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08 April 2011

Australian Media Wars: Warburton Most Wanted, by Greg Tingle - 8th April 2011

G'day media watchers, news media movers n shakers, punters, sports nuts, legal eagles, one and all. Today we probe the fun and games relating to James Warburton's early departure from Channel Seven, with the intention of starting at Network Ten, which has seen JW a regular in Australian court and talk of the Australian media landscape. Media Man and Gambling911 with the Warburton media war special...

AFL Rights Raised Via Warburton Stoush; Day 2 In Court Update...

Channel Seven's commercial director advised the process for awarding the Australian Football League's next sports broadcasting contract still had some way to run, the NSW Supreme Court heard on day 2 of the court hearing. Bruce McWilliam was giving evidence during the second day of Channel Seven's legal bid to postpone its former chief sales and digital officer James Warburton starting his new job as chief executive of Channel Ten. The current AFL broadcast deal, involving Seven, Ten and pay television operator, Foxtel, is in its final year. The AFL is understood to be seeking $1 billion in rights fees for the next 5-year deal. Quizzed by the super legal eagle - barrister for Warburton, John West, QC, whether the result of negotiations between the AFL and broadcasters would be known very soon, McWilliam said, "There's no end in sight in the current process in my mind." McWilliam then went on to say initial expectations were that the negotiations would be concluded at about the time of last year's AFL grand final but these kept being delayed. Channel's Seven and Ten made a preliminary presentation to the AFL recently, McWilliam told the court. He also said additional meetings would likely take place. "It just depends what the AFL requires and how they wish to conduct the process," McWilliam said. Ten announced Warburton's appointment as chief executive on March 2, with a commencement date of July 14 this year. Channel Seven states that conditions in Warburton's employment contract and participation in a management equity plan, dictate that Warburton has to wait until October 2012 before commencing work with any other media firm. That's quite a wait. Warburton's legal team says it believes the proposed transaction that will have Seven's media assets transferred to West Australian Newspapers Holdings, via a series of complex transactions, will cause the management equity plan to cease to exist. With that would disappear some of the restraints included in the plan on Warburton working for another media company. McWilliam said the proposed deal, due to be voted on by WAN shareholders later this month, would not dissolve the management equity plan. "'The scheme most definitely continues," McWilliam said. The case continues.

Media Contacts Printed Off By Warburton's Computer Prior To Resignation; Day 3 In Court...

Confidential contact details of clients, agencies and Seven Network staff were printed from James Warburton’s computer the day before he resigned from the company it has been alleged in court. On the third day of the trial brought by Seven, the NSW Supreme court also heard that Warburton’s knowledge of tech Channel Seven had acquired that allows products to be superimposed into programs had the potential to harm the business. Seven is attempting to hold back Warburton from switching to Ten to become its chief executive until October next year, claiming he is in breach of a management equity plan. Warburton wants to start at Ten in July this year. Referring to a document of good old fashioned Microsoft Outlook contacts, the network director of sales at Seven and Warburton’s former deputy, stated in an affidavit: "I note from the information at the bottom of the document that it appears to have been printed by Mr Warburton’s executive assistant… at 8.39am on 1 March 2011, being the day before Mr Warburton resigned from SMG. The contacts list includes the telephone and email contact details of numerous SMG employees and a number of SMG clients and agencies." Under a heading in his affidavit called "Virtual advertising", Burnette told how in December last year Channel Seven inked a deal with a company that provides technology which enables products to be superimposed into a program during the post production-phase. He said Warburton’s inside knowledge of a potential revenue stream it could deliver to Seven was information a competitor would value highly. Burnette also recounted a chat he had with Warburton in December last year after Seven’s direct group sales manager, David Bellamy, announced he was resigning to move to Ten. Burnette claims Warburton said: "OK. He needs to be put on gardening leave immediately and keep him from starting for the three months or whatever the maximum is." The hearing continues.

Warburton Advised Leave Channel Seven Immediately Sir...

Commercial director of Channel Seven, Bruce McWilliam, said it would have been "very impolite" for him to have told a departing executive, James Warburton, that he wouldn't be able to take up Ten's offer as chief executive for a year because of anti-competition rules within a management equity participation scheme. McWilliam advised he had requested HR staff to check the restraint period, and had been aware that a press release from Channel Ten stated Warburton would start with the network as chief executive in July. McWilliam said Warburton told him that Seven's chief executive, David Leckie, wanted him out of the building immediately. "I … wouldn't always take what is said at face value," McWilliam told the restraint of competition case brought by Seven against Warburton. He believed it was "harsh to someone who had been with the company so long". In an affidavit put forward in the court, McWilliam advised Leckie had told him he didn't want Warburton "mixing with staff and being around whatever deals are done, it is untenable". McWilliam said: "But you didn't imply he was terminated did you?", to which Leckie responded, "Of course not. I am not stupid. I said to him, "You have to go on gardening leave, or whatever it is called." The court was advised that while Warburton had run the numbers for Channel Seven's passing interest in MasterChef, and was the sole Seven executive who advised against broadcasting Wimbledon as it was a "dying tradition", Warburton could not retain so much confidential information in his head that would justify Seven restraining him from working in the television industry until October 2012. Warburton's barrister, John West, QC, rejected Seven's contention of Warburton's "total mastery". In one cheeky interlude with McWilliam, West said: "You really can't help yourself, you keep on over-egging the custard", to which McWilliam responded: "He doesn't just forward emails. If the information in the email was incorrect he would have gone back to them and corrected it …"
The hearing before Justice Michael Pembroke continues.

Warburton Didn't Steal Media Documents; Day 4 (18th Apri 2011)...

SMG (Seven Media Group) has withdrawn on claims that ex executive James Warburton stole confidential information upon his sudden departure from the firm. Warburton walked on Seven in March to join competitor Ten Network as chief executive officer, a move that pissed off Seven. Warburton was to have commenced with Ten in July, but Seven has taken legal action in the NSW Supreme Court in a bid to delay him starting until October 2012. Seven contends provisions in his employment contract and participation in a management equity plan at Seven constrain him from working at another media firm. Seven had also argued in court that Warburton had snatched confidential information when he left the group, including strategy reports as well as ratings and revenue data. In the NSW Supreme Court yesterday, Tony Meagher, SC, representing Seven told the court that this claim has now been retracted. "There is no longer a threat he will use the confidential information," Meagher told the court, according to news reports. The case continues today, with Seven Media boss executive David Leckie to take the stand after the media group's HR. Australian media has been talking about the case under watercoolers and in coffee shops since it commenced, and the legal eagles are understood to be making a financial killing, as is often the case on high level legal media battles. WAR...BURTON - sure sounds like he's ready for another round on Aussie media wars. James Packer might like to see him take on Ten's gaming arm (or whatever the secret project might be). Bang!

Readers... er, punters, how did you like our report? Tell us in the forum.

If you have a bet, please bet with your head, not over it, and for God's sake, have fun.

*Greg Tingle is a special contributor for Gambling911

*Media Man is primarily a media, publicity and internet portal development company. Gaming is just one of a dozen sectors covered

*The writer owns shares in Network Ten

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If you have a bet, please bet with your head, not over it, and for God's sake, have fun.

*Greg Tingle is a special contributor for Gambling911

*Media Man is primarily a media, publicity and internet portal development company. Gaming is just one of a dozen sectors covered

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