Lawsuit Says News Corp Board Allowed A 'Historic Pattern Of Corruption'

The corporate governance suit against News Corp that several labor-backed pension funds have filed in Delaware is becoming more interesting — and potentially important. The group led by Amalgamated Bank, the New Orleans Employees’ Retirement System, and the Central Laborers Pension Fund today filed an amended complaint that says News Corp directors rubber-stamped decisions that led to nearly $1B in settlements and verdicts from privacy breaches and other problems at News America Marketing and NDS. These problems plus other incidents including the News of the World hacking scandals “were part of a much broader, historic pattern of corruption at News Corp, under the acquiescence of a board that was fully aware of the wrongdoing, if not directly complicit in the actions,” says the group’s lawyer Jay Eisenhofer of Grant & Eisenhofer. They have already told Delaware’s Chancery Court that News Corp’s execs and board violated their legal duty to protect shareholder interests when they agreed to pay $615M for Elisabeth Murdoch’s Shine Group TV production company — which the group calls “a sweetheart deal.” They also amended the complaint to include the NOTW scandal. (more…)

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