The former president of Tennis Australia, Stephen Healy, said he did not want to eject Harold Mitchell from the board because he had connections in the Victorian government which could disrupt an upcoming government grant to redevelop the Melbourne Park sports precinct.
The Australian Securities and Investments Commission has taken Mr Healy and Mr Mitchell to court, alleging the pair withheld material information from the board when it was deciding which television station would win a five-year deal to broadcast the Australian Open in 2013.
Seven eventually paid $195 million for the rights, despite ASIC claiming Network Ten would have paid up to $250 million.
ASIC claims Mr Mitchell pressured the board to sign the deal with Seven instead of using a competitive tender process.
The 2013 deal with Seven created a rift among board members that lingered for years. When Mr Mitchell’s directorship came up for renewal in October 2015, former tennis champion Janet Young and fellow director Kerryn Pratt called for his removal.
Under cross-examination by ASIC’s barrister Michael Pearce, SC, Mr Healy said others at the meeting were concerned that removing Mr Mitchell could jeopardise an upcoming government grant to redevelop Melbourne Park, which includes Rod Laver Arena.
“It would not be ideal for Mr Mitchell to be pushed out when he was very close to the Victorian government and we were in the middle of further discussion on the redevelopment,” Mr Healy said.
“And you were afraid of retaliation by Mr Mitchell?” Mr Pearce asked.
“No, I wouldn’t describe it as retaliation, no,” Mr Healy replied.
“You were afraid of withdrawal of support by the Victorian government?” Mr Pearce pressed.
“I just thought it was, in my view and the view of some of the other directors, Mr Mitchell was very close with the Victorian government and if Mr Mitchell was to go he should go on his own terms and that would be a better way of doing it, if he was going at all,” Mr Healy said.
Private notes of Dr Young previously read in court revealed she believed the board was “fearful” Mr Mitchell would use his power in the media against Tennis Australia if he was forcibly removed from the board.
Mr Healy also agreed that at a board meeting in March 2013, Mr Mitchell had accused Dr Young of leaking details of the broadcast negotiations to the media.
Mr Mitchell stepped down from the board on October 26, 2015, only to be reappointed on December 23. He retired from the board in October last year and now sits on the board of Crown Resorts.
The rift led Scott Tanner, who was Bank of Melbourne chief executive at the time, to quit the board in December 2015. Dr Young, Ms Pratt and Tasmanian businessman Peter Armstrong were voted off the board in January 2016, days before the 2016 Australian Open began.
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