Channel 7 vs Amber Harrison: when PR should sometimes trump the law

The latest Court offering served up by the long running and very public legal dispute between Amber Harrison and Channel 7 serves as a timely reminder that sometimes technically correct (and indeed in this case successful) legal actions should still not be pursued for the sake of a company's reputation and wider commercial interests. 

As you may recall, Ms Harrison had a very public liaison dangereuse with one of her former colleagues, the CEO of Channel 7 Tim Worner.  That affair became the subject of a settlement agreement between Harrison and Ch7 which Harrison alleged was breached by Ch7 (including the failure to pay agreed sums of money) and that Ch7 alleged Harrison breached by failing to comply with confidentiality provisions.  Ch7 then obtained a very widespread 'gagging order' from the Court preventing Harrison from saying anything publicly about Ch7.

Ch7 Executives, no doubt relying on the extensive gagging order, then came out swinging, in public, against Harrison.  The plan back-fired.  Harrison refused to be gagged whilst being publicly attacked, and responded in kind.

Fast forward to this week, and we have the Supreme Court finding that whilst Harrison clearly breached the Court gagging order and needs to be found guilty of contempt, there appears to be no other penalty or punishment imposed and no costs ordered in favour of the Ch7 shareholders.  Even more damaging for Ch7, the judgment also overtly displays substantial sympathy for Harrison's position, and Justice Pembroke repeatedly stresses that the Court was required to find her guilty of contempt, whilst setting out at length in the Judgement all of the circumstances that led Harrison to respond in the manner that she did.  Reading between the lines, it was a bad strategic call by Ch7. 

And that is perhaps the take away: whilst technically Harrison was gagged and unable to respond to the public attacks levelled at her by the Ch7 Executives, such events are, at least initially, played out in the public domain well before they darken the door of any Courtroom.  The general public will not accept or fully understand the legal intricacies involved in a gagging orders or contempt proceedings and are merely going to see a lone female employee going toe to toe with a large and very well resourced company.  In a media/PR sense, it is never going to be a fair fight and Ch7 needed to recognise that, regardless of the weight of its legal argument.  The decision to then bring contempt proceedings was highly unlikely to bring any commercial or PR benefit to Ch7, but they still pressed the button.  Its a great example of where a legal argument or position needs to be strategically viewed in the wider commercial context - otherwise you may just be headed for a very expensive (if not damaging) pyrrhic victory.


The census debacle - Cove Legal comments to the AFR on the legal fallout

The recent Australian census debacle is the hottest topic in the press this week, and Roger Blow of Cove Legal was asked by the Australian Financial Review to provide his expert views on the likely legal fallout from the website failure.  Read the full article via the link below.

It has certainly been a bad news week for both the ABS and IBM, but as Roger comments, when it comes to launching any legal action there are many more considerations to take into account than merely the issue of who was at fault.  For example, a party can be liable for damages but have their liability capped within the contract, and when things really go wrong such clauses can have a massive impact on how the parties react.

Cove Legal acting on high value tax dispute

For the past 18 months Cove Legal has been representing two tax payers in their long running battle with the ATO over amended assessments that demanded amounts which the clients argued were considerably in excess of their genuine debts.  The case has raised relatively novel issues concerning the use of freezing orders and the summary judgment process in cases where it is argued the tax payers have not had the opportunity to properly challenge the ATO's assessment.  An Appeal is currently being run by Cove Legal before the Full Federal Court that includes a constitutional challenge to the imposition of tax debts without a proper right of review.