UK Court of Appeal grants interim injunction on foot of non-disclosure agreements in misconduct proceedings

The UK Court of Appeal has granted an interim injunction against The Telegraph newspaper, preventing it from publishing allegations of discreditable misconduct that were the subject of a non-disclosure agreement (NDA).

The case involved five employees who alleged that a high profile senior executive of two companies had engaged in ‘discreditable conduct’. Each of the employees brought complaints which ended in settlement agreements involving a NDA and substantial payment. The NDAs did allow the right to make legitimate disclosures, including reporting a criminal offence. The employees received independent legal advice in respect of these agreements. The Telegraph sought to publish the allegations despite being aware of the NDAs, leading to the senior executive and two companies seeking an interim injunction pending trial.

The High Court refused to grant the injunction, on the basis that the information was reasonably credible, there was little or no expectation of privacy in respect of the information, information was already believed to be in the public domain and it had not been shown that the information had been obtained in breach of the NDAs. It was also decided that the publication of this information would be in the public interest.

In the Court of Appeal, the completing interests of the parties under Article 10 (freedom of expression) and Article 8 (respect for private and family life) of the European Convention on Human Rights (ECHR) and the Human Rights Act 1998 were considered. In so doing, the Court found that freedom of expression can be qualified “for the protection of the reputation or rights of others, for preventing the disclosure of information received in confidence”.

The Court was of the view that the publication of the information would cause immediate, substantial and possibly irreversible harm to all of the claimants. The Court believed that some information had been obtained in breach of the NDAs and that serious allegations had been made which were denied by the claimants. The settlements meant that the opportunity to judicially examine the allegations had been lost and that the claimants would be curtailed in rebutting these details by virtue of the NDAs.

While the publication was undoubtedly in the public interest, the Court believed that this was outweighed by the protection of confidentiality and the legitimate role that NDAs can play in the consensual settlement of disputes where freely entered in to. The Court referred to the Report of the House of Commons Women and Equalities Select Committee on Sexual Harassment in the Workplace which criticised NDAs when used to ‘gag’ victims, however acknowledged the value of agreements that are genuinely in the best interests of the complainant. The Court found that the NDAs in this case were not the result of bullying, harassment or undue pressure. This was particularly in light of the independent legal advice received and the right to disclose information to regulatory or statutory bodies.

The case has prompted Prime Minister Teresa May to commit to bring forward measures that will improve the regulation of NDAs given their unethical use by some employers.

Click here for the decision in ABC v Telegraph Media Group.




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