The claimants in a defamation case needing to demonstrate "serious harm" have decided to withdraw from a planned appeal.
Ruth Cooke and Midland Heart had their case against the Sunday Mirror thrown out of court in August by Mr Justice Bean.
They sued Mirror Group Newspapers over a story headlined "Millionaire Tory crashes in on TV Benefits Street". It featured James Turner Street, of Channel 4's Benefits Street series, but also mentioned housing association Midland Heart and owner and chief executive Cooke.
The story focused on Paul Nischal, describing him as "Mr Goldfinger" and saying he was "raking it in" from renting properties in James Turner Street, Birmingham.
Cooke and Midland Heart were mentioned in one short paragraph of the story, which reported that the housing association owned three houses in the street and that Cooke earned £179,000 a year and lived in a large house in Gloucestershire.
But the judge threw out the case after the Mirror showed it had published an apology the following week, removed the story from its website and published a prominent apology online.
Mr Justice Bean said that many readers would have read the original article and the apology. That just left a small group who read the original article in isolation.
The case was to have gone to the Court of Appeal after the judge gave permission for an appeal at a hearing on 26 September.
But it has now emerged that Cooke and Midland Heart have decided against proceeding with the case.
It is believed that the factors which led to their decision to withdraw included the fact they would face a large costs bill if the appeal failed.
Mr Justice Bean awarded Cooke and Midland Heart their costs up to and including the publication of an apology by the defendants. But he awarded the defendants their costs from that point onwards.
It is thought that Cooke and Midland Heart already faced a bill for tens of thousands of pounds in costs for the defendants following the hearings on the serious harm issue and the application for permission to appeal.
Cooke said: "Whilst disappointed by the outcome of this case, we have accepted the ruling and decided not to appeal.
"Our decision to bring action wasn't taken lightly and was intended to underline our absolute commitment to the well-being of our customers and safeguard our reputation as a provider of quality homes."
The judge gave permission to appeal because the case was the first on the proper interpretation of section 1 of the Defamation Act 2013, which introduced the serious harm test into defamation cases.
Mr Justice Bean had held that it was necessary for claimants in defamation cases to produce evidence to demonstrate actual or likely serious harm to their reputations – although he said that in some cases, such as those involving false allegations of terrorism or paedophilia, the statements were so obviously likely seriously to harm to a person's reputation that that likelihood could be inferred.
In addition, the defendants had apologised in the following week's newspaper, and swiftly removed the offending words from the online version of the story as well as taking steps to ensure that it was removed from other internet postings – a finding which observers saw as undermining the potential strength of an appeal.
At the hearing on the appeal, the judge was told by Adrienne Page QC, for the claimants, that his original judgment, if correct, demonstrated the potentially far-reaching consequences of section 1, which included overturning centuries-old common law principles.
The website of Page's chambers, 5RB, reported that she had argued that at common law, in order to be actionable as defamatory, the words must be likely to cause harm, although modest harm would suffice.
In section 1, she argued, Parliament had qualified the common law only to the extent only that, in order to be actionable, the words must be likely to cause serious harm – but there was no necessity or warrant to read into section 1(1) any greater interference in the common law than this simple adjustment.
In addition, deciding whether a statement was defamatory remained an objective exercise on which no evidence of harm was required because of the presumption of harm which the Court of Appeal had held, in Jameel v Dow Jones, was compatible with Article 10 of the European Convention on Huamn Rights and which Parliament had not abolished.