The independent directors of News Corp.’s board issued a statement in support of its Chairman and CEO Rupert Murdoch on Tuesday, the Los Angeles Times is reporting.
Viet Dinh (below), a professor at Georgetown Law School and one of the directors, issued the statement, which said, “We are united in support of the senior management team to address these issues."
The statement comes on the same day that the independent directors hired an independent law firm to steer them through the continuing fallout of the phone-hacking scandal, as reported by the Wall Street Journal.
Tom Perkins, a venture capitalist and one of the board members, said he and his fellow directors had hired Debevoise & Plimpton LLP to help out Rupert Murdoch’s media company, which faces a shareholder suit, an FBI inquiry and the possible prosecutions of several former employees. Murdoch, News Corp.’s Chairman and CEO, testified with his son before a Parliament Select Committee Tuesday in a performance that was alleged to have some bearing on his status.
There had already been rumors that the board was considering replacing Murdoch with COO Chase Carey.
Perkins’ statement rejected that speculation.
“The board honestly thinks Rupert is a genius and we need him and the company needs him,” Perkins said. “Our worry is the shareholders at this point. The British police will take care of the hacking victims. The next step is not to let the company go down the drain on this thing because we're focused on events in London that are a small percentage of our business overall."
While the News of the World represented just one percent of News Corp.’s business, its scandal has had a significant effect on the company’s share prices. Entering Tuesday, the price had dropped 17 percent. With news of Carey’s potential ascendance, the price rose 5 percent Tuesday.
This statement of support could be an indication that the board needs its own counsel in the case of a lawsuit, or it could be an effort to calm investors and keep that stock price moving up.