Dyson hoovers up on appeal against Channel 4 and ITN

Background

Dyson Technology Limited and Dyson Limited sued Channel Four Television Corporation (C4) and Independent Television News Limited (ITN) for libel over claims made by C4 relating to allegations of “appalling abuse and exploitation in the factories in Malaysia where its cordless vacuums and other appliances are made”. The factories were run by a company named ATA.

Those claims were the subject of a broadcast made on 10 February 2022, which also concerned the manner in which Dyson had handled the allegations. The broadcast asked, “has this iconic British brand lost credibility?” It also referred to Dyson as “a flagship company in Britain”.

The broadcast also included footage outside a Dyson demonstration shop displaying the name Dyson and showing Sir James Dyson saying that “we are in a Dyson demo store where you can try out our technology”, as well as an interview with Dyson’s Global Manufacturing and Procurement Director in Singapore.

Paragraph 2 of the Particulars of Claim briefly set out the roles of the two Dyson companies, describing:

• Dyson Technology Limited as the UK-based company within the Dyson group that holds Dyson’s intellectual property, technology and brand rights, and that employs a number of Dyson’s executive team and retains advisers to protect the reputation of Dyson; and
• Dyson Limited as Dyson’s UK trading company.

Issues at first instance

The High Court considered that four preliminary issues should be tried, namely:

1. the natural and ordinary meaning of the broadcast;
2. whether that meaning was defamatory at common law;
3. whether the broadcast in its natural and ordinary meaning referred to the Dyson companies; and
4. whether the broadcast included statements of fact or opinion.

The judge, Mr Justice Nicklin, permitted the Dyson companies to amend their Particulars of Claim to submit that reasonable viewers would understand the broadcast to refer to Sir James Dyson and the Dyson companies without special knowledge of extrinsic facts, and that, in the alternative, the broadcast would have been understood by a substantial number of viewers to refer to the Dyson companies only.

C4 and ITN denied that the broadcast referred to the Dyson companies, arguing that they were not named, and that the broadcast lacked information that would lead a reasonable viewer to understand that the broadcast referred to them. They argued that the repeated references to the wider Dyson group’s activities in South-East Asia and an interview with the Director in Singapore meant that viewers would understand the broadcast to refer to a Singapore-based entity, rather than a British-based entity.

The broadcasters also argued that, as to the meaning of the broadcast, there was an expression of opinion such that the claimants were “responsible for” abuse and exploitation of ATA workers and for the alleged persecution of an ATA whistleblower.

High Court decision

Nicklin J noted that a claimant in cases of this sort may rely on:

• intrinsic evidence, i.e. identifying information contained within the publication or broadcast (which the judge termed “intrinsic reference”); or
• extrinsic evidence, i.e. matters known to viewers that would lead them reasonably to identify the claimant (conventionally referred to as “reference innuendo”).

Nicklin J held that, on determining whether the broadcast referred to the two Dyson companies, the first issue he had to decide was whether “without consideration of extrinsic evidence” the broadcast referred to them. He concluded that the broadcast would not reasonably be understood as being directed at the entire Dyson group, and that the ordinary viewer would identify the corporate entity trading with ATA and whichever company was responsible for the PR operation, rather than the Dyson companies. Accordingly, “based solely on intrinsic evidence in the broadcast”, the broadcast did not refer to the Dyson companies and, as such, the remaining issues fell away.

Submissions to the Court of Appeal

Dyson submissions

On appeal, the Dyson companies relied on two central submissions, namely that:

1. the judge applied the wrong test to the question of whether the words referred to the Dyson companies; and
2. in any event, the judge had erred on the subjects of the broadcast as a result of an over-elaborate analysis that was inconsistent with the content of the broadcast.

Hugh Tomlinson KC, for the Dyson companies, submitted that the judge had wrongly considered that the test for establishing reference set out in Knupffer [2] (i.e. whether the “hypothetical ordinary reasonable reader would understand the words to refer to the claimant”) applied only to cases of reference innuendo (“extrinsic evidence”), and that the judge should therefore have considered whether the words used would reasonably lead viewers familiar with the Dyson companies to believe they were the subject of the broadcast.

C4 and ITN submissions

Adam Wolanski KC, for C4 and ITN, submitted that the test in Knupffer was applied correctly. He further submitted that the judge’s conclusions as to the likely subjects of the broadcast were sound.

Court of Appeal decision

Giving a joint lead judgment, Lord Justices Dingemans and Warby began their analysis by considering how a claimant may prove to be the person identified in a statement.

• The first way is if the claimant is named or identified in such a way as reasonably to lead those acquainted with the claimant to believe that he was the person referred to, using the Knupffer test, i.e. “intrinsic reference”.
• Alternatively, a claimant may rely on particular facts known to individuals, i.e. “reference innuendo”.

