MX1 Ltd & Anor v SES S.A

This is the second hearing of an application by MX1 Limited (“MX1”) and SES SA (“SES”) (together the “applicants” or the “claimants”) for a search order against Mr Fardad Farahzad (“Mr Farahzad”) under section 7 of the Civil Procedure Act 1997 (“the 1997 Act”) and CPR part 25.1(1)(h).

The application has been made without notice to the defendant. I agreed at the outset of the first hearing, which took place on 13 March 2018, that I would accede to the applicant's application that the hearing be in private pursuant to CPR part 39.2(3)(a) on the ground that publicity would defeat the object of the hearing, and on the ground that under CPR part 39.2(3)(g) a private hearing was necessary in the interests of justice. It will, however, be necessary after this judgment has been completed to consider with counsel when it is appropriate for this judgment to be made public.

SES is one of the world's largest communications satellite owners and operators. It is publicly listed on the Luxembourg Stock Exchange and on Euronext in Paris. It is part owned by the Government of Luxembourg which directly or indirectly holds 33.3% of its voting shares. It has a turnover of some 2 billion euros.

MX1 is a subsidiary of SES which provides content management delivery and digital media services. The predecessor of MX1 was an Israeli based company called RR Media which SES acquired indirectly, as I understand it, in July 2016.

The present application results from 60 tweets published by a Twitter account going under the title @MX1 Leaker (the “Twitter account”) between 13 January 2017 and 13 March 2018 (the “Tweets”). The Tweets make various allegations of bribery and corruption against MX1 which are summarised in what will become schedule 1 to this judgment.

The applicants maintain that the Tweets have the potential to cause serious damage to their business because they operate in a highly regulated sector. They are subject to anti-bribery laws, both in the United Kingdom and in other countries and they have many customers who are sensitive to such matters and to such allegations being made against them. The applicants also submit that the Tweets disclose various documents and information that are confidential to them. The nature of that confidential information has changed, actually reduced a little, since the first hearing before me, and I shall include in schedule 2 to this judgment what is alleged by the claimants now to be demonstrably confidential as contained in the Tweets.

The applicants believe that the Twitter account was created and operated by Mr Farahzad. Since 2008 Mr Farahzad has been employed by the BBC and currently works, as I understand it, as a news anchor for the BBC Persian Service. He is also said to be the owner and director of a company called Wide Network Solutions International Limited (“Wide Network”), which acted as a reseller for RR Media until its acquisition by SES.

The applicants contend that Mr Farahzad could not have acted alone and would, in making the Tweets, have required assistance from their current or former employees, otherwise he would have been unable to obtain the information that is contained in some at least of those Tweets.

The applicants submit that the information was provided, at least in material part, by three former employees of RR Media, namely a Mr Shmulik Koren, the former chief financial officer (“Mr Koren”), Mr Shalom Izkovitz, the former global head of sales (“Mr Izkovitz”) and Mr Rami Goldberg, the former Middle East sales manager (“Mr Goldberg”). I shall refer to these three former employees in this judgment as the “former employees”.

The applicants are investigating the truth or otherwise of the allegations in the Tweets. They have scheduled to their draft particulars of claim those pieces of information which they believe to be untrue. That schedule was added to the particulars of claim after the last hearing before me, and is reproduced as schedule 3 to this judgment. It makes clear that there are only a limited number of matters in the Tweets that the appellants are actually able to say are positively untrue and even then that is mostly on the basis that the applicants are unaware of the corruption or bribery investigation alleged in the particular tweet.

It follows that, as matters stand today, there are many matters in the Tweets that may or may not be true. Notably there are allegations of bribery and corruption in the Tweets, none of which the applicants are able positively to say to the Court are false, and the applicants are also unable to tell the Court whether or not it is true that they are being investigated by the US authorities in connection with these allegations. They do, however, submit to me that in May 2017 they self-reported the allegations of bribery and corruption to the US Department of Justice and have then since held meetings with the Department of Justice, although there have been no charges brought. They do not give any evidence as to the current state of that investigation.

Accordingly, the applicants are not in a position to bring proceedings against the defendant for defamation and instead intend to bring claims against Mr Farahzad and the former employees based upon an alleged lawful means conspiracy and an alleged unlawful means conspiracy. As regards the latter, the unlawful means are the alleged breaches of confidence to which I have already referred.

The applicants say that this application for a search order is required to preserve evidence to support their claims, including: evidence that it was Mr Farahzad who set up the Twitter account, evidence that he has conspired with others in relation to making or producing or writing the Tweets, evidence as to the identity of the other parties to the alleged conspiracy, and evidence that the conspirators, including particularly Mr Farahzad as the defendant to this application, had a predominant purpose of injuring the applicants.

On 6 July 2016 SES acquired indirectly RR Media for the sum of US$242 million. It subsequently combined RR Media's operations with its existing platform services business and named the resulting entity MX1. On the day of the acquisition, as it appears, Mr Koren resigned from RR Media, leaving that employment three months later. Mr Izkovitz resigned on 20 July 2016, that is two weeks later, and Mr Goldberg did so on 4 August 2016, a further two weeks later. Each of the latter former employees, Mr Izkovitz and Mr Goldberg, left the employment of the applicants a month after that.

Since December 2016, the applicants have been in dispute with the former employees. It is alleged that the former employees enticed various customers of RR Media to competing companies that they owned, in particular IKO Media Group Limited in the British Virgin Islands, and IKO Media Group AG in Switzerland (together “IKO”).

It is alleged that by enticing these customers away from the applicants the former employees breached their obligation not to disclose or use the applicants' trade secrets, breached their obligation not to compete with the applicants and also broke various other contractual obligations owed by the former employees to the applicants.

