Clive Angel, Mark Chipkin, Stanley Shane; Integrated Capital Management (Pty) Ltd vs. City Press

SUMMARY

The headlines to the stories in dispute read, State capture; and, News analysis: The capture mind-set – Former Trillian Capital Partners executive Bianca Goodson details in her affidavit how the company allegedly milked the state. Here is the case against some of her former colleagues (published on 1 October 2017).

This ruling by Press Ombud Johan Retief was based on the Press Code that was in effect before 30 September 2022.

 

The main article was about the “enormity of the [state capture] bullet South Africa dodged, at least temporarily”. The complainants had allegedly been involved in state capture. The analysis recorded information about the complainants, together with their pictures.

Angel et al complained the inference that they were involved in state capture was false, misleading and defamatory.

After some correspondence with the parties, Retief went ahead to adjudicate the matter.

The crux of his adjudication focused on the question whether the reasonable reader would have thought the reportage inferred that the complainants had been involved in state capture and, if so, if such an inference was justified.

The Ombud found that the answer to both questions was “yes”. He upheld the complaint, saying that the reportage was unfair and unverified and that it unnecessarily had tarnished the complainants’ reputation.

City Press was directed to remove all references to the complainants in the articles, which should include the use of their pictures. “I am not asking for an apology,” Retief explained, “as I believe it is better to let sleeping dogs lie. The issue for the complainants is that, when people google their name, the allegations against them pop up. With the removal of the relevant sections and the pictures, this will not happen anymore. I believe this is fair and would cause the least harm to both the complainants and the newspaper.”

 

THE RULING ITSELF

Complainants: Integrated Capital Management (ICM) and its directors, Messrs Clive Angel, Mark Chipkin and Stanley Shane

Lodged by: Prof Billy Gundelfinger

Date of articles: 1 October 2017

Headlines: State capture; and: News analysis: The capture mind-set – Former Trillian Capital Partners executive Bianca Goodson details in her affidavit how the company allegedly milked the state. Here is the case against some of her former colleagues

Online: Yes

Author of article: Dewald van Rensburg

Respondent: Dumisane Lubisi, editor

Complaint                                            

Angel et al complain the inference that they were involved in state capture were false, misleading and defamatory.

The text

The main article was about the “enormity of the [state capture] bullet South Africa dodged, at least temporarily”. Regarding the complainants, it said ICM directors Angel, Chipkin and Shane, who had an office in Melrose Arch next to that of Gupta lieutenant Salim Essa, set up the “machinery” at Trillian Capital Partners.

Van Rensburg wrote that the ICM directors “effectively ran the place”, while Essa was “the boss” (according to Angel).

The journalist then said that, by Goodson’s account, Angel looked like a creep and a bully.

The latter reportedly also:

• explained the “realities” of business to her when she raised questions about the mysterious windfalls Trillian enjoyed; and
• suggested to her that the ends justify the means – “a common refrain in the Gupta family’s all-out propaganda war”.

The analysis recorded information about Angel and Shane, together with their pictures.

In the text about Angel, Goodson inter alia alleged she had been recruited by him. She reportedly said that, on 2 February 2016, he asked her to come to the office to sign some documents. However, she was not able to do so at that time, upon which Angel told her she needed to sign some invoices for payment. She then sent him a jpeg with her signature. She reportedly said she later realised that her signature had been used without her consent.

The text about Shane said that he was a non-executive director of Transnet, “another state-owned entity Trillian Capital Partners milked for at least R112 million”. Goodson was quoted as follows: “It has been mentioned in the media that Shane was not involved in TCP (Trillian Capital Partners) operations… [However] I can confirm that Shane was operationally involved in management decisions, strategy compilation and dispute resolution within TCP.”

Background to this adjudication

My initial decision

On August 15, I have sent the parties my decision – the content of which should explain the context of the complaint:

“I have now studied all the relevant material and have come to a decision.

“But first, here are the facts:

1. The offending story was published on 1 October 2017;
2. Because the publication of a new article provided a link to the offending story, the latter became (again) part of the news – and therefore could be complained about;
3. The complainants then demanded a right of reply from the newspaper, which it has published on 3 June 2018; and
4. Despite this right of reply, the complainants asked me to direct the newspaper to remove the offending text from its website.

