Lifecycle of a tech startup series: Intellectual Property
Last year Peter Cruddas, former Conservative Party co-treasurer, commenced proceedings against the Sunday Times for defamation and malicious falsehood following the publication of a series of articles about him in March 2012. The meaning of the words complained of were determined as a preliminary issue earlier this year and the natural and ordinary meanings were found to be as Mr Cruddas had alleged (see my previous blog Defamation & Malicious Falsehood – discussing the Peter Cruddas case – part 1).
On 31 July 2013, Tugenhudt J handed down his final judgement finding the articles to be both libellous and to contain malicious falsehoods. The Sunday Times was ordered to pay £180,000 in libel damages (including £15,000 for aggravated damages) and a costs order was made for £500,000 to be paid on account by 14 August 2013. No separate damages award was made in respect of the claim for malicious falsehood on the basis that Mr Cruddas was not entiled to recover twice for the same damage.
The Sunday Times fought the libel action relying solely on the defence of truth (justification) requiring them to prove that what had been published was an accurate and true report. The court found each of the meanings assigned to the articles published in the Sunday Times by the Court of Appeal to be untrue. More specifically, Tugenhudt J determined that:
It is interesting that the defendants chose not to raise the defence of honest opinion or public interest (the Reynolds defence) despite previously asserting that they considered that these defences would be available to them. In particular, the Reynolds defence is designed to protect investigative journalists and enable the publication of defamatory material where the content of the article is in the public interest and the journalist is able to demonstrate that they have acted responsibly in compiling the story. Given the high profile of Mr Cruddas and the suggestion that he was corrupt and willing to act in breach of UK electoral law, one would envisage that the newspaper may have had grounds to argue that the story was in the public interest. However whilst Tugendhat J was not required to consider the Reynolds defence he did comment as follows: ‘The truth is the truth, whether telling it is in the public interest or not. But telling a falsehood would not be in the public interest.’
Tugendhat J also gave a somewhat damning account of the manner in which the journalists went about obtaining the material forming the basis of the articles in questions (something that he would no doubt also have been taken into account when considering whether they had acted responsibly under Reynolds) and questioned the reliability of their evidence on this basis. He said: ‘It is very surprising that the journalists should so consistently and seriously have misled the Editor as to the basis on which they sought authorisation for the use of subterfuge… The journalists claimed in evidence that he had been kept fully informed. But since I find much of their evidence incredible, I doubt that too.’
In the wake of Leveson such criticism will only compound the furor surrounding the use of subterfuge by investigative journalists and may have serious implications for undercover reporting of this nature.
The components of a claim in malicious falsehood claim are: ‘that the defendant has published about the plaintiff words which are false, that they were published maliciously, and that special damage has followed as the direct and natural result of their publication’ (Tesla Motors Ltd v British Broadcasting Corporation). Given that the meanings assigned to the article were said to be untrue for the purposes of the claim in libel, it followed that the same applied in respect of malicious prosecution leaving the court to determine only whether they were published maliciously and that special damage had followed. In respect of malice, Tugenhudt J found that not only did the journalists know the articles to be false but also that they had the ‘dominant intention to injure Mr Cruddas and they expressed delight when they learnt that they had caused his resignation.’ As to special damage, the effect of the Defamation Act 1952 was that it would be sufficient if the words were calculated to cause pecuniary damage to the claimant and despite knowing the articles to be false the journalists had done nothing to limit the damage to Mr Cruddas’s reputation.
It is of note that one of the distinctions between a libel claim and a claim in malicious falsehood is that the burden of proof in the case of the latter lies with claimant. Tugenhudt J addressed this distinction in his judgement but stated that irrespective of where the burden of proof lies he would have reached the same conclusion in both instances.
The damages award in this case is one of the highest libel awards in recent years and is intended to reflect the level of damage to Mr Cruddas’s reputation and take account of the personal distress caused by the publication of the articles. Tugenhudt J commented that the trial had received almost no publicity in the media meaning that the allegations had not received wider circulation and therefore it was ‘all the more important that the award of damages should be one that will receive publicity’. The Sunday Times has confirmed that they will be appealing to the Court of Appeal.
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