TV whizz kid James Warburton won’t be able to start as CEO of Channel Ten until January 1 next year — when everyone else in the country will still be on holiday — thanks to a judgment in the NSW Supreme Court this morning.
And that means young Lachlan Murdoch will have another seven months to fill in as boss (and won’t get his Christmas off).
The decision is a big victory to Channel Seven, which is already winning the ratings battle and has just snaffled the TV rights for AFL in a huge $1 billion-plus deal. Seven took court action in April to enforce a restraint-of-trade agreement signed by Warburton in December 2007, in which he had agreed not to join a rival TV network for 12 months if he quit Seven, (which he did in March this year). And the court has upheld that deal.
Justice Michael Pembroke’s verdict, handed down shortly after 10am, explained that he was keen to give Warburton his freedom, but was required to protect Seven’s legitimate commercial interests. Said Pembroke:
“Mr Warburton is clearly a redoubtable talent who is respected, sought after, and even fought over. Until early this year, he was a valuable asset for the Seven Network. I have no doubt that he has the capacity to continue to make a significant impact in the television industry in Australia. I should do no more than the minimum that is reasonably necessary to protect the plaintiffs’ legitimate commercial interests. And I should strive to limit the hardship to Mr Warburton.
“The unfortunate but necessary consequence of my orders is that he will be sidelined for the whole of the balance of calendar year 2011. If he becomes the chief executive officer of Network Ten from 1 January 2012, Mr Warburton may well represent a competitive threat to Seven, but this will not realistically be because of his retention of confidential information acquired by him at Seven prior to 2 March 2011, but because of his skill, talent, personality and past successful record in the industry.”
Seven put out a short and very careful statement refusing to gloat over its victory. But that’s because the court will come back tomorrow to hear Warburton’s complaint that Kerry Stokes should be found in contempt for comments he made on Warburton’s evidence during the case. However, there’s no doubt they were smiling down at Seven’s Jones Bay offices.
Ten put out a statement accepting the decision, expressing disappointment and confirming that Warburton will indeed start in January next year, despite scuttlebutt that his contract might be cancelled.
The only one at Seven with cause to be disappointed is boss David Leckie, whose account of a key conversation in which he denied telling Warburton he was free to go was rejected by the judge. Leckie’s evidence about what he said was “defensive”, “imprecise” and “garrulous”, according to Justice Pembroke. But the fact that he had told Warburton he was free did not mean that Seven had given up its contractual rights.
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