Wednesday, August 03, 2011

What About Murdoch's American Empire?

By now, everyone is familiar with the firestorm of controversy that surrounds the Murdoch media empire, and it's about time considering the News of World phone-hacking schemes has been unfolding for six-years. It was The Guardian's revelation that News of the World had hacked into a teenage murder victim - even erasing the victim's voice-mails, giving the family false hope that she was alive - that broke the story wide open. News of the World also hacked the voice-mail accounts of victims of the London subway terrorist bombings in 2007. However, up until this point, the focus has been on the other side of the Atlantic. Granted, Rupert Murdoch's incestuous relationship with the British government is no secret. In less than a year,  there were 125 major lunches between the Cameron government and the Murdoch people.  But what about Murdoch's American empire?

Ten years ago, Murdoch set his eyes on Floorgraphics (FGI), a company that sells advertising on the floor of supermarkets.  Murdoch sent Paul Carlucci, president of News America (media arm of US Murdoch empire), to meet with the owners of FGI to make them an offer they couldn't refuse, but the owners, George and Richard Rebh (brothers), did, in fact, refuse.  Carlucci, in typical mafioso form,  threatened to destroy them, and over the next few years, that's exactly what  happened: News America hacked into FGI's database, and used the information to steal away  their clients, such as Safeway.

FGI hired a computer expert who traced the hacking to News America.  In 2004,  FGI petitioned Chris Christie  - New Jersey’s large-and-in-charge governor - then a U.S. attorney, to launch a criminal investigation into the alleged hacking, but the future governor of New Jersey refused to file charges. The case went to trial in 2009, and after one week, it resulted in Murdoch purchasing FGI for  $29.5 million.

Trial brief

FGI v. News America Court Testimony

FGI's complaint against News America

Defendant's response

FGI was not the only victim of News Corp. Valassis Communications, Inc claimed Murdoch's tactics caused $1.5 billion in damages. They ended up settling for $500 million

Insignia Systems, Inc. was seeking triple damages on its antitrust claim, alleging that it lost hundreds of millions of dollars as a result of anti-competitive behavior by the News America Marketing unit. They ended up settling for $125 million.

Insignia claimed that News America entered into exclusive contracts with retailers, paid the stores to boycott Insignia and used predatory pricing and bundling of advertising and promotion products, in violation of U.S. antitrust law.

Insignia also claimed News America disparaged it to customers, telling the consumer-goods companies that they would be throwing their money away by contracting with Insignia.
Judge's order finalizing Valassis deal

Insignia Systems complaint.

Sadly, News of the World reporter, Sean Hoare, who broke the was found dead a week after the story broke and his death declared not suspicious before they even did an autopsy.  The heads of DOW and the Wall Street Journal have resigned, and 43-year old Andy Coulson,  editor of News of the World, who left the company under a cloud only to become the media spokesman for Prime Minister Cameron, was arrested. The head of Scotland Yard resigned.

This hacking scandal may be the tip of what could be a Titanic sized iceberg that could sink not only News Corp, but also the “British/American Empire”. How? Well, not only does this scandal  reveal an incestuous relationship that reaches into the highest corridors of power, it may expose the profoundly dark and sinister practices of some of the most powerful people on the planet. More about that later.


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