Bloomberg LP v ZXC – A new affront to press freedom?

February 23, 2022

Last week, the Supreme Court handed down judgment in the case of Bloomberg LP v ZXC [2022] UKSC 5.

Facts

The background to the appeal, as per the Supreme Court website, is as follows:

“The Respondent ("ZXC") is a US citizen who worked for a company which operated overseas. He and his employer were the subject of a criminal investigation by a UK Legal Enforcement Body (the "UKLEB"). During that investigation, the UKLEB sent a confidential Letter of Request (the "Letter") to the authorities of a foreign state seeking, among other things, information and documents relating to ZXC. The Letter expressly requested that its existence and contents remain confidential.
The Appellant ("Bloomberg"), a well-known media company, obtained a copy of the Letter, on the basis of which it published an article reporting that information had been requested in respect of ZXC and detailing the matters in respect of which he was being investigated. After Bloomberg refused to remove the article from its website, and following an unsuccessful application for an interim injunction, ZXC brought a successful claim against Bloomberg for misuse of private information.
ZXC claimed that he had a reasonable expectation of privacy in relation to: (1) the fact that the UKLEB had requested information relating to him in the context of its investigations; and (2) the details of the matters that the UKLEB was investigating in relation to him. The first instance judge held that Bloomberg had published private information that was in principle protected by article 8 of the European Convention on Human Rights (the "ECHR"); and that in balancing ZXC’s rights against those of Bloomberg under article 10 ECHR, the balance favoured ZXC. Bloomberg’s appeal against that judgment was dismissed by the Court of Appeal. Bloomberg now appeals to the Supreme Court.”

Judgment

The Supreme Court unanimously rejected Bloomberg’s appeal, making clear that an individual under criminal investigation has, prior to being charged, a reasonable expectation of privacy in respect of the relevant information subject to the particular circumstances of the case.

In reaching this decision, the Supreme Court followed a long line of authority in first assessing whether the individual had a reasonable expectation of privacy in respect of the relevant information and, if so, going on to carry out a general balancing exercise in respect of the individual’s Article 8 ECHR right to privacy against the publisher’s Article 10 ECHR right to freedom of expression.

In conducting the stage one analysis and deciding that the ZXC did have a reasonable expectation of privacy in respect of the fact he was under investigation by the UKLEB, the Supreme Court rejected all of Bloomberg’s arguments, namely:

  • The public was able to understand that there was a presumption of innocence such that there was unlikely to be any reputational damage to the individual’s reputation;
  • The lower courts reliance on the “human characteristic” to equate suspicion with guilt, i.e. “no smoke without fire” ran contrary to well-established principles of defamation;
  • The information should not be protected because it is reputationally damaging but rather only in circumstances where it relates to the individual’s private life which is of no-one else’s concern, not his business activities as in this case; and
  • The lower courts had failed to apply the appropriate tests in conducting the stage one analysis.

On the face of it, the judgment is unremarkable being instead simply a further re-stating of principles now well known to privacy lawyers.

Bloomberg Opinion

Following the handing down of the judgment, John Micklethwait, editor-in-chief of Bloomberg news, published an opinion piece criticising the judgment and claiming “Powerful people under investigation for criminal activity have just been given a path to keep their names out of print.”

A number of elements of the Micklethwait article, set out below, deserve further scrutiny.

“In Britain, we are stumbling toward a system in which tabloids can still peek into celebrities' bedrooms but serious journalists cannot report on potential wrongdoing at public companies by powerful people.”

Micklethwait is wrong to suggest that tabloids can still peek into celebrities’ bedrooms. They do, but that is not to say that it is lawful for them to do so. The same principles of privacy law apply equally to celebrity tittle tattle as they do to the investigative journalism Micklethwait seeks to defend.

Further, there is nothing to prevent reporting of potential wrongdoing by “powerful people”. There is already express legislation by way of s.4 Defamation Act 2013 and provision for consideration of the genuine public interest of reporting in the second stage of the balancing exercise when considering privacy claims.

All that this case confirms is the fact that someone under criminal investigation has a reasonable expectation of privacy in respect of that information – stage one. It is up to the Court then to decide whether the publisher’s freedom of expression outweighs the complainant’s right to privacy at stage two. In conducting this balancing exercise “the extent to which publication is in the public interest is of central importance”.

In this case, the first instance Judge found that there was not sufficient public interest in the publication of the article to outweigh the ZXC’s Article 8 right to privacy.

“It gets worse. If you can’t report about potential wrongdoing before any charge is brought, then, once somebody has been charged (and ZXC has not), all the proceedings become sub judice with potential reporting restrictions added.”

The Supreme Court was again clear that this issue would need to be considered in light of the facts of each individual case. In this case, given the senior position held by ZXC the Supreme Court agreed the reporting of a criminal investigation into ZXC would likely cause reputational damage.

Regardless, by acknowledging that it would be wrong to report on individuals who have been charged with criminal offences in order not to prejudice on-going criminal proceedings, Micklethwait undermines his own arguments in respect of those simply under investigation.

As was made clear by a number of senior Judges in a paper dated 4 March 2013 issued by Treacy LJ and Tugendhat J entitled ‘Contempt of Court, A Judicial Response to Law Commission Consultation Paper No 209’:

“The police arrest many people who are never charged. If there were a policy that the police should consistently publish the fact that a person has been arrested, in many cases that information would attract substantial publicity, causing irremediable damage to the person’s reputation.”
“The courts have now presented the powerful with a path to keep their names out of print for years. And it really is only for them. The compensation in this case was 25,000 pounds (which we have paid), but that is a fraction of the legal costs. This right to privacy is only for those who can afford it; strangely enough, these often tend to be those who have the most to hide.”

Part wrong, part right.

Firstly, in developing the law of privacy the courts are only implementing legislation enacted by Parliament. Secondly, the original Bloomberg article was published on the internet and available for nearly two years. Search hard enough and you can find copies of the article and the name of ZXC. The issue with privacy is that once the private information is in the public domain it can never truly be unknown/erased.

The second and third sentences above are true. Compensation for privacy claims is generally low and a fraction of the legal costs. However, more often than not this plays to the advantage of media organisations whose financial resources nearly always outweigh those of their opponent.

Taking a case such as this to trial at first instance alone is likely to cost many hundreds of thousands of pounds, something the ordinary member of the public simply cannot afford. The fact it is more often than not the rich and/or powerful who bring the leading cases in this area of the law is simply down to the fact they can afford to do so. This is especially so since the abolition of conditional fee agreements for cases of this nature in 2019.

“Imagine the long list of British corporate scandals, from Polly Peck to Arcadia to Libor, that would have gone unreported, or only been summed up at the end.”

All of these scandals have been reported in full and rightly so. If they happened now, it is difficult to see how such reporting would not be in the public interest or prevented by applying the current legal principles.

“But that was before the hacking of Milly Dowler’s phone, the monstrous Cliff Richard intrusion (which is cited in the judgment) and other tabloidish excesses.”

The British media sadly has a long history of abusing its power. The Leveson Inquiry into the culture, practices and ethics of the press laid this bare for all to see.

Despite this, the media has continued to lobby successive Governments not to implement any independent regulation as to the way in which they operate.

Until they agree to do so, media organisations can continue to expect Judges to interpret legislation implemented by Parliament in line with now well established precedent, whether they like it or not.