The Claimant was an employee of the second defendant, LCA, a recruitment agency owned and operated by the first defendant. After leaving LCA, the Claimant was employed by another recruitment agency and began targeting LCA's clients. LCA's owner told two third parties, one of whom was the Claimant’s new line manager and the other a client of LCA, that by doing this the Claimant was in breach of her contract of employment with LCA. In fact, there was no term of that contract (as the owner of LCA knew) which prohibited the claimant from soliciting business from LCA’s clients.

The Claimant brought a claim for defamation and malicious falsehood. Whilst the claimant failed in her defamation claim, her claim for malicious falsehood came before the Supreme Court.

Summary of findings 

The Supreme Court held that the effect of section 3(1) of the Defamation Act is to enable a claimant to establish liability for malicious falsehoods where a falsehood is likely to cause financial loss even if, in fact, it does not. 

However, the Claimant may only recover damages (other than merely nominal damages) for financial loss actually suffered. The majority of the Court also held that compensation for injury to feelings can only be recovered if such injury is consequent on financial loss caused by a maliciously false statement.

Comment

The consequence of the Supreme Court's judgment is that in bringing a claim for malicious falsehood, it is vital for a claimant to be able to demonstrate that he or she has suffered financial loss caused by the maliciously false statement, even though liability can be established without such proof. This may mean that unless a claimant is able to plead such losses in their particular of claim, claims for malicious falsehood are susceptible to being struck out as an abuse of process and/or on Jameel grounds. 

A claimant is also precluded from bringing a claim for distress caused by the malicious publication alone unless they can prove that the distress was caused by the consequent financial losses. It is likely to be a question of fact as to whether any distress caused was in fact consequent on the statement itself or the financial loss caused by the statement. It will be incumbent on claimants to sufficiently prove the causal link through documentary, witness and, potentially, expert evidence. Provided that the financial loss is proximate to the statement, this is unlikely to be a problem in practice, but may be harder to prove where the financial loss does not materialise until some months later. 

It is important to remember that this issue only arose because the Claimant had failed in her defamation claim because she had not satisfied the Court that she had suffered serious harm to her reputation in accordance with section 1 of the Defamation Act 2013. Had she succeeded on this claim, she would have been awarded damages for damage caused to her reputation, and her claim in malicious falsehood would have fallen away. 

It is unlikely in a publication claim that a claim in malicious falsehood would be pleaded without an additional cause of action in defamation. Whilst a claimant may not always be able to show that they suffered financial loss caused by a maliciously false statement, it may be possible to show that the publication was defamatory and caused them serious harm to their reputation (which does not have to be evidenced as a monetary loss in the case of individuals bringing claims). 

Given that the Claimant was only awarded nominal damages, the issue of costs will be of significance to the parties. The general rule under CPR 44.2(2)(a) is that the unsuccessful party will be ordered to pay the costs of the successful party, but the court may make a different order.  The issue may turn therefore as to which party the Court considers has been successful. The Claimant has already failed in her defamation claim with the usual order as to costs likely to follow with the Claimant paying the Defendants' costs. Any offers to settle may also be relevant to the apportionment of costs between the parties. The claimant may therefore find herself in the position of having established liability for malicious falsehood but having to pay the defendants costs because she only obtained nominal damages and failed in her defamation claim.

George v Cannell and another [2024] UKSC 19

 In January 2019, RW, a private individual, made a request under Article 15 for Österreichische Post AG (the Austrian postal service, "OP") to provide access to any personal data being stored by OP and, if the data had been disclosed to third parties, for information as to the identity of the recipients.  OP declined to accede to this request.  Instead, OP explained that it uses data, to the extent permissible by law, in the course of its professional activities and that it offers the personal data to trading partners for marketing purposes.

