Editor will fight Rinehart demands over court fight

The article describes a dispute between Gina Rinehart and her four children over control of the family trust and the family’s estimated $17 billion fortune. The dispute involves whether confidential arrangements under a 2006 Hope Downs Deed were breached and whether parts of the matter should be resolved in confidential arbitration or litigated in open court.

Lawyers for Hancock Prospecting have sought correspondence and notes of conversations between The West Australian’s journalists (including Steve Pennells) and Mrs Rinehart’s children from around early September 2011. Hancock is seeking to discover whether any pre-litigation communications occurred that could indicate a breach of the Hope Downs Deed.

The Supreme Court of Western Australia issued a subpoena ordering The West Australian to provide copies of recordings or notes of conversations made on or after 4 September 2011 between Steve Pennells or any journalist employed or contracted by West Australian Newspapers Limited and Mrs Rinehart’s children.

Editor Brett McCarthy said the newspaper will fight to protect its confidential sources and will do everything possible to keep any source used in relation to the Rinehart matter private, resisting efforts to disclose reporters’ correspondence.

The Hope Downs Deed, signed in 2006 by Gina Rinehart and her children, contained confidentiality terms that would trigger arbitration and potentially prevent public litigation if the children breached secrecy. For investors, the deed is central because whether the dispute is arbitrated privately or litigated publicly can affect media coverage, corporate governance scrutiny, and the reputations of the parties involved.

According to reports cited in the article, Gina Rinehart, who holds a 12.6% stake in Fairfax, has been reported to have requested two board seats at Fairfax. She is also reportedly considering backing Macquarie Radio Network in a bid to acquire Fairfax’s radio assets, although Fairfax told the paper its radio stations were no longer for sale and had been integrated into the business.

The article reports that Mrs Rinehart discussed taking a 15% share in Macquarie to support John Singleton’s expansion plans. It also mentions an unnamed source saying Singleton bought the Smart Radio Group in regional Queensland last September, reportedly to keep Mrs Rinehart supportive ahead of any push for Fairfax’s radio network.

Investors should monitor court rulings on subpoenas and source protection, any statements or confirmations from Fairfax about asset sales or board changes, reported moves by Macquarie Radio Network, and official disclosures from Hancock Prospecting. These developments could affect media ownership dynamics and shareholder influence at Fairfax, which may influence investor sentiment.