Libel Tourism – the law as a whore

A few weeks later, I received a ‘pre-action letter’ from Boies Schiller Flexner, a law firm in New York whose clients have included Al Gore and Harvey Weinstein. The letter stated that openDemocracy, of which I am the editor-in-chief, had defamed a UK-registered shell company called Jusan Technologies. Four months earlier, we had reported that Jusan held billions of dollars in assets that were ultimately controlled by the Nazarbayev Fund, whose chairman is the former leader of Kazakhstan, Nursultan Nazarbayev. The letter claimed that our reporting had caused significant financial loss to Jusan in the UK. At the time of our story, it is believed Jusan had at most a single employee, no website and no address.

 

The following month another letter arrived from Boies Schiller Flexner. The allegations were almost identical, but this time the claimant was the Nazarbayev Fund. A spokesperson for Jusan and the fund told the Guardian that their ‘sole mission is to support public education in Kazakhstan’. The following month it was revealed that a Nazarbayev foundation had spent at least $5 million on a documentary about Nazarbayev produced by Oliver Stone.

After a summer of lengthy – and very expensive – legal letters back and forth, Jusan and the Nazarbayev Fund sued openDemocracy, as well as the Bureau of Investigative Journalism and the Telegraph, which had reported similar allegations. All had drawn heavily on reporting by the Organised Crime and Corruption Reporting Project, a network of investigative journalists, which was threatened with proceedings in the US. The Nazarbayev Fund has since withdrawn, but Jusan has served proceedings. The case has been classified as a Slapp by the group Coalition against Slapps in Europe. No judge has heard a single word about the claim, but it has already cost openDemocracy tens of thousands of pounds. The stories that have gone unwritten while fighting the case are harder to quantify.

The UK is ‘by far the most frequent international country of origin’ for Slapps, according to a report published in 2020 by the Foreign Policy Centre. In his recent polemic, Lawfare (Harper, £10.99), the human rights lawyer Geoffrey Robertson identifies three reasons why autocrats, kleptocrats and multinationals are so fond of London’s libel courts.

First, English media law is claimant friendly. Second, British courts – much like British company registrations – have a veneer of probity and respectability (there’s also a good chance the case will be reported in the SEO-friendly British media). Third, the powerful often sue in England to intimidate their critics, especially anti-corruption activists, many of whom are based in London.

Libel tourism isn’t new. In December 1996, Forbes described Boris Berezovsky and Nikolai Glushkov as ‘criminals on an outrageous scale’ in a story about Kremlin corruption under Boris Yeltsin. Only 1915 copies of Forbes were distributed in the UK that week – compared with more than 750,000 in the US – but the House of Lords gave Berezovsky and Glushkov permission to sue Forbes’s editor, James Michaels, in London.

Lord Hoffman, dissenting, noted that ‘the plaintiffs are forum shoppers in the most literal sense.’ In the years that followed, many international claimants followed their lead. (Berezovsky and Glushkov later fell out with Putin, moved to England and were found dead, five years apart, in suspicious circumstances.)

Cases such as Berezovsky v. Michaels led to calls for reform of England’s archaic libel laws. The 2013 Defamation Act brought improvements: claimants now have to demonstrate ‘serious harm’ to their reputation, and there is a statutory defence of ‘publication in the public interest’. But the reforms have done little to stop English courts being used for lawfare. Roman Abramovich and the Russian oil company Rosneft were among those who sued Catherine Belton for defamation after her book Putin’s People came out in 2020.

The Abramovich case was eventually settled in December 2021, at a cost of £1.5 million to the publisher, HarperCollins (if the case had gone to court it would have cost them far more). Barely two months later, following the invasion of Ukraine, the British government put sanctions on Abramovich and BP sold its 19.75 per cent stake in Rosneft, at an estimated loss of $25 billion.

Journalists don’t need to be in the UK to be targeted with a Slapp action. Paul Radu, a Romanian investigative journalist at the Organised Crime Project, was sued by an Azerbaijani MP over a series of reports about alleged money-laundering involving the Azeri elite. The case ran for almost two years before it was withdrawn just before the trial was due to begin.

If you have enough money, even being sanctioned by the British government is no impediment to using London’s courts to silence your critics. The Sanctions and Anti-Money Laundering Act 2018 explicitly excludes money sent to the UK to pay for legal advice and litigation. Among the beneficiaries of this exemption was Yevgeny Prigozhin, the founder of the Wagner Group.

Earlier this year, Prigozhin released a video claiming his mercenary force was ‘probably the most experienced army in the world today’. He used to be more circumspect. When, in August 2020, the investigative website Bellingcat published a series of stories about his role in Wagner – which before it started conscripting convicts to serve in Ukraine had been accused of war crimes in Mali and other African states – Prigozhin claimed that the group was a figment of Western imaginations and vowed to sue. But rather than pursue Bellingcat, which is based in the Netherlands, he went after the site’s founder, the British journalist Eliot Higgins, for his social media posts about the story.

The Office of Financial Sanctions Implementation, part of the Treasury, issued waivers to allow the London law firm Discreet Law to represent Prigozhin. A man who is forbidden to enter the UK or hold a British bank account was given permission to harass a British journalist. The Office of Financial Sanctions also signed off on the lawyers’ hotel and flights to meet Prigozhin in St Petersburg. The case collapsed when Discreet Law withdrew their services after the invasion of Ukraine, and was eventually struck out last May. Higgins was left with costs of £70,000.

