commons has asked Harbottle & Lewis: 

• What was the exact remit given to Harbottle and Lewis when it was instructed by News International in 2007?

• The contents of emails and information held in the file you mentioned in your letter.

• What advice was provided from Harbottle and Lewis to News International in 2007 following examination of the emails and information?

• Why the evidence you had in 2007 that was later examined by Lord McDonald in 2011 was not acted upon sooner?