Former director of legal affairs at News International Jon Chapman has accused James Murdoch of giving "very misleading" evidence to MPs at a select committee hearing on 19 July.
Chapman, who gave notice that he wanted to leave News International on 23 June, said that he does not think James or Rupert Murdoch intended to mislead the committee - but he said there were "serious inaccuracies" in what they told MPs about a review of emails carried out by lawyers Harbottle and Lewis.
James Murdoch used that review to defend the company's position from 2007 to 2010, that phone-hacking at the News of the World was limited to royal editor Clive Goodman and private detective Glenn Mulcaire.
Now Chapman has spoken out to insist that this review of internal emails was a limited process carried out purely in relation to Clive Goodman's 2007 claim for unfair dismissal.
It was never intended to be a wider investigation into whether phone-hacking was more widespread at the News of the World, he claimed.
Chapman said he was 'surprised and extremely concerned'that in the evidence given to MPs by James Murdoch the email review was given the same importance as investigations by the PCC and the police into phone-hacking.
Murdoch cited all three investigations as reasons why News International insisted that Clive Goodman was the only staffer involved in phone-hacking.
Harbottle claims were 'misleading'
In his letter, Chapman said that in fact the more important investigation into phone-hacking allegations at the News of the World was carried out by solicitors Burton Copeland in 2006.
He said that this was the basis for former News International chairman Les Hinton's statement to MPs in March 2007 (before the Harbottle and Lewis email review) that the company had carried out a rigorous internal inquiry, which had led it to conclude that Clive Goodman was the only employee involved in phone-hacking.
Chapman said in his letter: 'I do not understand why the Burton Copeland investigative exercise is no longer referred to my News International. Nor do I understand why the 2007 email review has now apparently become so hugely significant in the story of the News of the World and News International's response to the events of 2006."
Chapman said he believes that Harbottle and Lewis' 2007 email review 'was never intended to be a general internal inquiry or investigation into the issue of voicemail interception at the News of the World."
He said that to characterise it as such seems 'very misleading". The review did not examine emails between Goodman and several other key reporters and editorial executives and did not look at Mulcaire's emails.
Chapman said that he and head of HR for News International Daniel Cloke reviewed a large number of emails to find out if a limited number of 'specified individuals'knew about Clive Goodman's illegal activities.
Lawyers Harbottle and Lewis also reviewed the emails, Chapman said, and came to the same conclusion – that there was no evidence of further knowledge about voicemail interception in them.
He said: 'There was no suggestion at that time that anything other than voicemail interception was an issue."
He added that had he found evidence of any other criminal activity he would have reported it to his employer.
'Clean bill of health'
Lawyers Harbottle and Lewis back up this version of events in their letter to the Commons committee, which was also released today.
A document submitted by Harbottle and Lewis explained that the emails it examined were limited correspondence requested by Clive Goodman for the purposes of his appeal against unfair dismissal.
The law firm said that its review of emails was "expressly limited to the terms of Mr Goodman's employment dispute".
It said: "There was absolutely no question of the firm being asked to provide News International with a clean bill of health which it could deploy years later in wholly different contexts for wholly different purposes."
Harbottle and Lewis expressly contradicted Rupert Murdoch's statement to MPs that it was told "to find out what the hell was going on". It said that three junior employees carried out the email review over a period of two weeks, that none of them specialised in criminal law, and that the bill for the review had been £10,000.
Harbottle and Lewis believes that Rupert Murdoch may have been mistakenly referring to the other Burton and Copeland review.
In July 2011, Rupert Murdoch gave an interview to the Wall Street Journal in which he said Harbottle and Lewis had made a "major mistake" in underestimating the scope of the problem with phone-hacking at the News of the World.
Harbottle and Lewis said it rejects this "self-serving" view of events saying that "it was not retained to look for evidence of wider criminal activities and did not do so".