January 11, 2017

The government yesterday concluded its consultation on the implementation of section 40 of the Courts and Crimes Act 2013 and Part 2 of the Leveson Inquiry. As a law firm acting exclusively for media, technology and IP-owning companies, we welcomed this consultation and were keen to provide evidence in support of maintaining a free and vibrant press. Read our full submission here.

Background

Section 40 of the Crime and Courts Act 2013 provides that in the event a ‘relevant publisher’ (i.e., a provider of general news in print) is sued, and that publisher has chosen not to register with an ‘approved regulator’, that publisher will be required to pay a Claimant’s costs even if the publisher wins in court. An ‘approved regulator’ is one recognized by the Press Recognition Panel (PRP), set up by the government under Royal Charter in 2013.

In October 2016, IMPRESS became the first regulator to be recognized by the PRP, potentially triggering s40. The majority of the national and regional press have declined to join IMPRESS and instead joined the self-regulation Independent Press Standards Organisation (Ipso). Ipso has not applied to be recognised by PRP. Like IMPRESS, Ipso offers arbitration as an alternative means for a claimant to settle a dispute with a publisher. Unlike IMPRESS, Ipso’s fee structure is realistic and balanced, and is not compulsory for the publishers.

In November 2016, the government opened its consultation seeking submissions regarding the efficacy and potential consequences of triggering section 40 and Part 2 of the Leveson Inquiry.

Summary

We believe that if the government commences s.40 there will be a very considerable increase in the number of cases brought. The legal costs associated with ‘relevant claims’, already out of proportion to the likely damages awards, will rise considerably since there will be no ‘brake’ on claimants. S40 appears to be a blatant attempt to punish large circulation print publishers, rather than any considered measure designed to enable individuals to obtain cost effective redress in relation to ‘relevant claims’ in the situations where they most often rise.  We believe that commencement of s.40 is illogical, unjust and damaging to the public interest.