What price free speech? - Jonathan Watson

The scandal of England's libel laws England’s libel laws are in dire need of reform. That was the message from a report published last November by literature and free speech organisation English PEN, and Index on Censorship magazine. The study, entitled Free speech is not for sale, reached the alarming conclusion that ‘English libel law has a negative impact on freedom of expression, both in the UK and around the world’. It put forward ten proposals for change (see box below) – proposals that a number of lawyers are prepared to support. Those who were involved in the preparation of the report include Mark Stephens, partner at Finers Stephens Innocent and former Chair of the IBA’s Media Law Committee. ‘The report was published in response to concerns which have appeared over the years about our libel regime’, he says. One of these concerns is the phenomenon of ‘libel tourism’. Over the last decade, increasing numbers of foreign claimants have brought libel actions in the English courts, often against defendants who are neither British citizens nor resident in the country. ‘It is widely recognised that England is a very claimant-friendly location, which means that a lot of cases have been brought to London’, says Stephens. ‘The claimant lawyers have been encouraging more people to sue and pushing more and more foreigners to come here and sue. That’s led to a need to reform the law. That’s widely acknowledged and accepted.’ One of the most famous cases in this regard is that of US author Rachel Ehrenfeld, who was successfully sued in London by the Saudi businessman Khalid bin Mahfouz over allegations in her book Funding Evil. Only 23 copies of the book were available in the UK, but the English courts still heard the case.

In response to that verdict, New York State passed the Libel Terrorism Protection Act, nicknamed ‘Rachel’s Law’. This legislation declares foreign libel judgments unenforceable unless the foreign law grants the defendant the same First Amendment protections that are available in New York State. Anti-libel tourism legislation has now also been passed in Illinois, Florida and California, while the Free Speech Protection Act 2009 is pending before the US Congress. This bill would provide protection from libel tourism at a national level.

The issue has been taken up by Parliament’s Culture, Media and Sport Committee, an influential group of MPs. The committee spent over a year conducting an enquiry into press standards, privacy and libel and published its findings in February. ‘It should be a matter of profound concern that the UK is now regarded as the jurisdiction of choice for litigants to bring libel actions, even when there is no obvious connection with this country,’ said its chairman John Whittingdale MP. ‘It is a humiliation that US legislators have felt it necessary to take steps to protect freedom of speech from what are seen as unreasonable incursions by our courts and we believe the government should address this as a matter of urgency.’

Peter Noorlander is the legal director of the Media Legal Defence Initiative (MLDI). The organisation helps journalists to pay legal fees and access free legal advice. It also takes on cases in international courts and supervisory bodies. ‘It’s the aspect of English libel laws impacting on publications outside the UK that concerns us most’, Noorlander says. ‘In many cases, English libel laws have been used to bully people abroad into submission or into apologising.’ He cites the case of Rinat Akhmetov, who sued the Kyiv Post in London over allegations contained in an article published in October 2007 about land deals and corruption in Kiev. The article was written in Ukrainian, and the paper has only around 100 subscribers in the UK. The paper apologised as part of an undisclosed settlement out of court in February 2008.

‘Our libel law and practice have turned a country once famed for its traditions of freedom of speech into a legal farce’ Nick Clegg MP leader of the UK Liberal Democrats Party

UN concern

Concerns about English libel law have even been raised by the United Nations, whose human rights committee said in a report in 2008 that English libel law ‘has served to discourage critical media reporting on matters of serious public interest, adversely affecting the ability of scholars and journalists to publish their work’. The rise of the internet, the report adds, ‘creates the danger that a State party’s unduly restrictive libel law will affect freedom of expression worldwide on matters of valid public interest’.

Rod Christie-Miller is chief executive and partner at Schillings, a firm that has acted on behalf of a number of claimants. He takes a different view. ‘People don’t just come to England to protect their rights,’ he says. ‘The Barclay brothers, the former owners of the Daily Telegraph, decided to sue The Times in Paris. Max Mosley did the same thing with The News of the World. A US software company has recently sued a US blogger in Australia. It’s a bit parochial to object to foreigners using our courts. If they have a business interest here and they want to protect their reputation here, that’s all well and good.’

Christie-Miller objects to the repudiation of English libel judgments by US legislators. ‘To be perfectly blunt, that’s a form of imperialism,’ he says. ‘The US is alone in terms of how they pitch their reputation protection laws. The rest of the world balances free speech against rights and reputation. For historical reasons, the US has chosen to put free speech above all else. Events are also reported very differently in the US. There is a very clear separation of fact and comment. That’s not always the case in other countries.’

