Will British libel law kill net free speech?

Libel laws in England and Wales have caused plenty of controversy and the UK is known as the defamation capital of the world. Indeed, defamation is one of the UK's growing export industries. UK jurisdiction awards the highest damages in Europe and, with costs often running into the millions, has the dubious accolade of being the most expensive place to bring a defamation claim.

But what does this do to free speech on the internet? Freedom of expression and the right to opinion and comment is protected by law. Balanced against this is the right of individuals (and companies) not to have their reputations unfairly harmed by false or defamatory statements. This balance is delicate enough in the traditional media, but on the internet, where statements can be available to a global audience at the click of a mouse, the delicate nature of the balance is amplified exponentially. The global nature of the medium means that anything published anywhere could quite easily be claimed to lead to damages under UK law.

Plenty of print and website editors capitulate daily to the threat of libel by not publishing a piece or removing material from a website. Many of these threats are unjustified. So where exactly is the balance between freedom of speech and protection from defamation for internet service providers and publishers?

There is a real danger that we cannot rely on the UK's judge-made law to move sufficiently fast to protect world-wide web free speech. The UK's unique legal position could combine with the recent introduction of “No-Win-No-Fee” litigation arrangements to create serious globally adverse effects on new media's  freedom of speech.

THE BAD

In 1999 the use of CFAs (Conditional Fee Agreements) or no-win no-fee arrangements between lawyers and their clients was extended to defamation cases. This means a lawyer can take on a client and take his claim to court without seeking payment (ie: the law firm, in effect pays for the client to go to court). If the client then wins, the media defendant has to pay whatever damages were awarded, plus the costs of the claimant and (most controversially) the success fee of the lawyer. The success fee can be an uplift of up to 100% on the lawyer’s fees. The lawyer is rewarded for taking the risk of not getting paid at all, the client gets the damages and the defendant gets bankrupt. Well, not quite, but the defendant has to pay the damages and the claimant’s costs under his CFA, which often represent an amount three or four times that of the damages themselves. Julian Pike of law firm Farrer and Co was quoted in The Times last month estimating that the cost of losing a major action at trial in a case involving a CFA was now £2.4 million.

If they win, the media outlet is highly unlikely to recover their own fees from the claimant, as the claimant (generally an individual) will not be in a financial position to pay. It is a lose-lose situation for the media. As lawyers well know, there is nothing more dangerous to a defendant than a claimant with nothing to lose. CFA’s have created an environment in which there are a lot more claimants with nothing to lose.

The cost of defending libel claims has had a noticeable effect on the number of libel cases making their way through the courts. A report in October 2008 by Sweet & Maxwell found that in 2007-2008 61% of reported defamation cases in England and Wales resulted in a statement in open court (ie: the claim settled). The figure for the same period in 2006-2007 was 56%, and 2005-2006 it was just 21% of cases.

This trend has slowed the development of the law in the area of defamation. Fewer cases making it to trial mean that there have been fewer judgements on the principles of defamation law. This is harmful in an area of law that is traditionally judicially developed. In addition, old school judicial attitude to the internet pervades leading to many of the same problems as newspapers and magazines faced when mass publication and distribution first arose. As in an Australian High Court case, where it was considered that “the problem of widely disseminated communications is much older than the internet and the World Wide Web. The law has had to grapple with such cases ever since newspapers and magazines came to be distributed to large numbers of people over wide geographical areas”.

However, the internet poses a much bigger problem. The very nature of the world-wide web is that it is indeed, world wide. It is also instantaneous. Information can be published once in the UK and be accessed instantly from anywhere in the world. Anyone who participates in publishing a statement on the web is a ‘publisher’ for the purposes of defamation. This includes the ISPs, websites, individuals. So it is not just the person who wrote the statement and published it initially (the primary publisher), but everyone else who helped that statement to be shared and read (secondary publishers) that are liable. This brings ISPs and websites to the forefront of libel actions. In addition, the UK operates a “multiple publication” rule, whereby every time the statement is downloaded or accessed it constitutes a fresh publication. On the internet, it is hard to imagine how many publications of a statement could be possible if it catches the interest of people around the world. The judicial mind boggles at the thought.

THE GOOD

That is not to say that the law offers no defence to publishers on the internet. Defamation law itself is actually quite media friendly, offering several good defences which are often successfully used. It would also be unfair to say that the law has no grasp of the medium of internet.

