The High Court inspectors investigating a series of matters at Independent News & Media (INM) have written to its former directors asking them if material passed by former chairman Leslie Buckley to businessman Denis O'Brien constituted inside information, and "if not, why not".
The inspectors, barrister Sean Gillane and UK corporate governance expert Richard Fleck, say they wrote on March 23rd to Mr Buckley and the former listed group's non-executive directors, who included tech executive Triona Mullane, former KPMG managing partner Jerome Kennedy, Northern Irish businessman Len O'Hagan, former Dermot Desmond INM board nominee David Harrison, and long-time O'Brien associate Paul Connolly.
According to an affidavit filed by Mr Fleck, they were all provided with a schedule of communications that took place between Mr Buckley when he was INM’s chairman, and Mr O’Brien, who was then INM’s largest shareholder with a stake of almost 30 per cent.
The directors and Mr Buckley were asked by the inspectors to state “as a matter of fact” if the communications were “(i) inside information as defined by Article 7 of Market Abuse Regulations], (ii) information confidential to INM and (iii) if not, why not”.
Mr Buckley has already responded to Mr Fleck to acknowledge that “all but one” of the communications was confidential information, but said price sensitivity was not his area of expertise.
The inspectors say they will hire experts to assess whether the communications were in fact inside information, and say they have not yet reached a finding as to whether or not they were.
Further hearings will be held before they decide. Mr Buckley has criticised the inspectors’ report of his evidence over his passing of information in the company to Mr O’Brien.
A series of communications between Mr Buckley and Mr O’Brien are among five separate issues being investigated by the inspectors. Transcripts of interviews between the inspectors and Mr Buckley show Mr Gillane asking Mr Buckley about him keeping Mr O’Brien “in the loop ... in 40 or 50 emails or whatever it is”. Mr Buckley has argued that Mr O’Brien was an insider and would not have used the material for his own “advantage”.
The issues he kept Mr O’Brien “informed” of, according to the affidavit, include a search of INM’s staff emails that took place without the rest of the board’s knowledge, negotiations on an aborted deal for INM to buy Mr O’Brien’s Newstalk radio station, and matters that “might give rise to press interest or publicity”.
The affidavit was filed as part of ongoing proceedings by Mr Buckley, where he is seeking to have the inspectors removed for “objective bias” against him, which they deny.