The mobile licence competition that refuses to go away

ANALYSIS:WEDNESDAY'S SUPREME Court judgment on why two failed participants in the 1995 mobile phone licence competition should be allowed seek damages is a reminder of the ongoing and costly legacy of that event.

In July the court said that the parties, Comcast and Persona, should be allowed seek damages on the basis that the competition was corrupted by Denis O’Brien and Michael Lowry.

On Wednesday five judges from the court published their reasonings for the decision. Among other points, they said that the seriousness of the allegations being made weighed on the side of allowing them be heard in a court of law.

The judges used some pretty strong language, including repeated use of the word “corruption”, a word that did not feature in the Moriarty tribunal report.

Mr Justice Frank Clarke, in his ruling, said that “if the allegations which are made in these proceedings, and which formed the subject of the findings of the Moriarty tribunal, were to be established in a court of competent jurisdiction, they would amount to amongst the most serious factual determinations made by a court in this jurisdiction since the foundation of the State”.

Mr Justice Adrian Hardiman, in his ruling, said: “This case is absolutely unique, without precedent or parallel in the 90 year history of the State. It will be profoundly worrying, indeed alarming, in its implications for Irish public administration if the allegations made by the plaintiffs turn out to be true.”

He noted that the Moriarty tribunal did not consider the evidence against the minister accused of corruption, Michael Lowry, to be implausible.

While the plaintiffs – Irish businessmen Tony Boyle and Michael McGinley, who now own Persona, and Galway businessman Declan Ganley, who is associated with Comcast – cannot use the findings of the tribunal, they can call the evidence the tribunal heard and which led to its findings.

The tribunal’s findings were described as “breathtaking” by Mr Justice Liam McKechnie.

The tribunal, he said, found that Lowry exerted “insidious and pervasive influence” on the licence competition and undermined its integrity. He said improper payments were furnished by O’Brien – founder of the consortium behind the winning bid, Esat Digifone – to Lowry and the payments were related to various actions of Lowry that assisted Esat’s win.

Mr Justice Hardiman said that winning the licence “wholly transformed the fortunes of the successful applicant” and that Esat was sold a relatively short time later for “the enormous sum of €2.3 billion”.

O’Brien shared ownership of Esat with Norwegian firm Telenor, with Irish businessman Dermot Desmond owning a stake.

“Corruption of the sort alleged, if proved, is both a civil wrong and a criminal offence, not to mention a commercial and political disgrace of the highest order,” Mr Justice Hardiman said. “It would disgrace the nation and the State” and be “utterly disgraceful, destructive of the reputation of both the briber and the person bribed”.

Given the covert nature of what the plaintiffs are alleging occurred, the court believed they had a right to delay while seeing what evidence emerged.

O’Brien and Lowry have both rejected the findings of the tribunal, both in terms of the alleged payments (or attempted payments) and also in relation to interference in the licence process.

At the tribunal, Lowry’s former department contested the suggestion that the competition was corrupted, and the State has said it will contest the attempt by the two failed bidders to win damages from the State. Yet Taoiseach Enda Kenny has said he accepts the tribunal findings.