The activities of investigative journalists can lead them into a legal minefield. This is especially the case where the investigation involves infiltrating a commercial organisation whose staff are bound by contracts of employment, and which may have a right to keep its commercial information confidential.

On 23 February 2012 Hildyard J in the Chancery Division handed down a judgment ([2012] EWHC 433 (Ch)), on an attempt to restrain a documentary to be broadcast that night, which should help in picking a path through the dangers.

Background

The Applicant is one of the dominant forces in UK’s increasingly lucrative market for concert tickets. It describes itself as a “secondary ticketing company”, i.e. it allows fans to resell tickets to each other in a secure environment. But in February, Channel 4’s Dispatches strand broadcast a documentary which featured the company called “The Great Ticket Scandal”.

This claimed that the majority of tickets sold by the Applicant were in fact not from fans, but had been allocated to the site by professional resellers or promoters themselves, making it a primary seller instead. It also highlighted the practice of using employees to bulk buy tickets on company credit cards, which were then resold on the site at a premium.

The Applicant was informed about the documentary by a letter from the MD of its production company Hardcash Productions Limited, dated 7 February 2012. It told them that the first Respondent Mr Paul Myles, who had worked for them over the Christmas period, was also an employee of Hardcash, the second Respondent, who had been investigating their business practices for a programme for broadcast on C4, the third Respondent. The letter referred to the fact that covert filming had been sanctioned by C4, and carried out within the conditions of the Ofcom code, and to the evidence of primary selling and bulk buying.

The Applicants responded via two letters sent by their solicitors, the second of which referred to “claims against you inter alia in breach of confidence”. The letter anticipated and attempted to undermine a potential public interest defence by the Respondents. It emphasised that the Respondents’ Article 10 rights were qualified in relation to the leaking of confidential information in breach of fiduciary duty. It also referred to the negative reactions of Viagogo’s business partners to the disclosure of commercially sensitive information.

On Tuesday 21 February, the Applicant sought an injunction on short informal notice from Floyd J to prevent the broadcast of the programme. He adjourned to allow the Respondents to file evidence and brief counsel, and the application came back to court two days later, on the day of the programme’s broadcast. In line with the correspondence, the focus of the application was not to restrain the documentary, but to ensure that it did not contain confidential information.

Judgment

Hildyard J referred to the provisions of section 12 of the HRA 1998, that no relief should be granted to restrain publication

“unless the court is satisfied that the applicant is likely to establish that publication should not be allowed.”

He emphasised the difference between this test and the usual American Cyanamid approach and highlighted the effect of Cream Holdings Ltd. v. Banerjee [2004] UKHL 44, in which the House of Lords held that the effect of section 12 is that the courts will be slow to make a restraint order where the applicant has not satisfied the court “he will probably (‘more likely than not’) succeed at the trial”. Similarly established English and European authority was also cited in relation to the cautious approach that should be exercised by the courts in relation to prior restraints on the media.

The competing rights and interests here were not between Article 10 and Article 8, but between Article 10 and the Applicant’s right to protect confidential information. To succeed in protecting this right, it had first to establish what is confidential and why, and then show that there is no reason to deny or strip away the confidentiality the information would otherwise attract. It then had to show that the private right of confidence (which there is a public interest in upholding) outweighed any public interest in disclosure.

During the course of the hearing, it became clear that the interest in preventing a breach of confidentiality of its arrangements with third parties was really that of these promoters or ticket allocators, meaning that the Applicant’s claim in this respect was a derivative one. The Judge found that there was no evidence of any expectation of confidentiality, or objection to its breach on their behalf, and that they did not regard their arrangements with the Applicant as secret. It also appeared that the Applicant’s own employees considered primary ticket sales and bulk buying to be unethical. ‘

It was the Applicant’s own commercial interests that were at stake in the details of the terms of its business with contractual partners. Hildyard J turned to the express contractual restraint that the First Respondent was under, not to use information for his own purposes or disclose it to any third party. The public interest in the maintenance of confidences meant that the court had to ask itself whether it was in the public interest that the duty should be breached, bearing in mind that the express assumption of a duty may mean that it carries more weight.

In relation to the dealings with third parties, the Judge held that it was not clear that “the necessary quality of confidence” would be established at trial. In relation to the Applicant’s own business, there may have been a stronger case. It was this latter category for which he had to conduct a balancing exercise to determine whether there was a public interest in disclosure outweighing the private right to confidentiality – “the principle issue in the application”.

