Serious Harm… Seriously?

Recent years have seen a run of notorious defamation cases Vardy v Rooney, Depp v News Group Newspapers Ltd & another, and The Duke of Sussex v Associated Newspapers Limited, to name a few. It seems as if the Media & Communications List of the King’s Bench Division has never been busier. With the number of high-profile defamation actions on the rise, case law is developing fast.

The Court of Appeal in the recent case of Dr Craig Wright v Peter McCormack [2023] EWCA Civ 892 has addressed the impact that litigation misconduct may have upon a successful Claimant’s right to general compensatory damages for defamation. The appeal concerned a first instance decision of Mr Justice Chamberlain to award the Claimant, Dr Wright, compensatory damages in the nominal sum of just £1 because of his misconduct during the proceedings.

The First Instance Decision  

The claimant in this action, Dr Wright, was an active businessman in the field of cryptocurrency, who claimed to be ‘Satoshi Nakamoto’, the name used by the author of the 2008 “White Paper” which is often credited as being the first to table the introduction of Bitcoin.

The defendant, Mr McCormack, was an active cryptocurrency blogger who published several tweets claiming that Dr Wright was not, in fact, Satoshi and that he was a fraud. Mr McCormack also participated in a YouTube discussion in which similar comments were made. Dr Wright issued defamation proceedings against Mr McCormack in the High Court. Mr McCormack did not seek to defend the proceedings based on a truth defence, or any other substantive defence, but rather on the basis that Dr Wright had not suffered ‘serious harm’ in accordance with section 1 of the Defamation Act 2013.

At the trial, the Judge found that the serious harm threshold was satisfied, but also found that parts of Dr Wright’s case were ‘deliberately false’, including the assertion that, after the defamatory publications by Mr McCormack, Dr Wright had been systematically excluded from cryptocurrency related events. Prior to the publications, Dr Wright contended that he had been invited to speak at numerous academic conferences across the globe, including in New York, Ho Chi Minh City and Paris to name a few. Dr Wright claimed that similar invitations were withdrawn by reason of the publications by Mr McCormack. Dr Wright gave evidence to this effect in multiple witness statements over several years in support of this aspect of his case, but then abandoned it shortly before trial.

After hearing oral evidence at trial, Mr Justice Chamberlain concluded that ‘Dr Wright’s original case on serious harm, and the evidence supporting it, both of which were maintained until days before trial, were deliberately false’. The Judge considered that such a finding warranted more than a mere reduction in the award of damages. Dr Wright had damaged his own reputation in advancing a deliberately false case under oath. Accordingly, he was entitled to only nominal damages for injury to his reputation.

The Appeal

Dr Wright appealed the court’s decision on the basis that to the award of nominal damages did not restore him to the position he occupied before the injury to his reputation had occurred, and that litigation misconduct was not a basis for reducing damages.

Lord Justice Walby gave the lead judgment on the appeal and found that Mr Justice Chamberlain’s decision to reduce damages by reason of Dr Wright’s litigation misconduct was not wrong in principle. The decision to consider a post-publication event when assessing damages was novel, but not incorrect. The defamation that formed the basis of the claim was not that Dr Wright was simply ‘not Satoshi’, but that he had sought to deceive the public about being Satoshi and, therefore, that he had behaved dishonestly. As such, in this case the defamation and the litigation misconduct (which also concerned Dr Wright’s dishonesty) were related.

Comment

Both the judgment below and on appeal make clear that events which are relevant to the extent of damage suffered by a claimant, but which occur after the initial defamatory statement complained of, can be considered when assessing the appropriate level of damages to be awarded. Claimants must be wary of exaggerating the effects of any defamatory publications. The purpose of the statutory serious harm requirement was to reduce the number of frivolous libel claims brought by claimants. This judgment, whilst not ground breaking, ought to have a similar effect.