Libel Reform Campaign

Defamation Bill: briefing for House of Lords consideration of Commons disagreements and reasons on Tuesday 23rd April 2013
On Tuesday 17th April the House of Commons voted to disagree with a new clause to the Defamation Bill introduced by the House of Lords that would make companies prove actual or likely financial loss, before they can sue. It is deeply disappointing that the Bill now does not contain any specific provisions to stop companies using the law to threaten citizen critics. If the Defamation Bill is going to deliver on the promises of all three major parties to remove the libel chill on discussion of public interest matters then it must include reforms that address the libel bullying tactics of companies. How can it be right that a company can merely claim harm and pursue it through expensive court proceedings and yet not be asked to show that any damage actually happened? How can it be right that citizens aren’t free to criticise public services whether provided by Government or a private company?

Companies must be asked to show financial harm before a case can proceed
The Government indicated in the Commons on 17thApril that they might bring forward an amendment on this in the Lords. This is a welcome promise – but it must deliver. Currently a company can launch or threaten to launch a libel action against an individual without having to show any harm has occurred. Corporations have used this to try to bully individuals into silence. Cardiologist Dr Peter Wilmshurst was sued for libel by an American medical device company NMT Medical in 2005. Dr Wilmshurst spoke about his concerns about the accuracy and completeness of the presentation of results of a clinical research trial performed on patients in the UK. He was the principal cardiologist in the trial, which was sponsored by NMT Medical and used its device. He was sued for libel in England when some of his comments were published on a US website. The libel action against him prevented others with concerns about the safety of devices made by NMT from speaking out including making known life-threatening problems with NMT's devices.

Science writer Dr Simon Singh was sued by the British Chiropractic Association (BCA) in 2008 over a comment piece he wrote for the Guardian questioning ‘bogus claims’ that chiropractic could cure childhood conditions such as colic and asthma. The case took two years (and probably would have taken three years had it run its full course), it cost £500,000 for both parties (to settle damages of roughly £5,000). It has been repeatedly stated by senior politicians that the new Defamation Bill needs to prevent cases such as BCA v Singh from happening again. In 2009 and 2010 Citizens Advice had to fight repeated threats of libel action to tell people about a secretive, exploitative and quite possibly illegal practice called ‘civil recovery’. This practice involves agents of high street retailers bombarding vulnerable individuals who had been accused of shoplifting with legalistic letters demanding ‘compensation’ for the cost of dealing with the incident, and threatening civil court action if the demands are not paid promptly. Citizens Advice used its entire year’s research and campaign contingency budget on legal advice to fight legal bullying by one of the firms involved in this practice. The report they did publish to warn people of the hollow nature of threats of ‘civil recovery’ was self-censored and not as hard-hitting as it could and should have been. Consumer magazine Which? often receives pre- and post- publication libel threats on issues of considerable public interest. For example, when they published a lab testing based child car safety seat report containing a number of 'Don't Buy' recommendations for car seats they thought were unsafe, the manufacturers’ trade body threatened to sue them for libel unless they retracted the claims, published a full apology and paid them damages. Which? refused and were engaged in costly and time consuming correspondence for more than a year before the claimants changed their position and backed down. A hurdle asking companies to show harm would not prevent companies from suing for libel. The current legal position is that they can sue for special damages i.e. financial loss because they do not suffer emotional damage. We recommend that they be asked to show that they have experienced or are likely to experience such a loss before a case can proceed.

Taxpayers’ money should not be used to silence citizens: the Derbyshire principle should be extended to private companies providing public services.
The common law Derbyshire principle established that government bodies should be open to uninhibited public criticism and therefore do not have the right to sue for libel. But private companies contracted to provide public services are allowed to threaten and pursue libel claims. A central aim of the Defamation Bill has been to bring the law into the 21st century but it fails to take into account the increased use of private companies to deliver public services. Services including prison management, benefit claims assessments, refuse collection and serving school dinners are being sub-contracted by local councils and central government agencies to private companies. Recent changes to NHS commissioning will see many aspects of health-care being delivered by private companies.

ATOS Healthcare used libel law to silence its critics on CarerWatch, a closed forum where carers go to share experiences. Users’ posts were critical of how ATOS was running a state-funded contract to assess disability claimants fitness for work. In August 2011, ATOS’s lawyers sent a legal threat to myfreeforum.org, the host of the carer’s forum. Myfreeforum.org, fearing an expensive libel action, closed the forum. Frances Kelly, the founder of CarerWatch, said at the time: “The sudden disappearance of a support group has caused a lot of distress and fear. Some (members) are ringing us in tears.” After public outcry, CarerWatch is now back online. The Derbyshire principle should be extended to private companies providing public services. Companies should not be able to sue for defamation for criticism relating to the public service they are providing. Citizens should be able to criticise the delivery of these services, without the fear of a ruinous libel suit. Discussion of the running of a school, the collection of bins or the treatment of an ill relative should not be stifled or chilled by the libel law. There should be a level playing field between public and private service providers. If a private company takes public money to provide a service they should have to adhere to the same rules as public providers.

