Pension schemes and other News Corp. shareholders have filed a second amended complaint in the US, arguing that the phone hacking scandal is merely one of many acts of illegal conduct that the board was fully aware of

Amalgamated Bank, the New Orleans Employees' Retirement System and the Central Laborers Pension Fund are leading the action against the media empire. Another involved party, the Massachusetts Laborers' pension fund, originally filed its own complaint against News Corp but later merged with this case.

The new amended complaint, which was presented on 13 September, includes accounts of computer hacking, privacy breaches and "extreme" anti-competitive behaviour on the part of two News Corp. US. subsidiaries, News America Marketing (NAM) and NDS. The behaviour led to court cases against the company, as well as nearly $1bn that had to be paid out for verdicts and settlements.

The complaint claims that the board has not fulfilled its fiduciary duty and has allowed Rupert Murdoch to use News Corp as his "personal fiefdom".

"The revelations surrounding News Corp's corporate governance lapses get worse with each new disclosure," said Jay Eisenhofer, a partner at Grant & Eisenhofer. "In fact, our new complaint shows that the illicit phone hacking and subsequent cover-ups at News of the World were part of a much broader, historic pattern of corruption at News Corp."

The complaint states that a number of current News Corp. directors, including Rupert and James Murdoch, the CFO David DeVoe and COO Chase Carey, sat on the boards of both companies at the time the events occurred. Eisenhofer claims this is another sign that these practices took place with a board that was "fully aware of the wrongdoing, if not directly complicit in the actions".

Initially filed in March this year, the case against Murdoch and News Corp's other board members focussed on the $615 million purchase of the Shine Group, owned by Murdoch's daughter, earlier this year.

The purchase occurred without "a valid strategic purpose" and showed a lack of good corporate governance according to the plaintiffs. It was said to be "a sweetheart deal" which apparently earned Murdoch's daughter, Elisabeth, $250m. At the time she was also put forward for a seat on News Corp's board but has since removed her name from consideration.

In July, investors filed the first amended complaint, alleging 'rampant nepotism' and 'failed corporate governance' at the company. At the time they added a series of fresh claims tied to the media giant's role in the phone hacking scandal.

The new filing reads: "The board has not lifted a finger to engage in any oversight of Murdoch's rule, even when it was provided with clear and unmistakable warnings that News Corp's business practices were not only unethical, but also illegal.

"By the late 1990s, the board first received evidence that News Corp subsidiaries were systemically engaging in illegal violations of third party privacy, when two subsidiaries, News America Marketing and NDS Group plc, were accused by multiple parties of stealing computer technology, hacking into business plans and computers and violating the law through a wide range of anti-competitive behaviour."

The case reads that NAM allegedly attempted to drive its competition out of business by among other things, illegally hacking a competitor's password-protected website.

In one case, a former NAM director testified that the company issued false press releases impugning a rival it was trying to purchase, while mutilating and removing the competitor's signage from retailers.

azeevalkink@wilmington.co.uk