Thursday 17 October 2019

Former INM executives can use ODCE papers in lawsuit against media group

Independent House, Talbot Street, Dublin
Independent House, Talbot Street, Dublin
Shane Phelan

Shane Phelan

TWO former senior executives at Independent News & Media (INM) have been given permission to use documents filed in court by the corporate watchdog as part of lawsuits they intend bringing against the company.

Former chief executive Gavin O’Reilly and former director of corporate affairs Karl Brophy say they intend to sue over the alleged breach of their privacy and data protection rights arising from a major alleged data breach.

They also intend to allege various parties engaged in a conspiracy to damage their interests.

In a judgment today, the President of the High Court said both men could use Office of the Director of Corporate Enforcement (ODCE) documents regarding the data interrogation for the purpose of bringing proceedings against INM.

Mr Justice Peter Kelly rejected a number of objections made by INM to the applications by Mr O’Reilly and Mr Brophy.

Both men have been in possession of certain ODCE documents since April of last year, but were not permitted until now to use them in litigation against the media group.

The judge said if he refused to grant their application, it would result in an injustice to Mr O’Reilly and Mr Brophy.

He said that if he did not make the order it was inevitable that discovery applications would have to be made for documents both men already had.

“From a public interest point of view that would be wasteful of scarce time and resources of the court as well as increasing the cost and delaying the litigation in question,” Mr Justice Kelly said.  

Both men claim their privacy and data protection rights were breached during an alleged “interrogation” of INM data back-up tapes in 2014. The data tapes were taken to the premises of another company outside the jurisdiction and interrogated over a period of months.

Mr Justice Kelly said the operation was allegedly directed by the chairman of INM, Leslie Buckley, and paid for by a company owned by then major shareholder Denis O’Brien.

Other members of the board were allegedly not aware of the operation at the time, the judge said.

Mr Justice Kelly said the data interrogation was, according to Mr Buckley, part of a cost reduction exercise in respect of a contract with a firm of solicitors.

Mr Brophy’s name appeared on a list of 19 people against whom the ODCE believes searches of the data were made.

Mr O’Reilly’s name did not appear on the list, but the name of this personal assistant Mandy Scott was included.

“It is difficult to see what the interrogation of information concerning at least some of the 19 persons had to do with a cost reduction exercise,” the judge said.

He observed that solicitors for INM had described the names of those searched against as persons who may be regard as having acted adversely to Mr O’Brien.

“The rights and entitlements of some or all of the 19 people may have been transgressed in a most serious way by this activity,” the judge said.

“So also may have been the rights and entitlements of Mr Gavin O’Reilly.”

Both men say they believe their personal data was contained in the interrogated emails and was processed without their permission or consent.

They also say the exercise had no apparent legitimate purpose.

In an affidavit, Mr Brophy said he believed his personal data included sensitive information such as the results of a medical examination when he joined INM. He said his employee records, pension entitlements, salary and banking details were likely accessed.

Mr Brophy also said that for most of his time at INM he worked as a journalist and the data interrogation allegedly touched on matters which would attract journalistic privilege, such as the identity of sources and other confidential material.

He claimed the unlawful disclosure of his data to third parties would have the potential to cause him “enormous damage”.

Many of the same concerns were also voiced by Mr O’Reilly.

Mr Brophy worked as INM’s director of corporate affairs between January 2011 and October 2012, while Mr O’Reilly was the media group’s chief executive from 2009 until April 2012.

Both are now involved in a public relations firm called Red Flag, where Mr Brophy is chief executive and Mr O’Reilly is chairman.

According to the judgment, Mr Brophy alleged the termination of their respective employments was the result of a long-running power struggle between Mr O’Reilly’s father Anthony and Mr O’Brien.

He said considerable animosity existed between the two shareholders and because he was aligned with the O’Reilly family, this animosity extended to him.

Mr Brophy said he believed the animosity was ongoing and was evidenced by the fact proceedings have been taken by Mr O’Brien against Red Flag.

Although both men were granted access to the ODCE material by the court last year, Mr Justice Kelly placed restrictions on what it could be used for.

He said at the time that it would be necessary to apply to the court to use the material for any purpose other than the ODCE proceedings, which involved a successful application for the appointment of High Court inspectors to INM.

In his judgment, Mr Justice Kelly said Mr O’Reilly and Mr Brophy contended it was “of critical importance” they be given liberty to use the material in their intended proceedings.

He said they had pointed out that the material had already been opened in court and could not be considered either private or confidential.

The judge said they contended they would be placed in an invidious position if they were prevented from using the information in order to vindicate their rights.

Mr Justice Kelly said they also argued they would be severely prejudiced in their ability to bring the proceedings if they were forced to engage in lengthy and expensive discovery requests in order to obtain documents already in their possession.

INM objected to the application on a number of grounds, including that the relief sought was too wide as it sought permission to use the material without restriction and for entirely unidentified purposes.

The company also argued the application would breach some provisions of the Companies Act and that, if granted, would give Mr O’Reilly and Mr Brophy an unfair litigation advantage.

However, these arguments were not accepted by Mr Justice Kelly.

He said he was satisfied the applicants had demonstrated there were special circumstances and that the making of the order would not occasion injustice to INM.

The court will deal with the costs of the application next week.

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