Before Jiten Kotecha became Senior Counsel, Labour & Employment at Cummins, his early legal career included a short spell at Olswang in 2010. The following year, his former firm stepped into one of the filthiest media scandals in modern Britain. News International hired Olswang to examine what could be learned from the phone-hacking affair and help construct a new code of practice. Within months, Olswang was also handling victim-driven civil litigation, helping administer the compensation machinery and appearing for the publisher in an attempt to knock exemplary damages out of hacking claims. Learn the lessons. Process the victims. Fight the punishment. Somewhere between ethics review and litigation defence, the lesson-learning acquired a billing code.
The first Olswang instalment took us into BHS and Parliament’s magnificent description of professional advisers becoming an “expensive badge of legitimacy”. This time there is no failed department-store sale, no pension deficit and no billionaire trying to unload a high-street chain for a quid. The scenery is voicemail, privacy, tabloid power, police investigations, lawyers, compensation funds and one media empire trying to discover how much its past was going to cost.
The thesis is simpler too. Elite law firms are often hired not merely to defend a client after disaster arrives, but to help shape the institutional response to that disaster. They can examine what went wrong, design governance, write codes, administer settlements and simultaneously protect the client against the outer edge of legal exposure. There is nothing subtle about the tension. The ethics department and the litigation department can occupy the same fucking building.
Welcome back to Jiten’s Jobs.
Jiten Kotecha And The Olswang Name
Kotecha’s career history records a short Olswang placement in 2010, during the early years of the employment-law career that would later take him through Pinsent Masons, KPMG and eventually into senior labour and employment counsel at Cummins. Olswang was already a major City firm with a particularly strong reputation across media, technology and intellectual property, precisely the sort of polished professional environment that belongs on an ambitious lawyer’s CV.
By the summer of 2011, that media expertise had acquired an extraordinary client problem. The News of the World phone-hacking scandal had moved from grubby newspaper controversy into a full-scale institutional crisis. The newspaper closed in July, police investigations expanded, victims brought civil claims and News International faced the slightly awkward task of convincing Britain that the organisation responsible for the mess could also be trusted to clean it up.
Into that shitstorm walked Olswang.
Not merely to litigate.
To help write the lessons.
Please Examine What We Have Learned
On 30 June 2011, News International chief executive Rebekah Brooks told staff that Olswang had been brought in “to examine in great detail what can be learnt from the past”. The firm was also asked to draw up a new code of practice intended to help prevent a repetition of what had happened at the News of the World.
Read that instruction carefully because it frames everything that follows. This was not simply, “We have been sued, please defend us.” News International was presenting Olswang as part of the institutional repair job. Look backwards, understand the failure, turn the wreckage into rules and help construct the governance that supposedly stops the same behaviour happening again.
Law firms adore this kind of work because crisis produces paperwork by the tonne. Policies need reviewing, reporting structures need redesigning, responsibilities need clarifying, executives need advising and every sentence must survive the possibility that somebody hostile will eventually read it beneath fluorescent lights in a committee room.
The scandal had produced industrial quantities of ugly material.
Olswang was being invited to help turn it into governance.
The Management And Standards Machine
News Corporation created a Management and Standards Committee in July 2011 as part of its response to the crisis. Olswang worked for that committee, whose remit extended beyond tidying language in an editorial handbook. The committee dealt with compliance, governance, investigations and the increasingly enormous civil consequences of phone hacking.
The Leveson Report later recorded that the committee also had authority to negotiate and settle civil litigation relating to the hacking scandal. Olswang’s role therefore moved rapidly into the machinery dealing directly with claims from people whose private communications had been intercepted.
That shift is where the story begins to develop its peculiar City-law elegance. First comes the reform brief. What did we learn? How should standards change? What structures need repairing? Then another file lands beside it containing names, damages schedules, legal costs and people who would quite reasonably like money because somebody at your newspaper treated their voicemail inbox like a fucking staff newsletter.
The moral crisis has become a litigation portfolio.
Welcome to professional services.
