Newswatch: When the court judgement changed the tide

Described by many as the flagship of news magazine in Nigeria, Newswatch bestrode the media industry like a colossus for more than two and a half decades. Its inability to survive certain financial challenges, however, halted its progress and it was a matter of time for its founding fathers to start contemplating on selling off […]

Described by many as the flagship of news magazine in Nigeria, Newswatch bestrode the media industry like a colossus for more than two and a half decades. Its inability to survive certain financial challenges, however, halted its progress and it was a matter of time for its founding fathers to start contemplating on selling off some of its shares.
They found a willing buyer in Jimoh Ibrahim, a business man who also own Global Media Mirror Ltd (GMML), another newspaper outfit. But after the initial exchange of banters that saw Ibrahim paying the sum of N510 million which was a part payment of the 51 per cent agreed shares and the movement of the four founding members including Ray Ekpu, Soji Akinrinade, Yakubu Muhammed and Dan Agbese to Ibrahim’s GMML office on Lagos Island as non-executive directors, things turned awry.
In an exclusive interview he granted Sunday Trust newspaper in August 2013, Ray Ekpu, a co-founder with the late Dele Giwa, the first Managing Director of the newsmagazine, said after Ibrahim had given them all assurances that he would expand the scope of publication across the six geo-political zones and also increase the welfare of staff, he sent his staff to take over the running of the media outfit situated on 3 Billings way, Oregun.
“He ran it for one year and three months, during which we observed that he was not keeping to the terms of agreement. We tried to draw his attention to some of the violations of what we noted are the terms of agreements, written and unwritten, the violations which are not only in letter but also in spirit. He has actually not been able to do those things he has promised to do for the company. The staff union had to write him that quite a number of things were fast deteriorating in the company and I guess that annoyed him and he went to the office, No 3 Billings Way, summoned the staff, abused them, insulted them and shut down the place,” Ekpu had said in the interview.
According to Ekpu, that development was the last straw that broke the camel’s back as both parties ran to judiciary make claims and counter-claims.
Jimoh Ibrahim and his Newswatch Communications also were the first to savour the sweetness of victory, when on August 1, 2013 Justice O. E. Abang ruled in his favour. The judge sustained the argument that having paid the N510 million, Ibrahim had suceeded in paying for his 51 percent shares as agreed in the contract terms.
“Justice Abang had declared the sales of Newswatch Communications Limited to the new investor valid and had invalidated the purported decision of the board in appointing Ray Ekpu to the board of the company,” the company said. In a statement after the delivery of the recent judgement.
The euphoria that greeted that proclamation had assisted Ibrahim in consolidating his hold on the company and the publication of the newspaper version of Newswatch. All these were going at a time Ekpu and his colleagues had headed for Appeal Court. Little was actually reported of the case of two minority shareholders, Nuhu Aruwa and Professor Jubril Aminu who had filed another suit, urging the court to nullify the agreement which transferred ownership of the company to Ibrahim.
Respondents in the suit are Newswatch Communications Ltd, Global Media Mirror Ltd, Mr Jimoh Ibrahim, Newswatch Newspapers and the Corporate Affairs Commission.
The duo also sought a restraining order barring the respondents from publishing and selling to the public, Newswatch daily and weekend magazines.
Interestingly, Justice Ibrahim Buba of the Federal High Court sitting in Lagos conceded to the petitioners’ pleas. He held that the Share Purchase Agreement, which transferred ownership of Newswatch Communications Ltd to a businessman, Mr Jimoh Ibrahim was a nullity since the investor failed to pay for the acquired shares as agreed.
He further held that the respondents cannot prove that they paid up for the shares as the petitioners gave evidence to show that the second to the third respondents totally failed to pay for the shares of the company.
“They have not shownd how and when they paid for the said shares and nothing in paragraphs11 and 18a of the respondents’ statement of defence shows how they paid for the shares. There is no evidence in paragraph 3 that the respondents paid on or before May 5, 2011 as stated, as they have only given their interpretation to that paragraph.
“Whatever monies they spent was spent on Daily Mirror and this was confirmed by DW2 during cross-examination. The N510m was supposed to be paid for shares and not for any other purpose; there is no evidence to show that the shares have been paid for. Besides, it was a company called Global Fleet that paid the N14 million, not any of the respondents who contracted with the first respondent,” Justice Buba ruled.
The judge also awarded the sum of N15.7 million as damages against Ibrahim and also gave an order stopping further publications of Newswatch Daily. That pronouncement had since put a stop to the continuous printing of the Newswatch Daily newspaper.
Already, the management of Newswatch Communications has headed for Appeal Court on the order of Ibrahim, even as they put forward the argument of being the rightful owners.
“The Federal High Court is not a final court in Nigeria and it will be appropriate to file appeal against the ruling. Hon Justice O. E. Abang  judgment of August 1, 2013 in the case of Newswatch Communication & Others Vs Ray Ekpu & Others. Suit No: FHC/L/C5/1054/2012.
“Justice Abang had declared the sales of Newswatch Communications Limited to the new investor valid and had invalidated the purported decision of the board in appointing Ray Ekpu to the board of the company,” the company’s statement read.
Adedayo Kalejaiye, an industry observer and media critique said notwithstanding the decision of Ibrahim and his media organisation to appeal the suit, the enforcement of Justice Buba must be allowed to take effect.
“When Jimoh got a ruling that favoured him in August 2013, he went ahead with the publication of Newswatch newspaper and even the magazine sometimes ago, and now that another court of competent jurisdiction has called for the stoppage of the publication and the nullification of the contract, that ruling must also be effected. That is what justice is all about and that is what we are all waiting to see,” Kalajaiye said.
In the interview granted to Sunday Trust last year, Ekpu said all the founding fathers of the magazine were in pain over what has now become the fate of their cherished publication.
“Do you see the paper out every week? If you see the paper out every week, you feel something. And if you don’t see the paper the way I don’t see it, you also feel something. Something you laboured for.
Something you nurtured for over 26 years of your life. Something you carried out extensive research on before its establishment. A paper that was able to rank among the best 12 in the world. When we started, we were passionate about it. We loved it. The public loved it. It was something that was so dear to us. When you don’t see it anymore, something in you dies!” Ekpu said.
Whether the ruling of Justice Buba of the Federal High Court will ease Ekpu’s and his colleagues’ agony is what the public are patiently awaiting in the days ahead.