Today in the High Court, News Group Newpapers, the News Corp subsidiary responsible for the defunct News of the World and The Sun, is settling dozens of hacking and surveillance claims in an attempt to avoid a high court case on Feb 13th which could result in punitive damages.
There are over 60 hacking victims with ongoing cases, and at least another 800 confirmed and subject to litigation. Financially, this could be very costly for News International. But in terms of the hacking saga, it could be devastating for the Murdochs
Two Smoking Guns
1. In terms of the legal statements now being made in court, perhaps the most important is the admission of corporate cover-up. David Leigh at the stellar Guardian has the most incisive analysis
The most significant new element of Thursday's hacking settlement announcements is the accusation by the hacking victims' lawyers that Murdoch company directors tried to destroy evidence.
Although the lawyers' statement does not name names, it specifically accuses directors of News Group Newspapers Ltd, the Murdoch subsidiary which controlled the News of the World, of seeking to conceal the wrongdoing by "deliberately deceiving investigators and destroying evidence".
The directors of NGN were headed, from April 2008, by James Murdoch, Rupert Murdoch's son. James has already been at the centre of public allegations that he first authorised a cover-up in June 2008, by agreeing to buy the silence of Gordon Taylor, one of the hacking victims, with a lavish £700,000 secret pay-off.
The following year, former News of the World editor Rebekah Brooks joined the NGN board. This was on 23 July 2009, a few days after the Guardian revealed the existence of the cover-up at the News of the World. Brooks, who by now had been promoted by Rupert Murdoch to head his entire UK newspaper operation, responded by claiming: "The Guardian coverage, we believe, has substantially and likely deliberately misled the British public."
This takes the whole phone hacking scandal right to the top of the tree. Who knows what will unfold, but I wouldn't be surprised to see more resignations.
2. But for US readers - and for News Corp which is incorporated in the US - perhaps the most significant revelation in the welter of admissions today is with the Jude Law Case, where NGN's lawyers have admitted that - in line with news reports months ago - they hacked his phone while he was on US soil at JFK. From the Telegraph in June
The News of the World allegedly hacked into the mobile phones of Jude Law and his personal assistant while they were in New York, opening the way for News International to be prosecuted in the United States.
In the first specific example of a case of hacking on US soil, it has emerged that the actor and his assistant, Ben Jackson, were allegedly targeted shortly after arriving at New York's JFK airport.
Their mobile telephones were operating on American networks, meaning that regardless of where the alleged hacker was based, American law would apply.
It would leave News International open to claims that it broke US federal laws and also pave the way for costly lawsuits.
The allegation comes after it was announced that the FBI has opened a preliminary investigation into allegations that Rupert Murdoch's company tried to hack into the phones of victims of the September 11 attacks.
So where does this leave the FBI investigation? The DOJ is still looking at violations Foreign Corrupt Practices Act, and potential RICO violations. But this is a clear cut admission of intercepting wireless telephony on US soil.
I'm looking to fellow Kossacks for legal clarification on this and - if possible - to push the DOJ into action.
UPDATE: looks like this is getting some traction stateside. From Vanity Fair contributor and Murdoch Biographer, Michael Wolff:
Be part of the FOTHOM book: Bad Press: Fall of the House of Murdoch
5:38 AM PT: Also, for those interested, today's admissions extend beyond phone hacking
alan rusbridger @arusbridger Close
John Prescott's emails "unlawfully accessed" as well as phone hacked #Leveson #hackgate
That's the editor of the Guardian by the way, talking about the former Deputy Prime Minister having his computer hacked. Operation Tuleta is looking at allegations senior police and counter terrorism officers, as well as other serving ministers, were hacked by NI.
It's like a corporate version of East Germany's STASI.
6:01 AM PT: In the comments below Kossacks have asked me about the legal history of these cases, and I've given a brief sketch of background in this comment here. But more importantly as Brian Cathcart of the Hacked Off campaign writes, we should honour the victims - celebrity or otherwise - who took the grave risk of taking on News International.
A whole industry of deception, in other words, has crumbled thanks to the people compensated today and thanks to their predecessors who settled earlier, notably Sienna Miller.
And pathetic though News International’s legal defence has been lately, suing was never easy for the claimants. Think of the risks they exposed themselves to.
Back in 2010 when many of these cases began life, every politician knew that the Sun and the News of the World could wreck their reputations, and that these papers had more access to the Prime Minister (and his two predecessors) than any backbencher and most ministers. Suing probably looked like political suicide to most MPs.
Across television, cinema and sport, from Hollywood to India, New International owns or controls far more than any other company, so if you were an actress, a sportsman, a football agent or a PR person you risked much more than your time and money by suing — you risked your livelihood.
As for ordinary people whose phones had been hacked, you might think they had nothing to lose by suing, but think again: this is a company that employed private investigators on an industrial scale. Would you be happy to have every aspect of your private life secretly investigated, and if the slightest blemish was found — perhaps involving a vulnerable relative — to have that exposed in the press?
So it took courage for these people to sue, and collectively they made the difference between News International escaping scot free and what we have now: substantial police investigations, a couple of dozen arrests, and the historic and far-reaching Leveson Inquiry.