Legal News

MP's report demands ban on companies suing for libel
Mon 22nd Feb 10 - 16:03

Frances Gibb, Legal Editor at Times Online reports that tougher powers for the Press Complaints Commission and an end to the right of companies to sue for libel will be proposed next week in a longawaited report by MPs.

But the much criticised press watchdog will escape calls for its abolition or for any form of state regulation of the press.

The PCC needs a radical shake-up to turn it into a body that is proactive, rigorous and is taken seriously by the public, the Culture, Media and Sport Select Committee will say. New powers could extend to halting the printing of a newspaper edition. John Whittingdale, the committee’s chairman, says the watchdog should also have the ability to impose large fines.

The commission has come under fire this week for failing to uphold complaints about a Daily Mail article into the death last October of the Boyzone singer Stephen Gately. The column attracted 25,000 complaints from readers who perceived it to be homophobic.

But the PCC said it should be “slow to prevent columnists from expressing their views, however controversial they might be”. It was a point of principle that newspapers could print views that might offend people, it said.

The complaint made to the PCC that the Daily Mail’s column on Gately’s death was inaccurate, intrusive and discriminatory was not upheld. Gately, 33, died at his holiday home on the island of Majorca.

The PCC said that it could fully understand why Mr Cowles and a record number of complainants were upset, but ruled that Moir’s comments had not breached press guidelines.

Moir said that Gately had died a “lonely” death after Mr Cowles went into the bedroom with another man. The PCC ruling also said that Mr Cowles was concerned that a number of “pejorative references” had been made to Gately’s sexuality.

In a second move that will please media organisations, the committee is expected to reject calls by Max Mosley, the former Formula One chief, for victims of media exposés to be notified in advance.

There are fears that a requirement for “prior notification” will lead to judges imposing injunctions that would prevent many investigative stories going to print.

A third key recommendation expected in the report, to be published next week, is that businesses with more than ten employees will lose the right to sue for defamation. Concerns about the unequal playing field in defamation cases — where a big corporation is involved — are highlighted by a case in which The Guardian is contesting the £800,000 bill it is being served by Tesco after its coverage of the supermarket’s tax affairs.

The Guardian admitted it made “serious errors” in its story but the costs of the legal action dwarfed any damages claimed, proven or agreed, it said. Trafigura, the oil trader, has also threatened proceedings against a number of media companies over coverage concerning the dumping of toxic waste in Ivory Coast. The oil trader denied any liability.

The wideranging report by MPs will cover press standards, privacy, libel and “libel tourism”, “super-injunctions” and costs in defamation cases. The inquiry has already prompted some initiatives, including a libel working party set up by Jack Straw, the Justice Secretary.

Mr Straw indicated in January that he intends to cap the costs payable by a losing defendant in libel cases, which can be hugely inflated under no-win, no-fee arrangements and the insurance costs associated with them.

Phil Hitchen, Associate Solicitor at Ralli who specializes in business transactions, funding and intellectual property, comments:

“The Press Complaints Commission (“PCC”)’’s decision that in the article did not breach its guidelines and upholding the right to free speech even if the exercise of that right is considered by many to be offensive reopens a discussion on whether self regulation by journalists or regulation by a body considered by some to be less than impartial actually works.

Unless you can prove the article was a libel or otherwise an infringement of your other legal rights, you are left without a remedy. It will interesting to see what changes to the PCC and remedies are suggested. An absolute bar on certain persons bringing legal action should be avoided.

It may be better to promote resolution in the first instance through commercial mediation or alternative dispute resolution means if the primary reason for an absolute bar is only to try and keep enforcement costs of a valid case to a minimum.”