RENO, Nevada, Sept 12 (Reuters) - A closed-door court
battle over control of Rupert Murdoch's media empire begins
Sept. 16, and could determine the future of Fox News and the
Wall Street Journal.
Murdoch, 93, is attempting to change the terms of the
family's irrevocable trust to ensure his newspapers and
television networks remain under control of his eldest son and
chosen heir, Lachlan Murdoch, according to the New York Times,
which obtained a sealed court document detailing the succession
drama.
Reuters and other news organizations are attempting to gain
access to sealed court records, and to open the court hearings
in Reno, Nevada, before probate commissioner Edmund J. Gorman
Jr.
The trust lays out a scenario on how a potential takeover
could occur, according to a source who has seen the documents.
The trust is the vehicle through which the elder Murdoch
controls News Corp ( NWSA ) and Fox, with roughly a 40%
stake in voting shares of each company. Murdoch also holds a
small amount of shares of the companies outside the trust.
Upon Rupert Murdoch's death, News Corp ( NWSA ) and Fox voting shares
will be transferred to his four oldest children - Prudence,
Elisabeth, Lachlan and James. Potentially, three of the heirs
could out-vote a fourth, setting up a battle over the future of
the companies, even as Lachlan Murdoch runs Fox and is sole
chair of News Corp. ( NWSA )
Rupert Murdoch's proposed amendment to the trust would block
any interference by three of Lachlan's siblings, who are more
politically moderate, the Times reported, citing a sealed court
document.
Lachlan Murdoch is viewed as ideologically aligned with his
conservative father. James Murdoch, who has donated to
progressive political groups, resigned in 2020 from the News
Corp ( NWSA ) board, citing disagreements over editorial content. James
also has criticized the U.S. media for amplifying disinformation
about the 2020 election results ahead of the Jan. 6 attack on
the Capitol. He hosted a fundraiser for U.S. President Joe Biden
in 2021, before the Democrat ended his re-election campaign.
A hearing to determine whether Rupert Murdoch's proposed
changes to the trust would benefit his heirs will take place in
a Reno courtroom, well outside the media hubs from which the
conglomerate operates in New York, Los Angeles, London and
Sydney.
"He's going to have to prove that these changes are being
made in good faith," said Shane Jasmine Young, a Nevada attorney
who specializes in estate planning. That means demonstrating any
changes would not "sacrifice the rights, or discriminate
against, any of the parties that this trust was intended to
protect."
A group of news organizations, including the New York Times,
CNN, The Associated Press, National Public Radio, The Washington
Post and Reuters, have asked to intervene in the matter, arguing
that the court should unseal the records and provide access to
the proceedings.
"Though some litigants may desire secrecy and some courts
indulge this desire, this level of sealing does not pass
constitutional muster," attorneys for the Access Coalition of
news organizations wrote in a memo to the court, arguing the
First Amendment calls for civil judicial proceedings and records
to be open to the public.
The news organizations say the public has immense interest
in which of Murdoch's children will succeed him at the helm of
the influential media empire, an outcome that will affect
thousands of jobs, millions of worldwide media consumers and the
political landscape.
Spokespeople for Lachlan, James and Elisabeth Murdoch
declined comment. A spokesman for Rupert Murdoch referred
inquiries to his attorney, who did not respond to a request for
comment. An attorney representing James, Elisabeth and Prudence
also could not be reached for comment.
"The reason this is interesting is the outsized role that
Fox (News) has played in the political landscape, in the U.S.
and around the world," said Paul Hardart, director of the
Entertainment, Media and Technology Program at New York
University's Stern School of Business. "I think this is a
reflection of the future of not only the business, but also how
conservative media is handled going forward."