Twenty two media groups have joined forces to lobby the Government for a cap on the exponential costs in libel cases.
The body, including organisations such as Associated Newspapers and the BBC, submitted recommendations to the Ministry of Justice (MoJ) in response to the Government’s consultation on conditional fee arrangements (CFAs) in publication proceedings.
Reynolds Porter Chamberlain media partner Jaron Lewis, the author of the media joint submission, claims the current CFAs for defamation cases are out of control.
“With law firms seeking up to 100 per cent success fees and defendants having to pay claimants after-the-event (ATE) insurance at a rate of around £65,000 for £100,000 indemnity, the costs for media organisations are extortionate,” said Lewis.
Lewis, who was previously a BBC in-house lawyer, gave the example of Naomi Campbell’s claim against Mirror Group Newspapers, which saw the supermodel awarded £3,500 in damages, while the costs sought for the two-day hearing in the Lords were £594,470.
“These costs are simply not proportionate to the damages at all and it’s curtailing the media’s freedom of speech,” said Lewis. “If the thousand or so regional and local newspapers and broadcasters had to defend such a claim it would simply put them out of business.”
The joint submission, seen by The Lawyer, includes a proposal that there should be no success fee in defamation cases where a settlement has been accepted.
In addition, it proposes that ATE insurance should have premiums restricted and not be taken out without giving the defendant notice and the opportunity to agree the terms.
The submissions window for the MoJ consultation has closed, with the Government now set to consider the proposals made.