News Corp. Said to Be Sued by Former Investigator Mulcaire Over Legal Fees

Glenn Mulcaire, the private investigator jailed in 2007 for intercepting voice-mail messages while working for News Corp.’s defunct News of the World tabloid, sued the company, which had stopped paying his legal fees.

The lawsuit's court papers didn't state why Mulcaire had sued. He claims a breach of contract because the company stopped paying his legal bills, according to a person familiar with the case who wasn’t authorized to speak about it publicly. Mulcaire sued News Group Newspapers Ltd., which publishes the Sun tabloid and formerly the News of the World, in London court yesterday.

Mulcaire, who intercepted messages left for model Elle Macpherson and members of the British royal family, is a key figure in the phone-hacking scandal that prompted the closure of the 168-year-old tabloid last month after revelations that journalists had hacked the phone of a murdered schoolgirl.

News Corp. (NWSA) Chief Executive Officer Rupert Murdoch and his son James told U.K. lawmakers last month they didn’t know if the company was still paying legal fees for Mulcaire. The company said the next day they would immediately terminate “any arrangement” to pay Mulcaire’s bills. The documents outlining his claims aren’t publicly available under British law until News Group files a response to the court acknowledging the suit.

Mulcaire’s lawyer, Sarah Webb, didn’t immediately respond to a request for comment. A spokeswoman for News Corp.’s U.K. unit, Daisy Dunlop, said the lawsuit had been received.

“The claim will be vigorously contested,” Dunlop said.

Civil Cases

Mulcaire and News Group are defendants in dozens of civil lawsuits filed by individuals who claim their voice mails were accessed. London’s Metropolitan Police are examining Mulcaire’s notebooks and contacting possible victims. Today police arrested James Desborough, a former Hollywood reporter for the News of the World, according to a person familiar with the probe. He is the 13th person arrested in the investigation.

The British detective in charge of the phone hacking inquiry said last month her team is trying to contact potential victims as fast as it can. Sue Akers, the deputy assistant police commissioner, said there are almost 4,000 names in the 11,000 pages of documents seized by police in 2006. The documents include Mulcaire’s notebooks.

The original investigation was closed after Mulcaire and former News of the World royal reporter Clive Goodman were jailed in 2007. The case was reopened in January after civil lawsuits by the actress Sienna Miller and others revealed the crime went beyond the two men. Police subsequently opened a second probe, into allegations of police corruption, and a third investigation into computer hacking and breaches of privacy.

2007 Letter

Goodman, in a 2007 letter published this week by a parliamentary committee investigating phone hacking, said the crime was widespread at the News of the World, editors discussed it during meetings and that he was promised his job back if he didn’t reveal the problem to law enforcement. The company settled with him for close to 250,000 pounds ($412,000) after he claimed he was unfairly dismissed following being jailed.

News Corp. paid Mulcaire's lawyers 246,000 pounds before ending such reimbursements, James Murdoch said in a statement to Parliament Aug. 16.

The case is: Glenn Michael Mulcaire v. News Group Newspapers Ltd., case no 11-2867, High Court of Justice, Chancery Division (London).

To contact the reporter on this story: Lindsay Fortado in London at lfortado@bloomberg.net

To contact the editor responsible for this story: Christopher Scinta at cscinta@bloomberg.net

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