Resolution statement 00245-19 Hilco Capital Ltd v The Sunday Times
Summary of complaint
1. Hilco Capital Ltd complained to the Independent Press Standards Organisation that The Sunday Times breached Clause 1 (Accuracy) of the Editors’ Code of Practice in an article headlined “Vulture fund took £48m from ailing HMV”, published on 30 December 2018, and in an article headlined “Fresh blow for vulture after collapse of HMV" , which was also published online under the headline, "New blow for vulture fund Hilco, led by [name], after collapse of HMV”, published on 13 January 2019.
2. The first article claimed that Companies House records had shown that the complainant, a company which restructures and re-finances other companies, had “taken almost £50m in fees” out of a named “struggling” music retailer. The article reported comments attributed to a spokesperson for Hilco that “the accounts showed the amounts due, not the amounts paid”, and that “Hilco has expended considerable efforts in ensuring the continuance of [the music retailer] as a business, including the provision of all retail and property advisory services at rates either in line with or below the market levels.”
3. The second article reported that, following the collapse of the music retailer named in the first article, the complainant had suffered a “new blow” after a cookware business it had backed, “failed”.
4. The complainant said that the first article, including the headline, gave a distorted impression that it had stripped excessive sums out of the named ailing music retailer, so as to cause or contribute to its subsequent collapse. It said that the newspaper had been informed, prior to publication, that it had not “taken” £48m out of the retailer; these were charges which had not in fact been re-paid.
5. The complainant denied that it was in “turmoil”, or had suffered a “new blow” following the failure of the named cookware business, as reported in the second article. The complainant said that its role in the business was confined only to supporting it via a loan, which was subsequently re-paid in full; it had no hand in the day-to-day running of the business and therefore could not have been impacted by its subsequent failure.
6. The newspaper did not accept a breach of the Code, and provided accounts to IPSO which it said demonstrated that £48m had been “taken” from the music retailer through various companies for services provided to the retailer since 2013. The newspaper said that the article did not claim that the complainant had “stripped excessive sums” out of the retailer, as the complainant had claimed; it said that the article had set out various factors which had led to the retailer’s collapse.
7. In respect of the second article, the newspaper said that the fact the loan which Hilco had granted to the cookware business had been repaid, did not mean that the headline’s claim was inaccurate or misleading; it remained the case that a business supported by the complainant had gone into administration.
Relevant Code Provisions
8. Clause 1 (Accuracy)
i) The Press must take care not to publish inaccurate, misleading or distorted information or images, including headlines not supported by the text.
ii) A significant inaccuracy, misleading statement or distortion must be corrected, promptly and with due prominence, and — where appropriate — an apology published. In cases involving IPSO, due prominence should be as required by the regulator.
iii) A fair opportunity to reply to significant inaccuracies should be given, when reasonably called for.
iv) The Press, while free to editorialise and campaign, must distinguish clearly between comment, conjecture and fact.
9. The complaint was not resolved through direct correspondence between the parties. IPSO therefore began an investigation into the matter.
10. During IPSO’s investigation, the publication offered to amend the online headline of the first article to, “Vulture fund charged ailing HMV £48m” and to remove references to “took” or ”taken” and replace them with “charged”. It also offered to publish the following clarification in its established Corrections & Clarifications column, which appears on its letters page:
In an article (“Vulture fund took £48m from ailing HMV””, Business, 30 Dec 2018) we said that Hilco Capital Ltd had “taken” £48m from the music and film retailer, HMV. We would like to clarify that as stated in the article this figure related to charges which were incurred by HMV, some of which were not actually paid to Hilco"
11. The newspaper removed the second article from its website, and offered to publish the following correction in its established Corrections & Clarifications column the following week:
Hilco Capital Limited
In an article (“Fresh blow for vulture after collapse of HMV”, Business, 13 Jan) we said that Hilco, a venture fund which invests in distressed businesses, had hit more turmoil after the failure of a cookware business, Steamer Trading, it backed. In fact, Hilco had no hand in the day-to-day running of the business and its loan had already been repaid. We are happy to set the record straight.
12. The complainant confirmed that this would resolve the complaint to its satisfaction. As the complaint was successfully mediated, the Complaints Committee did not make a determination as to whether there had been any breach of the Code.
Date complaint received: 11/01/2019
Date complaint concluded by IPSO: 06/06/2019
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