These claims are being pursued by MX1 in the Israeli Labour Court and I shall refer to them as the “first Israeli proceedings”.

In addition, SES has brought claims against Mr Koren in the Israeli District Court of Tel Aviv for fraud and misrepresentation in respect of the sale of RR Media. I shall refer to those proceedings as the “second Israeli proceedings”.

On 13 January 2017 the Twitter account was created. Between that date and 11 March 2018, the Tweets were published. Having become aware of the Twitter account on the day that it was created, SES engaged Kroll Associates UK (“Kroll”) in March 2017 to investigate it. In their defence in the first Israeli proceedings filed on 7 February 2017 the former employees made similar but not identical allegations to those made in some of the Tweets. In Mr Koren's defence in the second Israeli proceedings filed on 3 May 2017 and in a counterclaim filed on the same day, these allegations were repeated.

The applicants have not put before the Court evidence of any of the documents from the Israeli litigation, despite my suggesting that that might be useful for the Court to see some of it at the last hearing, but it may be that those documents are not in English.

The applicants maintain that the allegations made in that litigation are more general in nature than those made in the Tweets, that the allegations lack the detail contained in the Tweets and, apart from the document published in the tweet of 10 May 2017 and the name of one of the sales agents mentioned in the tweet of 26 April 2017, do not include any of the same subject matter.

For these reasons and because the allegations in the Tweets purport to be from an insider, the applicants say they are more damaging than the allegations in the Israeli proceedings.

On 3 May 2017 MX1 commenced what are called in America, “John Doe proceedings”, brought against persons unknown in the Northern District Court of California. They alleged a malicious effort to disparage and injure MX1 by the holder of the Twitter account and sought injunctive relief and damages.

On 11 May 2017, MX1 filed an ex parte application for an order for discovery from Twitter Inc (“Twitter”) to obtain information reasonably likely to lead to the identity of the account holder. That was rejected on 31 May 2017 on grounds of jurisdiction.

On 5 July 2017 MX1 commenced similar proceedings in the Central District Court of California and filed a similar application. This time on 12 July 2017 the application was granted. Consequently on 16 September 2017 Twitter provided certain information to MX1, including first the Gmail account address given by the creator of the Twitter account (the “Gmail account”) and, secondly, three IP addresses that accessed the Twitter account, the first of which was used to create it. I shall call that IP address the first IP address.

On 12 October 2017, MX1 made another ex parte application in the Central District Court of California, this time for an order for third party discovery from Google Inc (“Google”) to obtain details of the identity of the owner of the Gmail account. The application was granted. On 20 November 2017 Google provided the requested data, which included first the UK mobile phone number given by the Gmail account holder (the “UK number”) and, secondly, the IP address used to create the Gmail account, which was the first IP address.

Kroll then investigated the UK number. It concluded on 30 November 2017 that it was registered to a network operated by a company known as Vectone Mobile Limited (“Vectone”). It had already determined from the information provided by Twitter that the first IP address was registered to an internet service provider known as Hyperoptic Limited (“Hyperoptic”).

In the light of this information the applicants made a without notice application in the London Circuit Commercial Court, also part of the Business and Property Courts of England and Wales here in the Rolls Building, for a Norwich Pharmacal order against Vectone and Hyperoptic. Their application was transferred to the Commercial Court in the Business and Property Courts, of the court's own motion.

The application was heard in private by Mr Justice Knowles on 15 December 2017. On 18 December 2017 Mr Justice Knowles made an order requiring that by 4 pm on 5 January 2018 Vectone should disclose to the applicants the name, address, email address and any other contact details it held of the holder of the UK number and, secondly, that Hyperoptic should disclose similar information in relation to the first IP address (the “order”).

In paragraph 3 of schedule A to the order the applicants undertook that they would not, without the permission of the Court, "make use of any of the information obtained as a result of had order save for the purpose of this claim" (the “Undertaking”). This claim was their claim against Vectone and Hyperoptic.

The return date of the order was initially 12 January 2018 but has been extended by two consent orders dated respectively 12 January 2018 and 27 February 2018 until 28 March 2018.

It subsequently became clear to the applicants that for technical reasons Hyperoptic would be unable to provide them with any useful information regarding the first IP address. Vectone was, however, able to confirm on 2 January 2018 that the UK number was held by a Mr Fredy Fernando of flat 103, New Providence Wharf, London, E14 9PA (the “NPW address”).

Kroll investigated this information and concluded that Mr Fredy Fernando was unlikely to be a real person and identified as a result of surveillance activities conducted on 7 and 8 March 2018 the occupant of the NPW address as Mr Farahzad.

It also noted that Mr Farahzad was the sole director and shareholder of a company called Facebook Travel Limited which was registered at the NPW address. As a result the applicants began preparing proceedings and an application for a search order against Mr Farahzad. In so doing they were breaking the undertaking they had given to the Commercial Court by using information resulting from the order for purposes other than their claim against Vectone and Hyperoptic.

On 9 March 2018, however, the applicants applied to the Commercial Court for retrospective permission to use information resulting from the order to first prepare and bring substantive proceedings against Mr Farahzad and other necessary or proper parties; secondly, to apply for a search order in support of such proceedings; and thirdly, to make all reasonable investigations and inquiries for these purposes. In their application the applicants explained that their breach of the undertaking had resulted from a belief that it was common practice for the Court to permit claimants to apply for permission to rely on evidence obtained in previous proceedings at the same time as applying for substantive relief based on that evidence. They realised, however, when the judgment in Tchenguiz v Grant Thornton LLP [2017] EWHC 3310 (Comm) came to their attention that this belief was mistaken. Their application was considered on paper by Mr Justice Popplewell in the Commercial Court and was granted on 12 March 2018.

