Key facts
- Prince Harry and six other public figures lost a High Court privacy case against Associated Newspapers.
- The claimants are liable for an estimated £19 million in legal costs.
- The judge ordered the claimants to pay interim costs of £9.5 million.
- The publisher could seek to recover up to £34.5 million in total legal costs.
- Experts predict a rise in After the Event (ATE) insurance premiums due to the ruling.
Prince Harry and six other high-profile individuals, including Sir Elton John and Sadie Frost, have suffered a significant defeat in their High Court privacy case against the publisher of the Daily Mail. The group brought the lawsuit in 2022, alleging serious privacy breaches over three decades.
Following the ruling, the claimants are now on the hook for a substantial portion of the legal costs. Judge Matthew Nicklin ordered them to pay interim costs of £9.5 million by August 28th, a figure significantly above the court's original budget. The publisher, Associated Newspapers, could seek to recover its entire £34.5 million in legal expenses, as the judge decided not to impose a ceiling on the recoverable costs, despite acknowledging concerns about whether all claimed costs were reasonably incurred.
This outcome has raised concerns within the legal insurance market. Experts suggest that After the Event (ATE) insurers, which cover legal costs in case of loss, may become more cautious. Nick McDonnell, a costs lawyer, noted that insurers might more heavily factor in the risk of an indemnity costs order, particularly in complex group litigation. This could lead to increased premiums, potentially making it harder for claimants to pursue viable legal actions.
Rocco Pirozzolo, an underwriting director at Harbour Underwriting, echoed these sentiments, suggesting that insurers might need to increase pricing to reflect the risk of indemnity costs being ordered, as they have limited control over how a case is managed once cover is in place. PR strategist Mark Borkowski anticipates that insurers will begin asking more stringent questions during the underwriting process following this case.