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 The description of T&T Sports Marketing Ltd in the indictment
signals that U.S. prosecutors have intensified their focus on media
companies and what they might have known about any bribes, people
familiar with the matter said.
When prosecutors announced their corruption investigation of world
soccer's governing body FIFA in May, they spoke in court papers
about "an array of broadcasters and advertisers" but otherwise did
not specifically address their role.
21st Century Fox listed T&T as a subsidiary last year in a filing
with the U.S. Securities and Exchange Commission. Its investment in
the company stretches back to 2002, government documents from the
United States and Argentina showed.
Fox had no operational control of T&T, a Fox spokeswoman said. She
declined to comment further.
Fox was not named in the indictment and was not accused of any
wrongdoing. T&T was also not accused of any wrongdoing.
T&T, which is registered in the Cayman Islands, does not have a
listed telephone number and it was unclear if it has employees of
its own.
A spokeswoman for the U.S. Attorney's Office in the New York City
borough of Brooklyn, where the cases against top soccer officials
and entities were brought, declined to comment. A spokeswoman for
the FBI also declined to comment.
The Dec. 3 indictment said three executives "affiliated" with T&T
bribed at least 15 high-level soccer officials to support the
company's exclusive worldwide broadcasting rights for events such as
the Copa Libertadores, a major South American club tournament. The
three executives were at the time with Argentine sports marketing
firm Torneos y Competencias, the indictment said.
One of the three executives, Alejandro Burzaco, the former chairman
of Torneos, was indicted for the bribery scheme in the United States
in May and pleaded guilty last month. The two others were described
in the indictment as co-conspirators but not named. Torneos, a
part-owner of T&T with Fox, was not charged.
The 15 soccer officials have been charged, and two of them pleaded
guilty last month.
The indictment does not explain how T&T benefited from retaining the
broadcasting contracts. T&T is not a broadcaster itself, but by
obtaining broadcasting rights, it could resell them to major
broadcasters.
21st Century Fox, which is led by media baron Rupert Murdoch, ended
up with the rights to broadcast the Copa Libertadores and other
tournaments.
The avalanche of corruption allegations prompted FIFA President Sepp
Blatter to say he would resign, only days after being re-elected to
a fifth term. Batter has not been charged with a crime, and denies
any wrongdoing.
Prosecutors have charged 41 people and entities in a probe of soccer
corruption spanning the globe. Soccer bosses from throughout the
Americas are among the defendants in a case that prosecutors said
involves $200 million in bribes and kickback schemes tied to
marketing of major tournaments and matches.
The schemes deprived soccer federations of the full value of
broadcasting and marketing rights and had powerful anti-competitive
effects, prosecutors said.
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POTENTIAL LIABILITY
Media companies could potentially be criminally liable if they
benefited from bribery and their employees had knowledge of it or
were willfully blind to it, legal experts said. Emails, text
messages and other documents, as well as interviews with cooperating
witnesses, are typically used to assess what if anything employees
knew and when.
Mere ownership in a subsidiary or affiliate involved in bribery
would not be enough, however, for prosecutors to charge a major
media company. There would need to be evidence the company knew or
was willfully blind.
According to the indictment, T&T was owned in part by Argentina's
Torneos and in part by "a group of investors that included an
affiliate of a major broadcasting company headquartered in the
United States whose identity is known to the grand jury." The
description does not go beyond that.
Today, only two companies own shares in T&T. A Fox affiliate owns 75
percent and Torneos owns 25 percent, according to Torneos.
Fox's relationship with T&T dates back to 2002, when the company
joined forces with Liberty Media Corp and a subsidiary of private
equity firm Hicks, Muse, Tate & Furst to form a venture called Fox
Pan American Sports. As part of the deal, Hicks transferred its 50
percent stake in T&T to the new venture, according to government
documents from Argentina. Fox completed its takeover of Fox Pan
American Sports in late 2011, according to U.S. securities filings.
A Liberty Media spokeswoman did not respond to questions about the
deal. Hicks is defunct.
Satellite-TV company DirecTV also has an interest in T&T, according
to a securities filing in February. It owns 40 percent of Torneos,
which in turn owns 25 percent of T&T's shares. DirecTV said in
August that its $147 million investment in Torneos could be hurt by
the ongoing FIFA investigations.
DirecTV is a unit of AT&T Inc, which declined to comment on the
case. Torneos also declined to comment.
Fox has chosen the law firm Williams & Connolly to conduct an
internal review related to the soccer investigation, people familiar
with the matter said. The scope of the review could not be
determined. Brendan Sullivan, a partner at the firm who represented
Murdoch's News Corp in the British phone-hacking scandal, could not
be reached for comment.
(Reporting by Mica Rosenberg and David Ingram in New York;
Additional reporting by Mark Hosenball in Washington; Editing by Amy
Stevens and Grant McCool)
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