«COMMERCIAL RADIO INQUIRY Report of the Australian Broadcasting Authority Hearing into Radio 2UE Sydney Pty Limited February 2000 Sydney ISBN 0 642 ...»
On another matter, would you please pass on to John that I really appreciated his comments on-air yesterday regarding the unattended child situation at Canterbury Leagues Club. This is obviously a touchy subject and from our point of view, John handled it very well.305 Comments Critical of Gambling During the period of the Star City Agreement Mr Laws’ critical on-air comment in relation to gambling was limited to the proliferation of poker machines in hotels and a proposal for a new ‘super club’ at Liverpool.306 Attitude of Star City Entertainment Pty Limited to the Performance of the Agreement In evidence, Mr Gamble stated that Star City was generally satisfied with the implementation of Mr Laws’ agreement.307
MR LAWS’ EVIDENCE AND SUBMISSIONS
Transcript, Mr Gamble, p. 623. Mr Gamble’s answer ‘On rare occasions’ seems to indicate that matters were brought to his attention rarely, rather than that monitoring of the program was rare.
SCH.0001.0062. Mr Gamble confirmed that the date on the printout of the message (‘3/10/99’) is in American format and should be read as 10 March rather than 3 October: Transcript, Mr Gamble, p. 623.
Transcript, Mr Gamble, p. 618.
Submission, Mr Laws (Exhibit 47) para. 93.
Exhibit 47, p. 63, Transcript, Mr Laws, p. 780.
Transcript, Mr Laws, p. 722.
with whom he did not. Mr Laws indicated that the sales department and management at 2UE were aware that ‘those sponsors are there in the main because they’re part of the family of the John Laws program’.312 Mr Laws often referred to his loyalty to sponsors and his listeners, and insisted that he will
not accept a sponsorship unless the product satisfies certain criteria:
♦ Will it be good for his listeners?
♦ Will listeners regard it as a worthwhile product?
♦ Is the company reputable?
♦ Can he enthusiastically endorse the product?
Will he or his family use it?313 ♦ When asked how it was that a listener would be able to discern who Mr Laws’ new sponsors were, counsel for Mr Laws submitted that it depends upon the surrounding circumstances.314 Mr Laws’ counsel submitted that those circumstances could range from Mr Laws being seen at a function of a sponsor, to Mr Laws writing about or mentioning on-air the fact that they were sponsors, to the dissemination of press release information disclosing the existence of a sponsorship arrangement.315
CONCLUSIONSMr Laws argued that the identity of those with whom he had sponsorship agreements was common knowledge. In evidence, however, Mr Conde, Mr Brennan and Ms Brownlow admitted that they were not aware of the existence of some of Mr Laws’ agreements (particularly those with the Road Transport Forum and the Registered Clubs Association of NSW).316 Mr Brennan, Ms Brownlow, Ms Wild and Mr Edmonds also gave evidence that the listening audience of the John Laws program was already well disposed to registered clubs and trucking issues.317 Furthermore, Mr Laws has argued that he would not enter into a sponsorship arrangement if he did not first sincerely believe that the product or service was suited to himself, his family and his listeners.318 There is a clear congruence of interests and common ground on issues between Mr Laws’ audience and his sponsors. Without further information, it would be difficult for a listener to Mr Laws’ program to determine where his personal support ends and paid advertisement begins. For example, during the RTF campaign a photograph of Mr Laws was placed on the side of a truck, a matter made known to Mr Laws’ listeners. There are a number of possible
conclusions that listeners might draw from this:
♦ the RTF might have paid Mr Laws to do so (as was the case);
Transcript, Mr Laws, p. 722.
Submission, Mr Laws (Exhibit 47) para. 41.
Transcript, p. 1781.
Transcript, p. 1782.
Transcript, Mr Conde, pp. 1532-1533; Transcript, Mr Brennan, pp. 1223-1227; Transcript, Ms Brownlow, pp. 700-703.
Transcript, Ms Brownlow, pp., 700-701; Transcript, Mr Brennan, pp. 1223, 1227; Transcript, Ms Wild, pp.
Submission, Mr Laws (Exhibit 47) para. 41.