“The publication of the right of reply has left me between a rock and a hard place – I have never before, in my nearly nine years of service, sanctioned a newspaper after it has published a right of reply in response to a complaint. The only exception was when the newspaper did not adequately reflect such a response.

“I have therefore (carefully) compared the letter sent by Prof Gundelfinger to the newspaper with the text that was published – and I am satisfied that the text contained the essence of that letter. Less important statements left out included that ICM’s office was next to that of Salim Essa; that Goodson’s statement was not an affidavit; and some of the company’s recent transactions.

“Given this situation, I am not willing to hand out a new sanction to City Press.

“On the other hand, though, the offending material is indeed potentially harmful to the complainants’ dignity and reputation – another fact, which I also have to keep in mind.

“I am therefore not sanctioning the newspaper, but am merely asking it to be consistent by ensuring that the complainants’ right of reply is also published on all Media24 platforms where the offending story appears.

“I deem that to be fair to both parties.

“So therefore, I need:

1. an undertaking by the editor to publish the right of reply on all the relevant Media24 platforms; and
2. to know if the complainants find this way forward acceptable.

“Please let me know what your decision is at your earliest convenience.”

My subsequent letter to the parties

Following an application for leave to appeal, and Judge Bernard Ngoepe’s decision in this regard, I have sent the following correspondence to both parties on October 29:

On August 15, I have sent you my decision in which I have asked the newspaper to ensure that the complainants’ right of reply is also published on all Media24 platforms where the offending story appears.

I asked for an undertaking by the editor to publish the reply on all the relevant Media24 platforms, and wanted to know if the parties find this way forward acceptable.

I therefore asked the complainants for their response to my decision, and stated that both parties are at liberty to lodge an application for leave to appeal against my decision.

The complainants did lodge an application for leave to appeal.

On October 10, Judge Bernard Ngoepe dismissed this application on the grounds that it was premature, as both parties were yet to come back to me in order to finalise the matter. He also stated: “The parties must comply with the Ombud’s directive, after which he would issue a Ruling one way or another, against which leave [to] appeal might be sought.”

In other words, the ball is back in my court again.

On October 23 I have received correspondence from Prof Gundelfinger in which he indicated that his clients are not satisfied with the publication of a reply only – they want the article and the photographs of Messrs Angel and Shane to be removed, or at least have all portions of the article that refer to Gundelfinger’s clients removed, as well as their reply that was published. They also ask for a retraction of the relevant allegations.

This now puts the matter on a totally different plate – earlier the complainants asked for a right of reply (which I have granted); now they want that to be removed as well. In light of this new situation, I am not going to insist that the complainants’ reply be published.

Formerly, I have opted for the publication of their reply in an attempt to be fair to both parties. However, any “middle ground” has now vanished, and I am left with either dismissing the complaint, or upholding it. No middle ground anymore.

This brings me to the heart of the matter – the statement, as fact, that the complainants helped set up the machinery of state capture and “effectively ran the place” (with special reference to Mr Salim Essa, a “Gupta lieutenant”, who was the “boss” of the operation).

The complainants say their company, ICM, was an “arms-length service provider”, as it has been to numerous other companies, and emphatically denies that they took part in any state capture actions.

Section 1.12 of the Press Code now becomes relevant. It says: “No person shall be entitled to have an article removed which falls short of being defamatory, but is alleged by such person to be embarrassing.”

Therefore, I am within my mandate to direct that all material pertaining to the complainants be removed from the websites – if I find it to be defamatory.

In order to make such a decision, I keep in mind that one cannot defame someone with the truth, if the statement in question is in the public interest. The latter clearly is the case and needs no debate, which brings me to the crux of the matter: The onus rests on the newspaper to prove that the complainants were part of the “state capture machinery” or, to use Section 1.3 of the Code, to convincingly argue that the statements were reasonably true.

I am therefore first giving City Press an opportunity to respond to the above.

Given the fact that this complaint has dragged on for quite some time now, I think it is fair to give the newspaper until Monday, November 5, at noon, to do so.

Regards,

Johan

The responses to my letter

City Press

LUBISI says it is worth noting that ICM’s right of reply was published on the platforms where the article first appeared, as well as in the print edition.

