Judgment is reserved in INM hearing

THE president of the High Court Mr Justice Peter Kelly has, after a three-day hearing, reserved judgment on the application by the State’s corporate watchdog to have inspectors appointed to investigate concerns over the conduct of the affairs of Independent News & Media (INM).

However, both sides are due to make written submissions this week as to the exact terms of reference for inspectors, should they be appointed by the court.

The Office of the Director of Corporate Enforcement (ODCE) wants inspectors appointed to probe the “interrogation” of INM data by outside parties in 2014, said to have been authorised by the then INM chairman Leslie Buckley, who was the nominee of INM’s largest shareholder, businessman Denis O’Brien.

Invoices associated with the data interrogation were discharged by a company owned by Mr O’Brien.

INM, which publishes this newspaper, is opposing the application, saying the appointment of inspectors is unwarranted and would damage the company.

The ODCE also wants inspectors to investigate claims that in 2016 senior INM executives came under pressure from Mr Buckley to pay an inflated price for the Denis O’Brien-owned radio station Newstalk. That proposed purchase by INM was subsequently abandoned.

INM claims it was misled by Mr Buckley about the data interrogation and has initiated legal proceedings against the former chairman, seeking damages for alleged breach of duty and misrepresentation.

It is also seeking an indemnity in respect of any legal claims against the company arising from his alleged conduct. Mr Buckley has signalled that he will robustly defend himself against each and every allegation.

During proceedings last week, counsel for INM rejected a suggestion by the corporate watchdog that a “culture of deference” existed within the company towards its largest shareholder, Mr O’Brien.

The company has also rejected a suggestion by the ODCE that former chairman Mr Buckley had “untrammelled authority” at INM.

Paul Gallagher SC, for INM, said there was no basis for the assertions.

He said the two criticisms were of considerable concern and it was difficult to envisage a more damaging set of remarks for the board of a public limited company.

The barrister said INM had a board of very experienced directors who were people of “unimpeachable integrity”.

The ODCE, which has been investigating matters at the company, says it had reached a point where inquiries cannot be advanced further without the appointment of inspectors.

The court heard the data breach issue is already being investigated by the Data Protection Commissioner (DPC) and that the Central Bank was considering investigating another matter raised by the ODCE.

Neil Steen SC, for the ODCE, said INM had asked that if inspectors are appointed, their remit should be “tightly drawn”.

But he said the nature of an investigation was to look into things that were not fully known. “The proposition the investigation be tightly drawn cannot be justified,” he said.