Phone hacking: massive privacy damages

22 May 2015 by David Hart KC

Gulati v. MGN Ltd [2015] EWHC 1482 (Ch), Mann J – judgment here

For some years in the early and mid 2000s, a routine form of news-gathering in the Mirror Group was phone hacking – listening to voicemails left for celebrities by their friends, and then dishing up revelations in their papers.  And this judgment amounts to a comprehensive pay-back time for the years of distress and upset sustained by those celebrities, as the ins and outs of their private lives were played out for the Mirror Group’s profit. The damages awarded well exceeded those previously payable, as justified in the tour de force of a judgment by Mann J. 

Warning – the judgment, compelling though it is, runs to 712 paragraphs. It concerns the assessment of damages in eight cases. The Mirror Group belatedly admitted liability and apologised, not before denying any wrongdoing to the Leveson inquiry. Other claims rest in the wings pending this trial. But with awards between £72,500 and £260,250, the bar has been set high by Mann J.

The claimants (with one exception) were the classic subjects of tabloid columns, namely EastEnders and Corrie stars (or those unfortunate to be married to them), the sometime air hostess girlfriend of Rio Ferdinand, Jude Law’s former wife, Sadie Frost, and, inevitably, Gazza. Seven sued because the hacking led to repeated articles about them. The eighth, Alan Yentob, Creative Director of the BBC, was hacked because of the information derived from the famous people who had left voicemails for him.

Before this case, there had not been many awards for breach of privacy. They are all reviewed in the judgment. Naomi Campbell got £4,000 for being photographed after drug therapy sessions (coupled with the publication of her drug regimen). The Douglas/Zeta-Joneses got £3,750 for their wedding photographs being all over the unauthorised Hello! Strasbourg gave someone 6,500 euros for their HIV status being revealed. Max Mosley received £60,000 for having his life “ruined” by exposes at a sex party.

But these tended to be one-off episodes, unlike, as we shall see, the sustained abuse of private information in these cases.

A few points of general interest arose.

The Mirror argued that the only determining factor in awards for damages should be the extent of the distress caused by the invasion of privacy. Mann J roundly disagreed. Awards ought to reflect infringement of the rights themselves. They should reflect the right of an individual to control information about his or her private life.

the defendant will have helped itself, over an extended period of time, to large amounts of personal and private information and treated it as its own to deal with as it thought fit.  There is an infringment of a right which is sustained and serious.  While it is not measurable in money terms, that is not necessarily a bar to compensation  (distress is not measurable in that way either).  Damages awarded to reflect the infringement are not vindicatory….  They are truly compensatory.

He thus distinguished the case from cases such as Lumba, in which the Supreme Court rejected the idea of vindicatory damages designed to reflect the special nature of the right infringed.

This conclusion plainly made a significant difference to the amount of the awards. The judge was plainly  swayed by the degree of infringement. For example, Alan Yentob had been hacked at least twice a day for a substantial part of seven years, and Sadie Frost was hacked regularly for over four years.

The judge also reached the decision that a separate award should be made in respect of each article published on the back of hacked material. Hence, Sadie Frost’s award of £260,250 was in respect of some 31 articles, in one case, receiving £25,000 for an article suggesting that Jude Law’s friendship with Nicole Kidman had led to her depression and self-harm.

The personal information revealed is predictable tabloid material, but nonetheless very affecting when you read it from the point of view of the poor victim. Alcoholism, drugs, rehab, messy divorces and attempts at reconciliation, all served up in such a way that the subject could not work out how on earth this private information came out. Predictably, it led to some claimants becoming distrustful if not paranoid about their friends, as to whether they were leaking information to the press. In some cases, it went the other way round: friends started to distrust specific claimants because of the regularity with which the claimants’ private life ended up in the papers.

Another legal principle relied upon by the judge founded on the famous case of Armory v. Delamirie (1722) 1 Strange 505. A chimney sweep found a jewel and took it to a jeweller. The jeweller’s offer was derisory. The sweep asked for the jewel back, and the jeweller refused. How much should be awarded in compensation? The sweep did not know – the jewel had gone. The judge said that the jury should

presume the strongest case against the defendant and make the value of the best jewels the measure of their damages

This principle cut in because of the Mirror Group’s determination to hide the evidence of hacking. Like a spy or terrorist, its hackers bought pay as you go phones, used them for a couple of months, then snapped the SIM card and threw the phone into the Thames at Canary Wharf. In the hackers’ jargon, these were “burners”. The most potent evidence of how to hack came from Dan Evans, an ex-employee, who dished the dirt comprehensively on his former employers.

So the claimants argued that the court should assume the strongest case against the Mirror papers as to the level of hacking, and hence its relationship to the various articles relied upon. The judge accepted the applicability of the principle, though he seems have had good evidence of the scale of hacking anyway. Evans would check the voicemail of his main victims once or twice daily. Mirror phone records showed some 12,000 calls to the Orange platform, used for getting into voicemails. The rate of those calls suddenly dropped when a News of the World hacker and journalist were arrested in 2006. Bit of a giveaway, that. According to Evans, there was widespread use of private investigators to “blag” out data, but no surviving records of what those investigators did for their considerable payments.

The final point of wider interest is the judge’s refusal to be guided by the fairly modest awards made to the victims of workplace harassment. This was perhaps the Mirror Group’s best point. In Vento, an employee had been harassed and been caused clinical depression. An award of £74,000 was set aside, and a top band of £15,000 to £25,000 established. The parallels are fairly obvious. The wrongful activity is often sustained and damaging. And it is very difficult to conceive of a harassment award in six figures, as six of the present awards were.

Conclusion

In awarding damages, courts have always been torn between the purely compensatory and the impulse to punish the wrong-doer. One way of doing the latter is to strip its profits. But that is almost impossible to prove when you are relying on a limited number of specific articles in a regularly published paper. Hence, the judge’s decision to go for compensation for the infringement of the wrongs, plus damage for distress, thus steering clear of the learning, such as Lumba, which stops awards for purely punitive or vindicatory damages.

The awards may be controversial. They may seem large compared with comparable awards for pain and suffering in personal injury cases. But I do not have any hesitation in supporting the judge’s conclusions. If anyone disagrees, read the last 400 paragraphs of the judgment as to what these individual people went through, and then say your piece.

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