He says I was wrong to state in my letter that the “onus rests on the newspaper to prove that the complainants were part of the state capture machinery”, since the article did not say that the complainants were part of state capture as a whole, but very specifically dealt with Trillian.

Lubisi says Goodson’s statement formed the basis of the article complained about.

In her statement, she inter alia claimed that:

• she had been approached by Angel with the opportunity to be CEO of Trillian Management Consulting;
• Angel had signed her employment contract, and told her that “Salim … was the boss” (who issued instructions to ICM); and
• she had e-mailed a signature of herself to Angel when she could not make it in time to the office in February 2016 to sign some documents.

The editor says it is reasonably true to say ICM set up the machinery, because even in its reply to City Press, the company said it “provided start-up and administrative services (for a limited period of time)” – which is literally the meaning of “set up” as City Press reported. He emphasises the story never said that ICM was part of the “state capture machinery”, as I have summarised the matter.

Lubisi says it may very well be true that ICM directors provided start-up and administrative services to other companies, but adds that that does not detract from the fact that the company was involved with Trillian.

He states: “The article’s assertions about ICM directors’ operational involvement in Trillian are drawn from Ms Goodson’s account and buttressed by the documents she made public alongside her statement. These include records of meetings about Trillian work, as opposed to the ‘start-up’ services ICM says they were limited to. It is factual, at least according to Ms Goodson’ statement, that ICM directors were more involved in Trillian’s businesses and that they effectively ran the place. Ms Goodson took her instructions from Mr Angel, who recruited her and signed her employment contract.”

Therefore, even if ICM were “at arms-length” with Trillian, its attendances of its meetings could not be seen as only the provision of start-up and administrative services – the meetings, according to Goodson’s statement, were to discuss Trillian’s businesses with at least Eskom and Transnet.

Lubisi calls ICM’s demand for a new remedy “absurd”, as it would amount to permitting an aggrieved party who simply complains long enough to be rewarded with an entirely different standard for journalistic fairness.

He says: “Allegations were made against ICM and they have responded to them… For ICM, to then come back and through lawyers and [a] complaint to the Ombudsman, that the right of reply was unsatisfactory is an abuse of the Press Council systems and processes.”

He also argues that, if I direct City Press to remove the material simply because its continued existence still allegedly prejudices them, reply or no reply, a large part of the media’s work would be banned if bald denials are being repeated enough.

Lubisi concludes that the newspaper was justified at the time to report the statement in dispute that ICM set up the machinery and that they effectively ran the place [Trillian]. “Evidence as contained in Ms Goodson’s statement detailed the involvement of ICM directors in Trillian’s operation and show that it was not an arms-length operation as they want us to believe,” he says.

Gundelfinger

Affidavit

Gundelfinger points out there is a fundamental distinction between a statement and an affidavit – no criminal sanctions arise from making an untruthful statement, while an untruthful affidavit can be criminally prosecuted for perjury.

He says the newspaper has never adequately explained why the sub-headline referred to Goodson’s statement as an affidavit. He argues, “[b]y using the word ‘affidavit’ the reasonable reader would have placed greater weight on its content than a statement. This appears to have been a deliberate attempt to mislead the reader…”

Goodson’s signature, credibility

Gundelfinger says the journalist relied on Goodson’s statement that she had prepared for the Portfolio Committee on Public Enterprises. In that document she stated as follows: “I emailed through a JPEG of my signature. I later realised that the signature I sent to Angel was used on invoices and formal letters without my consent.” However, in her subsequent sworn testimony on 15 June 2018 in Parliament Goodson confirmed that her signature was never used on any invoices by Angel.

He asserts the public has never been informed of this subsequent material admission by Goodson.

He explains that the reference to invoices is material, as the article referred to multimillion rand invoices to state-owned companies for little or no work. For example:

• “… Trillian billed Eskom R30.6 million at a time when it literally had no people who could have been doing any work”;
• “… Trillian invoiced Transnet R10 million alongside a proposal, before any work could conceivably have been done”; and
• “Budlender collected Trillian invoices to Transnet for well more than R100 million in the first half of last year. He also gathered invoices evidently paid by Eskom for more than R260 million between late 2015 and the end of last year.”

Gundelfinger adds that Goodson’s statement was riddled with factual errors and lacked credible documentation to support her assertions.

