Armando Costa and Emkhankasweni Waste Manages Services vs Sunday Times

Complainant: Armando Costa and Emkhankasweni Waste Manages Services

Lodged by: Armando Costa

Article: ICT talks of charging Kumba CEO

Author of article: Jana Marais

Date: 16 June 2011

Respondent: Sunday Times

Complaint

Mr Armando Costa, both in his personal capacity and as a director of Emkhankasweni Waste Management Services (EWMS), complains about a story in the Sunday Times, published on February 27, 2011 and headlined ICT talks of charging Kumba CEO.

Costa complains that:
• the newspaper did not attempt to contact him for comment;
• the statement that his company EWMS illegally siphoned a million liters of crude oil sludge is untrue;
• the story mentions the wrong company; and
• the journalists showed a clear bias in favour of Kumba.

In subsequent correspondence, Costa also asks this office to impose sanctions for a story that was published on November 25, 2007. However, our complaints procedures do not allow us to entertain complaints about stories that were published so long ago. I shall therefore limit this finding to the story mentioned above.

Analysis

The story, written by Jana Marais, quotes a lawyer who reportedly said that shelf company Imperial Crown Trading (ICT) would lay criminal charges against Sishen Iron Ore, Kumba’s CEO and other employees for “tampering with witnesses and documents”. This reportedly came after ICT, which is 50% held by a business partner of the Gupta family, was “controversially” awarded a 21.4% prospecting right for iron ore at Kumba’s Sishen mine in 2009. The story says that ArcelorMittal has offered to buy ICT for R800-million “and included ICT shareholders the Gupta family and the president’s son Duduzane Zuma in a R9.1-billion deal”.

The story also says that PetroSA cancelled a contract with Costa’s company EWMS in 2007 after it had “illegally” siphoned a million liters of crude oil sludge out of a storage facility and sold it to a private refinery. It states that, according to an internal PetroSA document which was reported by the newspaper at the time, EWMS reneged on its contract by not using specified cleaning technology.

I shall now consider the merits of the complaint:

Not asked for comment

Costa complains that the newspaper did not attempt to contact him for comment about the contract with PetroSA despite the fact that the journalists concerned had his number and could easily have contacted him, had they any desire to report objectively.

Sunday Times admits that it made no attempt to contact Costa ahead of publication. However, the newspaper says that it did try to contact him before publication of the 2007 story. It argues that the parts of the story that Costa complains about are based on the story of 2007. The newspaper says: “The 2007 story was based on information contained in a memo submitted to PetroSA’s executive procurement committee, and subsequent developments.” It adds that Costa did not complain about the 2007 story.

The newspaper argues that it was reasonable to refer to the facts in the 2007 article – the story is “constantly developing and it is interesting and relevant to know the histories of the various players in the saga”.

However, Sunday Times also says that since it was unable to obtain comment from Costa in 2007, it should have attempted to get his comment for the story that is in dispute.

Costa replies that his attorney wrote a letter to the newspaper a day after the November 2007 story was published in which the “true facts” were set out.

Regarding this letter, he says that:
• the newspaper never printed a correction, despite the assurances of one of its journalists that it would happen;
• the story in dispute should have, but does not refer to it.

Costa argues: “The fact that she (the journalist) repeated the erroneous, discredited story of 25 November 2007, without reference to the aforementioned letter of my then attorneys, aggravates the nature and extend (sic) of the defamation and obvious character assassination.”

He also:
• denies that the newspaper tried to contact him prior to the 2007 story;
• says that it is irrelevant that the story in dispute was based on information allegedly contained in a memo submitted to PetroSA;
• denies that he did not complain (with reference to his attorney’s letter to the newspaper);
• argues that it was not reasonable for the newspaper to have referred to the “false version” as set out in the 2007 story after it has been appraised of the true facts and then repeating inaccuracies; and
• says that Marais did not display the same zealousness in dealing with the “histories of the various players in the saga” as far as Kumba and its witnesses are concerned.

Firstly, let me make some remarks about issues that were raised, but that are not material to this part of the complaint:
• The fact that the newspaper never printed a correction after it had received the letter falls outside the scope of this finding;
• The question whether Sunday Times tried to contact Costa prior to the publication of the 2007 story is also not relevant here – the complaint is not about that story, but about the 2011 one; and
• It is irrelevant that the story in dispute was based on information allegedly contained in a memo submitted to PetroSA.

What is relevant, though, is the letter that Costa’s attorney wrote to the newspaper the day after the 2007 story appeared. It is relevant, because this letter contains his views.

The question now is if it was “reasonable” for the newspaper to only refer to the “facts” in the 2007 story, whilst it had Costa’s version to the contrary in its possession. Also: Was it fair to omit his version and only refer to the story?

I therefore asked the newspaper why it did not use the content of Costa’s letter in its 2011 story. It answered that “the reporter of the 2011 story was unaware of it, as was her manager”.

Although this is unfortunate, the journalists concerned cannot be blamed for not knowing about the letter – four years is a long time.

In response to my question why Marais did not contact Costa, she responded that she had thought that it was unnecessary as she was revisiting previously published information.

