Inside News Corp.'s Stockholders Meeting
Entering the annual meeting of stockholders for News Corp., one would be a bit surprised at how low-key the event was.
I walked into the Hudson Theater, just a block from Times Square in New York City, about a half hour before the scheduled start time of 10 a.m. Friday.
Only about 200 others were there, some of them News Corp. staffers and at least a few security-looking folks. It could have resembled a large family reunion given the attendance and fancy surroundings.
But they weren't ready to treat me like a long lost cousin.
I was ushered to the press table where they oddly did not have my name on the list despite my response to the announcement of the meeting.
A person handling press badges looked at me with surprise when I revealed my affiliation with Media Matters and produced my business card and identification. After getting approval from several others, I was allowed in, but told no recording devices were allowed.
I revealed my digital video recorder and was told I could not enter with any recording device. Despite promising I would gladly abide by their rules, they had to take it so I gave it up.
Next, all guests went through a security check equal to that at Kennedy Airport, sans removing shoes. They checked through bags, walked us through a metal detector and waved one of those detection wands as well. I passed.
I was also required to wear my press badge during the entire event and carry a white laminated card that indicated I was press, so forbidden to ask a question. Stockholders held their cards and were forced to show them before questioning the board, which sat on the stage.
When I reached the seating area of the small theater set aside for press, at least half of them had their own mini-recorders. When I noted this to staffers later, they said audio-recorders were allowed. That's not what they said before, but that did not apparently matter.
As the stockholders milled about, nibbling on the spread of breakfast items, fruit, Danish and coffee and juice, several discussed their concerns at the issues that would later dominate the day -- News Corp.'s twin million dollar donations to the Republican Governors Association and the U.S. Chamber of Commerce.
"It is worrisome on any number of levels," said Laura Shaffer Campos of the Nathan Cummings Foundation, which oversees 3,820 shares of News Corp. stock and has raised concerns about the political donations. "Your first responsibility is to the shareholders, furthering shareholder interest."
Campos said she and several other stockholders were concerned that the donations were made secretly and without shareholder input. She also noted that Murdoch later said he gave to the RGA in part because of his friend John Kasich, the GOP nominee for governor of Ohio. "When the company is making donations from the company treasury, it should be to further the interests of the company and the stockholders."
Per Olstad, a manager at the CtW Investment Group that represents the Massachusetts Laborers Pension Fund --which holds about 11,000 shares -- offered similar concerns.
"There is clear indication from Mr. Murdoch that he is using the corporate treasury to finance his own personal relationship and expressly denied it was some benefit to Fox News," Olstad told me. "It's a clear example of management using corporate treasury for their own personal use."
Inside the meeting, before the stockholders raised questions, the board quickly rejected two proposals brought forth.
One would have created a News Corp. Human Rights Committee to "review and approve all policies and actions taken by the company that may affect human rights observance in countries where it does business or where its products and technologies are used."
The board rejected it with Murdoch stating, "we employ thousands of journalists around the world who spend a great deal of their time tracking the issue of human rights and we don't think that it is necessary to have a special committee of the board because it is part of the DNA of the company."
Another proposal regarded shareholder advisory approval of executive salary increases.
"We do not consider this wise," Murdoch said as he announced its rejection.
When asked during shareholder questions about the million-dollar contributions to the RGA and the U.S. Chamber of Commerce, Murdoch admitted the donations were "unusual," but also said his reference to Kasich was "a foolish throwaway line."
He still defended the move and brushed aside requests from some shareholders to offer details of the process that went into the donations or promise more open details and shareholder input in the future.
"No, sorry, you have the right to vote us off the board," Murdoch said.
Other stockholders I approached to ask about the donations were almost offended that I would bring up the subject and offered their full support of the company's actions. One even asked a News Corp. staffer why I was allowed in. When I sought his name, he declined.
Few board members spoke, as Murdoch clearly ran the meeting. Even his son, James, remained silent. Lachlan Murdoch, another son and board member, was not in attendance.
Among the most outspoken stockholders was one Evelyn Davis, who asked all members of the press prior to the meeting to look at her booklet of "Highlights and Lowlights" marking her time at various stockholder meetings, from Bank of America to The New York Times.
Davis has made quite a name for herself in the past with publications ranging from People  to USA Today  profiling her and offering descriptions that range from "grandstanding crackpot" to "obstreperous corporate gadfly."
When Rupert Murdoch entered the theater, he gave her a big hug and a kiss, a move he might later regret as she took up about 15 minutes of the meeting's 60 minutes of time with a wide range of questions. But Murdoch let her continue, despite her going beyond the two minutes set for each speaker.
She claims to be "the most famous stockholder in the country."
Davis commandeered the microphone before anyone else and grilled Murdoch and the board with questions that ranged from concerns about getting better fashion coverage in the newspapers to removing liberals from public office.
"We should get rid of some of the socialist regime in Washington," she told Murdoch. "What are they doing about all of this?"
Murdoch withheld comment, but allowed her to speak longer than any of the other six stockholders who spoke.
At one point, when another stockholder later spoke and Davis wanted to comment, the stockholder yelled at her, declaring, "Don't assault me, step down, do not dare to touch me." It was unclear if she was touching him or not.
The board kept quiet as the man calmed down, proceeded to praise Murdoch, and let the next person speak.
After Olstad and Campos spoke and raised the campaign donation issues, Stephen Mayne, whose business card reads, "Australia's leading shareholder activist," took the mic. He immediately asked Murdoch if he planned to attend the Jon Stewart rally set for Washington, D.C., on Oct. 30.
"I never heard of it," Murdoch said. "I will be in Australia then."
Mayne asked if Murdoch planned to step down with an 80th birthday approaching. "No, when my health gives out, I will get out of the way, but not before unless the board decides to remove me, that's another matter."
When Mayne raised the issue of wiretapping by News Corp.'s News of the World in Britain and asked if other such incidents had been found, Murdoch said, "There have been two parliamentary inquiries that have found no further evidence of any other thing at all ... If any evidence comes to light, we will take immediate action as we did before."
Mayne noted a New York Times Magazine report  that found the practice "was widespread."
"Journalists who have been fired or unhappy or are now working for other organizations I do not take them as authority," Murdoch responded. "Least of all would I take The New York Times as authority, which is the most motivated of all of these."
When Mayne raised the issue of Glenn Beck's program losing advertisers, Murdoch jumped in to insist that Beck had only lost "four or five" and that they "moved over to Mr. O'Reilly's program."
According to The New York Times , "as of Sept. 21, 296 advertisers have asked that their commercials not be shown on Beck's show (up from 26 in August 2009)."
When Mayne cited recent reports that Roger Ailes was concerned about Beck and his promotion of "personal interests," Murdoch stated, "Mr. Beck is the least of our stars who take liberties in promoting their interests."
He added, "I don't agree with everything that's said on Fox News because we have all opinions. Unlike other channels, we are completely fair and open and we have Democrats being interviewed, Republicans, we have people who come on and argue. We have all sides of everything."
After a few more bits of business, the meeting ended. I went to collect my property that had been withheld, waiting about 10 minutes, then went off to file a story.
As I left, I asked the opinionated Ms. Davis what she thought of the RGA and Chamber of Commerce donations. She offered little concern, stating, "they all do it in Washington, but most are just more underhanded about it."