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04.11.12

Phone-Hacking Scandal Comes to the U.S.

In an exclusive interview, a London lawyer reveals his plans to take on Murdoch on behalf of clients who believe their phones were hacked in America.

Fleet Street lawyer Mark Lewis is coming to America this week—and he’s bringing the phone-hacking scandal with him.

Lewis has been Rupert Murdoch’s prime antagonist in the crisis rocking the mogul’s media empire in Britain. His 2007 lawsuit on behalf of a hacked soccer official kicked the scandal into gear, and he broke it open this summer with his suit on behalf of the parents of Milly Dowler, the murdered schoolgirl whose phone was hacked by Murdoch journalists when she disappeared. The uproar surrounding the Dowler revelations caused Murdoch to shutter his legendary News of the World tabloid, and he agreed to a landmark, multimillion-dollar payout to settle the family’s legal claim. 

When Lewis went toe-to-toe in those negotiations with Murdoch, there came a moment, he says, when Murdoch finally blinked—and it was when Lewis threatened that, in his words, “we would take it to America.”

Now Lewis says he is mounting a U.S. challenge to Murdoch all the same. In an exclusive interview with The Daily Beast, Lewis confirmed for the first time that he plans to file three separate lawsuits on behalf of clients who believe their phones were hacked while they were on U.S. soil. At least one of the cases, Lewis adds, involves allegations that the phone of a U.S. citizen was hacked. “This is getting wider,” Lewis says. A spokesperson for News Corporation declined to comment.

Lawyers and Murdoch opponents have been searching hard for U.S.-based cases since the scandal reached a head this summer. For one, they could bring the public-relations nightmare closer to home for News Corp., the parent company for Murdoch’s media conglomerate, which is headquartered in New York.

Analysts say the company has worked hard to limit the damage to its U.K. arm, News International, whose newspaper business accounts for just a fraction of the News Corp. bottom line. “News Corp. has so far tried to keep matters in the U.K. and has moved toward a policy of settling all cases as speedily as possible,” says Claire Enders, a London-based media analyst who follows News Corp. closely. “Mark Lewis launching these lawsuits in the U.S. brings the issue of phone hacking into News Corp.’s backyard, where they have the potential for significant embarrassment. And the people who are going to get the most embarrassed by this are the Murdochs in New York.”

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Former Times & Sunday Times editor Harold Evans and Parliament Member Tom Watson on how Rupert Murdoch scared Parliament

In addition, Lewis notes, if hacking took place on U.S. soil, he can more easily take aim at News Corp. itself.—he expects all three of his new lawsuits to be filed against the company in America. The purpose of his trip, which will take him to California on Thursday and New York on Monday, is to consult with U.S. lawyers on the stateside legal fight. “It gives him a bigger envelope for seeking damages,” Enders says.

At least one of the cases involves allegations that the phone of a U.S. citizen was hacked.

But the greatest damage from the lawsuits has not come from the settlements—and there have been more than 60 so far—but the revelations that have been unearthed as part of the legal process. Lewis’s 2008 suit, for example, produced proof that the phone-hacking problem was widespread at News of the World and not confined to a single “rogue reporter,” as News International had long claimed.

The scandal has since reached the feet of Murdoch’s son and onetime heir-apparent, James, who recently stepped down from the helm of News International amid accusations that he had helped to cover up the scandal when settling the 2008 case. Earlier this year the High Court justice overseeing the phone-hacking cases said he’d seen evidence over the course of the proceedings that raised  “compelling questions about whether [News International] concealed, told lies, actively tried to get off scot free.”

The police investigation into phone hacking has since expanded into far more serious allegations of corrupt payments to police and other public officials, which has led to a series of headline-grabbing arrests of senior journalists at Murdoch’s flagship daily tabloid, The Sun.

“It was those [early] cases that really opened up the files that allowed the exposure of lots of other things,” says Martin Moore, cofounder of the Hacked Off campaign against press abuses. “It’s as though News Corp. have been trying to chop off the rotten limbs, and each time they get further up the body. They started out by trying to chop off an individual rogue reporter. Then, for a short while, they said it was a handful of rogue reporters, and then a rogue newspaper. Then it started to expand beyond the newspaper to senior executives, and they cordoned off News International.”

Lewis seems anxious to start a legal discovery process against News Corp. itself. “We’ve only seen the documents that exist in respect to News International in England, and there’s been no process of discovery in respect of News Corp.,” Lewis says. “That could be the next thing that we have to find out.”

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Even without any actions from Lewis, the U.K. police investigations, along with a reported FBI investigation into whether News International violated the Foreign Corrupt Practices Act with the alleged Sun payments to public officials, has prompted News Corp. to launch an exhaustive internal investigation of News International. The company has been poring through millions of emails in its U.K. headquarters and handing potentially damning information to police—a process that sparked the arrests of Sun journalists.

In addition to the phone-hacking cases, Lewis says, he also plans to take aim at News Corp.’s commercial side. He plans to bring still another suit that looks into “perhaps the dirty tricks that might have been used in order to further the commercial aims for News Corporation.”

Lewis declined to give specifics on the three U.S.-based cases, but all three center on high-profile subjects. In one case, the alleged victim was connected to the royal household and to Princess Diana, Lewis says. In another case, the alleged victim was connected to England’s national football team. Lewis describes the third as a Hollywood case in which the alleged victim was in contact with a top celebrity, and therefore a target for hacking.

In each of the new phone-hacking cases, Lewis notes, people in contact with the primary hacking subject may have been targeted as well. “It’s not just the people who were A-list or celebrities, but people who were in their circles—people who might call them or work with them, what I would call the ordinary people who just got caught in the crossfire,” he says.

Just as in the U.K. scandal, Lewis says the allegedly hacked numbers were found in the notebooks of Glenn Mulcaire, the News of the World–employed private detective whose seized notebooks have been the basis of the police investigation into phone hacking. At least one of the numbers involved in his new cases was an American one. The presence of phone numbers in Mulcaire’s notebooks does not prove that the targets were hacked.

Lewis has yet to file the new cases but says he plans to do so “imminently.” He also says there could be more U.S.-based cases in the works—which will be a key part of his discussions over the coming week with his counterparts in the States.