State bid to have O'Brien, Lowry joined to case

The State is seeking to have billionaire businessman Denis O’Brien and former minister Michael Lowry made liable for damages that could arise from a claim of corruption in relation to the State’s 1995 mobile phone licence competition.

Legal papers to initiate such a move were lodged last week in a move that is due to come to court early next year.

The State is being sued by Persona, one of the consortiums that bid unsuccessfully for the licence in a claim which, if successful, could see substantial damages being awarded.

Launchpad

The licence was won by Denis O’Brien’s Esat Digifone and was the launchpad for his becoming one of Ireland’s richest businessmen. Mr Lowry was the minister in charge of the relevant government department at the time.

Esat Telecom, which owned half of Esat Digifone, was sold to BT for €2.92 billion in 2000, a sale which netted Mr O’Brien more than €350 million.

Last year the Moriarty tribunal issued a report in which it said Mr Lowry interfered in the licence process to the benefit of Esat and that Mr O’Brien sought to convey a material benefit on Mr Lowry.

Taoiseach Enda Kenny accepts the findings of the tribunal in their entirety. Mr O’Brien and Mr Lowry have said the tribunal is wrong.

Last week the Department of Communications, Energy and Natural Resources filed a notice of motion aimed at having Mr O’Brien and Mr Lowry joined as third parties in the case being taken by Persona.

The State is arguing that the claims being made by Persona are being contested by it but that if the court finds in Persona’s favour, any wrongful or corrupt acts that may have occurred are the responsibility of Mr O’Brien and Mr Lowry and that the State is, therefore, entitled to be indemnified by them.

The issue is due for mention in the courts on February 11th.

Mr Lowry said the move by the State was not unexpected and that he did not expect the Persona case to succeed.

A spokesman for Mr O’Brien could not be contacted. The Department of Communications had no comment.

The Persona entity is now owned by two Irish businessmen, Tony Boyle and Michael McGinley. It and Esat were the highest contenders for the licence in rankings drawn up by the civil servants that selected the winner of the licence.

In a separate case, the State is being sued by businessman Declan Ganley, by way of the legal entity Comcast, which was associated with the sixth of the six bidders in the rankings drafted by the assessment team.

Comcast/Ganley case

In the Comcast/Ganley case, the defendants include the State, Esat, Mr O’Brien and Mr Lowry. The State sought to have the two cases dismissed on the basis of the amount of time that has elapsed since the competition, but earlier this year the Supreme Court ruled that the cases could go ahead.

It said that much of the evidence in the case was documentary, that the witnesses were still alive and had given evidence to the tribunal, and that the alleged corruption was of such a magnitude that it was in the interest of the State that the claims were ruled on by a court of law.

“These proceedings make serious allegations of corruption by a minister of the government, not a matter which should be struck out on a technicality but which should be addressed in a full hearing in open court,” the Chief Justice, Ms Justice Susan Denham, said in her judgment.