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."