'Absolutely wrong' for INM to claim it was deprived of details on Buckley explanation for data removal, court told

The State’s corporate watchdog has said it was “absolutely wrong” for INM to claim it was deprived until March last of information casting doubt on its former chairman Leslie Buckley’s explanation for the removal of data from INM in 2014.

'Absolutely wrong' for INM to claim it was deprived of details on Buckley explanation for data removal, court told

By Ann O'Loughlin

The State’s corporate watchdog has said it was “absolutely wrong” for INM to claim it was deprived until March last of information casting doubt on its former chairman Leslie Buckley’s explanation for the removal of data from INM in 2014.

Lawyers for then INM CEO Robert Pitt gave INM information to that effect in August 2017 and it was “very curious” for INM to complain “critical” information came as a “bolt out of the blue” to the company when the Director of Corporate Enforcement (ODCE) moved last March for appointment of inspectors to INM, Brian Murray SC, for the ODCE, told the High Court.

It would appear, based on information obtained to date, “Mr Pitt may have been right and Mr Buckley may have been wrong”, he said.

There was “the prospect” Mr Pitt may also have been right in relation to his concerns about other issues, including the proposed purchase of Newstalk by Communicorp, a company of INM’s major shareholder Denis O’Brien, which purchase did not proceed.

Counsel stressed the ODCE has made no “findings” on these issues which would be a matter for the court if INM loses its judicial review challenged aimed at halting the ODCE application for appointment of inspectors to INM.

To treat the ODCE's concerns, as set out in his sworn statement seeking inspectors, as if those were conclusions in a report, demonstrated the "falsity and absurdity" of INM's arguments in the judicial review, he said.

The judicial review concluded today and judgment was reserved by Mr Justice Seamus Noonan.

ODCE Ian Drennan initiated the application for inspectors over concerns about the alleged data breach at INM and other issues arising from protected disclosures made by Mr Pitt and INM Chief Financial Officer Ryan Preston on dates in 2016 and 2017.

INM argues there is no basis for appointment of inspectors and the ODCE application was made in breach of its right to fair procedures. In closing arguments for INM, Paul Gallagher SC said it did not accept the criticism of it by the ODCE.

INM did not in August 2017, or before March 2018 , have a “critical” document that cast doubt on Mr Buckley’s explanation for the data removal, a spreadsheet containing the names of 19 people whose data may have been accessed, he said. The ODCE had that spreadsheet but had not provided it to INM for several months.

INM should not be criticised for having accepted Mr Buckley’s explanation the data interrogation was part of a cost reduction exercise linked to a legal services contract as INM had no evidence suggesting Mr Buckley was telling untruths in that regard, he said.

Absent such evidence, it would have been an “enormous step” to suggest to its then chairman he was telling an “outright lie”.

INM was in a “very difficult” position in 2017 because of a dispute between Mr Pitt and Mr Buckley and it was only in August 2017 Mr Pitt raised concerns about a possible data breach dating back to October 2014.

INM took the matter very seriously, the relevant people were interviewed, and it hired Deloitte to investigate a range of issues. INM’s IT director Gerry Wilde disputes a number of matters set out by Mr Pitt arising from a conversation between them, counsel also said.

Earlier, Mr Murray said Mr Pitt had said he had concerns, based on information communicated to him by Mr Wilde, that large, indiscriminate amounts of data, including emails and records, had been extracted and removed from INM over a period from October 2014.

Mr Pitt had said the information suggested the data was to be searched by third parties in relation to certain people, including former INM CEO Gavin O’Reilly and former INM executive Karl Brophy, and possibly legal advisers, for the possible benefit of third parties.

Mr Pitt also outlined concerns an invoice for a third party allegedly involved in accessing the data was paid by Blaydon, a company linked to INM’s major shareholder Denis O’Brien.

Mr Pitt had asked his concerns be notified to the Data Protection Commissioner and the INM Board convene to discuss them, counsel said.

INM had notified the DPC on August 24 but the ODCE had raised various points about that notification, he said. INM had told the DPC the data was accessed for a “limited business purpose” when INM had information suggesting it could not be “quite so confident about that”. The DPC was also not told “someone outside INM paid for this”, raising issues why someone outside INM would do so and what rights such payment gave over the data exercise.

INM’s assertion nothing was identified before last March that could have lead the Board to believe the explanations given to it by Mr Buckley for the data interrogation were not true “is at least questionable” in light of the material from Mr Pitt, counsel said. INM has said, in sworn statements filed since March, if Mr Pitt’s information was correct, that meant the Board was “intentionally misled” by Mr Buckley, he noted.

Mr Murray also argued there was no legal obligation on the ODCE to consult with INM before seeking inspectors. That would involve introducing a special rule for powerful public companies like INM, impose a “remarkable precondition”on the entitlement of public bodies to go to court and raise fundamental questions about the court’s entitlement to administer justice in public and in accordance with law.

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