RW subsequently issued proceedings in the Austrian courts, seeking an order that OP provide him with the specific identity of the recipients of his personal data.  During these proceedings, OP provided RW with information as to how his personal data was processed and the categories of recipient to whom the personal data had been disclosed.  The personal data had been processed for marketing purposes and disclosed to its customers, which included advertisers, IT companies, mailing list providers, charitable organisations, NGOs and political parties. 

At first instance and on appeal, the Austrian courts dismissed the proceedings finding that the wording of Article 15(1)(c) gave controllers the option of informing the data subject only of the categories of the recipient, without having to identify the specific recipients of the personal data.  The case was then referred to the ECJ by the Austrian Supreme Court which sought clarification on the correct interpretation of the wording of Article 15(1)(c), asking whether the provision must be interpreted as meaning that a data controller has an obligation to provide a data subject with the specific identity of the recipients of its personal data.

What did the Court decide?

For the following reasons, the ECJ held that the correct interpretation of Article 15(1)(c) placed an obligation on data controllers to provide the data subject with the actual identity of the recipients unless it is impossible to identify them, or the data controller can demonstrate that a request for access is manifestly unfounded or excessive (per Article 12(5)(b) of the GDPR):

1. While it is not possible to infer an order of priority between the terms 'recipients' and 'categories of recipients' on the wording of Article 15(1)(c), the Court noted that the corresponding recital (recital 63) did not allow for the right of access to be restricted solely to categories of recipient. 
   
   
2. All processing of personal data must comply with the principles enshrined in Article 5 of the GDPR. The third principle, transparency, requires data subjects to be provided with information about how their personal data is processed and that that information be easily accessible and easy to understand.
   
   
3. Article 15 provides data subjects with a genuine right of access.  When this right is exercised, a data subject must have the option of obtaining either information about the specific recipients to whom the data have been or will be disclosed, where possible, or information about the categories of recipient. It is the data subject, not the data controller who may choose between the two alternatives specified in the provision.
   
   
4. The right of access must allow a data subject to verify that their data are correct and are being, or have been, processed in a lawful manner.  This enables a data subject to exercise their rights to rectification, erasure or restriction of processing under Articles 16, 17 and 18, as well as their right to object to processing under Article 21 or right of action following damage being suffered, under Articles 79 and 82 of the GDPR. To effectively exercise these rights, a data subject must have the right to be informed of the identity of the specific recipients where their personal data have already been disclosed. Further, the Court noted that this was consistent with the terms of the notification obligation for data controllers under Article 19 of the GDPR. 

Conclusion

 This preliminary ruling should not come as a surprise, reflecting the reasoning set out in the Advocate General's opinion on this case issued in July 2022.  However, with ECJ rulings no longer legally binding in the UK, the immediate implications of this judgment are limited for data controllers based within the UK.  However, Such data controllers should bear in mind that the terms of Article 15(1)(c) of the UK GDPR are identical as for the same provision under the EU GDPR and, as a result, the judgment is likely to be highly persuasive in disputes arising in the UK.  

UK-based data controllers should therefore be prepared for data subjects to press for the specific identity of the recipients (if any) of their personal data in any request for access under Article 15(1)(c). Save where it is materially impossible for the data controller to identify the specific recipients of personal data or where the request for access is manifestly unfounded or excessive (or, alternatively, where a data subject deliberately restricts their request to include categories of recipient), it would be prudent for UK-based data controllers to put systems in place to allow them to provide the necessary information. 

The full model law can be read here, but here's a breakdown of the key points.  

SLAPPs, or "Strategic Lawsuits Against Public Participation" do not yet have a formal statutory definition in the UK being a term coined in the US but now prevalent, throughout North America and Europe. SLAPPs have been described by the UK Government as "an abuse of the legal process, where the primary objective is to harass, intimidate and financially and psychologically exhaust one’s opponent via improper means" in order to "evade scrutiny in the public interest". The main aims of the model law are to dispose of SLAPPs quickly whilst keeping the costs for the target of a SLAPP to an absolute minimum and deterring SLAPP cases by penalising claimants with adverse costs consequences. This is intended to be achieved in the following ways: 

1. Defining "an act of public participation" and an "abusive lawsuit against public participation"

Acts of public participation are effectively any expression on matters of public interest, with public interest being non-exhaustively defined as any matter which relate to issues such as public health, activities of persons or entities in the public eye, allegations of iniquity relating to fraud, political misconduct and similar issues.