He also points out that  Goodson, who worked for Trillian from 1 January to 19 March 2016 and who stated that she had resigned “when it became clear to me that I had been misled about the objective of TMC”, requested a 25% profit share in Trillian Management Consulting a day before her resignation (which was refused at the time). “Why Goodson should make such a demand when she alleges that it was clear to her that she had been misled beggars belief,” he says.

Gundelfinger says Goodson raised her “suspicions” that Trillian was only a “front” some 18 months after she had resigned. It also coincided with the time of the Gupta leaks. He concludes: “She created a narrative from her limited experience in which she sought to attribute blame for State Capture on Shane, Angel and Chipkin but mostly on Angel whom she blamed for introducing her to the Trillian opportunity. Despite knowing of the limited role of ICM and its directors as service providers to Trillian it opportunistically suited Goodson to portray ICM and its directors but particularly Angel as bullies and the architects of State Capture.”

He adds that City Press has never addressed these, and other defamatory allegations against Angel and ICM (Goodman described Angel as a “creep and bully”, and referred to the “crew” at ICM as “highly functional sociopaths”).

Architects of state capture

Gundelfinger says the newspaper’s argument that the article only referred to ICM’s involvement in Trillian and not to state capture as a whole is “completely disingenuous and misleading”.

He argues that the reasonable reader would have understood that Angel and Shane were in fact part of it and even architects thereof. He refers in this regard to:

• the headlines (State Capture Inc. and The Capture Mindset); and
• Angel’s and Shane’s photographs alongside those of Essa, Mohamed Bobat, Des van Rooyen, Matshela Koko and Anoj Singh – all of whom had been accused of having been significantly involved in state capture.

He says that neither Angel nor Shane has ever been accused of having been involved in state capture (except for the article in question), and adds: “Their only involvement … was via ICM as an arms-length service provider to Trillian for a limited period of time.”

In any case, he argues, from media reports, the Gupta leaks and the findings of the Public Prosecutor, it is clear that state capture preceded the set-up of Trillian by several years. It is therefore impossible to infer that ICM, Shane, Angel and Chipkin could have been involved at any level in setting up the “machinery” of state capture”, he says.

He adds the following statements in the article inferred a direct connection between ICM and state capture:

• “You want to believe the villains in our national drama operate in the shadows. In reality, they go to power lunches and meetings in Johannesburg’s most fantastical office park”;
• “[Angel’s] mansplaining the realities of business to [Goodman] when she raised questions about the mysterious windfalls Trillian enjoyed. The men running this show could casually employ the now mainstream rhetoric of comparing themselves with the business empires rooted in the apartheid era” (he says this was a clear inference, if not a direct statement, that Angel ran the show at Trillian and that he, and ICM, had been part of state capture); and
• “The crew at ICP and Trillian are of this world. They don’t seem unfamiliar at all – they just took the game to a higher level.”

Gundelfinger argues that the newspaper’s response therefore avoids the crux of the matter – the allegation by way of inference that his clients were the architects of, or at least involved in, state capture.

Relief sought

Gundelfinger says that fact that City Press published his clients’ right of reply does not prevent them from pursuing the relief they are presently seeking. He says the article was defamatory, untrue and inaccurate, and has caused his clients ongoing “irreparable financial and professional harm”.

His clients insist that City Press:

• remove that articles and the photographs of Angel and Shane, alternatively redact all portions of the article that refer to his clients, including their pictures;
• remove their reply from all electronic platforms; and
• publish a retraction of the allegations made, as well as an apology satisfactory to them, both in the electronic and print media.

Analysis

Preliminary remarks

The relevant section in the Press Code is 1.12, which reads: “No person shall be entitled to have an article removed which falls short of being defamatory, but is alleged by such person to be embarrassing.”

First, some remarks / observations:

• The number of times that Gundelfinger and his clients approached this office will have nothing to do with my conclusions;
• This adjudication will not affect the rest of the media, as each case is dealt with on its own merits;
• Section 1.12 states that a person is “entitled” to have an article removed which is defamatory – which places the onus on this office to act in this regard, whenever necessary; and
• It is irrelevant what people, including myself, may think of this section, as it is this office’s duty and responsibility to act on the basis of what the Press Code states at any given time.