♦ alternatively, Mr Laws, might have consented to his likeness being used in this way free of charge (because of his support for the trucking ‘cause’); or ♦ alternatively, 2UE might have paid the RTF or the truck owner to promote the John Laws Morning program in this way.
Without the disclosure of relevant information (that is, the existence of the RTF contract) the listener cannot make an informed decision about Mr Laws’ support for his sponsors’ products and services.
7 Radio 2UE Sydney Pty Limited and Messrs Jones and Laws’ Agreements
2UE’S KNOWLEDGE OF THE AGREEMENTSMr Conde gave evidence that it was 2UE policy that an announcer should be entitled to enter into a personal endorsement arrangement or promotional contract provided that: 319 ♦ the editorial independence of the announcer is not compromised, and ♦ the announcer does not receive recompense from a third party for doing something on 2UE that 2UE is already paying for.
Mr Conde said that prior to March 1998, when the ‘Media Watch’ program on ABC television broadcast allegations of improper editorial conduct, he was aware that Messrs Jones and Laws had commercial relationships with various entities. Mr Conde also gave evidence, however, that he thought that these arrangements did not infringe 2UE’s policy, stated above. Furthermore, prior to 3 August 1999, when 2UE’s solicitors were permitted to
view Mr Laws’ contracts, Mr Conde gave evidence that it never occurred to him that:
a particular editorial position being espoused on 2UE [by any presenter] … was being broadcast because the announcer had some arrangement or understanding with a third party to press that view in return for some payment or other valuable consideration.320 Mr Conde also indicated that he did not know of the terms of any contracts between presenters and sponsors which related to on-air behaviour until after the March 1998 ‘Media Watch’ program.321 Mr Conde said that, prior to August 1999, he did not know that Mr Jones had any relationship with Colonial State Bank or Qantas, or that Mr Laws had any relationship with the Registered Clubs Association of NSW or Star City.322 Mr Conde said that he knew of the promotional agreements between Mr Jones and Optus and Mr Laws and the Bankers’ Association, the Australian Trucking Association, Optus, Foxtel, NRMA, Qantas and RAMS. Mr Conde indicated, however, that he did not know that these promotional agreements related to on-air promotion.323 In short, Mr Conde gave evidence that, prior to mid 1999, he was not aware of ‘the on-air promotional contracts’ that were the subject of the hearing (a detailed chronology of the timing and extent of 2UE management’s knowledge of the existence of the Jones and Laws agreements can be found at Schedule Ten).324 Three matters raised during the hearing,
however, are difficult to reconcile with Mr Conde’s evidence:
♦ the provision of a draft NRMA contract by Mr Laws to 2UE in April 1998;
Submission, Mr Conde, paras 1.24, 12.6.
Submission, Mr Conde, para. 12.12.
Submission, Mr Conde, para. 1.27.
Submission, Mr Conde, paras 1.30 – 1.31.
Submission, Mr Conde, paras 1.32 – 1.33.
Submission, Mr Conde, para. 1.40.
♦ e-mails between senior personnel at 2UE regarding the Bankers’ Association in December 1998; and ♦ Mr Jones’ Optus agreements.
NRMA DRAFT CONTRACTOn 16 March 1998, the ABC television program ‘Media Watch’ alleged the existence of ‘endorsement agreements’ between Mr Laws and Qantas, Foxtel, Toyota and RAMS.325 During the program, Mr Ackland (the presenter of ‘Media Watch’) made the following allegation:326 Each of them pay him anything up to a five figure amount every month to broadcast endorsements, embellishments and ad lib flattery.
Mr Conde gave evidence that the allegations in the ‘Media Watch’ program concerned him.327 Following the broadcast of the ‘Media Watch’ program, Mr Conde wrote to Mr Laws, requesting that Mr Laws: 328 …tell me whether any of these assertions are true and, if so, supply me with copies of those contracts which are in writing and a summary of the terms of those which are oral.
