Maxwell, The Outsider

by Tom Bower

  On 18 September 1986, Maxwell summoned a press conference at the Rotunda in which he would announce the delay of the newspaper's publication. His approach on that day would not differ from the countless previous occasions when his press office had sent summonses for journalists to attend for his latest communication. Maxwell wants these encounters to excite and interest his audience: 'He likes to believe their jaws have dropped and they're sitting up. He wants to be certain that he'll be the talking-point for the rest of the day.' Since Maxwell was always a 'good story', he normally achieved his object by calculating what would most surprise. That press conference was no exception.

  ‘I have called you here today,' he began, 'to make an important and exciting announcement. The new London evening newspaper is to become Britain's first twenty-four-hour paper, which will provide the best possible service from breakfast to bedtime.' After explaining how the twenty-four-hour concept would revolutionise Britain's newspaper industry, he allowed a pause for the drama. 'This project has been so top secret that not even the editor knew about it until this morning.' The assembled journalists gasped. Linklater looked embarrassed and interrupted: 'That's a slight exaggeration, Bob.' 'Well, alright, alright,' conceded his employer unruffled. He added that accordingly the launch would be delayed to plan for 'this exciting new development'. Asked to reveal the anticipated circulation of the newspaper, Maxwell unhesitatingly replied, 'One million.' Again there was dismay on the dais, but this time it was felt by his other neighbour, Bill Gillespie, who was horrified. Advertisers' rates are calculated upon circulation and if the actual circulation falls below the amount guaranteed by the publisher the advertisers are automatically entitled to a refund. After heated whispering, Maxwell announced that the 'guaranteed circulation will be half a million'. Even that figure was higher than Gillespie had suggested. 'It was an unnecessary hostage to fortune,' said one of the team afterwards. As usual, Maxwell's optimism had outpaced realism. He had not assessed the full implications, especially the cost. Linklater and Gillespie consoled themselves with the knowledge that they had at least won another four months' preparation. Maxwell meanwhile stepped up another gear into more frenzied activity. During the week of 3 November, another of his ambitions was fulfilled. For seven days he dominated the news.

  In the autumn, the buying spree to enlarge his fortune had recommenced, initially through Hollis, a small publicly quoted timber merchant and furniture manufacturer which Maxwell controlled but which was managed by his son Kevin. Hollis had recently bid for a diverse range of insolvent engineering companies, a crane manufacturer and an electronics specialist and had paid £30 million in an intercompany transaction for some Pergamon assets. But those deals were eclipsed on 3 November when Maxwell in the name of Hollis offered £265 million for AE, a well-known Rugby-based engineering group. AE was in the midst of an exhausting take-over battle and Maxwell presented himself once more in the guise of the 'white knight'. 'Publisher Rescues Engineer' was not a convincing headline that week (the AE bid in fact later collapsed) but in another bitter and much publicised take-over battle between two printers, the management of McCorquodale and Norton Opax, he maximised his interventionist role. He had bought a strategic 19 per cent shareholding in McCorquodales and he encouraged both sides to bid against the other for his support. The Dutch auction for his favours had continued for several weeks, often late into the night as he coolly haggled for a better price between two increasingly exasperated bidders. During the week of 3 November, as the climax of bid and counter-bid approached, Maxwell's name appeared daily in bold, large print in the news, financial and legal sections of every paper - 'In the centre of the stage', 'The global player', 'The big-league player who is no longer in it for the money', and 'The incredible all-performing Robert Maxwell'. It was also the week that a Chinook helicopter which was part of the fleet Maxwell had bought six months earlier from British Airways for approximately £14 million crashed in the North Sea killing forty-five people, the world's worst civil helicopter crash in history. Moreover when, at 2 a.m. on 6 November, he finally came down on the side of Norton Opax, he was spending his daytime in the High Court fighting a libel action against Private Eye.