On 13 March 2018 the applicants made their without notice application to me for a search order. I expressed certain concerns as to the state of the evidence. Specifically I suggested that the defendant was an apparently respectable journalist who showed up on internet searches as having been very active on Facebook in relation to the BBC, and that he might be motivated by a desire to expose corruption and possibly by a desire to act in the public interest, rather than by the necessary "predominant intention to injure" the applicants. I questioned whether the material in the Tweets was already in the public domain and asked what evidence there was about investigations being made by public authorities overseas into the alleged corruption. Finally I asked whether the applicants could say that the allegations made in the Tweets were untrue and, as I have already said, that resulted in a new schedule to the particulars of claim now appended to this judgment as schedule 3.

Against that background, I have to consider the relevant law applicable to the granting of search orders, and to the causes of action raised by the applicants, and then to apply that relevant law to the facts of this case and to the submissions which I shall record in a moment, made helpfully on 13 March and this morning to me by Mr Michael Lazarus, counsel for the applicants.

The Court's jurisdiction to grant a search order derives from section 7 of the 1997 Act, which provides as follows:

“(1)

The court may make an order under this section for the purpose of securing, in the case of any existing or proposed proceedings in the court—(a) the preservation of evidence which is or may be relevant, or (b) the preservation of property which is or may be the subject-matter of the proceedings or as to which any question arises or may arise in the proceedings.

(2)

A person who is, or appears to the court likely to be, a party to proceedings in the court may make an application for such an order.

(3)

Such an order may direct any person to permit any person described in the order, or secure that any person so described is permitted—(a) to enter premises in England and Wales, and (b) while on the premises, to take in accordance with the terms of the order any of the following steps.

(4)

Those steps are—(a) to carry out a search for or inspection of anything described in the order, and (b) to make or obtain a copy, photograph, sample or other record of anything so described.

(5)

The order may also direct the person concerned—(a) to provide any person described in the order, or secure that any person so described is provided, with any information or article described in the order, and (b) to allow any person described in the order, or secure that any person so described is allowed, to retain for safe keeping anything described in the order.

(6)

An order under this section is to have effect subject to such conditions as are specified in the order.

(7)

This section does not affect any right of a person to refuse to do anything on the ground that to do so might tend to expose him or his spouse or civil partner to proceedings for an offence or for the recovery of a penalty.

(8)

In this section—

"court" means the High Court, and "premises" includes any vehicle;

and an order under this section may describe anything generally, whether by reference to a class or otherwise.”

CPR Part 25.1 further provides as follows:

"(1)

the Court may grant the following interim remedies ...

(h)

an order referred to as a 'search order' under section 7 of the [1997 Act] (order requiring a party to admit another party to premises for the purposes of preserving evidence et cetera)."

The matters which an applicant is required to establish in order to justify the grant of a search order as a matter of discretion were established in Anton Piller KG v Manufacturing Processes Ltd [1976] Ch. 55, and are set out in volume 2 of the Civil Procedure Rules at paragraph 15-91. That passage reads as follows:

“Although in the Anton Piller case Lord Denning spoke of “an extreme case”, in practice orders are granted far too routinely for them to be regarded as exceptional. However, the court still insists on a clear showing of fraud, dishonesty, contumacy, or imminent removal or destruction of property or evidence. The overriding principle is that of necessity. No order ought to be made unless it is necessary in the interests of justice. The so-called “balance of convenience” test, which plays a leading role in most decisions to grant interlocutory injunctions, has little, if any role to play in an application to grant a search order. Consistent with the principle of necessity, the cases have established the following conditions for the making of an order (see 1992 Consultation Paper, paras 2.4, et seq., and the summary in Indicii Salus Ltd v. Chandrasekaran [2006] EWHC 521 (Ch), February 15, 2006, unrep. (Warren J.)).

(1)

There must be a strong prima facie case of a civil cause of action. Suspicion that there may be a cause of action should not be enough. A scrutiny of the merits of the claimant’s case is an essential preliminary to the grant of a search order. It is not sufficient for the applicant to show merely a “serious question to be tried” (as is sufficient in applications for orthodox interlocutory injunctions).

(2)

The danger to the claimant to be avoided by the grant of an order must be serious. If an order is sought in order to forestall the destruction of evidence, the evidence in question must be of major, if not critical, importance.

(3)

There must be clear evidence that the defendants had in their possession incriminating documents or things.

(4)

The risk of destruction or removal of evidence must be a good deal more than merely possible. (In Booker McConnell v. Plascow Plc [1985] RPC 425 at 441, CA, Dillon LJ referred to “a real possibility”, which he contrasted with “extravagant fears which seem to afflict all claimants who have complaints of breach of confidence, breach of copyright or passing-off”.) The fact that a respondent can be shown to have behaved improperly will not always justify an order. There must be a real reason to believe that the respondent will disobey an injunction for the preservation of the evidence in question.

(5)

The harm likely to be caused by the execution of the order to the respondent and his business affairs must not be excessive or out of proportion to the legitimate object of the order. This precondition is particularly relevant where the seizure of trading stock or the perusal by the claimant of confidential commercial documents will be the effect of execution of the order and is strongly analogous to the principle of proportionality as applied by the European Court of Human Rights.

