Already facing smaller payouts and a drop in claims, libel work has faded from its 1980s glory days. Will reform of defamation and civil costs – and the rise of reputation managers – spell the end for traditional libel lawyers? Alex Novarese reports

"I'm quite sad about the passing of jury trials because it was my favourite part of the job," 
reflects Carter-Ruck veteran 
Nigel Tait, almost wistfully. "It was very exciting."

Such sentiments illustrate the mood among many of the UK's most experienced libel practitioners, who are facing a professional outlook that has changed considerably since the glory days of the 1980s.

Until recently, defamation law has held a singular place in the legal profession. From the emergence of the statute Scandalum Magnatum (Slander of Magnates) back in 1275, the business of libel has been a means by which the powerful would attempt – and sometimes spectacularly fail – to protect their reputations against attack.

By the post-war years, libel in England and Wales had become a crossroads where the legal profession met power, money, fame, the media, scandal and sex and even, in the course of many celebrated court battles, sometimes settled matters of public interest.

Ronald Irving, in his book of 
legal quotations The Law is a Ass, sums up the glamour and allure of high-stakes defamation disputes: "It would be a pity to abolish the law of libel and replace it with a system of published retraction 
and apology. In libel cases one sees the whole sweep of social history 
in its fascinating muddle, heartache, hypocrisy, spitefulness, greed, pride and sometimes outright lying."

Nowhere was this sweep more evident than during the1970s and 1980s when a series of famous libel cases were pursued by prominent figures including Jeffrey Archer, Sir James Goldsmith and Robert Maxwell – many of them against the satirical magazine Private Eye.

Such was the profile of these confrontations that, at the time, the small defamation boutique Peter Carter-Ruck & Partners was probably the most famous law firm in the UK, while the most celebrated advocate of the day, George Carman QC, largely made his name on the back of 
defamation work.

But long before the current prospect of substantive reform 
to libel law and civil litigation 
costs has emerged over the last 
12 months, it has been apparent that the heyday of such 
headline-friendly work had passed.

For one, juries started awarding smaller levels of damages during the 1990s. This trend was influenced by appeal courts gaining power to substitute their own awards for the juries in 1990 and several appeals during that decade saw high awards reduced, notably in a dispute between Elton John and Mirror Group Newspapers, which saw a £275,000 damages award slashed to £75,000.

There were other factors. The introduction of the offer of amends procedure under the Defamation Act 1996 – which gives defendants a chance to discount damages in exchange for setting the record straight at an early stage – proved highly successful at heading off lengthy litigation.

And while disputes have increasingly tended to settle early over the last decade, in general the level of claims has also somewhat tailed off. An analysis by Reynolds Porter Chamberlain (RPC) of the number of defamation writs issued in London since 1990 shows that the figures have fallen from a high of 560 in 1995. Between 2000 and 2009, writs have never exceeded 300 a year (though it should be acknowledged that the level of claims has often been very volatile from year to year). By the late 1990s, it seemed even Private Eye was safe.

Neither in recent years has it helped that an increasingly 
cash-strapped newspaper business, wrestling with falling readerships and advertising revenue disappearing online, is less willing to engage in lengthy battles.

Symbolically, Carter-Ruck, so long synonymous with defamation work, has chosen to branch out. 
As with many firms active in the area this has meant moving into growing field of privacy actions. Going a step further, the firm has made a conscious effort to expand its practice in the field in international law and financial regulatory matters. "Banks and financial advisers are our new hunting grounds," comments Tait.

From the blogosphere to Westminster

If many of the reasons for the slow decline of big ticket defamation work had been apparent for some time, a new – and perhaps decisive – factor quickly came into play without warning: the campaign for libel reform.

Of course, there is nothing new about calls for reform of libel laws. Though domestic libel laws are broadly comparable with international standards, the high costs associated with litigation in England and Wales have undoubtedly created considerable potential for defamation cases to be used oppressively by rich claimants.

However, while such campaigns for libel reform were associated with the media – in particular the tabloid press – there was little prospect of Members of Parliament (MPs) supporting reform. After all, MPs were often targets of such stories and were themselves enthusiastic users of the libel laws.