Nevertheless, increasing concerns about libel tourism have helped to prod the UK Government into making some tentative steps towards reforming the law. The Minister of Justice, Jack Straw, has set up a working group ‘to consider whether the law of libel, including the law relating to libel tourism, in England and Wales needs reform, and if so to make recommendations as to solutions’. These recommendations were due in March 2010. However, there has to be a general election in the UK in the coming months and the ruling Labour Party is lagging in the opinion polls. There are suspicions that this is simply a manoeuvre to impress the media in the run-up to the vote.

Opinions are divided as to how much the working group can achieve. ‘The group is a rather odd blend of claimant lawyers, media lawyers, campaigners and academics’, says Jonathan Heawood, director of English PEN. ‘It’s very unlikely to reach consensus.’ Heawood should know – he is one of its members.

Mark Stephens, who is also a member, is more positive. ‘We expect there to be nonlegislative change before the election and manifesto commitments to legislative change after the election’, he says. ‘All political parties are interested in reform.’ Those in favour of changing the law hope that civil servants can be persuaded that some reform is necessary before the election takes place. A package of reforms might then be ready for quick implementation once the next administration takes office.

If there is a change of government, it is not clear whether a new cabinet will be interested in reform. If neither Labour nor the Conservatives wins a clear majority, then
the UK’s third largest party, the Liberal Democrats, may hold the balance of power. Its leader, Nick Clegg, has made it clear that he wants change. ‘Our libel law and practice have turned a country once famed for its traditions of freedom of speech into a legal farce where people and corporations with money can impose silence on others at will’, he said in a recent speech. ‘The prospect of a costly, protracted legal battle hangs over journalists, editors and academics seeking to ask basic
questions about the evidence for practices they believe may put people at serious risk.’ A Liberal Democrat peer and QC, Lord Lester of Herne Hill, is planning to introduce a private member’s bill after the election.

‘It was going to cost us £3 million to keep going. Our libel regime is making it impossible to conduct any serious investigative journalism in this country’ BBC insider.

Costs

Clegg’s comments highlight one of the other main concerns about the English libel system – the enormous costs involved. Even those who are doing well out of the current regime accept that some change is necessary in relation to costs, says Stephens. ‘Partners have been charging about £800 an hour on a conditional fee basis. On any basis, that is a ludicrous amount of money and it means it has become uneconomic to defend these cases.’ Conditional fee agreements (CFAs), also known as ‘no win, no fee’ agreements, can lead to libel lawyers imposing an uplift of 100 per cent on the successful completion of a case. This leaves defendants facing extortionate legal bills for the other party.

In many cases, organisations choose to settle libel suits rather than confront the vast expense of contesting them. ‘It’s just astonishing the way the English legal system works’, says a BBC insider of a recent high profile case. ‘It was going to cost us £3 million to keep going. I think we should have done that as a point of principle … Our libel regime is making it impossible to conduct any serious investigative journalism in this country.’

Alan Rusbridger, editor of the UK newspaper, The Guardian, had described his recent experience of what’s happened when his paper has attempted to publish serious investigative journalism. He said that his paper was subjected to a ‘prolonged campaign of legal harassment’ by law firm Carter-Ruck on behalf of the company. ‘Carter- Ruck, like such other firms as Schillings, are trying to carve out for themselves a slice of the lucrative market known as “reputation management”’, he told Parliament’s culture committee as part of its enquiry. ‘This is not about the perfectly proper job of helping people or organisations gain legal redress when they have been mistreated by the press. It is a pitch to work with PR firms to pressurise and intimidate journalists in advance on behalf of big business. It exploits the oppressive nature and the frightening expense of British libel laws.’

David Leigh, the award-winning head of investigations at The Guardian, describes English libel laws as ‘a scandal’. However, his main concern is not the effect they have on relatively well-funded organisations like his, but the effect they have on small publications, charities and book publishers. ‘All those groups are very ill-equipped to deal with aggressive libel lawyers and their activities are quite seriously chilled as a result’, he says. ‘The enormous costs involved make it impossible for a small organisation to fight even a highly questionable claim.’

Peter Noorlander says that the MLDI gets a lot of enquiries from bloggers who have received threatening letters from solicitors about material they have posted on their websites. Even though the MLDI is based in London, the costs involved in England mean it is much easier to deal with enquiries like these from people in other countries. ‘We can arrange a lawyer for them and defend the case’, he says. ‘Here it’s different, because we could easily blow our annual budget just on defending one or two cases. A recent Oxford University study found that costs in the UK were 140 times the European average. That has a tremendous chilling effect.’