If any of these pre-conditions is absent, the weight of judicial authority suggests that an application for the grant of a search order should be refused. If each of these preconditions appears to be present, an order will not necessarily be justified. The court will still have to weigh in the balance the claimant’s need for the order against the injustice to the respondent in making the order ex parte without any opportunity for the respondent to be heard. The judge who hears the application for the order should keep in mind that, in as much as audi alteram partem is a requirement of natural justice, the making of an ex parte mandatory order always risks injustice to the absent and unheard respondent. The order should not be made unless it appears that, without the order, the claimant will be likely to suffer a greater injustice than that which the court, by making the order, will be inflicting on the respondent (see Columbia Picture Industries v. Robinson [1987] Ch 38; [1986] 3 WLR 542; [1986] 3 All ER 338). The court requires proportionality between the perceived threat to the claimant’s rights and the remedy granted. The fact that there is overwhelming evidence that the defendant has behaved wrongfully in his commercial relationships does not necessarily justify a search order. People whose commercial morality allows them to take a customer list will not necessarily disobey an order of the court requiring them to deliver it up. Not everyone who is misusing confidential information will destroy documents in the face of a court order requiring him to preserve them (Lock International Plc v. Beswick [1989] 1 WLR 1268, [1989] 3 All ER 373) (Hoffmann J.)).”

Mr Lazarus has submitted in the course of argument this morning that under the second condition recorded in the White Book, which is that "the danger to the claimant to be avoided by the grant of an order must be serious", the word "danger" should properly read "damage". I shall assume for the purposes of this application that he is right and apply the test on the basis that the second question to be considered by the Court is whether "the damage to the claimant to be avoided by the grant of an order" is serious.

The leading authority on a lawful means conspiracy is Crofter Hand Woven Harris Tweed Company v Veitch [1942] A.C. 435 (“Crofter”).

Self-evidently the tort does not require the defendants to have committed any unlawful acts, but it does require the following three elements: there must be first an agreement between the defendants (i.e. the parties to the conspiracy); secondly, that agreement must be to effect an unlawful purpose; and thirdly, it must result in damage to the claimants (see Viscount Simon at page 440 in Crofter).

The first and third elements are normally predominantly questions of fact, but it is around the second question or element that legal issues often arise. In respect of that second element the House of Lords in Crofter approved two propositions of law formulated by Lord Cave in the earlier case of Sorrell v Smith [1925] A.C. 700 (“Sorrell”). See Viscount Simon at pages 441-2 and Viscount Maugham at page 449 and Lord Wright at page 469:

“(1)

a combination of two or more persons wilfully to injure a man in his trade is unlawful and, if it results in damage to him, is actionable.

(2)

if the real purpose of the combination is not to injure another but to forward or defend the trade of those who enter into it, then no wrong is committed and no action will lie, although damage to another ensues.”

In that case, however, it was acknowledged, as it had been by Lord Cave in Sorrell, that these propositions were formulated in the context of the case then being decided and were not sufficient to dispose of all cases. By way of example, they refer to cases in which the combiners have mixed or different objectives. These situations are dealt with in the following passages from Clerk and Lindsell on Torts,22^nd edition, which also provides some guidance on whether particular purposes are considered legitimate or illegitimate:

"Legitimate and illegitimate objects

24-109 ... a genuine belief that [legitimate] objectives are the object and likely result of the combination is now enough to validate it. It is worthy of note that in some cases trade union officials have escaped liability for conspiracy to injure by reason of the fact that they acted in order 'to forward what they believed to be the interests of the union and fundamental trade union principle' [Stratford & Son Ltd v Lindley [1965] A.C. 269 at 323]. That genuinely held belief is sufficient to establish pursuit of a legitimate interest even if damage to the employer is known to be inevitable and is even intended.

24-110 The action taken should not exceed what is necessary for the protection of such legitimate interest and although liability is not to be determined by asking whether the damage inflicted is disproportionate to the objective 'this had may throw doubt on the bona fides of the avowed purpose' [Crofter at 447 per Viscount Simon]. To be legitimate it is not necessary that the interests should be material in that they can be exchanged for cash ...

24-111 On the other hand, Quinn v Leathem [1901] A.C. 495 shows that a combination is wrongful if the real object is an intention to injure ... if the object is to injure the claimant by way of punishing him or by way of compelling him to pay a debt, it is an actionable conspiracy ... action taken in pursuit of political goals (other than those which are proscribed by legislation) might possibly be seen as pursuit of a legitimate objective ...

Mixed objectives and predominant purpose

24-112 It is plain that a combination may have more than one object or purpose. If so 'liability must depend on ascertaining the predominant purpose'. If that predominant purpose is to damage another person and damage results, that is a tortious conspiracy. If the predominant purpose is the lawful protection or promotion of any lawful interests of the combiners (no illegal means being employed) it is not a tortious conspiracy, even though it causes damage to another person [Crofter at 447 per Viscount Simon]. In ascertaining the predominant purpose the Court can have regard to both the short and the long-term objectives of the combiners.

Disparity of interests and objects

24-113 To be legitimate there need not be 'a complete identity of interest between parties to a combination', but there must be 'sufficient identity of object, though advantage to be derived from that same object may not be the same' [Crofter at 479 per Lord Wright] ... it has been said however that if a conspiracy be once established 'the actions of any one of them (ie the conspirators) in furtherance of the objects of their conspiracy will be treated as the actions of all of them' [EC Thompson & Co Ltd v Deakin [1952] Ch. 646 at 674 per Evershed MR]. But where the aims or objects of the combiners are distinct and certainly where their knowledge of the facts differs, the Court does not adopt that approach to the extent of imputing the motives of one conspirator to all of the others [eg Huntley v Thornton [1967] 1 WLR 321 at 343]. A party to a combination who had a separate and predominantly vindictive or mercenary object of his aim other than trade interests might not be protected [per Lord Thankerton in Crofter at 460], but in such a case if the other parties have predominantly lawful objects of their own and he commits no unlawful act or threat, he will, even though malicious, incur no liability at all [Allen v Flood [1898] A.C. 1]. If, however, the other parties know of and countenance his vindictive purpose, they will, it is submitted, be jointly responsible with him for wrongful conspiracy [Lord Porter in Crofter at 495].

