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The House of Lords has decided that success fees payable by unsuccessful media defendants are not an unwarranted restriction of the freedom of expression provided by Article 10 of the European Convention on Human Rights.
The media must now fear even more the risks involved in publishing revelatory articles.
Naomi Campbell entered into a conditional fee agreement (CFA) which included an uplift as a success fee for the litigation in the House of Lords, which the Lords held was not incompatible with Mirror Group Newspapers' (MGN) Article 10 rights, even though Campbell could apparently have afforded to fund the litigation without such an agreement.
This is good news for claimants, many of whom will be wealthy individuals.
The nature of celebrity means that the people who attract the most column inches are likely to be rich enough to fund litigation to protect their reputations or privacy. So should the risk of having to pay enormous costs if their claims fail be the price to pay for fame? The answer to that is no, according to Parliament and the Law Lords.
The news is not so good for the media. Despite being in line with legislation, the decision highlights the huge risks involved in exercising Article 10 rights to free speech. A publisher may believe that a story should be run but be unable to take the risks.
The House of Lords' decision has shown that the publisher could be liable for costs up to twice those incurred if a CFA had not been entered into by the claimant. Lord Hoffmann noted that in some cases this could have a "blackmailing effect" on the media.
MGN argued that having to pay a success fee restricted its Article 10 right to freedom of expression (a success fee could also infringe Article 6, the right to a fair trial). It was up to the House of Lords to balance the rights. The claimant had an Article 6 right of access to justice and an Article 8 right to privacy.
MGN argued that Campbell did not need a CFA and so the balance should clearly be in favour of its freedom of expression. The House of Lords recognised that legal aid was not available and that CFAs were the only way for some claimants to fund litigation. It had been open to the legislature to decide how to fund access to justice, and the result had been the CFA. As there was nothing in the legislation requiring Campbell to be means tested, whether or not the claimant could have afforded to fund the litigation herself was held to be irrelevant.
This will strike many as a rather technical approach.
Lord Hoffmann quoted with approval Mr Justice Eady's observation in Turcu (2005) about a "significant temptation for media defendants to pay up something to be rid of litigation for purely commercial reasons and without regard to the true merits of any pleaded defence".
The Lords declined to declare the legislation incompatible with Article 10. It is clear, then, that there is a risk that success fees will restrict the press's freedom of expression. Instead, the Lords left it to Parliament to consider changes to the status quo.
There was some recognition that the situation is unsatisfactory, but the press will have to wait nervously to find out how, when, and indeed whether, change will happen.
Michael Skrein was assisted in this article by Richards Butler assistant Thomas Webley