Ireland: Qualified Privilege Defence Flies In Ryanair Case

Last Updated: 24 January 2018
Article by Darryl Broderick and Aisling Breen

Introduction

On 21 December 2017, Ryanair lost its High Court action for defamation against three pilots.

Ryanair brought its case against Evert Van Zwol, John Goss and Ted Murphy, founders of the Ryanair Pilot Group (RPG).

Evert Van Zwol is a pilot with KLM, Ted Murphy is a retired Aer Lingus pilot and John Goss was a pilot with Ryanair for 26 years however he was relieved of his duties in August 2013 for "gross misconduct" just days after he appeared in a Channel 4 television programme which made defamatory remarks regarding the airlines commitment to safety. 

A jury found a September 2013 email "Pilot update: what the markets are saying about Ryanair" did in fact mean that the airline was guilty of market manipulation, but in their majority verdict of 11 members of the jury, they found Ryanair had not proved malice by the three defendants.

Information regarding the "Pilot update" email

In May 2013 the airline had published its annual results for the year end of that financial year (31 March 2013) saying it had a very profitable year but advising the outlook for the coming year was cautious due to increased costs.

A short while after those results were released, Ryanair chairman David Bonderman sold 1.5 million shares in the airline that he had held in trust for his children. Non – executive Ryanair director Michael Horgan sold 25,000 share options. The sales were during the 28 – day quarterly "window" period permitted by the stock market where those affiliated with the company could sell; the sales were then notified to the airline. Ryanair claimed that there was no significant increase in the share price during the two-week period in which the two men sold their shares.

On 4 September 2013, the airline issued a trading update informing investors that profits would come in at the lower end of what had previously been predicted.

One week later, the email was circulated to the RPG. Ryanair immediately sought an apology and requested that the three defendants retract the email which was circulated to 2,289 Ryanair pilots. Ryanair also sought details of the RPG membership but this was refused.

The airline claimed that the email falsely inferred Ryanair management had misled investors and facilitated insider dealings by management. The three defendants denied defamation and denied the meaning attributed to the words of the update by Ryanair. They also said the words had the benefit of qualified privilege whereby a statement published to someone with an interest in receiving such information is protected as long as it is not motivated by malice.

Current Law

Section 19(1) of the Defamation Act 2009 provides that the onus lies on the plaintiff to prove that the defendant acted with malice.

In defamation cases it is for the judge to decide whether there is any evidence of malice fit to be considered by the jury, in other words whether there is a substantial amount of evidence in which a reasonable man could find malice. There also needs to be strength to the evidence before it goes to the jury.

Decision

The jury of nine men and two women (one member was unavailable on the final day of trial due to illness) found the update was published on an occasion of qualified privilege, which is only lost where malice is proven, and as a result there was no defamation.

Mr Justice Bernard Barton dismissed the case and granted costs to the defendants but put a 'stay' on this order in the event of an appeal.  

Comment

Decisions in High Court defamation cases in this jurisdiction are rare as most cases settle or do not proceed as there are significant risks for both Plaintiffs and Defendants in putting a case to a jury for decision when one consider the costs of High Court litigation coupled with the often unpredictable outcome in jury trials.

While the case is noteworthy because of the high profile participants, the seven week duration and the fact that it is a rare jury decision in a defamation case, one has to question the precedent value of the case given that every jury is different and a different jury may have come to a different decision, even if the same case was run before it. Leaving that aside, it is an indication that communications can be "privileged" even where the recipients of the information communicated consist of a relatively large group of people   - in this case over 2,000  - once that group has a common cause, the information in question has a relevance to that cause and there is no ulterior motive on the part of those distributing the information. However no-one should be getting carried away with the decision and it is well recognised that Irish defamation laws are still a significant restraint on freedom of expression.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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