February 21, 2022 | 5 minute read

Bloomberg LP v ZXC: Supreme Court Judgment on Expectation of Privacy for Individuals Under Criminal Investigation

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Menelaos Karampetsos

Associate

Get in touch

Menelaos Karampetsos

Associate

This week, the U.K. Supreme Court (“UKSC”) issued its judgment[1] on an appeal by Bloomberg LP against lower courts’ findings that an individual under criminal investigation has a reasonable expectation of privacy in respect of information relating to the investigation up to the point of being charged. ZXC originally claimed for damages for the tort of misuse private information, a tort where liability is assessed following a two-stage test: stage one involves determining whether the claimant objectively has a reasonable expectation of privacy in the relevant information considering the circumstances of the case (“Stage 1”); stage two involves determining whether such expectation is outweighed by the publisher’s right to freedom of expression (“Stage 2”).

The UKSC addressed two issues that arose from the application of the two-stage test by the lower courts:

1. Was the Court of Appeal (“CoA”) correct to hold that there is a general rule, which applied in this case, that an individual under criminal investigation has a reasonable expectation of privacy in respect of information relating to the criminal investigation up to the point of being charged?
2. Was the CoA correct to hold that, in a case in which a claim for breach of confidence was not pursued, the fact that Bloomberg LP published information originating from a confidential law enforcement document rendered the information private and/or undermined the Appellant’s ability to rely on the public interest in its disclosure?

The UKSC was then asked to determine whether, based on the above issues, it should interfere with the CoA’s findings in favour of ZXC.

The Facts

ZXC and his employer were subjects of an investigation by a UK legal enforcement body (“UKLEB”) in connection with allegations of fraud, bribery, and corruption relating to activities in a foreign state. Bloomberg LP published an article that was based on the contents of a letter of request for legal assistance that the UKLEB had sent to the foreign state. Such letters are recognised as confidential documents[2] and they typically include information about the underlying investigation, such as a summary of pertinent facts, the purpose for which the evidence is sought, and identifying information about the subject of the request. In this case, the letter mentioned, among other things, that the UKLEB was investigating whether ZXC was part of a conspiracy to defraud his employer.

Bloomberg LP published an article whose contents were almost exclusively drawn from the letter[3] and, according to the first instance judge in the claim, in disregard of confidentiality requirements set out in the letter and its sensitive nature[4]. ZXC brought a claim against Bloomberg LP for misuse of private information, in which he succeeded. Bloomberg LP appealed on the basis that the findings of the first instance court and the CoA subsequently were incorrect.

The Judgement

Issue (i)

The UKSC held that whether there is a reasonable expectation of privacy in the relevant information is a fact-specific enquiry.[5] In assessing whether Stage 1 was met, the UKSC referred to the “Murray factors”, identified in the CoA’s Murray v Express Newspapers plc decision.[6] These include: the attributes of the claimant, the nature of the activity in which the claimant was engaged, the place of the activity, the nature and purpose of intrusion of privacy, the absence of consent, the effect on the claimant, and the circumstances in which and the purposes for which the information came into the hands of the publisher.

Bloomberg LP argued that no general rule should apply to the information in question under issue (i) as the public is able to observe the presumption of innocence and therefore any effect on the claimant under the Murray factors is overstated. Bloomberg LP further argued that, in finding that it is a human characteristic to equate suspicion with guilt, the lower courts went against established principles of defamation law. Bloomberg LP also advanced that the information in the letter referred to ZXC’s business activities and not his private life, and the lower courts failed to consider all the circumstances of the case (including ZXC’s involvement in the affairs of a public company and his status as a businessman).

The UKSC found against Bloomberg LP. There is a growing recognition among law enforcement and state agencies that suspects should not be identified until they are charged.[7] In respect of the presumption of innocence, what matters is how ZXC’s inner circle would react to the publication of information that names ZXC as a person under criminal investigation.[8] Principles of defamation law do not apply here because the purpose of the tort of misuse of private information is to protect an individual’s private life in accordance with article 8 of the European Convention on Human Rights (“ECHR”), which is broader in scope to protecting the individual from untrue information.[9] Publication of information about a criminal investigation into ZXC’s can fall within “private life,”[10] as a right in respect of reputation is enshrined (even though not expressly mentioned) in article 8 of the ECHR. Such a right applies if the attack on reputation attains sufficient seriousness and impacts significantly on the individual’s life[11]; in the present instance, the UKSC accepted ZXC’s submissions on the impact of the publication on his mental and physical health as well as that of his family.[12] ZXC’s status as a businessman did not shield him from criticism but did not enable unlimited criticism either. The UKSC held that the CoA was entitled to focus on the circumstances in which and the purposes for which the information came into the hands of Bloomberg LP.[13]

The effect of publication of information regarding an individual’s status as the subject of a criminal investigation will result in damage, irrespective of the individual’s characteristics or status. ZXC’s status as a businessman meant, in fact, that he could suffer greater damage than a private individual.[14]

The UKSC held that there is, as a legitimate starting point, a reasonable expectation of privacy that an individual under criminal investigation can invoke, until the point of charge, in respect of information about the criminal investigation.

Issue (ii)

The UKSC held that the CoA was correct in finding that the confidentiality of the information in the letter was a relevant but non-determinative factor for Stage 2. Information might be private but not confidential or confidential but not private. However, there will often be overlap and if information is confidential, then that is likely to support the reasonableness of expectation of privacy. The CoA was correct in concluding that there was a substantial and clearly identified public interest in maintaining the confidentiality of the letter and in observing the duties of confidence.[15]

The UKSC did not, therefore, find there were grounds to intervene with the CoA’s findings.

Key Takeaways

The judgment has already generated media reaction[16] and it is expected to affect the way media entities navigate investigative reporting. Individuals implicated in criminal investigations are provided with clarity as to the safeguards in place under U.K. law to prevent reporting or information that severely affects their private life.

The tort of misuse of private information achieved recognition as a distinct tort in 2014,[17] and there is little case law on the assessment of damages. ZXC was awarded £25,000, and guidance will develop alongside case law, particularly as individuals other than celebrities[18] bring claims. At the moment, the tort continues to be invoked alongside data breach claims in a “catch all” approach by claimants (as, for example, in Darren Lee Warren v DSG Retail Limited,[19] where the court held that the claimant’s attempt to claim for misuse of private information failed because there was no positive action to indicate interference by the defendant). However, the UKSC’s judgment recognises that the tort is now fully formed and recognised as a cause of action distinct from similar ones such as breach of confidence or data breach claims.