Libel lawyers in other jurisdictions are well aware of the discrepancy in costs. David Schulz is a partner at Levine Sullivan Koch & Schulz and is based in New York. He is also a member of the IBA’s Media Law Committee. He says that US lawyers see English libel law not only as ‘archaic and draconian’, but also as extraordinarily expensive. ‘Damage awards tend to be lower than they are in the US, but the fee-shifting provisions mean it ends up being a hugely expensive proposition’, he says.

‘A recent Oxford University study found that costs in the UK were 140 times the European average. That has a tremendous chilling effect,’ Peter Noorlander Legal Director, the Media Legal Defence Initiative

Jackson review

Lord Justice Jackson considered the issue of costs as part of his wide-ranging review of civil litigation costs in England and Wales, commissioned by the Master of the Rolls in November 2008. The Master of the Rolls is the second most senior judge in England and Wales, after the Lord Chief Justice. Jackson’s final report, published in January 2010, recommended the abolition of CFAs. He also suggested an end to ‘after the event’ insurance, which is taken out to cover the claimant against the risk of having to pay the defendant’s costs. Neither of these costs should be recoverable from an unsuccessful defendant, his report says.

However, he also said that if his recommendations were accepted, the level of damages for defamation and breach of privacy claims should be increased by ten per cent. ‘Lord Justice Jackson’s recommendations on costs are very much in line with those made in our report’, says Jonathan Heawood. ‘He’s balanced that against slightly different recommendations on damages, but in practice it will come down to how confident people are of winning cases. If costs are lower but damages potentially higher, that may change the decision someone takes about whether to take a case to court.’

The Culture, Media and Sport Committee also supported many of Jackson’s proposals. ‘Just as the press must be accountable for what it writes, lawyers must be accountable for the way in which cases are run, and that includes costs,’ its report says. ‘The current costs system, especially the operation of CFAs, offers little incentive for either lawyers or their clients to control costs, rather the contrary. It also leads to claims being settled where they lack merit.’

Geoffrey Robertson QC, the head of Doughty Street Chambers, thinks the MPs should have gone further in their recommendations by backing the reversal of the burden of proof. This is currently carried by the defendant. ‘This is wrong in principle, because any claimant who invokes the legal process puts the defendant – often a scientist or a human rights NGO – to great expense and inconvenience and should be able to prove, on the balance of probabilities, that he or she has a good case,’ he wrote in The Guardian.

One week after the publication of the Jackson report, the Ministry of Justice proposed that success fees that lawyers can charge for winning defamation cases under CFAs should be reduced from 100 per cent to ten per cent. ‘Lawyers need to recover their costs and be rewarded for their efforts and the risks they undertake when providing people with access to justice in “no win, no fee” cases’, says Jack Straw. ‘But evidence suggests that the regular doubling of fees that currently takes place is simply not justified and the balance of costs between claimant and defendant needs to be reconsidered.’ A consultation on the proposal ran until mid-February.

Is reform inevitable?

Anthony Julius, deputy chairman of Mishcon de Reya, is best known in the UK for negotiating a reported £17 million divorce settlement for Diana, Princess of Wales. He also represented US academic Deborah Lipstadt, successfully defending her with Richard Rampton QC in a libel suit brought by Holocaust denier David Irving. He describes the clamour for libel reform as ‘a campaign without any significant opposition’.

This does not mean he believes change is inevitable. ‘Politicians are not likely to be sympathetic to changes in the law that make it easier for newspapers to write inaccurate and damaging stories about them’, he says. ‘This is an unusual contest. Rather than there being vested interests lined up against each other and competing for the legislators’ attention, there is a strong and vocal campaign for libel reform with no identifiable group of adversaries – but the position of the legislators themselves is at
least quietly antipathetic.’ David Leigh agrees. ‘Politicians are relatively happy with restrictive media laws, because they think it keeps the tabloids off their backs’, he says.

However, some lawyers are opposed to reform. ‘The legal profession tends to divide into those who act for the media organisations and those who act for the claimants’, says Gavin Millar QC of Doughty Street Chambers. ‘The Index/PEN proposals would command a lot of support among media lawyers, but not among claimant lawyers. They obviously feel it’s important to protect reputation. They tend to think that English common law, on which the current system is based, has evolved incrementally over hundreds of years and is basically fit for purpose.’

Desmond Browne QC is joint head of chambers at 5 Raymond Buildings. A leading silk in all areas of media law, Browne has recently acted for a company in major litigation against the BBC. He also acted for Vladimir Telnikoff, a Russian journalist who sued a US-based Russian journalist for libel in the UK courts over a letter printed in The Daily Telegraph. The case lasted for over a decade. ‘Libel practitioners tend to develop tribal loyalties’, he says. ‘It’s natural that lawyers acting for newspapers should wish to see reforms which would make the life of those newspapers easier.’

