Phone-hack apology could 'open floodgates' on claims

The apology issued by the News of the World over allegations of illegal phone hacking could lead to a deluge of new claims from celebrities and politicians, leading UK media lawyers have warned.

News International has apologised to eight of the News of the World phone-hacking litigants for intercepting their voicemails and there a further 16 ongoing phone-hacking civil legal actions facing the paper. It is understood that a £15m compensation fund has been set up to settle claims which are deemed to have merit.

While the apology and compensation offer has been seen as an attempt to draw a line under the scandal, lawyers contacted by the Press Gazette believe this is unlikely. Finers Stephens Innocent’s Mark Stephens, whose clients include Wikileaks editor-in-chief Julian Assange, has been approached by several high-profile figures likely to pursue claims against the News of the World.

‘This mea culpa is not going to halt the investigation,’he said. Stephens also argues it could be some time before claims are settled, because neither the police nor the newspaper have disclosed exactly how many have been the victim of phone hacking.

He added: ‘At the moment there’s no comprehensive list of who was hacked, so it’s not entirely clear how they’re going to determine who exactly is entitled to compensation.”

Taylor Wessing defamation partner Niri Shan said: ‘I think the apology could open the floodgates. I suspect this will encourage others to come forward with claims, and there could be an influx of no-won, no-fee clams.”

Shan believes the News of the World is likely to speed up the settlement process by pushing for settlements under ‘part 36 offers’. These are brought under civil procedure rules and are essentially a tactical measure – often used in personal injury claims – to resolve disputes by offering the claimant a settlement figure.

The claimant is free to reject the figure, but if a court decides on a lower settlement then the claimant has to pay both their own costs and the defendant’s.

Reynolds Porter Chamberlain partner David Hooper said that News International is likely to offer average settlements of around £200,000, and it is unlikely a court would settle on a figure that high.

Given the financial risks involved, Hooper believes many will decide to settle instead of pursuing a costly battle through the courts.

But Stephens argues that many of the celebrity victims are so well off that money is not the issue. ‘Many of these people have had their lives destroyed by the suspicion that their friends and families had betrayed them. They want to make sure that doesn’t happen again.’

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