ROBERT SIEGEL, HOST:
Media mogul Rupert Murdoch has had his eye on Sky, a giant European media company, for decades. Murdoch made a bid to take full control of Sky seven years ago only to see it fall apart during a hacking scandal at one of his British tabloids. Well, now his company has struck a new $14.6 billion deal for Sky. But as NPR's David Folkenflik reports, the Fox News scandals here in the U.S. threaten Murdoch's plan once more.
DAVID FOLKENFLIK, BYLINE: The last time Rupert Murdoch and his family sought to buy full control of Sky, they ran into a brick wall. In July 2011, The Guardian published accusations that their Sunday tabloid, News of the World, had hacked into the voicemail messages of a dead girl. David Cameron, then the British prime minister, took pains to address the allegations while in Afghanistan.
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DAVID CAMERON: If they are true, this is a truly dreadful act and a truly dreadful situation.
FOLKENFLIK: Accusations of criminality tore through the newsrooms of the Murdochs' British tabloids. Reporters had hacked the phones of terrorism victims and slain soldiers as well as celebrities, politicians, soccer stars and royals. The newspapers had bribed police officers too. National outrage led to the closing of the News of the World, several inquiries, criminal trials and the resignations of top executives, including James Murdoch, Rupert Murdoch's younger son. A parliamentary inquiry the next year arrived at a harsh judgment. Here's British MP Tom Watson.
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TOM WATSON: In the view of the majority of committee members, Rupert Murdoch is not fit to run an international company like BSkyB.
FOLKENFLIK: BSkyB being another name for Sky. Watson's phrasing, not fit, was carefully chosen. By law, the British regulator Ofcom - it's much like the FCC - has to determine whether the Murdoch's and their company would be fit and proper owners for Sky. Now James Murdoch is back as CEO of the family's television and entertainment arm, 21st Century Fox. They already control Sky, as Fox owns about 40 percent of its stock. But Rupert Murdoch has wanted to gain full control for decades, and James has made it a crusade.
Ofcom must once again judge whether 21st Century Fox and the Murdochs would be fit and proper owners. Many analysts say they've been strong stewards of the company, yet the scandals at Fox News loom over everything. Former Fox News chairman Roger Ailes and former star host Bill O'Reilly were forced out after multiple allegations of sexual harassment. Other executives had to leave, too.
DOUGLAS WIGDOR: I refer to them as 18th Century Fox given the abhorrent behavior, racist and gender-based conduct that's been going on in the workplace for many, many years.
FOLKENFLIK: That's Douglas Wigdor, a New York-based lawyer who represents 20 current and former Fox News employees who have filed suit against the network and its executives for sexual and racial bias. Wigdor spoke with staffers at Ofcom today in London. I interviewed him earlier this week.
WIGDOR: I think it starts at the top with the Murdochs and then filters down all the way to people like Dianne Brandi, who has been there for many, many years. Certainly it also points a finger to Suzanne Scott.
FOLKENFLIK: Dianne Brandi is Fox News' top lawyer. Suzanne Scott was just promoted to be president of programming. Both have been named as defendants in the harassment suits, and both figure prominently in Wigdor's racial bias suits, too. Though Fox denies they have any culpability.
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UNIDENTIFIED REPORTER: Do you have any concerns about what Ofcom might say about what's happening at Fox News?
FOLKENFLIK: Earlier this week, a reporter for the BBC surprised Rupert Murdoch outside his New York City headquarters as he hopped into a chauffeured car.
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RUPERT MURDOCH: Fox News is getting record ratings.
UNIDENTIFIED REPORTER: Yeah.
MURDOCH: And so I'm not worried at all.
UNIDENTIFIED REPORTER: And you don't think Ofcom are going to consider what's happening at Fox News when they enter their considerations?
MURDOCH: Nothing's happening at Fox News - nothing, OK?
FOLKENFLIK: Lachlan Murdoch, Rupert's elder son, spoke in a conference call with financial analysts yesterday. He predicted the Sky deal would be wrapped up by the end of 2017. Fox also disclosed it spent $45 million over the past nine months to address sexual harassment claims. In London last night, Attorney Douglas Wigdor called on Fox to allow the women who have received confidential settlements to speak out publicly, especially to the British regulator. The accusers are among the critics seeking to deny the Murdochs this long-coveted prize of Sky. David Folkenflik, NPR News, New York.
(SOUNDBITE OF GIANT BRAIN'S "DIE FESTZEIT") Transcript provided by NPR, Copyright NPR.