Onus of proof

24-114 The burden of proving both the combination and the purpose of damaging the claimant is normally on the claimant himself ..."

I have cited these passages at length because the tort of lawful means conspiracy is certainly not the most straightforward of torts. This case specifically engages the question of Mr Farahzad’s predominant purpose, and in considering whether there is a strong prima facie case in accordance with the criteria that I have already mentioned, I have had specific and detailed regard to the passages that I have cited which, as it seems to me, reflect the current law.

Clerk and Lindsell, 22^nd edition, summarises the element of the tort of unlawful means conspiracy and provides some guidance relevant to the facts of the present case as follows:

“24-98 This form of the tort is committed where two or more persons combine and take action which is unlawful in itself with the intention of causing damage to a third party who does incur the intended damage. It is not necessary for the injured party to prove that causing him damage was the main or predominant purpose of the combination but that purpose must be part of the combiners’ intentions. The main issues raised by this form of the tort are first the degree of intention required and second the ambit of unlawful means …

24-101 There is no good reason why the ambit of “unlawful means” in this form of conspiracy should not be coterminous with its scope in the other economic torts. It has been held that whenever an act is itself tortious, a combination to do that act is a tortious conspiracy [Crofter at 462, per Lord Wright] … While not all equitable wrongs appear to be unlawful means, where a serious contravention occurs it is still open to the court to regard such wrongs as unlawful means for the purposes of conspiracy [Belmont Finance Corp v. Williams Furniture Ltd (No.2) [1980] 1 All ER 393]. If however the overt acts alleged are not actionable in a civil action the claimant will fail to establish a cause of action for conspiracy …

Other forms of unlawful means

24-106 Although the “general” approach, which finds unlawful means whenever defendants have done acts which they are not at liberty to commit such as contempt of court or even intentional misuse of confidential information to damage the claimant [Spermolin Ltd v. Winter, The Guardian, 22^nd June 1962], should not be permitted after the House of Lords decision in Lonrho v. Shell [[1982] AC 173], that decision does not deal directly with the treatment of wrongs other than breach of statute as unlawful means … Where a combination uses breach of confidence as part of the method of achieving its objective, that may be sufficient [Faccenda Chicken Ltd v. Fowler [1984] ICR 589 at 602, per Goulding J] …”.

Since the applicants' allegations of an unlawful means conspiracy are based on breach of confidence, it is necessarily briefly to set out what that cause of action entails. In this respect I take the criteria again from Clerk and Lindsell, 22^nd edition, as follows:

"Requirements

27-06 Traditionally there are three elements for liability for breach of confidence. These principles are derived from Coco v AN Clark Engineers Limited [[1969] RPC 41] per Megarry J [at 47]. First, the information in respect of which relief is sought must have the necessary quality of confidence about it. Secondly, the information must have been imparted in circumstances importing an obligation of confidence. The use of the word 'imparted' however is now clearly too limited for the modern action, it now being established that there is no need for an initial confidential relationship. Thirdly, there must be an unauthorised use or disclosure of that information ...

Limiting principles

27-07 In Attorney General v Guardian Newspapers (No. 2) [1991] A.C. 109, Lord Goff identified three limiting principles on the duty of confidence [at 280].

First, the principle of confidentiality only applies to information to the extent that it remains confidential and once it has entered the public domain, which means no more than that the information in question is so generally accessible that in all the circumstances it cannot be regarded as confidential, then the principle of confidentiality can have no application to it.

Secondly, the duty of confidence applies neither to useless information nor to trivia.

Thirdly, the public interest that confidence should be preserved may be outweighed by some other countervailing public interest which favours use or disclosure, either to the world at large, or at least appropriate authorities. That may require the Court to carry out a balancing operation weighing the public interest in maintaining confidence against the public interest favouring use or disclosure. Where free speech is a concern, the impact of Article 10 of the ECHR will have to be addressed so that the issue becomes whether restraining disclosure of the confidential information is a justifiable interference with the Article 10 right to freedom of expression."

Mr Lazarus submitted that the Kroll investigations clearly point to Mr Farahzad as the likely instigator of the Twitter account. He submitted that Mr Farahzad could not have been acting alone because he would have not had access to much of the information contained in the Tweets. And, thirdly, that his co-conspirators were most likely the former employees. In support of that submission Mr Lazarus relied on three points. First, the emails downloaded by the applicants from the former employees' RR Media accounts demonstrated extensive business dealings between Mr Farahzad as a representative of Wide Network and the former employees which, at least in the case of Mr Izkovitz, had evolved into a personal friendship. Secondly, the former employees would have had access to most of the information contained in the Tweets. Thirdly, the former employees had a clear motive to seek to injure the applicants as retaliation for them having brought the Israeli proceedings.

Mr Lazarus pointed to the fact that the first tweet was published shortly after commencement of the first Israeli proceedings, and that no tweets were published between August and October 2017 when the parties were seeking to settle the Israeli proceedings, nor between 7 January and 19 February 2018 during which there was a mediation meeting in the Israeli proceedings.

Mr Lazarus then submitted that the applicants have a strong prima facie case of a lawful means conspiracy against Mr Farahzad. He reflected these arguments in an amended version of the particulars of claim as follows:

In the alternative to these submissions Mr Lazarus submitted that the applicants also have a strong prima facie case of unlawful means conspiracy against Mr Farahzad, on the basis of the unlawful means being the publishing of the confidential information set out in schedule 2 to this judgment.