This dynamic was to be fundamentally recast when a new group of campaigners were to 
turn the debate on its head. 
These campaigners were focused on scientific writing and academic debate and in highlighting a number of cases in which libel laws has been aggressively deployed to stifle public debate.

In contrast to the unsympathetic image of tabloid hacks, this new breed of campaigner included respected academics and science writers, non-governmental organisations like Index on Censorship and a passionate group of bloggers.

There were a number of cases highlighted but the campaign was to find its real rallying point in the libel claim issued by the British Chiropractic Association (BCA) against the well-regarded science author Simon Singh in relation to a 2008 newspaper article that said the BCA "happily promotes bogus treatments".

The case was given further momentum following a controversial ruling from 
Mr Justice Eady that Singh's article constituted a statement of fact, robbing him of a fair comment defence, which greatly increased the odds of losing the case. As bloggers, and campaign groups rallied to the cause, the media took interest.

By the time of an appeal last year when Eady's ruling was heard by the Court of Appeal, it was clear that the judiciary had become very sensitive to the tensions the case highlighted. This was unambiguously illustrated by the heavyweight line-up on the hearing of Lord Chief Justice Lord Judge, Master of the Rolls Lord Neuberger and Lord Justice Sedley – the former two of the most senior judges in England and Wales and the latter one of the most technically gifted minds on the bench. The court's judgment on 1 April 2010 overruled Eady's finding that Singh's article constituted fact and swiftly led to the BCA abandoning the case (not to mention attracting a good deal of unflattering attention).

The ruling was hailed as a victory for free speech campaigners but the results of their campaign for libel reform were already apparent even before the decision was handed down.

Only a few months previously the prospect of libel reform looked remote. Yet by January 2010 
Lord Justice Jackson had issued a wide-ranging report on civil litigation costs, which recommended a number of reforms certain to have considerable impact on defamation cases.

In February, the Parliamentary Culture, Media and Sport Committee called for a review of the burden of proof in libel cases and a drastic cut in the level of success fees. By March 2010, Justice Secretary Jack Straw caught many unawares by announcing plans to virtually abolish success fees in defamation cases (though this attempt was blocked by a vote in the House of Commons).

Most remarkably, the three main political parties went into last May's general election pledging either to reform or investigate reform of libel laws as a means of protecting free speech. The campaign for libel reform – by separating itself from tabloid interests in favour of more sympathetic academics – had proved incredibly successful.

However, success also con-tributed to a level of intense scrutiny on the judges handling libel cases – in particular Eady, who attracted much of the 
flak (Eady was the most senior libel and privacy judge in the Queen's Bench Division of the High Court from 2004 until Mr Justice Tugendhat took charge of managing the court's lists in October 2010).

This view is largely rejected by practitioners, who stress that while Eady developed a somewhat jaded view of the media's excesses, he genuinely attempted to balance competing interests and often recognised the importance of the media's role. (Eady was also reportedly personally stung by his status as the bogeyman for free speech campaigners).

This sense in which the judges were to come into the firing line in the campaign over free speech was to be revisited with a vengeance amid subsequent controversies over privacy laws this year and judges' supposed role in developing it.

However, it seems apparent that campaigners were very successful in changing attitudes among senior judiciary. Indeed, many of the judgments that the media have howled the loudest about in recent months have contained passages explicitly sympathetic to the role of the media in society.

"The freedom of expression campaigners have transformed the thinking of the judges," argues Tait, in what he sees as a positive development. "Attitudes have been completely changed. Judges are seen to pay much more respect to freedom of expression than ever before."

With such a broad shift in attitudes, there was little surprise when the incoming coalition Government quickly committed itself to libel reform (see A 'laughing stock' libel law no more? The Defamation Bill).

All about the money

Ironically, if the libel reform campaign quickly gathered pace, there was already considerable momentum building behind the issue that most libel specialists believe will have more impact than the new Defamation Bill: costs.

