The publisher of the Daily Mail racked up £34.5m in costs fighting unproven allegations of unlawful newsgathering and is seeking an initial payment from Prince Harry and his co-claimants of £10m.
Associated Newspapers is also arguing it should receive indemnity costs, meaning more than the usual proportion of costs from the losing parties, in part because they believe the trial was used by the claimants to pursue a political campaign.
Prince Harry, Baroness Doreen Lawrence, Sir Elton John and his husband David Furnish, Sadie Frost, Liz Hurley and former Lib Dem MP Sir Simon Hughes failed to prove any of their 97 allegations of unlawful information gathering, including phone-hacking, in an 11-week trial held this year.
Any application for a potential appeal will only be dealt with after the question of costs has been finalised.
It has now been revealed that the Mail publisher spent £34,481,622.54 fighting the case.
Six of the seven claimants had ATE (after the event) insurance to cover their costs if they lost.
However, this cover totalled £16.2m (£2.7m each on six policies) meaning it “would be insufficient to meet their total costs exposure, possibly to the tune of many millions of pounds”, their lawyers said.
They added that this would have a “particularly harsh impact” on the claimants even though they “conducted themselves honestly” and “approached this litigation in good faith, under the burden of decades of intense, intrusive media scrutiny into their private lives”.
The claimants’ lawyers said the insurance policies had deliberately matched the level of estimated costs agreed by the court as a proportionate budget. They said Associated had exceeded the budget by £18.6m.
The claimants described this as an “astonishingly high legal spend by Associated and an entirely cavalier approach to the principle of proportionality and the overriding objective, which seeks to ensure that parties are on an equal footing”.
Associated said in turn that the trial “deviated in several respects from the assumptions on which the claims were budgeted”.
It has requested £9.9m as an interim payment while the claimants said it should be just over £7.9m. A future hearing would then decide what overall legal costs should be paid.
In its request for indemnity costs, Associated Newspapers cited the broad nature of the claims, some of which were dropped before or during the trial, and the inclusion of “wide-ranging allegations of impropriety that could only be suitable for investigation by a public inquiry”.
Claim was ‘born out of desire to demonstrate publisher misled Leveson Inquiry’
In their written argument, lawyers for Associated said the claim was “born out of a desire on the part of certain individuals (including at least Dr Evan Harris of Hacked Off and Graham Johnson, both of whom later became members of the Claimants’ Research Team) to demonstrate that Associated had misled the Leveson Inquiry.
Associated said the claim deployed high-profile claimants, who it was hoped would be regarded sympathetically by the public, to demonstrate that Associated had been guilty of the same kinds of unlawful information gathering (UIG) as News Group Newspapers Ltd (NGN) and Mirror Group Newspapers Ltd (MGN), and to further their campaign to persuade the Government to implement the second part of the Leveson Inquiry.
Prince Harry previously received damages from both Mirror publisher MGN (after a 2023 trial) and NGN (in a 2025 settlement that admitted “unlawful activities” carried out for The Sun for the first time).
The Leveson Inquiry looking at the ethics and practices of the media published its findings, which led to reform around press regulation and policing practices, in 2012.
Critics of the media such as the Hacked Off group continue to call for part two of the inquiry, which was intended to look further at the relationship between the press and the police, but it was formally closed by the then-Conservative Government in 2012.
Associated added: “This resulted in the inclusion in the POC [particulars of claim] of wide-ranging allegations of impropriety that could only be suitable for investigation by a public inquiry, and specific allegations of criminal activity (for example burglary to order) that had nothing to do with the individual claimants’ cases.
“The court used its case management powers to prevent the case becoming a public inquiry, but the breadth and seriousness of the allegations which the claimants pursued to the bitter end (including persisting in their allegations that Mr Dacre, Mr Wright and Ms Hartley had deliberately lied to the Leveson Inquiry) reflected the origins of the case.”
Mr Justice Nicklin found that the claimants failed to prove allegations that former Daily Mail editor Paul Dacre, Mail on Sunday editor Peter Wright and lawyer Elizabeth Hartley had lied in their evidence to the Leveson Inquiry when they denied hacking had taken place at the papers.
Legal claims were ‘campaign rather than reasonable litigation’
Antony White KC, for the publisher, told a court hearing on Wednesday that the legal claims were brought for a “collateral purpose” of trying to pressure the Government into introducing the second stage of the Leveson Inquiry, describing it as “a campaign rather than ordinary and reasonable litigation”.
The barrister said that the cases “were launched in a blaze of publicity knowing that these were likely to attract significant attention on the world stage” with a press release in October 2022.
Discussing the release, he said: “This was a monstrous thing to publish. It is intended to be as damaging as it could possibly be, and it was.”
Discussing the high-profile figures, White said: “They knew that this was an all-out attack on Associated.
“They were at pains to emphasise that there were others who could join the bandwagon.”
White also said he was “sad” to say that Baroness Lawrence was “recruited as the national treasure”, adding: “That is a matter of regret for my client, but it is not to be shrunk from.”
The barrister later criticised the breadth of the allegations and how they “shifted”.
He said that the claimants cast a “strikingly wide” net for their claim “in the hope of catching some fish” and that the court should “step back and ask itself why the net was cast so wide”.
Associated accused of trying to ‘teach claimants a lesson’
Associated also noted that Prince Harry and Sir Simon Hughes, as well as Hacked Off, put out statements after the judgment continuing to suggest the publisher “was guilty of the unlawful conduct alleged against it”.
In a joint statement, the two claimants said: “The fact that this court has chosen to dismiss [the claims] represents an inconsistency which is hard to understand or reconcile with common sense, or the evidence heard in the courtroom itself.
“It is a complete and obvious whitewash, but sadly not altogether unexpected.”
The claimants’ lawyers suggested Associated was trying to “teach the claimants a lesson” by seeking an indemnity based costs order.
They cited a Times report that quoted an anonymous source saying the publisher was going to “go for the jugular” to try and recover as much of its costs as possible.
Associated has asked for an initial payment of £9,950,624.37 within 14 days and noted this sum would fall within the claimants’ insurance policies.
The hearing before Mr Justice Nicklin is expected to conclude on Wednesday or Thursday with a decision about costs due in writing at a later date.
Update after day two of the hearing: Mr Justice Nicklin said he would give his decision on the size of an initial payment the group will make to ANL, as well as how the costs will be assessed, in a written ruling next month.
The judge described the size of the costs in the claims as “unprecedented” for a High Court media law case.
Email pged@pressgazette.co.uk to point out mistakes, provide story tips or send in a letter for publication on our "Letters Page" blog
