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Six Lessons from the Rebel Wilson Court of Appeal decision

LOS ANGELES – JAN 27: Rebel Wilson arrives for the G’Day USA Gala 2018 on January 27, 2018 in Los Angeles, CA

In September 2017, after Rebel Wilson had won ‘monster’ damages in her defamation case in Victoria (in Australian terms anyway), I posted on this blog my concern that her multi-million dollar damages award might be at risk if scrutinised by an appellate court (see Rebel Wilson $4.5 damages award might not survive an appeal). On 14 June 2018, the Court of Appeal did indeed strike down the special damages component. If the present result stands, Bauer Media, the publisher of Woman’s Day magazine, will have to pay Ms Wilson $600,000 in damages.  This remains a very large damages award in Australia for defamation, even though much less than the original sum.

The nutshell summary is this. Bauer Media only appealed the award of damages and did not challenge the findings on liability. There were three components to the original award of damages:

(a) general damages (a finger waving exercise based on factors such as the hurt the plaintiff feels, and so on);

(b) aggravated damages caused by factors within Bauer Media’s control that had made the situation worse; and

(c) special damages, being a further component based on economic loss which must be proved on the balance of probabilities.

The trial judge had ordered that (a) and (b) equaled $650,000 (together, compensatory damages), and he also awarded special damages in the sum of almost $4 million.

On appeal, the Court reduced the compensatory damages to $600,000 and disallowed the special damages completely, so the latter became $0.

Rebel Wilson is suggesting via her Twitter feed that there may remain a final chapter to this saga before the High Court.

Having now read the 100 page plus judgment, I could try to summarise it for you. As fascinating a public figure as Rebel Wilson is, I fear that to do this would leave you in a stupor. A Danielle Steele novel the judgment is not.

So, let me distil what I’ve read into six lessons, in no particular order.

1. Juries are good IF THE EVIDENCE IS ABOUT POPULAR CULTURE

Juries live in the real world. Judges and barristers spend their lives pulling apart words.

Rebel Wilson won her case by proving that it was false for it to be imputed that she was a serial liar.  Bauer Media had tried to prove the claim was true by relying on a series of public statements made by Rebel.

The Court of Appeal decision sets out the background to the case in detail, to outline the territory of the dispute.

One of the matters cited concerned an appearance on David Letterman’s The Late Show in 2014. During the interview, Rebel said that: she came from ‘Sydney, the western suburbs which is kind of like the real ghetto area’; that she was named ‘Rebel’ after a little girl who sang at her parents’ wedding; that she was named ‘Rebel’ and her siblings were named ‘Liberty’, ‘Anarchy’ and ‘Ryot’ because her mother was a dog-shower and bred dogs and liked themed names; and that, because her name was ‘Rebel’ she was lucky that she became an actress’.

The interview involved a level of exaggeration. Rebel Wilson’s evidence was that it was a comedic performance and she explained how the content is prepared for a talk show. Her use of the word ‘ghetto’ during the interview was a joke.  She used this term rather than ‘westie’ or ‘bogan’  because Americans would have no idea what those slang words meant.

Imagine what you would make of this if you were a judge. First of all, you have an enormous workload writing 100 page judgments one after the other, some of them likely about very serious criminal things. You see a lot about human life that is sad.  When it’s late at night, there is a good chance you are sleeping (or trying to do so)  rather settling into late night TV with a block of Dairy Milk chocolate and a giggle with your favourite celebs. Are you David Letterman’s target market? Is there a risk that you might micro-analyse the ‘truth’ and ‘falsity’ of what was said by a guest on his show, arriving at a conclusion that risks not being ‘real world’?

That a ‘jury of peers’ might be more likely to ‘get’ evidence about popular culture, struck home when I was reading these passages of the judgment.

2. Don’t win too big

This is often said by litigators. If the win is really ‘out there’, the plaintiff might be thrilled, but the litigators look at each other with a grimace. This is because an appeal is likely.  Appeals are expensive and time consuming.  The experience of litigation for the plaintiff has just been extended.  Swift justice is far away.

Accordingly, a modest win, a satisfying win without the ‘thrill factor’, is often the best kind. The risk of an appeal is often reduced.

3. It’s OFTEN hard being a TRIAL LAWyer and courts CAN BE quite kind about this

What a lawyer feels about a case is irrelevant. Subject to our duties to the Court and our ethical rules, we are at the mercy of our client’s instructions. It is therefore very important not to shoot the messenger, and I appreciate I have a vested interest in saying this.

An aspect that led the Court of Appeal to reduce the compensatory damages amount to $600,000 was a concern that the trial judge had, metaphorically speaking, shot the messenger when awarding aggravated damages.

The trial judge had criticised Bauer’s pursuit of an amended truth defence on the basis that, by the time of the amendment, it must have been clear that Rebel Wilson was not a serial liar. The sub-text is that the legal advisers were responsible for pursuing a case theory that was wrong and increased the hurt that Rebel Wilson suffered.

However, the Court of Appeal concluded that, while Bauer’s attempt at a truth defence may have been weak and unpersuasive, this was not an improper or unjustifiable approach. The Court drew on closing remarks by Counsel for Bauer, who informed the jury that a ‘lie’ is something told by most of us, frequently. A lie does not have to be especially serious. For instance, how many parents have told their children that the Easter Bunny is real? In this sense, a lie can be relatively trivial. The Court of Appeal then said:

“…care needs to be taken to separate the impropriety of a litigant in knowingly running a false defence and the conduct of a litigant’s lawyers in pursuing arguments based upon evidence that was open to be accepted by the trier of fact (in this case the jury). There is nothing in the material before us that suggests that Bauer’s solicitors or counsel were aware of Bauer’s improper purpose in the publication of the articles [being publication for a commercial purpose, which had not yet been found].”

I appreciate that this looks a bit like hair splitting but, remember, judges were once solicitors and/or counsel too. Rightly or wrongly, there is often a level of residual sympathy for those who call the court room “their place of work”.

For reasons including this, the Court decided to set aside the sum of $650,000 in compensatory damages and to substitute the sum of $600,000. There is no science to the $50,000 deduction. All it tells you is that the Court decided that the judge’s perceived error justified a reduction, but not a big one.

4. There is no good news in the judgment if you are A media defendant

General damages in defamation law are subject to a current statutory cap of $389,500. There is, however, a curious provision in the Defamation Act 2005 (Vic.) (s.35(2)) which provides:

“A court may order a defendant in defamation proceedings to pay damages for non-economic loss that exceed the maximum damages amount applicable at the time the order is made if, and only if, the court is satisfied that the circumstances of the publication of the defamatory matter to which the proceedings relate are such as to warrant an award of aggravated damages.” [emphasis added]

Australian defamation laws pose numerous issues for mainstream media.  They fetter speech to a significant degree and provide the plaintiff with a natural advantage because it is easy to prove the cause of action, which means the burden lies on the media to prove that a relevant defence applies.

Add to this the unpredictability of outcomes for general damages. There is a lot of gut feel and little science. The possibility that the statutory cap might be lifted if conduct is said to be “aggravating” just adds another unwelcome variable when trying to assess risk.

The trial judge held that, because he found there were grounds for aggravated damages, first, the statutory cap would not apply and, secondly, his assessment of general plus aggravated damages could be treated as a single exercise. This meant that Bauer Media had no transparency as to how the original $650,000 figure was calculated. All it knew was that $650,000 is a lot more than $389,500.

Bauer Media sought unsuccessfully to persuade the Court of Appeal that the statutory cap should continue to apply to general damages. Section 35 was only relevant to the aggravated damages component, it argued. It should not be the case that, simply because aggravated damages exist, there is scope to remove the cap entirely when evaluating compensatory damages (general plus aggravated damages) as a whole.

Further, Bauer Media argued that it was wrong to roll up general and aggravated damages into a single impenetrable sum. The two components should be separated out, for no other reason than to assist the defendant to work out whether the sums were reasonable when contemplating possible appeal.

In fairness to Bauer Media, it had the second reading speech of the Attorney-General on its side. This appears to be an example of Parliament’s intention and the words of the relevant section parting ways.

The Court of Appeal rejected Bauer Media’s argument. The Court agreed that section 35 did not reflect the Attorney-General’s speech. However, the language of section 35 was unambiguous, it was held. Further, it was customary for general and aggravated damages to be rolled up together. Aggravated damages were not a separate component the Court found, but reflected conduct within the control of the defendant that increased the harm which the defamation caused or may be supposed to have caused to the plaintiff.

5. GEOFFREY RUSH MIGHT THINK TWICE BEFORE PURSUING ANY SPECIAL DAMAGES IN HIS OWN CLAIM

Most plaintiffs seek only general damages when suing for defamation. Proving that you have suffered economic loss is, for the most part, really difficult to do. It is not impossible. For instance if you have lost your job because of a wrongful slur, and you were informed when you were sacked, “Look you have to go because of [false defamatory thing]”, then there lies a good case for economic loss.

However, such clear specific evidence is rare, particularly when the damage is to something as nebulous to defamation (c.f. theft of a car, or loss of a limb which are tangible things).  This means one must usually rely on inference to determine whether lost money has been caused by a defamation publication.

The Court of Appeal rejected the trial judge’s inferential reasoning, finding it unpersuasive. For example, the Court found that the evidence was not so strong that there had been much, if any, negative effect to Rebel Wilson as a result of the often poisonous effect of grapevine gossip.

The Court of Appeal applied a very micro approach to the special damages assessment.  This stands in contrast to the broad brush approach of the trial judge. The micro nature of this reasoning stands in stark contrast to the opaque manner in which the same Court had earlier reduced compensatory damages by $50,000.  Simply put, general damages (whether or not with an aggravated damages component) are often judged by the seriousness of the slur and the breadth of publication. Special damages, based on economic loss, are dealt with by much more specific criteria.  Simply to illustrate what micro looks like, imagine you have numerous passages of the judgment that look like this:

“The judge, with respect, wrongly included A Few Best Men in the post-Pitch Perfect catalogue of contracts, did not advert to the relative lack of success of Super Fun Night, much overstated the plaintiff’s earnings from that production, and described the plaintiff’s role in Pain & Gain as ‘lucrative’ when the remuneration which she received was akin to remuneration received by her for Bachelorette (contract, August 2011) and significantly less than remuneration which she received for Pitch Perfect (contract, September 2011).

As for Geoffrey Rush’s current litigation against Nationwide News (discussed elsewhere on this blog here and here), each fact set is different, of course. However, if Geoffrey Rush has been contemplating seeking special damages via a broad brush inferential approach, he might choose to think twice. It’s time consuming and expensive to prove this kind of loss, and might just not be worth the effort.

6. avoid a knee jerk PR litigation strategy

I use the term ‘PR litigation strategy’ loosely, because strategy often has nothing to do with a person’s decision to vent on Twitter. Rebel Wilson is entitled to express how she feels publicly.  I get it. Her 2.97M followers want to see an authentic Rebel.

But …

Exhibit A

Okay … So you want your damages claim upheld but in a context where your film career is booming …

Exhibit B

Simple point. What you do with a court award (i.e. giving away to charity) is an irrelevant consideration to the Court.

Exhibit C

Simple point (2). The Court of Appeal has not decided yet who is to pay the costs of the appeal …

My own recommendation is that your target audience includes judges and, of course, their Gen Y or Millenial Associates …

Next steps

The High Court of Australia is the last port of call for any appeal (as viewers of the iconic movie The Castle, will recall).  However, there is no automatic right of appeal. Rebel Wilson must first obtain special leave to appeal which involves a short hearing before a few members of the High Court. She must persuade them not only that her case has merit, but that there is a public interest point. This is not so clear from a judgment that says, in short, that there is insufficient causation to prove loss of personal income of several million dollars.

When a person appeals, the opposing party is entitled to bring their own cross appeal. Bauer Media, in this context, has a possible ground (with a public interest component) namely, whether the Court of Appeal’s construction of section 35(2) of the Defamation Act 2005 (Vic.) was correct.  Accordingly, if the High Court were to grant special leave but found in favour of Bauer Media, then Rebel could find that her current damages award of $600,000 becomes closer to $389,500.

Accordingly, the risk of a further appeal for Rebel Wilson is that she might appeal to the High Court, the High Court might grant special leave, but then it might find against her and reduce her damages further. Or she could win on all fronts so that her multi-million dollar damages award (to go to charity) is restored.

It follows that an appeal is not a natural next step. In this respect, I refer to Lesson 2 above.

 

2 Responses to “Six Lessons from the Rebel Wilson Court of Appeal decision”

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