Indeed, one of the reasons that pressure for revisions to libel law had built up even while damage payouts had fallen was due to what looked like the one thing going in favour of claimant lawyers, conditional fee agreements (CFAs). It has been increasingly noted that the use of such success fees were in some cases being used tactically as a weapon, including by wealthy claimants with no need of such arrangements to obtain legal services. It was also becoming increasingly common for legal fees to utterly dwarf actual damages – a spectacle that did the profession's image no favours. "CFAs were a licence to print money for claimant lawyers," comments Gill Phillips, director of editorial legal services for The Guardian newspaper. "They led to huge costs inflation."

Though targeted more at personal injury and clinical negligence, the aforementioned Jackson report put forward a number of recommendations that are likely to have a huge impact on defamation cases. The bulk of Jackson's blueprint has already been endorsed by the Ministry of Justice (MoJ), which in March this year announced its intention to introduce many of his key reforms. Crucially, these will end the recoverability of success fees and associated insurance policies, meaning they will no longer be paid for by the losing party. 
This is expected to hugely clamp down on the use of CFAs and the willingness of lawyers to take on defamation cases under no win, no fee deals.

Though the Government intends to raise general damages for torts by 10% to compensate for the restriction of success fees, with many defamation cases achieving damages in the region of £25,000, it seems many potential claimants with limited means will have little chance of engaging a lawyer.

Importantly, the Government has not followed Jackson's suggestion of having qualified one-way costs shifting for defamation, whereby claimants would not be liable for the other side's costs if they lose, which also promises to ensure that libel claims remain extremely risky for claimants of limited means.

"Jackson will have much more impact in practical terms [than the Defamation Bill]", says Addleshaw Goddard partner David Engel, echoing a widely held view. "This will take us back to the 1980s where those bringing libel claims will be the rich and famous and mostly just the rich."

Indeed, even those sympathetic to the need for libel reform such as Alastair Mullis, head of the law school at University of East Anglia, ask if the Jackson review was too focused on volume litigation to provide effective reform to libel costs. He comments: "Jackson didn't really get his head around how costs work in libel. He identified solutions that work for personal injury – I don't think he understood the level of damages in libel."

While it is true – as Gill Phillips points out – that the bulk of defamation work involves rich claimants, the combined impact of reform of defamation and civil costs seems rather ambiguous. On one hand freedom of speech will gain greater protection and some of the undoubted excesses of claimant lawyers seem certain to be curbed – yet reform is problematic from the perspective of access to justice as libel will remain expensive in general and increasingly even further beyond the reach of most individuals.

The rise of the 
reputation managers

If traditional defamation work has dwindled in recent years, the loss has been more than made up for by the much-debated rise of privacy law. This means that many firms active in defamation like Carter-Ruck, RPC and Addleshaw Goddard are spending increasing amounts of time on such actions.

The reasons for the rapid emergence of this field have been well documented. The introduction of the Human Rights Act 1998 ushered in the right to a private family life, alongside article 10 rights to freedom of expression. 
In considering privacy cases, judges have sought to equally balance these two rights – often to the dismay of the media that has been inclined to argue that free speech should be dominant.

With judges applying the law – most notably in Campbell v MGN Limited, in which the House of Lords in 2004 ruled the Mirror had invaded the privacy of the model Naomi Campbell, giving rise to the new cause of action of misuse of private information – the area has quickly expanded in scope.

This has helped to create a new breed of lawyer – the reputation managers – who are often focused on stopping publication entirely rather than seeking legal remedies afterwards. The boutique Schillings has come to symbolise this kind of celebrity lawyering in the way Carter-Ruck was the face of libel.

There is no doubt that such tactics are controversial, and probably set to become more so. Recent weeks have seen a rash of media stories decrying the use of injunctions by celebrities to stop stories – while prime minster David Cameron last month publicly questioned the role of judges in developing privacy law (to the widespread irritation of lawyers).

The media has also made much of the supposed "super-injunction" – cases in which the media is barred from reporting the existence of the injunction. However, the vast majority of injunctions classed as such simply have anonymity orders, which block publication of the name of those obtaining the injunction (a service generally regarded as costing the claimant in the region of £50,000 in legal fees).

