BW Legal Services Ltd v Trustpilot A/S

Factual and Procedural Background

The Plaintiff is a law firm specialising in debt recovery. The Defendant operates the well-known website Trustpilot. The Plaintiff brought libel proceedings concerning reviews about the Plaintiff published on Trustpilot. Initially, the claim concerned 136 reviews, but was later amended to focus on twenty reviews posted between 21 February 2020 and 17 July 2021 ("the Twenty Reviews"). The Plaintiff seeks damages between £10,000 and £50,000, an injunction, and an order under section 12 of the Defamation Act 2013 that the Defendant publish a summary of the court's judgment.

The background was previously addressed in a judgment following a preliminary issue trial. On 12 July 2023, the Defendant filed a detailed defence pleading general defences including that it is not a publisher under statute or common law, and defences of truth, honest opinion, and publication on a matter of public interest in respect of each review. The Defendant also contended that the Twenty Reviews have not caused or are not likely to cause "serious harm" to the Plaintiff's reputation as required by section 1 of the Defamation Act 2013.

The Plaintiff served its reply on 8 November 2023. The Defendant then applied for summary judgment on the basis that the Plaintiff has no real prospect of establishing serious harm or serious financial loss caused by the Twenty Reviews. Alternatively, the Defendant sought to strike out the claim for abuse of process arising from delay. The strike-out application was not pursued at the hearing.

Legal Issues Presented

1. Whether the Plaintiff has a real prospect of proving that the publication of the Twenty Reviews caused or is likely to cause serious harm to its reputation as required by section 1 of the Defamation Act 2013.
2. Whether the Plaintiff has a real prospect of proving that the Twenty Reviews caused or are likely to cause serious financial loss pursuant to section 1(2) of the Defamation Act 2013, given that the Plaintiff is a body trading for profit.
3. Whether summary judgment is appropriate on the basis that there is no real prospect of success on the claim.
4. Whether the claim should be struck out for abuse of process due to delay.

Arguments of the Parties

Defendant's Arguments

• The Plaintiff cannot prove actual financial loss resulting from the Twenty Reviews, particularly the specific loss of a tender opportunity with a telecoms company ("Three").
• The claim based on "loss of chance" is inherently problematic as the Plaintiff cannot prove it would have been awarded the contract absent the reviews.
• The contemporaneous documents and correspondence contradict the Plaintiff’s case, showing the tender process was reconsidered and the final decision was to stay with the incumbent supplier for reasons unrelated to the reviews.
• The Plaintiff has failed to provide sufficient evidence that the three relevant reviews were seen by Three or caused the loss of the tender opportunity.
• The inferential case of likely financial loss is unsupported by any evidence of lost business or downturn in turnover after four years.
• The Defendant contends that the Plaintiff's case is speculative and unsupported, relying on general assertions without meaningful evidence or indication of further evidence to be produced.
• There is no compelling reason for the claim to proceed to trial given the lack of real prospect of success.

Plaintiff's Arguments

• The Plaintiff pleads serious harm both actual and likely, including serious financial loss, relying on the seriousness of the defamatory meanings, the extent of publication, and the status of the Defendant’s website.
• The Plaintiff claims loss of chance regarding the rejected tender with Three, asserting that the reviews influenced Three’s perception and decision.
• The Plaintiff argues that "loss of chance" is a recognised basis for damages under section 1(2) and that the claim has significant financial value.
• The Plaintiff contends that the contemporaneous documents do not tell the full story and that witness evidence will provide necessary context and explanation of the tender process and reasons for failure.
• The Plaintiff maintains that the inferential case on likely future financial loss is supported by the nature of the reviews, the Defendant’s platform prominence, and the number of views the reviews received.
• The Plaintiff notes that evidence of harm to business reputation often does not appear in documentary form, and that it is common for potential clients to be deterred without direct evidence of lost contracts.
• The Plaintiff intends to produce further evidence, including witness statements, to support its case on serious harm and financial loss.

Table of Precedents Cited

Court's Reasoning and Analysis

The court applied the well-established principles governing summary judgment, focusing on whether the Plaintiff had a realistic prospect of success and whether there was any compelling reason for trial. The court noted that serious harm under section 1 of the Defamation Act 2013 requires proof of actual or likely serious harm to reputation, and for a body trading for profit, proof of serious financial loss causally linked to that harm.

The court analysed the Plaintiff’s pleaded case on actual financial loss, which was principally based on a lost tender opportunity with Three. It found that only three of the Twenty Reviews had been published at the relevant time, limiting the scope of the claim. The contemporaneous correspondence revealed that Three initially rejected the Plaintiff’s bid citing general concerns including Trustpilot feedback, but then reconsidered and allowed the Plaintiff to proceed further in the tender process. Ultimately, Three chose to remain with its incumbent supplier for reasons unrelated to the reviews.

The court found the Plaintiff’s case on causation problematic, noting the absence of evidence that Three saw the specific reviews or that the reviews caused the loss of the tender. The Plaintiff’s reliance on a "loss of chance" was not pleaded as a damages claim and was considered speculative without evidential support. The court also found the inferential case on likely financial loss unsubstantiated by any evidence of lost business beyond the Three tender, despite the passage of several years since publication.

The court gave weight to the contemporaneous documentation over the Plaintiff’s unsubstantiated assertions and noted the Plaintiff’s failure to indicate what further evidence might be forthcoming or to provide reasonable grounds for expecting such evidence. The court acknowledged the seriousness of the defamatory imputations but emphasised the critical importance of causation and the evidential burden on the Plaintiff.

Overall, the court concluded that the Plaintiff had no real prospect of proving that the Twenty Reviews caused or were likely to cause serious financial loss, and thus failed the threshold requirement of section 1 DA2013. Consequently, there was no compelling reason for the claim to proceed to trial.

Holding and Implications

The court granted summary judgment in favour of the Defendant, concluding that the Plaintiff has no real prospect of success in proving serious harm and serious financial loss caused by the Twenty Reviews.

The direct effect is the dismissal of the Plaintiff’s claim at summary judgment stage. The court did not set any new legal precedent but applied existing principles to the facts of this case. The strike-out application was not pursued and therefore not decided. The judgment underscores the evidential rigor required to satisfy the serious harm threshold in defamation claims involving bodies trading for profit, particularly the necessity to prove causation and serious financial loss with sufficient evidence.