October: Bring Us The Claims As Well
By 14 October 2011, News International had replaced Farrer & Co with Olswang for the civil phone-hacking claims. At that stage the publisher faced more than 60 civil actions, while a series of test cases threatened to establish benchmarks for the claims behind them.
Olswang was asked to advise News Group Newspapers on the appropriate resolution of civil claims and to implement the £20 million compensation fund News International had announced earlier in the year. Leveson would later record that Olswang had been appointed to handle all victim-driven civil litigation concerning voicemail hacking at the News of the World alongside administrative responsibilities for the compensation scheme.
That is some progression in a few months. In June, examine the past and help write a new code. By October, sit inside the legal machinery deciding how claims generated by that past should be resolved.
The lesson had found its invoice number.
The Compensation Counter Opens
News International publicly launched its voluntary compensation scheme on 4 November 2011. Former High Court judge Sir Charles Gray acted as the independent adjudicator, while the scheme promised a route intended to be quicker and cheaper than grinding through ordinary litigation.
News International described it as a “speedy, cost effective alternative to litigation”. Successful applicants could receive an uplift of 10% over the amount the independent adjudicator considered appropriate by reference to court compensation, while the publisher also undertook to meet reasonable legal costs.
From a claims-management perspective, it was tidy. Victims could seek redress through a structured process, News International could try to resolve a multiplying liability problem without every claimant becoming a separate High Court spectacle, and an independent former judge gave the scheme institutional weight.
From a gonzo perspective, the image is stranger. A newspaper empire spends years with private communications being treated like raw material and eventually arrives at a professionally administered counter where the people on the other side can take a number and discuss what the intrusion is worth.
Britain can bureaucratise absolutely any bastard thing.
Five Thousand Eight Hundred Possible Victims
The scale surrounding the scheme was already grotesque.
When the compensation mechanism publicly launched in November, police had said there might be as many as 5,800 possible victims of News of the World phone hacking. Not 58. Not 580. Five thousand eight hundred possible human beings whose private communications might have wandered into the appetite of a newspaper operation.
That number changes the atmosphere around phrases like claims administration. Every application represented somebody’s messages, relationships, family, work or private life becoming material for a newsroom without permission. Some were celebrities and politicians accustomed to press attention. Others were connected to tragedies they had never volunteered to make public property.
The hacking of murdered schoolgirl Milly Dowler’s voicemail had become the scandal’s most morally devastating revelation. News International subsequently agreed a £2 million settlement with her family, while Rupert Murdoch personally donated another £1 million to charities selected by them.
Against that background, “appropriate resolution of civil claims” stops sounding like corporate boilerplate.
It sounds like a conveyor belt with lawyers standing beside it.
Then Comes Exemplary Damages
Less than two weeks after the compensation scheme launched, the legal posture changed register again.
On 17 November 2011, Olswang, acting for News International, sought a High Court ruling that the publisher should not face exemplary damages in the cluster of phone-hacking civil claims.
Exemplary damages are different from ordinary compensation. Compensatory damages seek to compensate somebody for the wrong done to them. Exemplary damages, where the law permits them, have a punitive or deterrent element. They are supposed to sting.
That distinction is exactly why the application matters.
News International was prepared to compensate hacking victims in appropriate cases. It had created a scheme, appointed an independent adjudicator and put money behind it. But when claimants sought the nastier category of damages, the legal team wanted that route closed.
The remedial cheque was one thing.
The judicial slap round the fucking head was another.
Learn The Lessons, Fight The Damages
Put the chronology side by side and Olswang’s institutional role becomes almost too beautifully symmetrical.
News International asks the firm to investigate what can be learned from the past and help write a code designed to stop repetition. The same firm then moves into the Management and Standards Committee’s work, takes over victim-driven civil litigation, helps implement the compensation scheme and appears in court seeking to remove exemplary damages from the field.
That is not a contradiction caused by lawyers getting confused about which side they represent. It is the sophisticated commercial-law model operating exactly as sophisticated commercial law often operates. A major client has several different problems at once, so the adviser helps solve several different problems at once.