Intrinsic reference

Consistently with the approach taken to the preliminary issue, the judges were mainly concerned with the first such way of identifying a claimant. They noted that the standard of reasonableness is given effect by interpreting it through the eyes and ears of a hypothetical reasonable reader or viewer, with well-established qualities, as set out in Stocker v Stocker (i.e. including a lack of naivety, an absence of undue suspicion and an ability to read between the lines, reading a piece holistically, taking “bane and antidote” together) [3]. They also considered that an appellate court should exercise “disciplined restraint” when interfering with findings made by a judge on meaning.

The Court of Appeal found that Nicklin J was incorrect in his approach to the issue of intrinsic reference.

• The judge’s approach to identification had to come from within the broadcast itself or from some extrinsic fact pleaded by way of innuendo. The judge had wrongly distinguished Knupffer on the basis that the test was applicable only where the case on identification was one of “extrinsic evidence” or “reference innuendo”.

• Nicklin J was not helped by procedure in this case, namely to have a preliminary issue about whether the broadcast in its natural and ordinary meaning referred to the Dyson companies. Furthermore, the use of “intrinsic” was unhelpful, as it led to difficulty in determining whether Nicklin J applied the Knupffer test, when it was common ground that he should have done. The Court of Appeal found that the test had not been correctly applied.

• Nicklin J had also applied the reasoning in Palace Films (a case in which the reasonable reader acquainted with the claimant company would not have considered that the words were about that company) [4], considering that the absence of a full and precise corporate name functioning as a unique identifier meant that the Dyson companies could not show that they were the subjects of the allegations in the broadcast for the purposes of intrinsic reference. Yet he had not reviewed the broadcast in light of the knowledge of the Dyson companies that a hypothetical viewer acquainted with the companies would possess.

• Nicklin J had omitted from consideration the features of the broadcast on which the Dyson companies placed heavy reliance in their submissions. The reasonable viewer acquainted with the Dyson companies would have known that Dyson Limited was “Dyson UK’s trading name” and must have operated the shops selling the products made by ATA. Also relevant were the broadcast’s references to “this iconic British brand”, “one of Britain’s most iconic British companies” and “a flagship British company”, as well as the filming of the Dyson shop.
  

Extrinsic evidence

The judge further erred in approaching this case as being limited to “intrinsic reference”. He reasoned that the broadcast pointed in general terms to a company or companies in the Dyson group that were responsible for certain disreputable acts. He further reasoned that the Dyson companies would have to plead and prove a case of extrinsic reference or innuendo in order to show that they were the subjects of the broadcast.

But the Court of Appeal identified three problems with this approach.

1. It ignored the words used in the broadcast.
2. It did not account for the fact that the hypothetical viewer acquainted with the Dyson companies would know that Dyson Technology Limited is a UK-based company that holds Dyson’s IP and protects its own reputation, as pleaded in the Particulars of Claim.
3. Nicklin J’s analysis was “unduly refined”, and the broadcast provided “no good reason” for the ordinary viewer acquainted with the claimants to think that the allegations made were the responsibility of anyone other than a “British” Dyson group company.

The broadcast had “at least the theme“ that Dyson was a leading British company selling products manufactured in Malaysia by ATA whose employees allegedly suffered abuse, and that Dyson should have been aware and should have intervened.

The Court of Appeal further disagreed with Nicklin J’s reliance on the Singapore-based director. It held that her speaking from Singapore did little to inform the reasonable viewer about Dyson’s corporate structure and, if anything, reinforced the portrayal of the British Dyson entity as responsible for the group’s global operations.

Conclusion

So the Court of Appeal allowed the appeal and set aside the order that, based solely on intrinsic evidence in the broadcast, the broadcast did not refer to the Dyson companies. The court also found that the hypothetical reasonable viewer acquainted with the Dyson companies would be able to identify them via the broadcast.

The Court of Appeal also considered it undesirable to have a preliminary determination on the issue of identification or reference that deals solely with the first (i.e. intrinsic) way of identifying or referring to claimants. This was due to the risk, as in the present case, that the determination of the preliminary issue would not determine a party’s case. The judges understood Nicklin J’s reasoning as to his non-determination of reference innuendo, as it would have required the calling of evidence. The need for caution was emphasised by the Court of Appeal when ordering a preliminary determination on the issue of identification or reference.

Comment

This case serves as a useful reminder of the test to be applied when deciding whether sufficient reference has been made to a person, such that they reach the threshold to bring an action in defamation.

The Court of Appeal decision also explored the scope of how a person may be identified. A person need not be uniquely identified by name only, but may be identified by reference to an office or role. Equally, even a full name may not be enough to identify a person, if such a name is particularly common. So it may be up to the court to resolve the question.

This case also illustrates the undesirability of using preliminary issues to determine identification or reference. Trials on a preliminary issue may be a quicker and more cost-effective short-cut to full litigation on an appropriate question. But caution should be applied to questions of identification and reference, which may not be wholly determinable within the scope of a preliminary hearing. After all, they don’t necessarily exist in a vacuum.

Article written for Entertainment Law Review.