  Among the several paradoxes reaffirmed about Maxwell during that epochal week was his sensitivity about his reputation. Private Eye had falsely alleged in July 1985 that Maxwell had paid for the travel expenses of Neil Kinnock to East Africa in the hope that he would, as the Labour leaders' 'paymaster', be recommended for a peerage. When the item had appeared, Maxwell had denied the story (and was subsequently vindicated by the jury), asked for a published apology and a payment of £10,000 for the Mirror's Ethiopian famine fund. The Eye's editor, Shrewsbury-educated Richard Ingrams, had spurned his protest and had unwisely repeated the allegation. For many years, Maxwell and his wife had been a standing butt of facetious comment in the magazine and Maxwell was also the subject of a regular, laconic strip cartoon. The stimulus, he believed, was Ingrams's xenophobia and anti-semitism which sprang from the same 'forces of evil' which had pursued him since 1969. For Ingrams, Maxwell represented the worst type of humbug - a man who perpetually cried 'foul' but committed identical sins about which he vociferously complained. One of the Eye's functions, which Ingrams had repeatedly expounded during his twenty-five-year editorship, was to expose what he thought to be the hypocrisy of the rich and powerful, who in turn were outraged that those beyond their employ did not display the respect which they desired. In 1985, Ingrams, who was contemplating retirement, viewed Maxwell as a prime candidate for that treatment and therefore ignored his complaint. Maxwell's lawyers served a writ alleging defamation. In reply, a member of the Eye's staff swore an affidavit, which was presented to a judge, claiming that he would be able prove the 'peerage' story if the issue came to trial.

  Maxwell's relationship with Kinnock was workmanlike despite the Mirror's publisher occasionally posing as the alternative Opposition. With the exception of policies on trade union laws and defence, where his views had changed from two decades earlier (he was now opposed to unilateralism), Maxwell broadly supported the party leadership. His endorsement was welcomed by the Labour leader, who more than ever needed the Mirror's support, although he was dismayed by the newspaper's rush downmarket, at the expense of political coverage, to chase the Sun. Maxwell, whose personal loyalty to the party was never in doubt, was clearly an important benefactor because there were few socialist millionaires who could afford to make large contributions. It was clearly within Kinnock's gift to recommend peerages and, after the elevation to the House of Lords of Maxwell's employees and fellow Labour Party supporters Charles Williams, Bernard Donoughue and Sam Silkin in 1984, the Mirror's publisher might reasonably have expected the same recognition. Indeed, according to Maxwell, soon after the three appointments he was 'asked' by Roy Hattersley whether he too would like a peerage but he had rejected the offer. Maxwell would cite this exchange in the High Court case against the Eye as the second occasion on which he had refused the offer of a peerage, and as proof that he had no need to bribe the Labour leader. Hattersley insists that the question he posed at a social event was an 'obvious jest' and that Maxwell later privately apologised for mentioning the 'offer' in court. Kinnock is equally emphatic that he would only recommend Labour supporters as peers who would solemnly undertake to appear regularly in the House of Lords and dedicate themselves to work for the Opposition. Since Maxwell would be unable to commit himself to those long hours, he was therefore automatically excluded.

  Nevertheless, such was Maxwell's obvious interest in power and recognition that when Ingrams was handed the story he approved publication because, even if he could not produce a witness to the alleged transaction, 'it seemed right'. Newspaper barons in Britain were customarily created peers and there was every reason to imply that Maxwell might expect the same. A jury, Ingrams calculated, would sympathetically interpret and share his prejudices against power and wealth and, even if the case were lost, the free publicity of daily coverage
in the national newspapers would be worth a fortune. Since Ingrams had entered 'litigation' as one of his recreations in Who's Who, observers might have expected his familiarity with the law of defamation and the vagaries of the courts to make him hesitate to engage Maxwell in battle unless his case were stronger. It was a challenge to Maxwell, who readily accepted the chance to teach the public school establishment a lesson and to protect his standing in the Labour Party. By the end of the first day's hearing on 2 November, it was obvious that the same British cult of amateurism which had enabled Maxwell to earn his fortune had blinded Ingrams and his legal advisers to the interpretation which a jury of common men would put on their criticisms. The opening speeches in Court 11 showed that the trial would not be about buying a peerage, because the Eye could not substantiate its allegations. Its 'eyewitnesses' could not be named nor could they appear. Their case was a bluff. Maxwell v Pressdam, alias School Bully v School Sneak, became Nasty Outsider v Nasty Insider.

