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Independent News and Media ordered to pay legal costs as probe to begin into company affairs

Costs of the proceedings were also awarded to the ODCE against INM.

Image: Sam Boal/Rollingnews.ie

INDEPENDENT NEWS AND Media (INM) has decided not to appeal the High Court ruling to appoint inspectors to investigate the company’s affairs.

Sean Gillane, senior counsel, and UK lawyer Richard Fleck, who were appointed as the two inspectors will now begin work immediately.

It’s understood that staff working at INM received a message today from interim chief executive Michael Doorley, which said that he wants to reassure them that management are aware of the “sensitivities surrounding journalistic materials, journalistic privilege and, in particular, the protection of sources”.

He says that the cooperation of the company with inspectors is “not without limit” but they will take “every action to preserve privilege and protect sources”, which could include seeking court orders.

However, he reassured staff that there is not currently an expectation that inspectors will be interested in the editorial side of INM, and rather they will focus on corporate issues. Staff are to contact named managerial staff if asked to produce any material during the inspection.

On Tuesday, the High Court President Mr Justice Peter Kelly agreed to appoint inspectors to investigate INM after an application by the Director of Corporate Enforcement (ODCE).

The judge said what was alleged to have happened at the company was “very serious indeed” but postponed the making of final orders until today to allow INM to consider his judgment.

This morning, lawyers for INM told the court there would be no further application – meaning the company does not intend to appeal the ruling.

Costs of the proceedings were also awarded to the ODCE against INM.

Ruling

As explained here, the recent furore was sparked by INM’s ill-fated bid for radio station Newstalk (owned by INM’s largest shareholder Denis O’Brien). In March 2017, the ODCE asked INM to “produce books and record” in relation to the proposed takeover.

As the ODCE’s involvement with INM persisted over the year, the watchdog announced on 23 March that it would be seeking to appoint inspectors.

INM, however, strongly resisted efforts to have inspectors appointed, and failed to block the case following a judicial review in June

In an affidavit from ODCE director Ian Drennan, he said that there was a removal of INM’s IT system’s back-up tapes from the company’s premises. According to the affidavit, they were moved to the premises of a company outside of this jurisdiction in October 2014.

In his ruling, Mr Justice Kelly said he was satisfied that it was in the public interest for these matters to be investigated. 

“A free press is a cornerstone of a functioning democracy,” he said, adding that if the data of journalists was accessed in the manner in which it is alleged, this was worthy of further investigation. 

He rejected arguments from INM that the alleged actions of its then-chairman Leslie Buckley were solely alleged wrongdoings of him and not of the company. 

Mr Justice Kelly said that if wrongdoing was done by Buckley in his role as chairman of the board of the INM, then it directly relates to the affairs of the company. 

He also rejected the assertion that the “very survival” of the company would be jeopardised by the appointment of inspectors, adding: “I am sceptical that the mere appointment of inspectors would have such devastating consequences.”

In a statement released on Tuesday evening following the judge’s ruling, INM said that its board and the company’s management “intend to remain focused on the business and ensuring that the group’s operations continue, so far as possible, to be conducted as normal”.

With reporting from Sean Murray

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