Given the present situation in the country, it is beyond doubt that an allegation or inference of having been involved in state capture will significantly lower that person’s reputation. It follows that, if I find that the reportage did infer that the complainants had been involved in state capture, and if such an inference was wrong, or not reasonably true, I would have to direct the newspaper to remove the relevant reportage.

The crux of my adjudication, therefore, focuses on two questions:

• Would the reasonable reader have thought the reportage inferred that the complainants had been involved in state capture?; and
• If so, was such an inference reasonably true?

If this finding goes against City Press, I would also need to consider the:

• impact the reporting could have had on the reputations of the complainants (and therefore of their professional future); and
• reasonableness of the complainants’ request to remove the articles, or at least the parts which referred to the complainants, which includes the very right of reply that they have asked for in the first place.

State capture inferred?

Firstly, I need to deal with Lubisi’s assertion that I was wrong to state that the onus rests on the newspaper to prove that the complainants were part of the state capture machinery, “since the article did not say that the complainants were part of state capture as a whole, but deals very specifically with Trillian”.

I fear that there may be some misunderstanding here – I never said, or meant, that City Press had to justify the reasonableness of inferring that ICM was part of “state capture as a whole” – the issue at hand is whether it was part of state capture specifically with regards to Trillian.

The editor also says the story never said that ICM was part of the “state capture machinery” (as I have summarised the matter).

This brings me to the interpretation of the word “machinery” in the following sentence: “The people who set up the machinery are Integrated Capital Management (ICM) – a three-man team with an office in Melrose Arch next to Essa’s”.

Lubisi is correct in that I did interpret the word “machinery” in the context of state capture (not as a whole, though, but in the context of ICM’s involvement in Trillian).

So then, looking afresh at the story in general and the statement in particular, my test is how the reasonable reader would have understood the reportage with regards to this complaint.

Gundelfinger’s argument in this regard is difficult to discard. He refers to the headlines (State Capture Inc. and The Capture Mindset), the pictures of Angel and Shane (alongside those who were known to have been accused of state capture), as well as some rather pertinent statements in the article (especially the reference to Angel, Shane and Chipkin who “effectively ran the place” – read: “Trillian”).

Let me elaborate even more: The sub-headline to the analysis read: Former Trillian Capital Partners executive Bianca Goodson details in her affidavit how the company allegedly milked the state. Here is the case against some of her former colleagues (my underlining) – Angel and Shane formed part of this “case” against “her former colleagues” regarding the “milking of the state”.

The inference could not be clearer.

The examples of the complainants’ involvement in Trillian, as well as the context within which this occurred, leave me with no doubt that the reasonable reader would have thought that the complainants were involved in state capture – not “as a whole”, but certainly as far as Trillian was concerned.

I usually say “little doubt” – but in exceptional circumstances, I revert to the absolute. Indeed, I have “no doubt” about this matter.

State capture: reasonably true?

Having decided that the reasonable reader would have understood that Angel et al were part of Trillian’s attempts at state capture, the question now becomes if City Press was justified in making this inference. To put it differently: Was this inference reasonably true?

It is not in dispute that Goodson’s statement formed the basis of the article. Please note: “statement”, not “affidavit”.

This means that City Press used one source, and one source only, for its reportage. At best, that is a dangerous practice – especially when allegations are of such a serious nature, as in this case.

It is not for me to either credit or discredit Goodson’s statement, or to pronounce on her credibility or the lack thereof – that would fall outside my mandate (as she is not the subject of this adjudication).

However, I need to state that I am deeply concerned that the newspaper has reported such serious allegations based on one source only. Not even once did the journalist attempt to verify Goodman’s allegations, let alone giving Angel and the others an opportunity to comment (which only came later). If he did, he failed to come up with any kind of evidence to the contrary.

Let me make a general statement: The more serious an allegation, the more obligated the media are to verify it – or, at least, to state that they could not do so. The reason for this should be clear: The more serious an allegation, the greater the risk of causing huge, unnecessary harm. That is why the Preamble to the Press Code says that journalists should commit themselves to the “highest standards” in order, inter alia, to “avoid unnecessary harm”.

Given the seriousness of the allegation in question, I would have thought that the journalist should have attempted to verify it – and if he was not able to do so, to have stated such.

