Exemplary damages clause of Crime and Courts Act comes into force: What this means for publishers

Yesterday may be an important date for press regulation. Or it may be of no significance whatsoever. 

It was the date when the exemplary damages sections of the Crime and Courts Act 2013 came into force. These provisions apply to the claims which most commonly affect the press such as libel, breach of confidence and privacy as well as harassment claims. They allow higher damages to be awarded against defendants who have shown “a deliberate or reckless disregard of an outrageous nature” for a claimant’s rights.

There is still much uncertainty, however, as to who (if anyone) is going to be affected by these provisions. First, it is unclear which publishers are “relevant publishers” who can be penalised. There is little doubt that newspapers, current affairs and celebrity magazines (both print and digital) fall within the Act and that broadcasters and book publishers do not. What is less clear is whether publications like special interest magazines with significant news content or larger websites with some news content are vulnerable.

The Act (passed at a time where it was unclear what the press regulation landscape was going to look like in 2015 and before the establishment of IPSO) draws a distinction between two categories of publishers – those who are members of a Royal Charter approved regulator and those who are not. When the courts decide whether to award exemplary damages against a publisher they have to consider (a) whether membership of a Royal Charter approved regulator was available at the material time; (b) if such membership was available, the reasons for the defendant not being a member; and (c) where relevant, whether the publisher had satisfactory internal compliance procedures in place and, if so, the extent to which they were adhered to.

It is no surprise that IPSO has confirmed that it will not apply to become an approved regulator. On the other hand, Impress, the regulator backed by Sir Harold Evans, J.K. Rowling and others has said that it will apply. The question is, what will become of these provisions if Impress is not approved as a regulator? Or indeed if it is but has only a small number of publishers on board, or none at all (Impress is yet to announce details of its members)?

Will the courts penalise publishers if there is no approved regulator, or if an approved regulator exists but has few, if any members? And would membership of IPSO be a good reason for not being a member of the approved regulator?

John Whittingdale has recently expressed doubt as to whether now is the right time to introduce the punitive costs provisions of the Act because of the effect that it may have on smaller publishers (the exemplary damages provisions come into force automatically).

Will the courts be similarly doubtful about imposing exemplary damages now?

Although it is not yet known whether the exemplary damages provisions will have any teeth, two things are clear.

The first is that publishers without an internal compliance procedure should make sure they have one now (it may just save them later) and the second is that if a claim for exemplary damages is made against any of the major players, we can expect a lengthy legal battle.

Carolyn Pepper is a partner at Reed Smith

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