by borman818
The Media Equation: Troubles That Money Can’t Dispel
[Via NYT > NYTimes.com Home]
The willingness of the News Corporation to spend millions in settlement costs to make problems go away provides a useful window into its larger culture.
[More]
Some interesting material about court cases here in the US. This one stood out (my bold):
In 2009, a federal case in New Jersey brought by a company called Floorgraphics went to trial, accusing News America of, wait for it, hacking its way into Floorgraphics’s password protected computer system.
The complaint stated that the breach was traced to an I.P. address registered to News America and that after the break-in, Floorgraphics lost contracts from Safeway, Winn-Dixie and Piggly Wiggly.
Much of the lawsuit was based on the testimony of Robert Emmel, a former News America executive who had become a whistle-blower. After a few days of testimony, the News Corporation had heard enough.
The suit that Floorgraphics brought claimed that the information stolen from the hacked computers was used to spread false and misleading information. Floorgraphics settled for about $30 million and then News America bought the company. Floorgraphics has sales of $1 million.
I thought hacking into computer systems was a federal criminal offense. I wonder why there was no criminal investigation?
News America made a mistake here since it did go to trial and there were some interesting testimony from whistleblowers until News America shut the trial down.
They settled another case recently for half a billion dollars, one dealing with their uncompetitive business practices.
That amount was equal to the total annual earnings of all of their news and information divisions.
They have already lost in federal court on hacking charges stemming from another subsidiary, so I would not be surprised to hear about more instances. It seems to be part of their culture.
Often, being a cutthroat business on the way up means that there is little to cry about on the way down. We shall see how far down this goes.