  The magazine attempted, within the limitations of the alleged defamation, to put Maxwell himself on trial by probing his quest for publicity, his own newspaper's mistakes and how he might expect his support for the Labour Party to be ultimately rewarded. Maxwell, who had spent a lifetime defending himself against more formidable advocates armed with more incriminating allegations, not only withstood the attack without demur but turned the spotlight upon his accusers. On the third day, when he was giving evidence, Maxwell performed a remarkable somersault. Maxwell the ogre and bully became Maxwell the underdog.

  The issue was a regular 'letter' purportedly sent by his wife to the magazine asking whether readers had noticed the similarity between two photographs. The personalities for comparison one week from 'Ena B. Maxwell’ were the Duke of Edinburgh and Colonel Adolf Eichmann, who had organised the Third Reich's 'Final Solution' for the extermination of European Jewry. Eichmann had personally supervised the deportation of 400,000 Jews from Hungary for extermination at Auschwitz, and Maxwell's parents had been among those victims. The 'Ena B. Maxwell' letter was an example of the magazine's regular lampooning of the millionaire and Maxwell would probably have known in advance which examples his counsel would have offered him for comment in the witness box. No one, however, anticipated his reaction.

  As he looked at the page, tears began falling down his cheeks and, according to the following day's Daily Mirror report, Maxwell 'shook with emotion and banged his hands on the witness box as he said, "My family was destroyed by Eichmann". ... It was several minutes before he composed himself, wiped his eyes and took a sip of the glass of water handed to him. He then turned to the judge and said, "I'm sorry.'" In the Eye camp, there was astonishment. 'When I saw him blubber, I knew that we'd lost,' confessed one of their heavier, hard-nosed investigators. Ingrams did not help his case by admitting in evidence his ignorance about Eichmann's role in the fate of Maxwell's family. The Mirror's headline was the gravestone inscription over the Eye's case: 'Maxwell Weeps over Family Massacre - Publisher's Fury at Eye's Fake Letters'. As the case spun out from the expected one week into the third week, the champions of anti-privilege began massaging their brows: Maxwell was winning sympathy as the victim of gross insensitivity.

  The jury's award against the Eye for the defamation was an unimpressive £5,000. But they awarded an extra £50,000 as punitive damages because the Eye's journalist misleadingly swore an affidavit claiming that he would be able to prove his allegation. In addition there were an estimated £250,000 legal costs, which the Eye was ordered to pay. 'Bloody hell. . . bloody hell' was the crisp reaction of the Eye's managing director, the aptly named David Cash, as the jury recited the damages. In his own valediction, Ingrams, who was not in court to hear the verdict, advised potential litigants, 'If your lawyers tell you that you have a very good case, you should settle immediately,' and blamed the jury who 'while good and true [are] immensely thick'. Maxwell disagreed. 'People, family and friends', his voice boomed across the courtroom, 'have been recklessly attacked for years. We have exposed once and for all that they will publish anything for profit. They do not check their sources, they do not have the guts to apologise or withdraw. They are pedlars of lies and filth.' Asked what he would do with the damages, he answered, 'The money might go to AIDS research. After all it came from an infected organ and will go to help cure another.'

  In November 1982, Maxwell had reviewed a book which recounted the history of the Eye and he had asked, 'Does it really make a valuable contribution to our society to destroy both in our own eyes and in those of the world at large our major national asset of incorruptibility in public life - to replace it with a belief that the instincts of the piggery motivate our public servants and successful entrepreneurs?' Four years later he went further and argued that the Eye should be closed down. The Eye's readers did not agree. The alleged scandals surrounding the Guinness bid for Distillers (Maxwell had publicly supported Ernest Saunders for reneging on a solemn pledge about the composition of the new board), the endless corruption in local authorities, the chain of negligence which led to the sinking of the Townsend ferry at Zeebrugge and the admission of Britain's senior civil servant in Australia that he had been 'economical with the truth' pointed to a need for the Eye. Britain, the Eye's supporters argued, does not enjoy incorruptibility but suffers from a lack of formalised accountability. In the vacuum of parliamentary power, the press was Britain's last safeguard against 'our public servants and successful entrepreneurs'. But, for Maxwell, 'The Eye has become the Joe McCarthy of British journalism [and it] cannot justify its continued existence.' His desire for its eradication revealed a limited understanding about newspapers. The Eye enjoyed sustained credibility, something which Maxwell's own newspapers could not boast.

