Losing mobile phone consortium to sue State for millions

THE consortium beaten to the country's second mobile phone licence will proceed with a multi-million euro civil action against the State irrespective of the Moriarty Tribunal's findings, said Persona chairman Tony Boyle.

Persona spent £5 million during the company's three-year work on the project. When the GSM2 competition was announced, staff involved in the bid worked 20-hour days, seven days a week, the tribunal heard yesterday.

In evidence yesterday, Mr Boyle insisted financier Dermot Desmond told him during the Grand National at Aintree in April 1995, he was not getting involved in the GSM2 bid process.

Mr Desmond, he said, told him Denis O'Brien had invited him to chair the consortium but Mr Desmond had had enough of telecoms. Mr Boyle understood this referred to Glackin - an investigation connecting Mr Desmond with the Telecom Éireann property controversy.

Just weeks before the licence was handed over to Digifone in May 1996, the tribunal has heard, Mr Desmond had become a 20% stakeholder in Digifone, having signed an agreement the previous September.

According to Mr Boyle, it was most significant information from Mr Desmond that he was not getting involved in the bidding process for the mobile licence.

Mr Boyle said Mr Desmond also told him he knew who Denis O'Brien, who led the winning Esat Digifone consortium, would use "to get to" Michael Lowry, then Minister for Communications.

Declaring he had a photographic memory, Mr Boyle said he absolutely recalled being in JP McManus's Aintree box. He said his conversation with Mr Desmond was witnessed by a business partner.

Mr Desmond has said no such conversation took place either in relation to his non-involvement in telecoms or the alleged reference to Mr Lowry.

Questioned why he met Mr Lowry in Fitzpatrick's Castle Hotel, Killiney, Co Dublin, in August 1995 - while the bid process was underway Mr Boyle said he was making a sales presentation to the minister. He was not giving him any more information than was in the public domain about Persona.

He understood Mr Lowry would have a role in making the GSM2 decision and he believed he was within his rights to communicate directly with the minister. He agreed he was attempting to influence the minister.

Replying to Bill Shipsey, for Mr Desmond, Mr Boyle agreed Persona had closed the matter of the GSM bid after the EU competition authority rejected its complaint in 1996. However, it had reopened the matter in recent times and the consortium was now suing the State having been told by its lawyers it had a case.

Earlier, tribunal counsel John Coughlan told Mr Boyle they had to test his credibility to see whether he might be acting out of malice because Persona had lost the bid competition.