The High Court decision which blocked the award of the third mobile phone licence to Meteor contains scathing criticism of the Office of the Director of Telecommunications Regulation, and how its staff, its director, Ms Etain Doyle, and her consultants handled the process.

Ms Justice Macken - in her judgment published on Tuesday - found that documents had been shredded "or in some way disposed of", no records of some important meetings had been kept and that a witness whose evidence would have been very helpful to the court did not testify.

She found the award of the licence to Meteor was objectively biased and unreasonable and she referred the matter back to Ms Doyle for reconsideration. Orange, which took the case, was also deemed not to have been given adequate reasons for Ms Doyle's decision, which was wrong in law, according to the judge.

It emerged that when Orange wrote to Ms Doyle last October contending that it should have access to certain materials which she would have had when making her decisions, she responded in a rather succinct manner. "The director indicated that the reason why she was refusing Orange the licence was in brief because (a) Orange was not ranked first; (b) the discussions with Meteor were satisfactory and (c) none of the representations made by Orange caused the director to change her mind."

Ms Justice Macken said there was an obligation - in law - on the director to give full and proper reasons for awarding the licence and that there was not a valid legal basis for refusing to give any further details save for the rankings and summary report.

The 243-page judgment is extremely detailed. It considers the arguments raised by Orange and counter-arguments put forward by the director's office and includes submissions by Meteor. It ranges across many topics and shows that Orange took issue with whether the regulator was looking for the third operator to charge very low tariffs. It also raises the issue of whether the regulator was more in favour of an Irish/American consortium than one which might be perceived to be British.

The crux of the case lies in documents which the judge said were altered to generate a result which could be "readily perceived to be biased in favour of Meteor". The documents were draft reports which contained evaluations of the two applicants' proposals.

Alterations which occurred included changing a word in the draft report relating to Orange's submission on tariffs and changing rankings on both Orange's and Meteor's financial solidity.

The judge was extremely critical of the fact that no notes of the working groups' meetings were kept.

The competition was overseen by Danish consultants Andersen Management International, which was involved in a separate controversy over the second mobile phone licence. Orange and Meteor were rated under various categories known as group dimensions with indicators and sub-indicators.

The drafts of the reports which were altered came about on foot of 12 working group meetings in May 1998. Each of these meetings was chaired by an Andersen Management representative. The only chairman who gave evidence was Mr Michael Andersen, who presided over the working group on financial sensitivities. The first drafts were written in English by Andersen personnel in Denmark. Orange took issue with a range of points, including the marking of both Orange and Meteor in relation to their finances.

Ms Justice Macken found that the director's general response was that the drafts were changed, but only to remove "the Danish language approach" and to clarify unclear statements.

The judge said that on the general complaints - on financial backers - "there was little or no response".

It emerged that when Mr John McQuaid - a civil servant on secondment to the regulator - received the first full draft of the final report, he considered the original marking of both Orange and Meteor to be too severe. The judge found no basis had been given for such a view in evidence.

Mr McQuaid then discussed the matter with Mr Michael Thrane, of Andersen, and it was decided to increase the marks of Meteor and Orange. Ms Justice Macken found that the effect of the alterations was to generate a result "which can easily be perceived to be biased in favour of Meteor and against Orange".

She further stated: "I find the alterations, or some of them, were intended to remove or modify the otherwise very harsh meaning attaching to many of the phrases or words used by the drafters."

She further stated that the director had given little or no explanation, save to say that the drafts suffered from a Danish language approach and therefore had to be amended to take account of this.

While Ms Justice Macken accepted that some amendments were of a purely linguistic nature, she did not agree that this was a full answer to Orange's case.

"In the first place, on evidence tendered, it was clear that Mr Andersen had a very fluent grasp of English and where he had any hesitation in answering, clarification of a question generated a clear and very comprehensive answer."

The judge also said that all of the chairmen of the 12 working groups which considered the indicators were Danish.

"There was no evidence whatsoever that any of the members of the Andersen team were at any disadvantage by virtue of the fact that the entire process and evaluation was English."

She said these processes were considered in great detail at the steering group meetings, well prior to the closing date of the bids, and both Andersen Management International and the director's own team were silent on any possible disadvantage arising from the approach regarding drafting.

The steering group met from time to time to discuss the findings of the working groups. These findings had been collated by staff from the regulator and Andersen.

In the original draft report, Orange's approach to tariffs was stated to be "unprecedented" but this was altered to "atypical". This word was then deleted and Orange was stated to be "credible". Ms Justice Macken said that Mr McQuaid had suggested the word " `unprecedented' may have been an error, but that Mr Andersen confirmed in evidence that it was exactly what he meant". Mr Andersen is on holidays and was not available for comment last night. The regulator is still considering the judgment and may make a statement next week.

It should be added that Ms Justice Macken said that it was not her view that there was deliberate bias of a subjective nature on the part of evaluators who gave evidence in the course of the hearing. These included Mr McQuaid and Mr Andersen.