Murdoch to Testify on Politics as Hunt Faces Pressure to Resign

Rupert Murdoch will give evidence on his relationship with U.K. politicians a day after an inquiry’s probing of his son James ended with calls for Culture Secretary Jeremy Hunt to quit over his dealings with News Corp. (NWSA)

The Leveson Inquiry into media ethics released e-mails yesterday showing either Hunt or his officials were leaking information to News Corp. as they decided whether to allow its takeover bid for British Sky Broadcasting Group Plc (BSY) last year. Hunt’s own career hangs on a News Corp. lobbyist’s statement that he misled his bosses when he sent messages suggesting he was having regular evening chats with the culture secretary.

Murdoch, 81, will take the stand at the inquiry in London today for the first of two days of evidence, under oath, on his five decades of involvement with British politicians. Those looking for evidence of closeness found it in e-mails that showed on at least two occasions, News Corp. was given details of Hunt’s decisions the day before he announced them.

“There is just overwhelming evidence that while he was telling Parliament and while he was saying his duty was to be transparent, to be impartial, he was providing all kinds of information, both through himself and his advisers, to the Murdochs and News Corp.,” Ed Miliband, leader of the opposition Labour Party, said late yesterday. “He singularly failed to exercise his duties -- he was a secretary of state who was far too close to the big media interests.”

Murdoch’s son James, deputy chief operating officer of New- York-based News Corp., went through five hours of testimony yesterday, questioned first on the phone-hacking scandal and then on the bid for BSkyB. On the first, he stuck to his defense that he had been misled about the extent of wrongdoing at the News of the World tabloid by the paper’s editor and lawyer.

James Defense

Murdoch argued there was nothing more he could have done to establish the truth, repeating that he hadn’t read in full an e- mail setting out the situation in more detail because he’d received it on a Saturday.

The morning session closed with the inquiry’s lawyer, Robert Jay, putting it to James Murdoch that he’d either authorized a cover-up or been responsible for a failure of governance, a charge Murdoch denied.

It was the afternoon session that offered fresh revelations, with Jay taking Murdoch through his dealings with Hunt over the BSkyB bid. When this was announced in 2010, Liberal Democrat Business Secretary Vince Cable was given the job of deciding whether it should be allowed, sitting in a “quasi-judicial” role that gave him specific legal duties.

Lobbying Attempts

The e-mails from News Corp. lobbyist Frederic Michel to Murdoch show him spending the second half of 2010 trying to find out Cable’s thinking. An attempt to meet Cable’s adviser Giles Wilkes was rebuffed, with the aide insisting he wanted to stay “within the bounds of proper conduct.”

Michel was having more luck with the Conservative side of Britain’s coalition government. Hunt was in regular contact, even calling Murdoch to apologize for being unable to meet him after he was given “strong legal advice” by one of his officials that he shouldn’t be discussing the bid with the company while another minister was considering it.

On Dec. 21, 2010, Prime Minister David Cameron removed responsibility for examining the deal from Cable after undercover journalists recorded the business secretary saying he had “declared war” on Rupert Murdoch. The job was passed to Hunt.

The culture secretary and Michel had got to know each other in May of that year when their wives gave birth in the same west London hospital on the same night. “We bumped into each other in the very same ward and shared a night of anxiety,” Michel said in written evidence to the inquiry.

Text Messages

In early 2011, Michel sent James Murdoch a series of e- mails detailing Hunt’s thinking, and explaining the stage the process had got to. Often sent in the evenings, they typically began: “Just spoke to JH.”

In his sworn statement to the Leveson Inquiry, Michel said these had in fact been the result of conversations with or text messages from Adam Smith, Hunt’s adviser, whom he believed to be speaking on Hunt’s behalf.

“At no point between Dec. 24, 2010 and the end of July 2011 did I have any direct conversation with Jeremy Hunt relating to the BSkyB proposal beyond the two formal meetings I attended,” Michel said. “It was never my intention to imply to readers of my e-mails that I had had direct access to the minister.”

‘Kneejerk Reactions’

Michel provided detailed records of text messages from Smith that he had relayed to Murdoch as conversations with Hunt. The culture secretary pointed to this in a statement last night. “Now is not a time for kneejerk reactions,” Hunt said. “We’ve heard one side of the story today but some of the evidence reported meetings and conversations that simply didn’t happen.”

Hunt has asked to give evidence to Leveson to put his defense and is likely to be called to Parliament today to explain his actions. He’ll be asked how Michel came to be e- mailing details of Hunt’s decisions to his superiors the day before they were announced.

“How can it be that Sky knew before Parliament exactly what Jeremy Hunt was going to say?” Labour lawmaker Chris Bryant told the BBC yesterday. “How can that be?”

To contact the reporter on this story: Robert Hutton in London at rhutton1@bloomberg.net.

To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net.

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