A US subsidiary of News Corp was accused of hacking the computer systems of a small start-up – one of its competitors – according to a letter sent to the FBI yesterday by a US senator.
In the letter, Senator Frank Lautenberg, the Democrat from New Jersey, highlighted concerns – in light of the current investigations surrounding News Corp – that a subsidiary called News America Marketing illegally gained access to the computer systems of a start-up called Floorgraphics Inc (FGI) in 2004.
Lautenberg wrote that he had raised the allegations of News America’s intrusion into the Floorgraphics website with the FBI in 2005, saying he had been told at the time that the FBI and other agencies had "initiated an investigation into allegations that News America illegally gained access to Floorgraphics’s password-protected computer system and obtained Floorgraphics’s confidential data".
The filings from the 2006 court case show that Floorgraphics accused News America of breaching its computer systems on "at least eleven separate occasions" at the end of 2003.
"News [America] intentionally, knowingly, and without authorisation breached FGI’s secure computer system and repeatedly accessed, viewed, took and obtained FGI’s most sensitive and private information," the filings read, adding that Floorgraphics had traced the unauthorised access to an IP address owned by News America.
FGI claimed that News America had won crucial contracts through the use of the confidential, stolen trade secrets. However, during the trial, News America lawyers told the jury that the Floorgraphics site was open to those who did business with the company, and that someone from News America had accessed the website in that capacity.
The case was settled at the time, the New York Times reports, with News America buying Floorgraphics outright in return for dropping the case – at a cost of £18.2 million.
In a related case, another marketing company, Insignia Systems, agreed to a settlement with News America in February this year, releasing Murdoch’s company from antitrust claims for a net settlement of $121 million.
No one from News American Marketing was available to comment on these developments.