In the course of oral argument Mr Lazarus accepted that his case on the unlawful means conspiracy was a weaker case, so that if he did not succeed on the lawful means conspiracy on this application, he would be unlikely to succeed on the unlawful means conspiracy, mainly because of the state of the evidence as regards the confidentiality of the material in the Tweets.

As I have already said, Mr Lazarus submits that the Tweets have the potential to cause serious damage to the applicants' business because they operate in a highly regulated industry and are subject to anti-bribery laws and have customers that are very sensitive to such matters. One example given by Mr Lazarus is a company referred to in the Tweets that has actually told the applicants that it is unhappy about such references. The applicants are worried that this could cause them a loss of business worth about US$1-2 million in 2018, although it is fair to point out that Mr Lazarus accepted that that damage would not be sustained within England and Wales for the purposes of establishing the applicable law for this claim.

Mr Lazarus submitted that much of the damage will be caused in England and Wales, however, because the applicants have a significant presence here. 83 of its employees are based here, MX1 has a substantial facility in West London and approximately 11.75 million United Kingdom homes are connected to SES satellites, making it the country's largest supplier.

Mr Lazarus submitted that if Mr Farahzad is the instigator of the Twitter account, as seems highly likely, it must follow that he is in possession of electronic evidence showing that he set it up, operated it and conspired with others in relation to those matters. Such evidence would be plainly incriminating, so that the third condition is obviously satisfied.

Moreover, Mr Lazarus submits that the evidence is crucial to establishing the claimants’ case because the applicants currently have no direct evidence of the conspiracy or who was involved and the case, as Mr Lazarus put it, is based entirely on inference from the material that I have already recited.

Finally, Mr Lazarus relies, in seeking to establish the risk of destruction or removal of the evidence, on the fact that Mr Farahzad has already taken steps to disguise his involvement in the Twitter account, such as the use of a pseudonym to open the linked Gmail account. Mr Farahzad would, because of this history which I have described in detail above, be likely to destroy the evidence if he were notified of the proceedings.

Mr Lazarus submitted in oral argument that the test here is akin to that which needs to be satisfied for the grant of a freezing order injunction because it is simply to the effect that the risk of destruction or removal is a good deal more than merely possible, something that effectively needs to be shown where a freezing order is sought.

Mr Lazarus submits that apart from the immediate impact of the execution of the search order, the potential adverse consequences for Mr Farahzad would be limited. He accepted, however, that a search order is, in his words, "deeply unpleasant" for the defendant, but points to the fact that the draft order that he seeks makes provision for electronic evidence to be copied and preserved, but not to be reviewed by the applicant until the return date. It is therefore directed at ensuring, as far as possible, that the appointed computer specialists make copies of any electronic documents during the search so that devices are not removed from the premises. He points also to the usual undertakings.

Mr Lazarus has, in a fully detailed and entirely appropriate manner, drawn my attention to the differences between a standard Anton Piller order and the order that he seeks, and I should say that there is nothing in the form of order that Mr Lazarus seeks that makes me think that the order is inappropriate if the conditions for it, to which I shall come in a moment, were otherwise fulfilled.

He has also made disclosure of a number of matters which are contained in each of the two witness statements prepared by Mr Blunt which I have considered in detail together with their quite lengthy exhibits. I do not think it is necessary to set out those paragraphs from Mr Blunt's evidence, but they can be found towards the end of both his first and second witness statement.

Mr Lazarus drew my attention to section 10 of the Contempt of Court Act 1981, which provides that:

"No court may require a person to disclose ... the source of information contained in a publication for which he is responsible unless it be established to the satisfaction of the Court that disclosure is necessary in the interests of justice ..."

He accepted that the Tweets were a "publication" for the purposes of the Contempt of Court Act 1981. He said, however, that in the light of the terms of the draft order it is unlikely that any disclosure would occur before the return date and in any event the interests of justice exception would apply. I am inclined to think that that submission is correct insofar as it is appropriate to grant the search order that he seeks.

In these circumstances, therefore, if I were satisfied that those conditions applied and a search order were otherwise appropriate, it would I think be in the interests of justice for the order to be granted applying the exception under section 10 of the Contempt of Court Act 1981.

I asked Mr Lazarus in the course of oral argument, both on 13 March 2018 and this morning, whether the applicants were seeking any alternative order in the event that a search order were not to be granted. Though no form of order has been put forward, Mr Lazarus informed me on instructions that if a search order were not granted, he would be seeking an injunction requiring the defendant to preserve the evidence referred to in the search order so that on the return date of such an application he could seek an order for delivery up in accordance with the CPR. The applicants would not in that situation seek any injunctive relief so as to restrain the defendant at this stage from promulgating further tweets, although of course he might wish to do so at a return date if that were the outcome of this application.

I can say at once, in relation to the application for a search order, that I do regard the claimants as having shown at this stage and on the evidence before the Court, and subject to what the defendant may ultimately say, that they have a serious case to be tried against the defendant in relation both to a lawful means and an unlawful means conspiracy. That latter conspiracy, however, relates only to the limited information mentioned in schedule 2 to this judgment and the case is rather weak because it may turn out that some or all of the material was anyway in the public domain before the tweets in question.

The applicants have not seen fit to put before me the evidence from the Israeli proceedings in detail, although they have summarised them, and plainly they have not been able to identify other elements in the public domain in the various countries concerned in this case. In any event, as I have said, Mr Lazarus puts greatest weight on his contention that there is a strong prima facie case as to the lawful means conspiracy and that is what I now turn to consider.