Vindictive libel lawsuits did not begin with the arrival of Russian oligarchs and kleptocrats. In the 1970s, James Goldsmith issued more than a hundred writs against Private Eye and its wholesalers and distributors. (The legal action brought Private Eye considerable media attention, and new readers.)

Robert Maxwell had a penchant for pre-emptive writs and high profile defamation actions. Over the past twenty years, however, lawfare has ratcheted up significantly. Caroline Kean, who is representing openDemocracy in the Jusan case, says that the rules of engagement changed when lawyers started working alongside PR firms and private investigators, and suing journalists personally. ‘It’s like the difference between an infantryman and a tank,’ Kean told me. ‘An infantryman can kill you, but a tank can really kill you.’

Schillings is widely seen as the first London law firm to offer the full spectrum of reputation management, from suing journalists to gaming search engine rankings. Others have followed suit. Harbottle and Lewis boasts of ‘an unrivalled history in reputation protection’. CMS describes itself as a specialist in ‘reputation and defamation’. It announced that it was closing its Moscow office after Bob Seely, a Tory MP, accused one of its partners of working for oligarchs to silence the press.

The Labour MP Liam Byrne has called for a windfall tax to be levied on these firms’ profits, accusing lawyers of ‘making millions from the misuse of our courts’. Even ascertaining how much law firms are making can be hard: Carter-Ruck is a partnership, not a company, so doesn’t have to publish any accounts. When an openDemocracy reporter asked about its profits he received an email marked ‘Private and confidential. Not for publication.’ The Solicitors Regulation Authority subsequently amended its guidance, instructing lawyers not to use threatening warnings to ‘mislead’ correspondents. But, as many journalists can attest, little has changed.

Some of the loudest voices against Slapp reform have come from the upper echelons of the legal profession. Lord Pannick, in a letter to the Times in January, criticised the media’s focus on enabling lawyers: ‘In general, judges, not lawyers, decide whether litigation by clients is well founded.’ But preliminary hearings on meaning or jurisdictional grounds can cost as much as £100,000, and many would-be defendants with strong cases fold long before they get anywhere near a judge.

A few years ago an award-winning Northern Irish investigative journalist told me that local politicians treated his newspaper ‘like an ATM’, extracting five-figure settlements on the merest threat of legal action. (The Democratic Unionist Party vetoed the adoption of the 2013 Defamation Act in Northern Ireland.)

Defamation isn’t the only legal threat to investigative journalism. Data protection and privacy laws are increasingly used as alternatives to a libel claim. Unlike a defamation writ, which claimants generally have only a year to file, data protection and privacy actions can be taken up to six years after publication, and there is no defence of truth.

Last year, the Supreme Court upheld a ruling that suspects in a police investigation have a ‘reasonable expectation of privacy’ and should not be named in the press. Bloomberg News had reported in 2016 that ‘ZXC’, a senior executive at a UK listed company that was frequently named and criticised in Parliament, was under criminal investigation. 

ZXC did not dispute the veracity of the story, but claimed that the article was an invasion of his privacy. The Supreme Court agreed. Publishing the details of an ongoing investigation isn’t mere prurience: it can prompt new victims to come forward or fresh evidence to emerge. The decision in Bloomberg v. ZXC has prevented, among other things, the publication of the name of a Conservative MP arrested for rape.

Slapps have succeeded in uniting Britain’s fissiparous press. Last November, a raft of Fleet Street editors signed an open letter calling on Dominic Raab to adopt a ‘model anti-Slapp law’ drawn up by the UK Anti-Slapp Coalition. It would include a filter mechanism to allow courts to dispose swiftly of malicious claims, financial penalties to deter the use of Slapps and protective measures for Slapp victims.

One barrier to reform is the difficulty of identifying a Slapp. The Ministry of Justice’s response to its own call for evidence features a non-exhaustive typology that includes ‘sending a very large number of highly aggressive letters on a trivial matter’ and cases being taken that have ‘no realistic prospect of success’. For Caroline Kean, intent is key: ‘Slapps almost always involve someone bringing a case to use the outcome to suppress further reporting.’ Often claimants aren’t looking for damages, but are seeking ‘a form of words they can use to stop anyone else reporting’.

London’s libel judges seem a little less claimant-friendly since the invasion of Ukraine. Last March, Mr Justice Nicklin threw out a claim against Tom Burgis by an English holding company owned by a Kazakh mining conglomerate. Burgis’s book Kleptopia: How Dirty Money is Conquering the World became a bestseller the following week. In June, the High Court threw out Arron Banks’s libel case against Carole Cadwalladr. This is cause for optimism, but many libel cases are still settled in silence, out of court, for fear of the costs of fighting them.

A 2020 survey by the Foreign Policy Centre found that almost three-quarters of investigative journalists in 41 countries had received legal correspondence as a result of information they had published. The Organised Crime and Corruption Reporting Project and the Vance Centre for International Justice in New York are launching an initiative called Reporters Shield, largely funded by USAID, which will provide journalists and news organisations around the world with libel lawyers, training and pre-publication legal checks (for a membership fee). British journalists will need it. Dominic Raab promised to ‘put an end to this bullying and protect our free press’, but no parliamentary time has been allotted to Slapp reform. Last summer, the former chancellor Nadhim Zahawi issued legal threats against journalists who asked questions about his tax affairs.