Browne feels that the Index/PEN report is a classic example of a curate’s egg – good in parts, but indigestible overall. ‘There are issues which most people would sympathise with, and the cost of defending libel proceedings is one of them’, he says. ‘Unsuccessful defendants can avoid a huge bill for costs if they operate the Offer of Amends procedure introduced by the 1996 Defamation Act. If defendants do that promptly, then in line with the case law, they get a discount of 50 per cent or more on the damages. That is simply not addressed by this report.’

Browne believes that the campaign for libel reform aims to transplant the jurisprudence of the US First Amendment into England and into European human rights law. ‘The problem is that the approach of the US courts cannot be squared with the European human rights jurisprudence coming from Strasbourg’, he says.

‘The report makes no reference to the balance that needs to be struck between Article 10 – the freedom of expression provision in the European Convention on Human Rights (ECHR) – and the rights of individuals under Article 8, which includes a right to reputation as well as a right to privacy and to family life. The two have to be balanced, and it’s quite clear from the Strasbourg cases and from the House of Lords that neither right has pre-eminence. Reformers would like to see Article 10 treated as equivalent to the First Amendment, which gives pre-eminence to freedom of speech. But it just isn’t. It’s as simple as that.’

This point is echoed by David Schulz. ‘The problem really stems from the fundamental conceptual difference between the US and Commonwealth countries in terms of how tort is conceived’, he says. ‘We really approach the question from opposite ends.’

According to Millar, many people think English common law errs too much on the side of protecting reputation and does not contain enough procedural and substantive law protections for freedom of expression. ‘They think the law ought to acknowledge that there are times when it’s in the public interest for people’s reputations to be damaged’, he says.

Sceptical

He is sceptical about the prospect of reform. ‘We’ve had numerous proposals in the last 20- 30 years and very little has happened’, he says. ‘The biggest change has been the introduction of the Human Rights Act, which included Article 10 of the ECHR. That allowed people who defend media organisations to bring in Strasbourg case law and make a positive argument for freedom of expression. That’s why we have the public interest defence. But it has not gone far enough yet and there are big problems with judges not really taking a realistic approach to the issue of responsible journalism and public interest.’

Most libel cases that are heard in London tend to find their way to the same judge, Mr Justice Eady. Many journalists accuse him of deliberately restricting their freedom. In 2008, he ruled that the News of the World had breached the confidentiality of married Formula One boss Max Mosley by publishing photos and video of an orgy he was involved in with five prostitutes. Eady also ruled in 2009 that science writer Simon Singh could be sued by the British Chiropractic Association for questioning its support for some of its members’ medical claims.

‘We have ended up with a system where nearly all of the cases go to one or two specialist judges, in particular Mr Justice Eady’, says Millar. ‘To operate a judicial system where the two–three judges who get the cases are all from the small world of libel practitioners is a very bad idea. Eady does seem to act as a magnet for all the big privacy and defamation cases. I would not criticise him, but as so much of libel law hinges on value judgments, you need a range of different personalities making those judg-ments, rather than just one person who, as his judgments show, has fairly fixed ideas about some aspects of reputation and privacy.’

If there is to be a wide-ranging reform of England’s libel laws, it will have to wait at least until later this year, after the election. Until then, and beyond, it will remain a highly contentious issue. ‘What animates people is that libel laws are being used to attack the public space at a time when the scope for comment and for intervention in the political process by non-professionals has never been so great’, says Julius. He blames the system rather than the lawyers. ‘If there was a simple, cheap procedure, if you could appeal to some libel commissioner who could make a quick adjudication, that would save everyone hundreds of thousands of pounds. But the extent of the libel procedures means that the question of who has deeper pockets has become hugely significant.’

‘Free speech is not for sale’ – recommendations Require the claimant to demonstrate damage and falsity Cap damages at £10,000 Abolish the ‘Duke of Brunswick’ rule (which says that each individual publication of a libel gives rise to a separate cause of action) and introduce a single publication rule No case should be heard in England and Wales unless at least ten per cent of copies of the relevant publication have been circulated there Establish a libel tribunal as a low-cost forum for hearings Strengthen the public interest defence Expand the definition of fair comment Cap base costs and make success fees and ‘after the event’ insurance premiums non-recoverable Exempt interactive online services and interactive chat from liability Exempt large and medium-sized corporate bodies and associations from libel law unless they can prove malicious falsehood Source: Free speech is not for sale, report published by English PEN and Index on Censorship. Copies can be downloaded from www.libelreform.org

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Jonathan Watson is a journalist specialising in European business, legal and regulatory developments. He can be contacted by e-mail at watsonjonathan@yahoo.co.uk.

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