The well-regarded media law blog Inforrm last month argued that the "superinjunction is dead", stating there does not appear to have been a genuine super-injunction for months. By the same token the number of injunctions the media has claimed are in effect are often vastly inflated.

Of course, there are a number of reasons to feel uneasy about the rise of privacy law and the increasing blurring of the lines between libel and privacy actions. The expansion of privacy law increasingly takes the courts into the realm of prior restraint – and there is a good reason why the dynamic of libel as 'publish and be damned' has long been celebrated as a bulwark of free speech.

Yet in many ways the coverage of privacy law and injunctions seems exaggerated and at times laughably self-interested on the part of the media (sections of which are itself embroiled in a messy scandal regarding illegal phone-hacking). And despite the repeated criticism of judges supposedly independently developing privacy law, the implications of the Human Rights Act with regards to privacy were very well flagged up before it passed through Parliament.

Many of the controversies about the attitudes of the judiciary with regard to freedom of expression seem to have ignored the trend that judges have become more progressive in their views, with many judgments explicitly recognising the importance of 
the free speech and the role of 
the media.

East Anglia's Mullis articulates the view of many in the profession that judges have not been given enough credit for striking a progressive stance on libel and privacy law, adding: "The treatment that has been dished out to Eady is utterly appalling. If you look back at his record he has almost single-handed pushed through reform of the law on libel that has made our law consistent with article 10 [protecting freedom of expression]."

Certainly, the tone of judgments in this field have changed hugely since the 1970s and 1980s, when judges often did show an 
excessive regard for the needs for state secrecy, commercial confidentiality and little regard for democratic and constitutional position of the media.

It is a further irony that back then the media were more often attempting to publish stories of obvious public interest, at a time when the UK media had a far stronger tradition of serious investigative journalism.

In contrast, the current skirmishes between the media and the judiciary have often been fought over dubious kiss-and-tell stories or celebrity-driven pieces, which has itself often obscured the privacy cases in which more genuine issues of public policy 
have been raised. (Those like 
RPC partner Keith Mathieson and The Guardian's Phillips that offer a more nuanced criticism of privacy rulings are concerned that stories covering sexual matters are too broadly classed as qualifying for privacy protection without enough regard to context.)

But the media has too often chosen to fight a supposed point of principle on the weakest cases. This was well illustrated by the bizarre fuss made last month about an injunction taken out by the journalist Andrew Marr and the even stranger attempts to frame protests about injunctions as the media standing up for the rights of women (to sell their stories) on the basis that those obtaining injunctions are men.

Libel law will survive in some form, of course, though it looks as if it may bear little resemblance in the future to its former incarnation. But surveying some of the current clashes over celebrity gossip stories, it becomes possible to share defamation veterans' nostalgia for a time when libel cases often involved powerful individuals and serious issues of public interest.

As Addleshaws' Engel comments: "If a paper is running a serious investigative story, it is likely to have a strong public interest defence to any claim in privacy. But there's less serious journalism now. You don't get the kind of work like The Sunday Times' Insight team in Harry Evans' day.

"Would you get a Thalidomide investigation now? Maybe, but proper investigative reporting is expensive and it is cheaper to do another celebrity story."

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Quotable libel over the years

"A man is not stung the less by a libel because it happens to be true." Lord Abinger, in Frazer v Berkeley (1836)

"It is perfectly monstrous the way people go about nowadays saying things against one, behind one's back, that are absolutely and entirely true." Oscar Wilde, The Picture of Dorian Gray (1891)

"If this is justice, I am a banana." Ian Hislop (pictured), editor of Private Eye, on the award of £600,000 damages against the magazine to Sonia Sutcliffe (1989)

"We trust her gravy train has finally hit the buffers." Thomas Gerald Crone, legal manager of News of the World, after Sonia Sutcliffe failed in an action against the newspaper (1990)

"Robert Maxwell… a liar, a cheat and a bully [who] did more than any other individual to pervert the British law of libel." Obituary in The Independent (1991)

"The whole nonsense… should be swept away