Governance problem? Write standards.
Reputational problem? Help build the response.
Victim problem? Create a settlement mechanism.
Litigation problem? Defend the bloody client.
The interesting part is not that those services can coexist.
It is seeing them coexist in the same scandal.
The Cleaner Route Out
The compensation scheme had obvious attractions for News International. Full litigation meant disclosure, hearings, legal costs, witness evidence and repeated public examinations of conduct that had already poisoned the company’s reputation.
A structured scheme offered another route. Victims could receive compensation without necessarily spending years pushing claims through the courts, while News International could convert an unpredictable mass of litigation into something more manageable.
This is where the vocabulary of dispute resolution becomes wonderfully bloodless. Efficient resolution. Alternative process. Appropriate compensation. Perfectly respectable phrases, each capable of fitting comfortably into a client presentation while the underlying facts involve somebody rifling through private voicemails.
That is the corporate-law talent.
Take something feral and feed it into procedure until it comes out wearing a tie.
The High Court Was Still Waiting
The compensation mechanism did not make the court claims disappear. News International still faced substantial litigation, and by January 2012 it had agreed settlements with 37 hacking victims, including Jude Law, Lord Prescott and Ashley Cole.
Fifteen disclosed settlements announced in court that January totalled £645,000, with further undisclosed sums and legal costs adding to the bill. The publisher agreed that, for the purpose of calculating those settlements, damages could be assessed on an assumed basis reflecting serious allegations about senior knowledge and concealment, while making no admission of those allegations as part of the settlements.
The litigation machine was therefore doing what litigation machines eventually do when exposure becomes large enough. Cases were being valued, claims settled, costs added and increasingly unpleasant facts translated into pounds.
Every settlement also removed another possible trial.
Every avoided trial meant one fewer public stage on which the News of the World’s internal behaviour might be examined in excruciating detail.
That is not some mysterious conspiracy theory.
That is why defendants settle cases.
Sometimes the cheapest way out of a room is through the fucking cashier.
The Punitive Question Did Not Vanish Immediately
News International’s effort to strike out exemplary damages did not instantly settle the issue. Claims involving exemplary damages remained part of the litigation landscape into 2012 before claimants eventually abandoned that element of their cases because of concerns that litigating those issues could prejudice related criminal proceedings.
The important point for Olswang II sits earlier in the chronology. When News International’s new civil-litigation team arrived in late 2011, one of the positions advanced on behalf of the publisher was that victims should not be able to obtain that punitive category of damages.
The same institutional response therefore contained both a compensation scheme offering an enhanced payment mechanism and litigation seeking to narrow another potential route to financial punishment.
Carrot at one desk.
Shield at the next.
City law can multitask like a motherfucker.
Olswang Drafts The Rules
There is another useful detail in the compensation story. Contemporary legal commentary later recorded that Olswang drafted the original rules of the scheme before Linklaters subsequently replaced the firm and changes were made.
That gives the role even more texture. Olswang was not merely processing forms after somebody else designed the machine. It sat inside the legal architecture of the response, from the broader standards brief through to the rules governing how hacking victims could seek redress.
The compensation scheme ultimately attracted more than 250 applications before News International announced its closure in 2013. By then, litigation and settlement work had already produced millions of pounds in damages and legal costs, and the scandal had generated a public inquiry, police investigations and an industry-wide argument about how British newspapers exercised power.
A code had been written.
A scheme had been built.
A hell of a lot of cheques had been signed.
The past remained stubbornly fucking expensive.
The Lawyer As Crisis Infrastructure
This is where Olswang becomes useful beyond the specific scandal.
Large commercial law firms do not merely arrive after a company has done something stupid and wave statutes at the wreckage. At their most powerful, they become part of the infrastructure through which the organisation survives the event.
They help determine what gets investigated, how governance changes, what policy says afterwards, how victims or counterparties are approached, which claims settle, which claims get fought and what arguments go before the court.