  'Watching Maxwell play with newspapers is like a child with a Meccano set,' said Keith Water house, who resigned as a columnist on the Mirror in disgruntlement. 'When he's fed up with one toy, he looks for another.' By the end of 1986, Maxwell had successfully maximised the Mirror Group's profits. Having slashed its overheads in London, Manchester and Glasgow, BPCC entered 1987 aiming to fulfil his objective of becoming an 'enterprise with earnings of £3-5 billion with earnings per share to match'. The focus in early 1987 returned to his newspapers, although the omens were not encouraging. A new sports magazine, Sportsweek, launched in September 1986, had collapsed three weeks after its launch; he publicly alternated his views about continuing to print in Holborn; despite his announcement that the Mirror would be printed with colour pictures, no such pictures had appeared; and BPCC had lost the contracts for the colour magazines of the Observer and the Mail on Sunday. Balancing achievements were securing the contract for the Sunday Express Magazine, for satelliting the China Daily from Peking to distribute 20,000 copies throughout Europe, and the launch at last of the London Daily News.

  The delay in launching the evening newspaper had probably improved morale among the newly hired journalists, who had wanted more time to prepare. Five weeks after the decision was announced, Maxwell organised a sumptuous weekend at Ettington Park where, to the delight of the 180 staff, the famed chef Michael Quinn served a gourmet's dinner which was eaten off an enormous refectory table. The highlight on Sunday was the arrival by helicopter of Maxwell himself with Betty and his after-lunch speech. 'You are the staff I have hired,' he averred, 'and I am going to stick with you through thick and thin. There will be no blood-letting. I am not the kind of proprietor who will close you down. You have my guarantee that you have two to three years to prove yourselves.' There were cheers and Maxwell began to take his leave when a note was thrust into his hands. The chef wondered whether he might have a ride on the helicopter. Proudly the publisher agreed and the two artistes flew off over the Warwickshire countryside. On the ground however, there was one man who was disturbed by Maxwell's whole approach - Bill Gillespie, the paper's publisher and the managing director of BNPC.

  Until the spring of 1986, Gillespie had been working for Murdoch's News International. Maxwell had telephon
ed and offered him a high salary to manage the newly incorporated printing operation and oversee the creation of the London newspaper. Gillespie's credentials were impeccable. Under his supervision, all of Murdoch's newspapers had been moved overnight to Wapping, utterly routing the unions, and he had pioneered News International's own blueprint for a London evening newspaper. Since Maxwell prided himself on his ruthless and commercial unsentimentality towards newspapers, Gillespie was an astute choice. But by the summer Gillespie had become disconcerted by the contrast between working for Maxwell and working for Murdoch. Under the new regime, he was denied independence, initiative, information and access. While Murdoch had a deep understanding of newspapers, the foundation of a long-term strategy, Maxwell thought that creating a newspaper was similar to dealing on the Stock Exchange; he only needed to bark down a telephone 'buy' or 'sell' and the whole deed could be completed by his backroom 'number crunchers'. 'He was so arrogant', complained one executive, 'that he believed that if he just blew on the new paper, it would blossom.' Gillespie's confidence had already been shaken when Maxwell, without his knowledge, personally negotiated on a Sunday night in Oxford an agreement with the print union leaders (which later collapsed), and his unease was aggravated by the circumstances surrounding the delayed launch. Three years earlier, the collapse in the Mirror's sales had exposed Maxwell's weak understanding of consumer journalism. The two months after Ettington Park tarnished his image as an innovator.