On this point the Judge found that Claimant had not demonstrated that it would be likely to obtain a permanent injunction at trial; the public interest in disclosure outweighed the private right. He found real substance in the Respondents’ point that the Applicant was concealing its website’s primary ticketing function from the public. He focused on the fact that the Claimant had previously made statements about the true nature of its business “which appear to be misleading and inaccurate”. A number of authorities were cited on the fact that a legitimate function of the media is “to put the record straight”.  This public interest is also one recognised by the PCC and Ofcom.

Three further factors were also taken into consideration: first, that the court should grant latitude to journalists’ editorial decisions, giving

“deference to the considered view of an editor or journalist that without the relevant detail the general impact and the overall credibility of the article or programme in question will be seriously undermined”

Not to grant this latitude would have a chilling effect on freedom of expression, a point on which the House of Lords was unanimous in Campbell v MGN. The Judge also referred to a dictum of the ECHR in this year’s case of Von Hannover v Germany (No. 2):

“It is not for the court, any more than it is for the national court, to substitute its own views for those of the press as to what techniques of reporting should be adopted in a particular case”

Second, the Judge said that he appreciated the public interest “in discouraging covert activities and especially the unlawful garnering of evidence”. However, on this, he felt he could not gainsay the scrupulous attention paid by the Respondents to C4’s internal guidelines and Ofcom’s own guidance.

Third, he considered the practicality of intervening on the very day of broadcast. Given that the confidential material which the Applicant wanted to delete was interwoven throughout the programme, its removal would have meant delaying the broadcast. On the question of why the Judge had to make a call on the day of broadcast, he found that it was the Applicant itself which was to blame.

At the conclusion of his judgment, Hildyard J turned to

“a concern that the real purpose of the claimant’s application in this case is really to protect its reputation rather than any confidential information”

Where it seemed that the Applicant was trying to protect its reputation by preventing a broadcast on a matter of public interest, it is right for the court to ask “what really is the gist and purpose of the application”. He referred to Mann J’s judgment in Tillery Valley Foods v. Channel 4 Television ([2004] EWHC 1075), where he noted that the case was not about confidentiality, but about getting around the rule in Bonnard v Perryman.  Given the lack of evidence from the third party promoters from whose rights the application was said to largely derive, the Judge had to ask whether the case was really about business reputation rather than confidential information.

Comment

It is this last aspect of the Judge’s decision which stands out, and seems to underlie the judgment as a whole. The rule in Bonnard v Perryman creates a strong presumption against the granting of an interim injunction to restrain an alleged libel where the defendant intends to plead justification. Given the awareness of those engaged in this kind of investigative journalism, and of its subjects, that there would be huge pressure at every stage to stand up the story properly, it is obvious why efforts to prevent the broadcast through an application based in defamation would have cut no ice.

From the word go, the Applicant disavowed any such cause of action. But, in light of Bonnard, it is now well established that, where a claimant attempts to protect his reputation by means of an injunction by bringing his claim other than in defamation, the court will look closely at the substance rather than the form of the application. This scrutiny of the real nature of the application weighed heavily against the Applicant here, and the decision affirms the position set out by Tugendhat J in Terry v. Persons Unknown ([2010] EMLR 16), that the rule will apply where the nub of the application “is a desire to protect what is in substance reputation”.

Several points of interest arise from the judgment in relation to the type of investigative journalism which produced the programme. First, there is the reluctance of the court to interfere in editorial decisions, such as whether certain information should be included in a piece of work. This was explained by Lord Hope in Campbell v MGN, where the House of Lords was unanimous on the principle of journalists being free to make choices about presentation and matters of detail without judges peering over their shoulders. His reference to Jersild v. Denmark (1994) 19 EHRR 1 bolstered this idea about the reach of Article 10. The reiteration of the principle in Von Hannover (No 2), and discussion of its relevance to this case, further emphasises the idea of editorial independence.

Second is the point relating to the covert acquisition of evidence. The Judge referred to the public interest in discouraging “covert activities and especially the unlawful gathering of evidence”. To prove both the public interest in such activities, and their proper monitoring, the court will take into account compliance with Ofcom’s guidelines and other codes – these should be scrupulously followed. It may also, as here, look at whether the subject of the investigation is themselves “shady”, something which presumably goes to the public interest justification.

Third is the fact that in acquiring such evidence the journalist may find themselves bound by express contractual duties of confidentiality. In Campbell v. Frisbee [2003] ICR 141, the Court of Appeal held that “putting the record straight” could override this kind of obligation, and this line of authority, which has largely grown up in relation to individuals, clearly applies to companies as well. Journalists can enter into agreements which they fully intend to repudiate further down the line.

Although there isn’t yet the robust public interest defence for investigative journalists to protect themselves from criminal prosecution argued for recently on this blog, this decision shows how the law does afford latitude to their activities in other ways.

Gervase de Wilde is a former journalist at the Daily Telegraph and a student barrister.