But there is another consideration: More than a year has now lapsed since the publication of the story – and I cannot find any reference to any of the complainants regarding an allegation of their “involvement” in state capture. I have also found no reference to them regarding the investigations of the Zondo Commission that is currently dealing with state capture.

As far as I could ascertain, the only person, ever – not before, during, or after the publication of the articles in question – to have alleged or inferred that ICM was involved in state capture is Goodman (except for stories which referred to the one in question).

This adds another question mark behind the newspaper’s reportage on Goodman’s statement (which the sub-headline falsely dubbed an “affidavit”).

Note what Section 1.7 of the Press Code says in this regard: “Where there is reason to doubt the accuracy of a report or a source and it is practicable to verify the accuracy thereof, it shall be verified. Where it has not been practicable to verify the accuracy of a report, this shall be stated in such report.”

This simply did not happen.

I hasten to add I am not saying that:

• City Press should not have reported what Goodman had to say. I believe, though, that it should have done so with much more circumspect and healthy scepticism, and with an attempt at proper verification; and
• ICM was not involved in state capture – I simply do not have any evidence to pronounce on that issue, nor is it within my mandate to do so. What I am saying, though, is that the newspaper also did not have any way of knowing this – and that its reportage on this matter, without the necessary verification, was irresponsible in that it had all the potential to cause huge unnecessary damage to its reputation.

It follows that I cannot state with absolute certainty that the reportage did defame ICM. In my estimation, though, based on my arguments above, it probably did. I believe the newspaper took too high a risk in reporting Goodman’s allegations the way it did, as the potential of defamation (in this context, I interpret this word to mean the unfair lowering of their reputation) was just too great.

In such circumstances, I would err on the side of caution – I would rather see the references to the complainants removed, than to take the same chance that City Press did.

Impact on reputation

I do not need to belabour this point: State capture is an extremely serious matter, and everyone involved in it has to live with the consequences.

I am not convinced at all that Angel, Shane and Chipkin were indeed involved in state capture (even though I cannot be 100% sure, as I have stated above), and therefore, as far as I am concerned, the possibility that the reportage has unfairly tarnished their reputations are real.

Removal of texts, including right of reply: reasonable?

It is regrettable that the complainants first asked for a right of reply and then, when the newspaper adhered to this request, turn around and want that to be removed. I can well understand Lubisi’s frustration in this regard.

However, I need to weigh up matters here: What is more important – the possible unnecessary lowering of the complainants’ reputation (defamation), or the unreasonableness of them changing their minds on this matter?

I believe the answer to this question is obvious.

Finding

The articles were in breach of the following sections of the Press Code:

• 1.1: “The media shall take care to report news … fairly”;
• 1.7: “Where there is reason to doubt the accuracy of a report or a source and it is practicable to verify the accuracy thereof, it shall be verified. Where it has not been practicable to verify the accuracy of a report, this shall be stated in such report”;
• 3.3: “The media shall exercise care and consideration in matters involving … reputation”; and
• 10.1: “Headlines … shall give a reasonable reflection of the contents of the report … in question” (with regard to the unwarranted use of the word “affidavit”).

Seriousness of breaches

Under the headline Hierarchy of sanctions, Section 8 of the Complaints Procedures distinguishes between minor breaches (Tier 1 – minor errors which do not change the thrust of the story), serious breaches (Tier 2), and serious misconduct (Tier 3).

The breaches of the Press Code as indicated above are all Tier 2 offences.

Sanction

Based on Section 1.12 of the Press Code, as quoted above, City Press is directed to remove all references to the complainants in the articles, which should include the use of their pictures. As their right of reply would have no meaning without the articles, I am directing the newspaper to remove that as well.

I am not asking for an apology, as I believe it is better to let sleeping dogs lie. The issue for the complainants is that, when people google their name, the allegations against them pop up. With the removal of the relevant sections and the pictures, this will not happen anymore. I believe this is fair and would cause the least harm to both the complainants and the newspaper.

Appeal

The Complaints Procedures lay down that within seven working days of receipt of this decision, either party may apply for leave to appeal to the Chairperson of the SA Press Appeals Panel, Judge Bernard Ngoepe, fully setting out the grounds of appeal. He can be contacted at [email protected].

Johan Retief

Press Ombud