On 24 March 1998, Mr Laws’ solicitors responded to Mr Conde. No contracts were provided at that time, Mr Laws’ solicitors citing confidentiality as the reason.329 This claim of confidentiality sits uncomfortably with Mr Laws’ assertion that the identity of his sponsors was well known.330 On 1 April 1998 Mr Conde and Mr Laws met over lunch to discuss the allegations arising from the ‘Media Watch’ program, and Mr Conde’s concern in relation to those allegations.331 On 9 April 1998, Mr Laws provided a written response to Mr Conde’s concerns expressed at the luncheon meeting.332 Mr Laws said: 333 I am disturbed (a) that he (Mr Conde) was shocked and (b) that he simply accepted as being the fact that the inferences, snide as they were, made on a program on the ABC.
Mr Laws and his solicitor Mr Boyce met with Mr Conde and 2UE’s solicitor, Mr Foster, on 20 April 1998, for further discussion about the allegations on the Media Watch program.
Mr Laws was in the process of negotiating an agreement with the NRMA and, since the agreement was not yet concluded, the view was taken that the terms of that agreement were not protected by a confidentiality clause. At that meeting, it was decided that a draft of the NRMA agreement would be provided to 2UE,334 and Mr Boyce did so on 22 April 1998.335 2UE.0015.2746.
2UE.0015.2746 at 2748.
Submission, Mr Conde, para. 13.2.
Transcript, Mr Laws p. 769.
Submission, Mr Conde, para. 13.7. Mr Laws gave evidence that he did not recall the lunch: Transcript, Mr Laws p. 870.
This agreement between NRMA and Mr Laws was to become ‘the litmus test’ for other agreements.336 It appears that Mr Conde instructed his lawyers to modify the NRMA draft,337 and the
modifications to the draft contract required by 2UE included:
♦ removal of any obligation upon Mr Laws to make positive comment as part of the services for which he was to be remunerated by the advertiser;
♦ removal of any obligation upon Mr Laws to embellish live reads as part of the services for which he was to be remunerated by the advertiser;
♦ acknowledgment that a script for an advertisement to be broadcast on 2UE, whether a paid live read or a paid pre-recorded advertisement, may contain Mr Laws’ personal endorsement.;338 and ♦ ensuring that any material provided to Mr Laws for possible broadcast would be broadcast only if it was in the judgment of Mr Laws, and of 2UE, newsworthy. 339 From the time the draft NRMA agreement was provided to Mr Conde (April 1998), he knew (or at least could readily infer) the terms of Mr Laws’ standard endorsement agreement.340 As the NRMA draft was to be treated as a litmus test for the others, the NRMA draft gave Mr Conde clear knowledge of the kinds of obligations Mr Laws had undertaken to other sponsors. From that moment, Mr Conde knew that the problem was bigger than he had at first thought,341 yet he did not request Mr Laws to provide the names of his sponsors.342 On 14 May 1998, Mr Conde wrote to Mr Laws informing Mr Laws that 2UE would not object to Mr Laws entering into endorsement agreements provided those agreements complied with two points of principle.343 The two points of principle were: 344
Mr Conde gave evidence that Mr Laws had accepted those two points of principle.345 Mr Laws gave evidence that while he accepted the points of principle, he did not believe that they applied to his situation.346 Mr Laws gave evidence that he accepted that Mr Conde had concerns and that he (Mr Laws) had offered to ‘rephrase agreements’ so that the wording Exhibit 56.
Transcript, Mr Conde pp. 1361-1362.
Clauses 2.3 and 7.
4 – JL.0001.0212.
Clause 2.4 – JL.
Transcript, Mr Conde pp. 1349-1350.
Transcript, Mr Conde p. 1351.
Transcript, Mr Conde pp. 1350-1352.
Transcript, Mr Conde, p. 1318.
Transcript, Mr Laws, p. 723.
satisfied those concerns.347 On his own evidence, however, from 14 May 1998 until the date of the hearing, Mr Laws’ did not alter his on-air conduct.348 2UE submitted that Mr Conde’s perception that Mr Laws had accepted the points of principle justified Mr Conde:349 in his expectation that none of Mr Laws’ agreements would continue to contain provisions which would entitle him to receive remuneration from sponsors for any onair activities not authorised by the 2UE policy.
On 27 July 1998, Mr Conde issued a memorandum to all on-air broadcasters. The memorandum expressed concern with certain types of arrangements between presenters and other entities and spelt out 2UE’s policy.
The memorandum said:350 2UE’s policy in relation to these matters is as follows: