In this post, Jessica Eaton, an associate in the litigation team at CMS, comments on the Supreme Court’s decision in the Bloomberg LP v ZXC  UKSC 5, case which concerned the right to privacy in the context of a criminal investigation.
On 16 February 2022, the Supreme Court handed down their unanimous decision in favour of ZXC.
The Supreme Court held that, in general, a person under criminal investigation has, prior to being charged, a reasonable expectation of privacy in respect of information that relates to that investigation.
The case concerns the publication of a 2016 article by Bloomberg relating to the activities of a publicly listed company for which ZXC worked as the chief executive of one of its regional divisions (the “Article”).
The Article was based almost entirely on the contents of a Letter of Request (the “LoR”) which had been sent by a UK law enforcement body (the “UKLEB”) to their foreign counterpart seeking assistance with the criminal investigation into possible offences of corruption, bribery, offences under the Proceeds of Crime Act 2002, the Fraud Act 2006, as well as the conspiracy to commit certain offences. The letter was headed up “confidential” and in relation to confidentiality contained the following statement:
“…In order not to prejudice the investigation, I request that no person (including any of the above named subjects) is notified by the competent authorities in your country of the existence and contents of this Letter of Request and any action taken in response to it… the reason for requesting confidentiality is that it is feared that, if the above suspect [sic] or an associated party became aware of the existence of this request or of action taken in response to it, actions may be taken to frustrate our investigation by interference with documents or witnesses.”
In addition, and prior to publication of the Article, Bloomberg contacted the UKLEB. During their correspondence, the UKLEB repeatedly expressed concerns about the threatened publication and made it clear to Bloomberg that “the publication of material pertaining to a LoR will pose a material risk of prejudice to a criminal investigation.” ZXC’s solicitors also expressed concerns in response to Bloomberg’s threat of publication of the confidential contents of a LoR.
Bloomberg proceed to publish. In response, ZXC brought a claim for misuse of private information. ZXC argued that he had a reasonable expectation of privacy in the content of the Article and that his right to privacy was not outweighed by Bloomberg’s right to publish. The first instance court agreed and upheld ZXC’s claim for misuse of private information, awarded £25,000 in damages, and granted an injunction against further publication in the jurisdiction.
Bloomberg’s appeal to the Court of Appeal was dismissed. The Supreme Court has upheld that decision and ruled for ZXC.
First instance decision
Liability for misuse of private information is determined by the application of a two-stage test. Stage one concerns an objective analysis of whether the claimant has a reasonable expectation of privacy in the relevant information in the circumstances. If it is held that the claimant does have such an expectation, the court moves onto stage two of the test which involves a balancing act between the claimant’s right to privacy in the information (his Article 8 right) and the publisher’s right to publish it (their Article 10 right).
In relation to stage one, the court considered the relevant authorities and concluded that “it is possible now to say that, in general, a person does have a reasonable expectation of privacy in a police investigation up to the point of charge” and that, therefore, ZXC had a reasonable expectation of privacy in the contents of the LoR. That entitlement was not invariable, however. The court noted that the entitlement was fact dependent. In the case of ZXC, the obviously confidential nature of the LoR and the circumstances in which the letter came to be in Bloomberg’s possession, meant that Bloomberg was bound to, in the Supreme Court’s summary of Nicklin J’s judgment, “observe the confidentiality of the Letter of Request”.
In relation to stage two, the judge considered whether the public interest in the UKLEB investigation (Bloomberg’s argument in favour of publication) outweighed ZXC’s reasonable expectation of privacy. He held it did not. In fact, the judge found that “there was a very clear public interest that the contents of the LoR should not be published and that the confidentiality of UKLEB’s investigations should be maintained”.
Court of Appeal
Bloomberg appealed to the Court of Appeal.
In relation to stage one, Simon LJ agreed with the lower court that a person, such as ZXC, had a reasonable expectation of privacy in the fact of a criminal investigation up until the point of charge. The position is summarised at paragraph 82 of his judgment where he states that:
“… I would take the opportunity to make clear that those who have simply come under suspicion by an organ of the state have, in general, a reasonable and objectively founded expectation of privacy in relation to that fact and an expressed basis for that suspicion. The suspicion may ultimately be shown to be well-founded or ill-founded, but until that point the law should recognise the human characteristic to assume the worst (that there is no smoke without fire); and to overlook the fundamental legal principle that those who are accused of an offence are deemed to be innocent until they are proven guilty.”
As did Nicklin J, Simon LJ accepted that the expectation was not invariable. Rather, the general rule, applicable in this case, that the subject of a criminal investigation has a reasonable expectation of privacy in the fact of that investigation up to the point of charge is “the legitimate starting point.”
In relation to the second stage, Simon LJ found no reason to reach a different conclusion to the first instance court. ZXC’s Article 8 rights were not outweighed by Bloomberg’s countervailing Article 10 rights.
The appeal to the Supreme Court
Bloomberg appealed to the Supreme Court. The issues that arose on appeal were the following;
“(1) Whether the Court of Appeal was wrong to hold that there is a general rule, applicable in the present case, that a person under criminal investigation has, prior to being charged, a reasonable expectation of privacy in respect of information relating to that investigation.
(2) Whether the Court of Appeal was wrong to hold that, in a case in which a claim for breach of confidence was not pursued, the fact that information published by Bloomberg about a criminal investigation originated from a confidential law enforcement document rendered the information private and/or undermined Bloomberg’s ability to rely on the public interest in its disclosure.
(3) Whether the Court of Appeal was wrong to uphold the findings of Nicklin J that the claimant had a reasonable expectation of privacy in relation to the published information complained of, and that the article 8/10 balancing exercise came down in favour of the claimant.”
Most of the Supreme Court’s decision is dedicated to the first issue. Issue 2 is dealt with briefly and issue 3 was held to be dependent upon Bloomberg establishing that the Court of Appeal had erred in law on issues 1 and 2 which, the Supreme Court concluded it had not.
In relation to issue 1, the Supreme Court stated that “in order to establish misuse of private information, a claimant must first show that the information in question is private. The test at stage one is whether there is objectively a reasonable expectation of privacy taking into account all the circumstances of the case, including but not limited to, the so-called Murray factors” (which emerged from the well-known Murray v Express Newspapers plc  EWCA Civ 446 case). These factors are;
(1) the attributes of the claimant;
(2) the nature of the activity in which the claimant was engaged;
(3) the place at which it was happening;
(4) the nature and purpose of the intrusion;
(5) the absence of consent and whether it was known or could be inferred;
(6) the effect on the claimant; and
(7) the circumstances in which and the purposes for which the information came into the hands of the publisher
Importantly, Issue 1 is confined to stage one of the test – the stage at which the reasonable expectation is established – and to whether or not the Supreme Court agrees that it should be the “legitimate starting point” or general rule as per the Court of Appeal’s decision.
Before reaching a conclusion on this issue, the Supreme Court considered it appropriate to define the “legitimate starting point” phrase used by Simon LJ.
In that regard the Supreme Court, stated first and foremost that “the general rule or legitimate starting point is not a legal rule or legal presumption, let alone an irrebuttable presumption. The determination as to whether there is a reasonable expectation of privacy in the relevant information is a fact specific enquiry.” Second, that the general rule is not invariable (a point made by both lower Courts). In other words, there may well be criminal investigations in which the expectation does not arise (the Supreme Court gave the example of public rioting, a behaviour which the court in In Re JR38 made clear Article 8 is not designed to protect). Third, the existence of the general rule does not mean that the claimant is relieved from the job of setting out the circumstances that demonstrate the reasonable expectation. Fourth, if the expectation does arise but due to the factual circumstances is a reduced expectation, then that will have an impact on the strength of the Article 8 arguments at stage two. And finally, the rationale of the starting point is that publication of the relevant information can cause “harm and damage” that is on occasion “irremediable and profound.”
The Supreme Court went on to say that it considered the general rule in relation to this category of information (fact of a criminal investigation, prior to the point of charge) to operate in a similar way to general rules in relation to other categories of information (e.g. – health-related information – a category widely considered to give rise to a reasonable expectation of privacy). As with any general rule, exceptions may arise, but, for example, in respect of health-related information, there would have to be strong countervailing factors to reach a conclusion otherwise than that the information is private.
In their appeal to the Supreme Court, Bloomberg challenged the Court of Appeal’s “general rule” or “legitimate starting point” approach, essentially on the basis that it underestimated the public’s ability to appreciate the importance of the presumption of innocence so as not to presume guilt and overestimated the capacity of the publication to cause damage to reputation. Bloomberg also submitted that the lower courts had applied the incorrect legal test by giving undue weight to effect of publication on the claimant to the exclusion of the other Murray factors (listed above).
The Supreme Court rejected Bloomberg’s argument that in adopting the “legitimate starting point” approach, the lower courts had applied the wrong legal test and failed to consider properly all the Murray factors (with an overemphasis on Murray factor 6). This is not least because Nicklin LJ had considered that the most significant Murray factor was not the impact of the publication on the claimant (Murray factor 6) but rather “the circumstances in which and the purposes for which the information came into the hands of the publisher” (Murray factor 7).
Ultimately, the Supreme Court concluded that the lower courts were “correct in articulating such a legitimate starting point to the information in this case” and that “once the claimant has set out and established the circumstances, the court should commence its analysis by applying the starting point”. Importantly, the Supreme Court noted their preference for the “legitimate starting point” terminology so as to “emphasise the fact specific nature of the enquiry and to avoid any suggestion of a legal presumption.”
Significance and Comment
In order to appreciate properly the significance of the Supreme Court’s decision, it is important to consider the issues that did not arise for determination on appeal.
First, issue one – “whether the Court of Appeal was wrong to hold that there is a general rule, applicable in the present case, that a person under criminal investigation has, prior to being charged, a reasonable expectation of privacy in respect of information relating to that investigation” – was confined to stage one of the test. As noted above, the Supreme Court never got onto the balancing exercise involved in stage two of the test (issue 3) because that issue was held to be dependent upon Bloomberg establishing that the Court of Appeal had erred in law on issues 1 and 2 which, the Supreme Court concluded it had not.
Second, as “it was common ground that if someone is charged with a criminal offence there can be no reasonable expectation of privacy” the decision does not say anything about the application of the “legitimate starting point” from the point of charge or thereafter. And third, the determination in the appeal is confined to the information that relates to the investigation of the claimant by an organ of the state and not to the “distinct and separate situation that might arise if Bloomberg wished to publish information as to the results of its own investigations.”
Once the dust has settled, properly analysed, this important decision recognises a discrete point, that, in general, a person under criminal investigation has, prior to being charged (our emphasis), a reasonable expectation of privacy in respect of information that relates to that investigation. The decision does not assess the weight to be given to the competing Article 8 and Article 10 rights at stage two.
CMS acted for Bloomberg at the High Court.