The question I have to decide today is not whether there is a serious case to be tried, although that may be relevant to the alternative injunction sought if a search order is not appropriate. The question that I have to decide, as I have already indicated, is whether the claimants have established to my satisfaction as a matter of discretion the five main elements required for the grant of a search order. To summarise again, first that there is a strong prima facie case of a civil cause of action: in this case predominantly for a lawful means conspiracy against Mr Farahzad. Secondly, that serious damage to the claimants will be avoided by the grant of a search order. Thirdly, that there is clear evidence that the defendant has in his possession incriminating documents or things. Fourthly, that the risk of destruction or removal of evidence is a good deal more than merely possible. Fifthly, that the harm likely to be caused to the defendant and to his business affairs by the execution of a search order is not excessive or out of proportion to the legitimate objects of the order.

I need to bear in mind in deciding these questions, again as a matter of discretion, that the defendant has not been heard and I need to look at whether the claimants or the defendant will suffer the greater injustice from the search order being made or not being made. Moreover, I am reminded that not every wrong-doing defendant will destroy documents in the face of a court order requiring him to preserve them, even if he has been guilty of serious wrongdoing in the past. I will then go through the five conditions.

I have considered this issue very carefully and it seems to me to be a difficult one. I have already pointed to the possibility that the material in the Tweets is not confidential, so I am concerned primarily with the strength of the unlawful means conspiracy case. I fully accept that there is evidence that the defendant has been in close contact with the former employees and has probably obtained information about the applicants from them. I fully accept that the defendant has behaved in a covert way on social media, although, as I pointed out in oral argument, that is not perhaps as unusual now as it may have been in former times. Nowadays, it is relatively common for people to use pseudonyms on social media, although the applicants can quite properly submit that this degree of subterfuge and covert activity seems specifically designed to prevent the applicants finding out precisely who was responsible for the Tweets, and indeed that is made good by the number of proceedings that the applicants have had to bring round the world to identify Mr Farahzad.

I do, however, take into account the possibility that the Tweets are not actually written by Mr Farahzad, notwithstanding the quite strong inferences to be drawn from the evidence I have already mentioned.

I am influenced in reaching my conclusion on this point as to the likely strong prima facie case by the fact that the defendant appears at first sight, from the evidence and from social media and from the internet, to be a respectable BBC journalist of some ten years standing. It seems to me that it is likely that the defendant may say, in answer to this claim, that he is motivated not by an intention to injure the applicants, but by an intention to expose corruption and to act in the public interest. In my judgment, deciding between those motives in a conspiracy case of this kind is a difficult and finely balanced exercise. One knows from the authorities that I have already mentioned in some detail how difficult some of the past cases of lawful means conspiracy have been to prove. It is not, in my judgment, at all clear on the evidence I have seen that the applicants will be able to establish the necessary dominant intention to injure.

I have seen the emails that have been exchanged between the defendant and the former employees in relation to the defendant's own business, Wide Networks, but even those documents, which are from some time ago, do not seem to me to weigh heavily in support the necessary dominant intention. I realise that the claimants argue very persuasively that the style of the Tweets is not journalistic, but that in itself does not show precisely what the defendant's motive is and does not prove conclusively one way or another whether his dominant intention is to expose corruption, or his dominant intention is to injure the claimants. I quite accept that the style of the Tweets will assist them somewhat in establishing their case. I also accept that the claimants can point quite properly to the fact that the defendant's journalistic responsibilities do not include the exposure of corruption. He is simply the anchor for the BBC's Persian Service. That also does not bear conclusively one way or another upon whether the defendant may have been legitimately upset or even outraged by what he has heard about corrupt activities from the former employees.

As for the question of the specific corruption allegations in the Tweets, there is of course a case that this is likely to have emanated from the former employees, with whom the defendant plainly had both a personal and a business relationship. But, as I have pointed out from the authorities, the motivation of the co-conspirators, as will be alleged, is not necessarily the motivation of the defendant. The defendant was not a former employee of the claimants, and the defendant may - I do not say will -ultimately show that he had a different motivation from that of the former employees, despite his relationship with them.

I quite accept that the claimants may establish such a conspiracy against the defendant at trial, but I have to say that the case at this stage based on a lawful means conspiracy looks relatively speculative, albeit that the defendant may have been motivated in part by a desire to help the former employees. The picture is very unclear on the limited evidence that the claimants have chosen to put before the Court. The requirement to establish a strong prima facie case is an important and high hurdle to mount, as Mr Lazarus quite properly accepts.

I do not pretend that my decision on this has been an easy one, but it seems to me, balancing all the relevant features of the law and the facts that have been put before the Court, that whilst the claimants have established a serious case to be tried on the question of whether the defendant has a predominant intention to injure the claimants in tweeting as he had, they have not established, in my judgment, at this stage that they have shown a strong prima facie case in respect of their chosen causes of action. I shall come back to the other factors that are required to be established.

I have also had drawn to my attention the fact that in order to establish English law as the applicable law for this claim it is necessary to establish that prospective damage will be caused in this jurisdiction under Article 3.1 of the Rome II Convention. Mr Lazarus has quite properly drawn my attention to the dictum of Andrew Smith J in the case of Hillside (New Media Limited) v Baasland [2010] EWHC 3336 (Comm.) at paragraph 37, to the effect that the Court might have to decide in which country the damage predominantly occurred. Mr Lazarus submits that that is at odds with explanatory memorandum to the Rome II Convention, which provides that the:

"... rule entails where damage is sustained in several countries that the laws of all the countries concerned will have to be applied on a distributive basis, applying what is known as 'mosaikbetrachtung' in German law."

I fortunately do not need to decide which of the two propositions are correct, but I have assumed for the purposes of this application that the applicants can show prospective damage in this country sufficient to establish that English law is applicable. That may of course be the subject of argument at a later stage.