Proposals to limit the ability of corporations to sue in libel have been extensively scrutinised by Parliament.
The House of Commons Culture, Media and Sport Select Committee (2010) and the pre-legislative Joint Scrutiny Committee on the Draft Defamation Bill (2011) have made considered recommendations to limit corporations’ use of libel laws. The issue was debated extensively in the House of Commons Public Bill Committee (June 2012), and the House of Lords Grand Committee (December 2012), as part of the legislative process. The Joint Scrutiny Committee on the Draft Defamation Bill, chaired by Lord Mahwinney and composed of members from all three main political parties, examined this issue extensively. The report of the committee made the following recommendations: It is unacceptable that corporations are able to silence critical reporting by threatening or starting libel claims which they know the publisher cannot afford to defend and where there is no realistic prospect of serious financial loss. However, we do not believe that corporations should lose the right to sue for defamation altogether ... we favour the approach which limits libel claims to situations where the corporation can prove the likelihood of ‘substantial financial loss’. This approach will provide greater protection to freedom of speech but will not, in our view, remove necessary protection for the reputation of corporations.

The Joint Scrutiny Committee also made the following recommendation: There is one additional and significant restriction on corporate libel claims that we endorse: corporations should be required to obtain the permission of the court before bringing a libel claim. This would encourage robust and decisive action by the courts to prevent trivial and abusive litigation from being commenced at all, let alone continued for years. The House of Commons Culture, Media and Sport Select Committee also recommended changes to the law. Reporting in 2010, the committee cited the ‘mismatch in resources between wealthy corporations and impecunious defendants’ and that a corporation to prove actual damage to its business before an action could be brought.’ The Culture, Media and Sport Committee also suggested that ‘corporations could be forced to rely on the existing tort of malicious falsehood where damage needs to be shown and malice or recklessness proved.’ This recognises the fact that corporations do have other means to defend their brands. As well as malicious falsehood, the simple ‘declaration of falsity’ law may also be used to prevent the spread of lies or inaccuracies. Laws governing advertising, competition and business practices govern what one company may say about its competitor. And through their PR and Marketing teams, a company may use its own right to free expression to counter negative publicity.
In a House of Lords debate on 17 December 2012, Lord Mawhinney described the problem succinctly: It is a form of bullying. It is trying to exercise right simply on the basis of size and financial strength. That is not what the law of the land is supposed to be about. (Lords Hansard, 17 Dec 2012, Col GC 438) The Government also acknowledges the extent of this problem. In its Response to the Report of the Joint Committee on the Draft Defamation Bill (PDF link) the Government said: It is unacceptable that corporations are able to silence critical reporting by threatening or starting libel claims which they know the publisher cannot afford to defend and where there is no realistic prospect of serious financial loss. Reputation is personal. In human rights law, it is derived from the Article 8 right to a private life. The protection of reputation is designed to preserve an individual’s ‘psychological integrity’, which cannot apply to companies and other non-natural persons.

Government objection: Corporations should not be exempt
The reason given by the House of Commons (i.e. the Government) for rejecting provisions limiting corporations use of the libel laws is: Because it is unnecessary and inappropriate for the Bill to make special provision restricting the bringing of defamation claims by non-natural legal persons. (Commons Disagreements and Reasons paper, 17 April 2013, part 2A). Corporations do not have feelings or a personal reputation, which is what the law of defamation was originally designed to protect. They do not have ‘psychological integrity’ which gives a right to a reputation force under Article 8 of the European Convention on Human Rights. As the CMS Select Committee and the Joint Scrutiny Committee have stated, and as the Government has acknowledged, corporate libel bullying is a real and particular issue. It is entirely appropriate that Parliament tackles this point head on. It should not be obliquely addressed through other areas of law. The Government promised to deliver law that is clear, simple and accessible for everyone. A specific clause that clearly sets out when a company can use for libel would give the community groups, scientists, consumer watchdogs and human rights NGOs most affected by corporate libel bullying the confidence about where they stand.

Government objection: Early permission would duplicate proceedings
On the issue of an early permissions stage for corporations, the Government claims that this would duplicate existing Early Resolution Procedures (see the speech by the Parliamentary Under-Secretary of State for Justice, Helen Grant MP, Commons Hansard 16 April 2012, Col. 267). We consider this response to be inadequate. The Early Resolution Procedures have been promised by Government for many months, and yet have still not been published. In fact the Civil Procedure Rules Committee have not even been asked to start work on it. It will be several years before any recommendation they make will be implemented It is inappropriate for Government to ask parliamentarians and the public to accept that an alternative system will be in place in the future, when it has offered no indication of what that system will look like, or when it will be introduced. A solution to this issue would be to include a time-limited permissions stage, which would exist only until more comprehensive Early Resolution Procedures are in place. If a duplication does arise, it may be fixed by means of a Statutory Instrument. In the meantime, appropriate early safeguards for citizen critics will remain in place.

About the Defamation Bill and the Libel Reform Campaign
This legislation is the culmination of a three-year collaboration between the public, civil society groups, and politicians to reform the out-of-date libel laws. More than 60,000 people signed a petition calling for reform, and more than 100 organisations including medical and scientific bodies, author's associations, human rights NGOs, consumer groups and parenting forums have joined the Libel Reform Campaign. In the last Parliament, 243 MPs signed EDM 423, calling for change, and the three main political parties made general election manifesto commitments to reform the libel laws. Throughout this process, the Libel Reform Campaign has called for changes that would protect free expression, particularly on matters of public interest, while ensuring access to redress for those whose reputations are unfairly damaged. The key to achieving this is to ensure that the new laws are clear and simple. Reducing the complexity of the law reduces the time and cost of being involved in a libel action for both claimants and defendants. The new law should prevent wealthy companies and individuals from using the libel laws to censor investigative journalists, scientists and bloggers.

Contact:

Jo Glanville, Mike Harris, Sile Lane,

English PEN, Index on Censorship, Sense About Science,

07713 020 971 07974 838468 07719 391814

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