In order to all the court to identify a SLAPP without evidence of the mental state of the claimant, the model law defines a SLAPP as proceedings brought against an act of public participation that have "some" objectively ascertainable "features" of an abuse of process. These features have been non-exhaustively defined and include: the deployment of disproportionate resources having regard to the nature of the claim and remedies available to the Claimant, the Claimant's general litigation conduct such as the choice of jurisdiction, excessive or aggressive correspondence, disproportionate disclosure requests, failures to engage in pre-publication correspondence and refusals to engage in ADR. 

2. Early disposal of proceedings

The Coalition say in their preface to the model law that the test for summary judgment (i.e. allowing cases with a "reasonable prospect of success" to proceed to trial) provides too low a bar for Claimants to overcome, particularly where a claimant's pleaded case is taken to be true and wider context is ignored. Instead, the model law directs that the court "must" dismiss abusive lawsuits against public participation unless the Claimant satisfies the judge of a two-limb test that:

a. The claim is "likely" to prevail at trial (as opposed to having a real or realistic prospect of success) to succeed; and
b. The harm suffered by the Claimant is sufficiently serious to outweigh the public interest in dismissing the case before trial.

If an application is made for early disposal of the proceedings, the whole claim is stayed pending final disposal of the application.

3. Adverse costs consequences 

If Defendants are able to have the claim disposed of summarily using the mechanism described above, the usual costs order would, under the model law, be costs on a "full indemnity basis", potentially together with exemplary damages awarded to the Defendant in a sum considered appropriate by the Court to deter the Claimant's conduct being repeated in future. 

4. Disclosure 

The model law proposes that in any proceedings brought in relation to a matter of public participation (i.e. not only abusive lawsuits against public participation), there should be strong presumption that disclosure on behalf of the Defendant should be limited to "known adverse documents" and key documents on which the parties have relied or are necessary to understand the claim and/or defence. 

In any case, under the model law the Court must ensure that the Defendant's disclosure obligations are reasonable and proportionate, having regard to the resources (or lack thereof) available to the Defendant, the potential chilling effect on freedom of expression, and nature of the issues in the proceedings, amongst other factors. 

Comment

This model law appears to address the key issues and current failures seen in SLAPPs: the imbalance of resources between the parties and the high bar for Defendants to meet in making an application for summary judgment if they are to dispose of potentially abusive proceedings without incurring the costs of defending the claim in full or conceding their Article 10 rights to publish an apology or correction simply to avoid the costs of oppressive litigation. The aspiration is that England and Wales become a jurisdiction where important public journalism, and so public debate, cannot be so easily prevented by significant wealth, litigation tactics and the mere threat of ruinously expensive litigation.

The Government's response to the SLAPP consultation earlier this year suggested that a costs protection regime could be introduced under secondary legislation (i.e. as part of reform to the Civil Procedure Rules). Costs protection is essential in order to protect Defendants' rights if they are faced with SLAPPs. A possible fixed costs regime to ensure that Claimants do not continue to use their unlimited resources on disproportionate issues, and sanctions (costs or otherwise) for failures to comply with the Pre-Action Protocols as we so often see in SLAPPs, must be introduced at the earliest opportunity.

RPC's media and data disputes team has significant experience in acting for Defendants in relation to SLAPP litigation. Get in touch with us at Anti-SLAPP@rpclegal.com.  