That is an extraordinary amount of influence because legal advice can shape both the public-facing reform story and the private mechanics of liability.
One desk can help formulate the sentence about lessons learned.
Another can argue about precisely how much those lessons should cost.
Same lobby.
Same logo.
Different file.
From Ethics To Exposure
News International’s original instruction to Olswang contained the phrase that should sit above this entire piece: examine what can be learned from the past.
That is what corporations say when the past has become radioactive. Lessons will be learned. Systems will improve. Policies will change. Everybody suddenly discovers a deep spiritual attachment to compliance.
The harder question is what happens when learning the lesson collides with paying for it.
Phone hacking generated victims, and victims generated legal rights. Those rights could become compensation, aggravated damages, exemplary damages, legal costs and public trials capable of revealing still more material.
At that point, the lawyer helping construct the reform environment also belongs to a profession whose duty is to protect the client’s legal position.
The noble language and the adversarial language are not separate universes.
They share a time sheet.
Quite A Former Employer
This is exactly why Olswang deserves a second visit in Jiten’s Jobs.
Kotecha’s own spell there belongs to 2010. The phone-hacking work arrived the following year, but the institution on the CV is the same institution we are examining. The point of this series is not to treat prestigious names as decorative career wallpaper. It is to open them up and look at the professional environments behind the branding.
The first Olswang piece found a law firm later sitting inside the BHS sale, where Parliament would eventually warn against professional advisers becoming an “expensive badge of legitimacy”.
Olswang II finds something different.
A media-law powerhouse helping one of Britain’s most powerful publishers respond to a catastrophic ethics scandal, build standards, process redress and defend its exposure.
That is a much more interesting professional habitat than the usual biography line about “gaining valuable experience”.
Valuable to whom is always the better fucking question.
The Code And The Claim
There is something almost architectural about the Olswang role.
At one end sits the code of practice, the document meant to capture institutional learning and ensure the behaviour of the past does not repeat itself. It belongs to the clean side of crisis response, where governance becomes visible and executives talk about standards.
At the other end sits the claim, where the same past becomes quantified in damages, costs and legal arguments. That side is less photogenic. Nobody puts the application to strike out exemplary damages into the corporate values brochure.
Between those two points sits the commercial lawyer.
The lawyer does not need to love either side.
The lawyer needs to understand both.
That is why the role is so powerful and why the juxtaposition deserves attention. Professional expertise can help an institution become better after failure, but the same expertise can also make the consequences of that failure more manageable for the institution itself.
The code tells you what should happen next time.
The litigation team tells you what this time is going to cost.
Learn The Lessons
News International’s choice of language in June 2011 was probably intended to communicate seriousness. Olswang would examine in detail what could be learned from the past. Standards would improve. A new code would help prevent repetition.
Then the claims multiplied.
Olswang moved into civil litigation and compensation. The firm helped build the mechanism through which victims could obtain redress and represented the publisher as the legal consequences continued to expand.
By November, it was asking the High Court to remove exemplary damages from the equation.
That is the entire story in one movement from principle to exposure.
First, ask what the scandal taught you.
Then work out what the lesson costs.
Then argue about the bits of the bill you do not think the client should fucking pay.
Learn the lessons. Fight the damages.
Lee Thompson – Founder, The Cummins Accountability Project
Sources
- The Guardian – Phone Hacking: NI Asks Legal Firm To Draw Up Code Of Practice
- The Guardian – News Corporation Parts Company With Law Firm Farrer & Co
- The Leveson Report – Management And Standards Committee And Compensation Scheme
- The Guardian – NI Launches Compensation Scheme For Phone-Hacking Victims
- The Guardian – NI Asks Judge To Strike Out Exemplary Damages Claims
- House Of Commons – News International And Phone-Hacking
- The Guardian – News International To Pay Out To 37 Victims
- The Independent – Phone-Hacking Claimants Drop Exemplary Damages Case
- Inforrm – News International Closes Phone Hacking Compensation Scheme
- The Guardian – News International To Close Phone-Hacking Compensation Scheme