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News Corp Rupert Murdoch

Clouds gather over Fox lot as shareholders sharpen arrows for Murdoch family

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By Noel Young, Correspondent

October 21, 2011 | 4 min read

The question on everyone’s lips is : Will the House of Murdoch fall? That's how Nicholas Wapshott starts his piece on America's Daily Beast website, on the eve of today's News Corp shareholders' meeting in Los Angeles.

Rupert Murdoch

In Australia, Murdoch's flagship paper, The Australian agrees that Murdoch and his leaders "face a firestorm at the shareholder meeting" with calls for Murdoch and sons James and Lachlan to be removed from the company's board.

But for all the sound and fury from shareholders, there is little chance of change at the top, says Wapshott. And the others agree. Murdoch controls 40 percent of the voting stock, which, with his ally Saudi Prince Alwaleed bin Talal’s 7 percent, will ensure he sees off all comers.

However, a significant vote of no confidence by investors could lead to someone other than a Murdoch running News Corp. for the first time in its history, says the Los Angeles Times. "Under one scenario discussed in recent months, President Chase Carey may be elevated to CEO, leaving Murdoch in a diminished role."

Veteran media analyst Harold Vogel comments on that scenario, "This is not something you want late in your life after building such a great company. But now Murdoch must live with this blotch, this stain on his reputation, and it won't be easy to erase."

Back at the Daily Beast, Wapshott has another bombshell in his locker: When will James Murdoch be arrested? "Alone among those Rupert Murdoch claims to have let him down in the firestorm over journalistic ethics that is engulfing his media company, his son James has so far avoided the attention of Scotland Yard detectives," he says.

Wapshott believes that the arrest of James, until earlier this year his father’s favourite and the unrivaled heir apparent to the media empire, has moved "sharply closer" with the admission by a London-based attorney, whose company represents News Corp. that Murdoch Jr. misled the parliamentary committee investigating the hacking.

And it will be James Murdoch who can expect the toughest ride when shareholders meet in Los Angeles.

The AGM, "once held in the tranquil Asia Society on Park Avenue," has been switched to the safety of the Fox movie lot in Los Angeles, says Wapshott.

"There is nothing like a media company in deep trouble for keeping journalists from doing their jobs. Reporters, just one per publication, armed with photo ID and credentials, must assemble at a parking garage to be bussed in to the studio, to dodge the protesters expected at the gates. The press may not ask questions at the meeting.

"The company that founded the Fox network, Fox News, and Fox Business insists that no TV cameras record the scene."

One set of shareholders is suing News Corp. because it says it overpaid for Shine, Rupert’s daughter Elizabeth’s London film company . The writ says that “Murdoch has treated News Corp. like a family candy jar, which he raids whenever his appetite strikes.” Four giant pension funds who invest in News Corp. want to see the Murdochs kicked off the board. The failure to prevent malfeasance shows the Murdochs cannot deliver the ethical leadership a public company deserves, they claim.lists agree.

The Washington Post said British MP Tom Watson, who has flown out to Los Angeles, plans to detail new findings of covert surveillance techniques employed by News Corp. that go “beyond phone hacking.”

Watson said he would reveal details at the company’s annual shareholders meeting that “will leave the company liable to civil liability but also huge reputational harm.”

Watson said he will be acting as the proxy for 1,669 nonvoting shares owned by the American labour group AFL-CIO. He will likely be allowed to speak along with other shareholders.

News Corp Rupert Murdoch

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