James Packer on the stand
July 28, 2008
Here is Stephen Mayne's story from the Crikey edition on Monday, 28 November, 2005.
1. James Packer on the stand
By Stephen Mayne, in a King Cross net cafe which dropped 7k on One-Tel
Clutching worry beads just like his late father-figure mentor Rene Rivkin, James Packer this morning began what will be a gruelling eight days of cross examination in the NSW Supreme Court at the hands of Jodee Rich's super-aggressive barrister, David Williams SC.
It was a cautious and hesitant beginning from the media heir as he took almost as long as a contestant on Who Wants to be a Millionaire? to provide answers such as as "no, in part," "I can't recall" or the best offering for the morning, "that's quite possible, possibly even probable."
The stakes are clearly very high as James admitted to spending 7-10 days preparing his evidence with guidance from Melbourne-based barrister James Elliott, who sat in his usual spot towards the back whilst ASIC's counsel lobbed regular but usually unsuccessful objections to much of the questioning.
James' most obliging contribution on the opening morning was to offer up a copy of all the documents he used to prepare, which were currently stored at his home, although that wasn't an address he was comfortable giving when swearing he would tell the truth. This includes One-Tel and PBL board documents, his evidence to ASIC and in the liquidators hearing and a pile of One-Tel monthly and daily flash reports that were in his possession.
It was clearly an illuminating period as James Packer told the court this morning that he hadn't remembered sitting on the One-Tel board for a week in August 1997. How do you not remember sitting on a board? James was shown two documents and agreed that he did sign the consent to nominate but said "nope" when asked if he had filled in the rest of the form.
Asked if he resigned from the board a week later because his father Kerry Packer said he was not allowed to sit on boards outside PBL and CPH, James said "no."
However, at the time James' private investment vehicle had just stumped up another $5 million and was trying to persuade either PBL or the private Packer interests to come up with another $20 million for One-Tel.
Having done all this preparation, it was surprising that James couldn't handle the opening exchange and tell the court how many One-Tel affidavits he had sworn. The latest of the five was sworn on November 18 and it is the first that deals with the events of May 27, 2001, when News and PBL pulled the plug on $132 million rescue rights issue.
Asked if his first affidavit in June 2002 dealt with the events of that day, James first claimed it had "at some length," but on inspecting the document, he quickly recanted, whilst accepting that it was "a significant day."
Williams is clearly pushing to establish that James Packer was intimately involved in One-Tel from cradle to grave. A document from November 1994 was produced explaining "Project E" which was the basis of the initial $250,000 investment by Dorigad, a vehicle James jointly owned with his since departed investing mate Theo Onisforou.
James said he would "not necessarily" have read the document because it was Theo's job to source investment opportunities. James could also not recall that Ted Pretty and Peter O'Connell conducted due diligence for him on the initial One-Tel investment but accepted it probably happened on inspecting his 1994 diary and seeing an entry for a meeting with O'Connell.
Whilst a long forgotten due diligence was done before the initial investment, James said that PBL's decision to invest in 1998 and 1999 was driven "to a large extent by me."
He did get a CPH analyst John Willings to do some work but the basis for backing One-Tel was largely the thesis promoted by Jodee Rich – that the three then mobile phone incumbents, Telstra, Optus and Vodafone, were worth an estimated $40-50 billion and there was ample room for a fourth player to share in these riches.
Jodee Rich sat in the court next to co-accused Mark Silbermann tapping out copious notes and his lawyer wife Maxine, a key strategist in the defence, was there as usual too.
Whilst his then wife Jodie Meares supported James during the One-Tel liquidator hearings in 2002, current girlfriend Erica Baxter was in court today, with an operative from solicitors Atanaskovic & Hartnell attempting to move journalists out of key seats at 9.30am to create room for the Packer entourage.
At it turned out, the court was never actually full and there were only about 12 journalists present, far less than the huge scrum which turned up for Steve Vizard earlier this year.
Whilst Lachlan Murdoch appeared relaxed and was incredibly nice to everyone last week, despite not being able to recall much, James Packer did not appear to be enjoying himself this morning, although he did compliment The 7.30 Report's Emma Alberici, saying "I love your work on the ABC" during the first 20-minute break after spending an hour on the stand.
ASIC is seeking civil penalties against Rich and Silbermann and the repayment of $92 million. The defence is clearly that James Packer knew everything that was going on, so his "profoundly misled" claim was rubbish and he should have been in court for the past 15 months too.
Williams claimed that Packer was regularly provided board documents, received briefings from Jodee Rich before board meetings and also attending some board meetings – all before he even joined the board.
Packer claimed he couldn't recall most of this, but did say some early board documents were in his pile of papers at home, so this presumably did happen.
On the key point of Packer's involvement as One-Tel approached collapse, James admitted that he used to speak to Rich almost every day when he was in the country and when out of the country he would speak to co-founder Brad Keeling or Mark Silbermann.
Williams: From mid-2000 you made it your business to speak to someone from One-Tel every day or so?
Packer: Yes
Hmmm, given that PBL also had executives inside One-Tel and was receiving daily cash reports, it does look a little odd that James Packer isn't also being pursued in this civil action. If Rich and Silbermann should have pulled the plug three months earlier, shouldn't James have done the same?
The next few days might be some of the most unpleasant in James Packer's life, but don't hold your breath for ASIC to ever take action against Australia's richest and most powerful family.
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