As regards the second condition that serious damage to the claimants must be shown to be avoided by the grant of a search order, I am not satisfied that that is the case here. The Tweets have been going on now for some 15 months, although quite sporadically, and indeed Mr Lazarus accepts there have been no Tweets since the last hearing before me on 13 March 2018, now nearly two weeks ago. I cannot really see that a few more tweets before the defendant is brought to court and before an injunction is sought, if it is to be sought, that will be enforceable against him, if they are entitled to such an injunction, will cause serious damage.

Indeed, the real damage may be likely to be caused by the retweeting of material that is already in the public domain, but that is material that the claimants in large part are unable even to say is untrue. The fact is that there are allegations of historic corruption which, as it seems to me, the claimants will need to deal with whether the order sought is made or not.

I know that the claimants say that the Tweets have and will upset some of their customers, but they cannot really show that they are likely to lose further business if there is no search order, as opposed simply to a claim being made and an order restraining the defendant deleting or disposing of the material evidence.

It seems to me that the second condition that the damage to the claimants to be avoided by the grant of the serious order must be serious is not really satisfied as a matter of discretion in this case. This is not a case like the more normal Anton Piller orders in intellectual property cases where unless a search order is made there is no real likelihood of establishing the case at all.

I accept that the third condition is satisfied in this case in that it is overwhelmingly probable that the defendant will have in his possession evidence of how the tweets came into being, emails between him and the former employees which relate to the alleged conspiracy, and other digital material which may well support or possibly deny the claimants' case. On the evidence before me it is fairly clear that any incriminating material is likely to be in his possession and therefore to be acquired from the search. Of course, if I make a negative order requiring the defendant to retain and not to destroy that material, it will still be available to the claimants unless it is destroyed. That brings me to the fourth condition. I regard the fourth condition as particularly important in a case of this kind.

I have thought carefully about this condition, as I did about the others. I do not accept that the risk of destruction or removal of evidence in this case is "a good deal more than merely possible". I accept that it is possible that the evidence will be destroyed. I accept also that the claimants are fully entitled to point to the defendant's covert activities, to his undoubted contact with the former employees and the fact that his job as a journalist is not directly related to any of these Tweets, but that does not point directly to any overt dishonesty of the defendant, or the likelihood that he will destroy evidence.

Again, I call on a lengthy experience of Anton Piller orders in the more normal field of intellectual property where it is often axiomatic that the defendants are engaged in an entirely dishonest business and that they will certainly not be handing over pirated films or pirated videos or digital copies of infringing material if they are simply ordered to do so. This is a quite different situation. The defendant, I repeat, is known only to be a respectable journalist. I know he has engaged, through Wide Network, in some business activities with the former employees in the past, but that also does not specifically confirm that he is not to be trusted. There is really nothing by way of significant or strong evidence to the effect that the defendant is an essentially dishonest person who is likely to disobey a court order. There is nothing to show that the defendant is likely to commit a contempt of this court, which carries a term of imprisonment of up to two years, if the Court makes an order requiring him to maintain in existence documents or digital material evidencing what he has done in the past.

As to proportionality also I am not satisfied that the harm likely to be caused to the defendant in terms of his reputation as a journalist and the intrusion on his privacy and the "deeply unpleasant" experience of a search order being executed against him is justified by the legitimate objects of the order. It would I think be regarded as overkill to execute a search order against a reputable journalist in these circumstances.

This is a delicate balancing exercise and I have not made this decision without careful consideration, but search orders are appropriate where there is a clear case against the defendant. Here there is a case against the defendant, but certainly not a very clear one. Search orders are appropriate where there is a clear likelihood that vital evidence will be destroyed. Again, here there is a possibility that evidence will be destroyed, which I very much hope does not happen, but not a clear likelihood. I would expect that when the defendant is served with a copy of the order that I do intend to make in this case, he will preserve the material and engage with the litigation against him appropriately, now that he has been identified. He will of course be entitled to raise any proper defences, which the Court will consider with appropriate care. But, as I say, at the moment, balancing the likely harm to him to be caused by the intrusive search order sought, as against the legitimate objectives of the order in establishing the case alleged, it seems to me that the balance falls on the side of rejecting the application for a search order.

I bear in mind also in this regard that the defendant has not been heard, that this has been going on for a very long time indeed, not entirely due to the fault of the appellants since they have had to bring a number of sets of proceedings before reaching this stage, but nonetheless the Tweets have been sporadic and the harm or damage caused by each tweet must be itself somewhat limited.

It is entirely correct that the appellants should come to court to seek to protect themselves against inappropriate tweeting and inappropriate damage, if it is inappropriate, but it seems to me that the grant of a search order would be out of proportion to the damage they are likely to sustain for the reasons I have given.

For the reasons I have given I do not think that the strict conditions necessary for the grant of what, as I have said, is a very intrusive order have been made out on the evidence before the Court and I will refuse the application for a search order.

I am, however, as I have already indicated, entirely satisfied that it is appropriate to grant an order requiring the defendant to preserve the digital material that the claimants sought to obtain by the search order.

Summary of the allegations made in the Tweets

The identity of suppliers, commercial partners and sales agents referenced in the Tweets posted on 13^th January 2017, 22^nd February 2017, 19^th March 2017 (6 Tweets), 29^th May 2017, and 24^th November 2017.

The invoice included in the Tweet posted on 25^th January 2017.

Confidential emails in the Tweets posted on 22^nd February 2017 and 22^nd April 2017.

The confidential letter sent to agent Bashe Omar terminating the agreement between RR Media and Mr Omar in the Tweet posted on 15^th June 2017.

Summary of the Tweets which the Applicants believe to be untrue