I welcome the newspaper’s acknowledgement that, since it was unable to obtain comment from Costa in 2007, it should have attempted to get his comment for the new story. Sunday Times also says: “We make no attempt to defend this.”

Illegally siphoning crude oil sludge

The sentence in dispute reads: “In 2007, PetroSA cancelled a contract with Costa’s company…after EWMS illegally siphoned a million liters of crude oil sludge out of a storage facility…”

Costa denies that EWMS illegally siphoned crude oil sludge. He says that it is “glibly based on a prior untrue article” in the same newspaper (the 2007 story), adding that he was then also not asked for comment.

The newspaper does not reply to this part of the complaint.

On June 8, I asked the Sunday Times three questions, including why it has not responded to this issue. The newspaper responded to the other two matters, but neglected to do so with regards to the illegal siphoning of crude oil sludge.

From this, it is reasonable for me to accept that the newspaper was wrong to report that EWMS illegally siphoned crude oil sludge – if it was correct, surely it would have told this office why its reportage was justified.

The wrong company

The story mentions a contract that PetroSA cancelled with Costa’s company EWMS.

Costa complains that it was EWMS Petro Chemicals (Pty) Limited (EWMSPCL), rather than EWMS, that was involved in the dispute with PetroSA.

Sunday Times says that it accepts that it got the company’s name wrong.

Biased in favour of Kumba

Costa complains that the journalists were biased in favour of Kumba, as they declined to report on the “major environmental breaches by Kumba” as set out in his affidavit. These breaches, he argues, are strongly substantiated by independent reports and pictures. Instead, he says that the reporters concentrated on falsely alluding to illegal conduct by EWMS and therefore to himself “in an obvious and mischievous attempt to try to discredit me and my company and hence my testimony against Kumba”.

Sunday Times denies any bias in favour of Kumba. The newspaper furnished our office with a story, published on January 30 this year, in which it did report on Kumba’s “environmental breaches”.

Costa replies that:
• the newspaper’s failure to contact him underscores his complaint of bias in favour of Kumba “and a deliberate attempt of character assassination and to discredit and suppress my side of the story”;
• unlike on previous occasions, the journalists responsible for the January 30 story (Stephan Hofstatter and Mzilikazi Wa Afrika) gave Kumba an opportunity to comment prior to publication (he adds that he does not complain about these journalists as they have always acted professionally and fairly in their reporting in this matter);
• Marais did not follow the same approach in the disputed story; and
• Marais, in a story published on May 8 this year, again neglected to ask comment from ICT – and yet she afforded a “Kumba spokesperson” that opportunity.

While I can understand both Costa’s frustration that the newspaper was “biased” in favour of Kumba and against him, and the newspaper’s argument that it did report on Kumba’s “environmental breaches”, I have decided not to look wider than the story in dispute. This office cannot embark on investigations into alleged breaches of the Code that spans over months or years. The complaint is about one story and one story only.

Costa’s argument that the newspaper is biased against him and in favour of Kumba because it did not ask him for comment is weak – the newspaper also did not ask Kumba for comment.

Besides, the story may have omitted Costa’s affidavit regarding “major environmental breaches by Kumba”, but it certainly does not protect Kumba either as it explains the nature of its alleged transgressions.

Finding

Not asked for comment

By its own admission, the newspaper should have obtained comment from Costa prior to publication. This is in breach of Art. 1.5 of the Press Code that states: “A publication should usually seek the views of the subject of serious critical reportage in advance of publication…”

Illegally siphoning crude oil sludge

From the newspaper’s lack of response on two occasions it is reasonable to accept that the newspaper was wrong to report that EWMS illegally siphoned crude oil sludge. This is in breach of Art. 1.1 of the Press Code: “The press shall be obliged to report news truthfully, accurately and fairly.”

The wrong company

The newspaper accepted that it was EWMSPCL, rather than EWMS, that was involved in the dispute with PetroSA. This is in breach of Art. 1.1 of the Press Code.

Biased in favour of Kumba

Marais did not ask either Costa or Kumba for comment; the story also does not protect Kumba. This part of the complaint is dismissed.

Sanction

Sunday Times is reprimanded for:
• not obtaining comment from Costa prior to publication; and
• reporting a wrong company that was involved in a dispute with PetroSA.

The newspaper is directed to apologise to Costa for reporting that his company illegally siphoned crude oil sludge.

Sunday Times is directed to publish a summary of this finding (not the whole ruling) on the same page that the story in dispute appeared. Our office should be furnished with the text prior to publication. If there is no application to appeal (by either party), the text should be published within three weeks from today.

Please add the following sentence at the end of the text: “Visit www.presscouncil.org.za (rulings, 2011) for the full finding.”

Appeal

Please note that our Complaints Procedures lay down that within seven days of receipt of this decision, anyone of the parties may apply for leave to appeal to the Chairperson of the SA Press Appeals Panel, Judge Ralph Zulman, fully setting out the grounds of appeal. He can be reached at khanyim@ombudsman.org.za.

Johan Retief
Deputy Press Ombudsman