Cahal Milmo: Now Murdoch's reputation is at stake in his own back yard


Six years ago, the news that a News of the World reporter and a private investigator had been caught listening to the voicemails of royal aides barely caused a ripple in the United States. Now, the legal whirlwind that has been slowly crossing the Atlantic since then is finally about to crash on to the shores of Rupert Murdoch's media heartland.

The expected filing in the US of three lawsuits by individuals who believe their messages were intercepted while on American soil is the realisation of the Murdoch empire's worst nightmare – the mutation of its hacking problem in Britain into a thorny scandal on the doorstep of News Corp's Manhattan headquarters.

This presents News Corp with a major public-relations problem. Proceedings before American courts alleging criminality in the US have the potential to tar News Corp – whose vast and lucrative US holdings range from the Fox network to the Wall Street Journal – with the hacking scandal on its home turf as never before.

A greater threat to News Corp comes from the growing risk that the mothership itself is dragged into the mire. Legal disclosure on phone hacking may now be sought from News Corp itself and the US Department of Justice is already considering bringing action against the company under the Foreign Corrupt Practices Act barring the bribing of foreign officials by American firms.