The basic defences available to all the print media are also available to ISPs. In particular, the defence of innocent dissemination (under Section 1 Defamation Act (DA)) is useful for internet publishers.

Traditionally a defence of newsagents and libraries, innocent dissemination is now Section 1 DA and is intended to protect ISPs as well. The defence is essentially that if you did not author the work nor physically publish it yourself and did not know or could not reasonably have known that the material was defamatory then you will not be liable for it. It therefore protects websites that publish blogs for example, as they have no control over what is written. However, they will have a responsibility once they are put on notice of any libellous material as then they will have control over it. So there is a responsibility on the part of ISPs only once they are told, or come to believe, that material they are publishing could be libellous.

This rule has meant that now, when ISPs come to know of potentially libellous material on their websites, their first reaction is to take it down to prevent their liability commencing or being exacerbated. This has been criticised because it essentially means that websites will capitulate to almost any threat of libel without the merits of the complaint being examined, or the author’s view being taken. Even if what was said was true (so any libel claim could be defended with justification), the fear of expensive litigation is enough to warrant the post being removed. Many argue this flies in the face of free speech, as any publisher is effectively held to ransom by someone crying libel, irrespective of how good their case is.

In addition to section 1 of the DA, the E-commerce regulations are also in place to protect ISP’s, although it is doubtful how much this adds to the DA already in place. There is much overlap (in fact, they say almost exactly the same things). In Bunt v Tilly the judge hinted that where protection under s1 of the DA falls away when the publisher becomes aware of the libel, more detailed knowledge might be needed on the part of the ISP in order for it to be deprived of the protection of the e-commerce regulations. We must wait for a court to decide whether the directive brings any additional protection to ISPs.

Judicially as well, there have been some important developments on internet libel. Defamatory posts in chatrooms and bulletin boards, for example, are likely to be viewed by the courts as more akin to slander than libel. This is significant because slander is defamation in the form of spoken word rather than the more permanent libel. In slander the claimant will actually have to prove that they were damaged by the statements, whereas in libel damage is assumed.

In a recent case (Smith v ADVFN Plc and others [2008]) a high court judge threw out the claimant's case because he felt the claim to be without merit and with little chance of success. The claimant had complained of a series of postings by shareholders on ADVFN Plc’s online bulletin board. Smith was a director of the company, which had failed to make a profit and was not paying dividends to its shareholders. The bulletin board conversations revolved around abuse of Mr Smith in his position as a director.

The judge believed the statements not to be libellous for several reasons. Firstly he noted that comments of this kind were much more like a conversation than permanent printed media, and therefore more likely to be slander than libel. He also said that comments made on bulletin boards are not made in a vacuum. Most people reading the online conversations would know what the background was and be able to put it into context. He felt that the defendants would be able to avail themselves of several defences and would argue, rightly, that the comments were mere vulgar abuse, fair comment or both.

Where the authors held an interest in the subject matter, he felt that the defence of qualified privilege (see below) might apply. The judge noted that many of the posts were expressed in exaggerated terms, but he believed the authors were still expressing views honestly held. The case was held to have no merit and was thrown out, albeit with a judicial caveat that he "would not suggest for a moment that blogging cannot ever form the basis of a legitimate libel claim.” Still, it is good news for websites operating bulletin boards and forums for debate that what is written can be recognised as slander and the traditional defences used successfully as protection.

PRIVELEGING THE PUBLIC REALM

The Courts do recognise the need to preserve freedom of expression and privilege can attach to certain situations to allow for this.  Qualified Privilege is a defence which protects a defendant where the statements he makes were wrong but were fairly warranted by the occasion in which they were made. An occasion of qualified privilege exists where the maker of the statement has a duty (whether legal, social or moral) to make it, and the recipient has a corresponding interest in receiving it. The defence is defeated by evidence of any malice in the making of the statement, although for legal purposes 'malice' is where the person making the statement had no real belief in what he was saying, not that he wished ill towards anyone.

Obviously, whether the defence will succeed depends on what is being said and whether the court believes it is in the public interest to know about it. In the recent case of Mosley v News Group Newspapers Limited [2008] the idea of "public interest" was found not to extend to Max Mosley's private activities. Of course, the News of the World would disagree with that, citing their publication figures as proof that the public were very interested. But, as Lord Bingham succinctly put it in Jameel (Mohammed) v Wall Street Journal Sprl [2007] "...what engages the interest of the public may not be material which engages the public interest."