Background 

The Attorney General sought an interim injunction to prevent the BBC from broadcasting a programme about ‘X’, a covert human intelligence source (CHIS) for MI5 who has been accused of being a dangerous extremist who physically abused two female partners, and that X had told one of these women he worked for MI5 in order to control her.

The injunction was sought on the grounds that:

• it was necessary to protect X’s rights under Articles 2, 3, and/or 8 of the European Convention on Human Rights (ECHR)
• disclosing X’s name or image would give rise to a real and immediate risk that X would be killed or subject to serious physical harm. If the application for an injunction was refused, the Security Services would need to deploy extensive protective measures to protect X’s life and safety and those measures themselves would have a substantial impact on X’s Article 8 ECHR rights
• such a disclosure would also cause real damage to national security as individuals considering becoming CHIS would reconsider if they thought their identities might be disclosed

The BBC argued that:

• an injunction would infringe its Article 10 rights, as well as those of the women who had provided information to the BBC
• there is a relevant public debate on coercive control and MI5’s role in potentially preventing the actions of X
• the court should bear in mind the rights and interests of the women who would or might be protected by being made aware of the allegations against X

The court sat in private and heard from ‘Special Advocates’ with national security clearance to hear evidence relating to those sensitive issues, with the remainder of the proceedings being heard in public.

What did the court decide?

Mr Justice Chamberlain accepted that the relief would prevent publication by a responsible broadcaster of facts which would contribute to a debate on matters of legitimate public concern but that there is ample support in the authorities that informants play a vital role in maintaining national security, and that disclosure of their identity undermines their ability to work effectively.

There is conflicting case law on whether a balancing exercise need be carried out between Article 2 and/or 3 and Article 10 where it has been established that Article 2 and/or 3 is engaged. The court assumed in the BBC’s favour and conducted a balancing exercise in the absence of detailed argument.

In considering that balance, the court was satisfied that the AG had provided cogent evidence that the disclosure of X’s identity would expose him to a ‘real and immediate risk’ of death or serious injury. If disclosure were permitted, the protective measures which would be undertaken by the Security Services would undermine the protective effect that disclosure of X’s identity would have on women considering a relationship with X. In any event, the chances that the broadcast would protect those women was likely to be small. The grant of relief would not materially increase any danger that X poses to women, either.

The court therefore held that the AG was more likely than not to succeed at trial in establishing the balance of interests favours the grant of relief. While the AG had previously sought an injunction prohibiting broadcast of the facts alleged at all, by virtue of an earlier judgment, extensive facts had already been made public and such a position was no longer tenable. The court noted that:

"an injunction which restrains a media organisation from exercising the right of freedom of expression should be narrowly tailored, and, where possible, should precisely identify the information whose publication is prohibited." [87]

What are the practical implications of this case?

While the court ultimately restricted publication, this ruling provides some helpful commentary for media publishers seeking to ensure that their Article 10 rights prevail:

• national security itself is not sufficient to pre-determine the grant of relief; the executive must convince the court that the elements of the cause of action are present and that the balance of public interest favours the grant of relief. There may be cases where the public interest in national security is outweighed by other competing rights, particularly where the grant of relief could itself cause a risk to the safety of the public
• it is not sufficient for applicants to seek to prove the allegations are untrue; in a breach of confidence action, the court will not be concerned with the truth or falsity of the allegations which are the subject of proposed restraint. However, a party claiming that publication of confidential information is in the public interest must in general show that the allegations it seeks to publish and the criticisms it seeks to advance are serious and have a credible evidential basis
• the court must consider not only whether the publication of the information is in the public interest, but also whether it is in the public interest that the duty of confidence should be breached

Publishers should bear in mind that the fact that an individual disclosed the confidential information to a third party does not necessarily diminish the quality of confidence; the disclosure to one person is different from disclosure to the world at large. Such a disclosure is also unlikely to have a significant impact on the assessment of the risk to life as a result of publication.

This article was first published by LexisPSL on 11 April 2022