Appleby is taking legal action against two U.K.-based media organizations, the BBC and The Guardian, over their reporting of offshore transactions by the law firm’s clients based on what Appleby calls confidential information taken in a “criminal act.”
Appleby is suing for breach of confidence and seeks a permanent injunction against further use of the information, as well as the disclosure and return of the documents.
Both the BBC and The Guardian said they would vigorously defend the revelations as being in the “highest public interest.”
The BBC claimed the leak of financial documents, branded the “Paradise Papers,” had revealed “how the powerful and ultra-wealthy secretly invest cash in offshore tax havens.”
A spokesperson for the BBC said the organization’s “serious and responsible journalism is resulting in revelations which are clearly of the highest public interest,” and has revealed matters which would otherwise have remained secret. As a result, authorities were taking action.
The Guardian said the legal action was an attempt to “undermine responsible public-interest journalism.”
Media organizations are typically allowed to disclose confidential documents, provided their content is deemed to be in the public interest. Data protection legislation in most countries, including the incoming Data Protection Law in Cayman, contains such exemptions for the media.
Appleby, in turn, argues that the documents were stolen in a data breach and that there was no public interest in the stories published about it and its clients, according to reports in the BBC and The Guardian citing legal documents Appleby sent to the organizations. About half of the 13.4 million leaked “Paradise Papers” documents belonged to the offshore law firm.
The documents were first obtained by the German newspaper, Süddeutsche Zeitung, which shared them with the U.S.-based International Consortium of Investigative Journalists (ICIJ). The ICIJ then coordinated the Paradise Papers project with 380 journalists from 96 media organizations in 67 countries.
The consortium also included the New York Times, Le Monde, the ABC in Australia and CBC News in Canada. However, Appleby has only taken legal action in the U.K.
A spokesperson for The Guardian told his own newspaper that the claim does not challenge the truth of the stories that were published. “Instead it is an attempt to undermine our responsible public interest journalism and to force us to disclose documents that we regard as journalistic material.”
The Guardian spokesperson added that the claim could have serious consequences for investigative journalism in the U.K. “Ninety-six of the world’s most respected media organizations concluded there was significant public interest in undertaking the Paradise Papers project and hundreds of articles have been published in recent weeks as a result of the work undertaken by partners. We will be defending ourselves vigorously against this claim as we believe our reporting was responsible and a matter of legitimate public interest.”
In a statement, Appleby said it was “obliged to take legal action.”
“Our overwhelming responsibility is to our clients and our own colleagues who have had their private and confidential information taken in what was a criminal act. We need to know firstly which of their – and our – documents were taken,” Appleby said.
“We would want to explain in detail to our clients and our colleagues the extent to which their confidentiality has been attacked. Despite repeated requests, the journalists have failed to provide to us copies of the stolen documents they claim to have seen. For this reason, Appleby is obliged to take legal action in order to ascertain what information has been stolen.”
Gerard Ryle, the director of the ICIJ, said the lawsuit is a potentially dangerous moment for free expression in Britain.
“By sharing the data with journalists across the world, we are able to bring a new kind of scrutiny to power.
“The BBC and The Guardian have been part of recent collaborations into financial secrecy that have changed laws from the United States to New Zealand to Europe, sending a strong message to the corporate world that some of the behavior we revealed is no longer acceptable,” Mr. Ryle said.
Wolfgang Krach, the editor-in-chief of Süddeutsche Zeitung, which received the data first, said his newspaper would not allow The Guardian, or any other partner, to make the leaked documents available to third parties.
“At the same time, Süddeutsche Zeitung is extremely worried about the attempt to force a journalistic enterprise to hand over highly sensitive data that could endanger the life and well-being of sources,” Mr. Krach said.
“Journalists must be allowed to protect their sources by all means, especially when they clearly report in [the] public interest. Therefore, we appeal to the court and the public to support The Guardian’s legitimate wish to keep the material protected.”