Another edge to this defence is the idea of responsible journalism, that it is also in the public interest to receive information that has been thoroughly researched and properly investigated to the best of the journalist's capabilities. If a journalist fails to properly research material which then turns out to be false, then it is his fault and it is not in the public interest to receive such information. If the journalist had very carefully researched both aspects of the argument, obtained quotes from both sides and still the material was false, it is much more likely to be considered to be in the public interest. It is perhaps here that the defence moves away from being available to websites running online forums because the very nature of that debate is that the views expressed are often very poorly researched, they are just one person's opinion - glibly given and quickly forgotten.

However, it is easy to see that it is still in the public interest to allow forums such as these to exist. The authors of these statements are not pretending to be journalists, and everyone reading the discussion will understand that the views being expressed are not representative, well-thought out or informed, but mere opinion, to which everyone is entitled. It is difficult to see how a court would not accept that websites such as openDemocracy were in the public interest. That may not be enough to defend a libel claim, but it would doubtless be taken into account and would probably affect any damages awarded.

WHAT IS DIFFERENT ELSEWHERE

Comparatively with other jurisdictions, England and Wales did not fare well in a recent Oxford University report called A Comparative Study of Costs in Defamation Proceedings Across Europe. The report was commissioned by the Daily Mail and found that CFAs are making defamation in England and Wales up to 140 times more costly than in the rest of Europe.

England and Wales was found to be three times more expensive than Ireland, which was the next most expensive jurisdiction. Ireland was still ten times more expensive than Italy, which came in third. England and Wales was also found to be the jurisdiction that awarded the most in damages in libel claims. The report noted that article 10 of the European Convention on Human Rights (freedom of speech) was potentially being infringed, as the media would obviously tend to self-censor in order to avoid potential court cases. The report said that the media “no longer had any economic incentive to defend [themselves] against defamation actions in court." It also noted that the high cost of defending a claim against a claimant on a CFA could be infringing the media’s right to a fair trial under Article 6. The report constitutes a fairly damning indictment of the system for defamation claims in England and Wales, particularly in comparison to our European neighbours.

Our libel laws seem particularly stringent on internet providers when compared to the US. The US apply a “single publication rule" in libel law, where only the first publication of the defamatory material will count. This essentially means that ISP’s are immune under statute from defamation actions resulting from the comments of third parties. So where a website picks up on a story elsewhere and re-publishes any defamatory material, they will not be liable. We must bear in mind however, that courts in the US are extremely reluctant to fetter free speech because of the First Amendment which enshrines freedom of speech as part of the US constitution. It is also worth noting that ISP’s immunity has meant that any responsibility on the part of ISPs to police the material they publish has been removed. This has been commented upon several times by the US courts and means it is very unlikely to ever be enacted in the UK. Indeed, our multiple publication rule has recently been upheld by the European Court of Human Rights in Times Newspapers Limited (Nos 1 and 2) v United Kingdom. The Times argued that the multiple publication rule was a disproportionate interference with their freedom of expression. The European court disagreed, saying that it served a legitimate aim and was necessary in a democratic society. The court noted that when exercising its freedom of expression, the media must act responsibly, particularly when the information imparted is likely to have a serious impact on the reputation and rights of private individuals.

NEEDED: PRINCIPLED DEEP-POCKETED LITIGANTS

So where does this leave libel on the internet? Should websites feel they have no choice but to remove potentially defamatory material from their web pages as soon as they become aware of it - or is this just the latest infringement on freedom of speech?

There are arguments that if the website feels what has been said can be defended it should be left online. But that involves a gutsy editor with the financial backing to go to court and not win anything other than the right to publish the material. That should be enough, but often it is not when the website has expended many thousands of pounds defending the action, which it then cannot claim back from the claimant because he had no money to start with.

Perhaps a good middle ground would be if the Section 1 defence under the DA (innocent dissemination as discussed above) was amended. It has been argued that the Act could provide immunity when an ISP has investigated a complaint and reasonably concluded that there is a valid defence to defamation proceedings. If the DA was amended in this way, it would give ISPs more scope to deal with each complaint independently, although it would likely still mean that the post or statement complained of would have to be taken down while the ISP was investigating it.

The government has also recently launched a consultation paper to look into capping CFA fees to rebalance the financial burden on defendants. In addition there has been talk of an industry code for internet publishers giving guidance and best practice to ISPs and websites confronted with libel complaints.

But for now the reaction to libel remains: take it down, take it down quickly, take it down again. And libel tourism means that this habit is likely to spread.