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Murdoch Confronts Critics At News Corp. Meeting

<p>Protesters demonstrate outside the News Corp. annual shareholder meeting at Fox Studios in Los Angeles on Friday. </p>
Eric Thayer
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Getty Images

Protesters demonstrate outside the News Corp. annual shareholder meeting at Fox Studios in Los Angeles on Friday.

On Friday, News Corp. held its first shareholder meeting since a phone-hacking scandal in the U.K. led the company to close a major tabloid. Outside the meeting at Fox Studios in Los Angeles, about 100 demonstrators assembled to condemn the Murdochs and News Corp.'s leadership.

But the complaints that followed inside were far more specific. There was a vote to approve the board of directors, but it was largely a formality because the Murdoch family and its allies control so many voting shares.

Rupert Murdoch wasted little time in reminding investors of his track record.

<p>British lawmaker Tom Watson, who is leading the investigative charge into the News Corp. hacking scandal, talks to protesters outside Fox Studios.</p>
Nick Ut / AP
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AP

British lawmaker Tom Watson, who is leading the investigative charge into the News Corp. hacking scandal, talks to protesters outside Fox Studios.

"The story of our company is the stuff of legend — from a small newspaper in Adelaide [Australia], to a global corporation based in New York, with a market capitalization of about $44 billion," he said.

Murdoch sounded contrite about the phone-hacking scandal, but he pushed back — pre-emptively — against his critics.

"The company has been the subject of both understandable scrutiny and unfair attack," he said.

Notably, however, Murdoch did not mention credible allegations that a News Corp. tabloid bribed police, that its executives may have perjured themselves in a Scottish trial or that British lawmakers are investigating whether executives lied to Parliament. Among those executives is James Murdoch, Rupert's son.

Leading the investigative charge in the U.K. is Labor MP Tom Watson. He held proxy shares on behalf of some union-related investors and traveled to Los Angeles for the meeting.

"I've genuinely been shocked about the scale of criminal wrongdoing and how executives covered it up and how, frankly, Rupert Murdoch, as head of the company, took a blase approach — almost took a blind eye to wrongdoing. And I don't think that's right," he said in an interview Thursday.

"I think I've got a duty to bring that to the shareholders' attention, because, after all, they are also responsible for what this company does," he said. "And I think this board has let them down."

At Friday's meeting, Watson told Murdoch and shareholders that there will be a second front: that journalists for a British News Corp. tabloid were involved in hacking into emails, too.

Murdoch didn't have much patience for that, slapping the table repeatedly.

Other executives played defense. Corporate director Viet Dinh called the scandal limited to one small corner of the company. Dinh, who is overseeing the internal investigation, is a former assistant U.S. attorney general, as well as the godfather of one of Murdoch's grandchildren.

Many shareholders — led by labor and religious institutional investors — challenged how much top executives were paid and Murdoch's decisions to acquire MySpace, The Wall Street Journal and his daughter Elisabeth's production company. The overall argument struck at the integrity of the corporation and the coziness between the Murdochs and its board.

News Corp.'s British arm confirmed Friday it would pay nearly $5 million to settle claims from parents of a murdered girl whose cellphone messages were hacked and deleted. The company also announced it would be laying off 200 employees at The Times of London and its sister paper, The Sunday Times.

Company officials were already looking ahead to Monday, when the former publisher of The Wall Street Journal will be questioned anew before Parliament. He felt compelled to resign after his testimony about hacking during his time as CEO of News Corp.'s British newspaper arm proved to be untrue.

Copyright 2020 NPR. To see more, visit https://www.npr.org.

David Folkenflik was described by Geraldo Rivera of Fox News as "a really weak-kneed, backstabbing, sweaty-palmed reporter." Others have been kinder. The Columbia Journalism Review, for example, once gave him a "laurel" for reporting that immediately led the U.S. military to institute safety measures for journalists in Baghdad.