INDEPENDENT Newspapers has confirmed that it plans to sue the State for damages to its microwave television signal business, although the action may take many months to reach the High Court. A consultant's report which will be the basis for the suit is as yet unfinished, but sources say it will conclude that the reluctance of the Government to close down unlicensed community television signal deflectors cost the company around £100 million.
"An action for damages against the Government is under way," a spokesman for Independent Newspapers said last night.
Today, Princes Holdings, the subsidiary of Independent Newspapers that runs its MMDS operations, will ask the High Court to set a date in its case against Carrigaline Community Television, a Co Cork group providing a multi channel service for locals.
In 1994, and again in 1995, the High Court ordered the MMDS operator to suspend its court battle against the deflector group, ruling that the State should reconsider granting a licence to the locals. The order was rescinded in April.
In most areas where community deflector systems operate, usually charging less than £50 per household a year there has been resistance to the MMDS provider, which can demand as much as £200. The commercial providers say they need the extra money and to be the only provider available, to pay for the MMDS technology.
In the run up to the election the Government told representatives of Independent that the matter could cost it votes, and it was not willing to take any action which might jeopardise seats.
Independent executives then suggested that in order to make up for its loss of earnings, the Government should sell Cablelink to Independent, grant it a telephone licence, or extend the exclusivity clause in its current MMDS licences; failing this, they warned, the Rainbow would lose Independent Newspapers "as friends".
On the eve of the election, the Irish Independent called on its front page for readers to vote Fianna Fail.
Some weeks ago, Independent; called in the consultancy firm Deloitte & Touche to calculate how much money it would have made if all of the deflectors had been shut down. Sources within Independent said last night that while the report was not complete, the figure was "looking like £100 million".
Other MMDS operators are likely to seek similar damages, bringing the entire claim against the State to around £200 million.
