## Facts

- A national newspaper published a front-page article about a well-known musician, alleging he followed a “don’t swallow and get thin” practice at a party and presenting the story as a “world exclusive.”
- The story was supplied by a freelance journalist who had not attended the party and relied on two alleged sources; the publisher performed little meaningful verification and made only minimal, unsuccessful attempts to seek comment.
- The claimant denied the allegation and denied attending the party, asserting the story was fabricated.
- The claimant sued for libel; the publisher ultimately accepted falsity, and the appeal primarily concerned damages rather than liability.
- A jury awarded £75,000 in compensatory damages and £275,000 in exemplary damages, totaling £350,000.
- The publisher appealed, arguing exemplary damages should not have been available, the jury had been misdirected on both compensatory and exemplary damages, and the amounts were grossly excessive.

## Issues

1. Whether exemplary (punitive) damages are legally available in libel actions against media defendants and, if so, under what limits.
2. Whether the trial judge’s directions to the jury on compensatory and exemplary damages were erroneous or insufficiently bounded.
3. Whether the compensatory and exemplary awards were so excessive and disproportionate as to require appellate reduction, including due to potential chilling effects on expression.

## Decision

- The Court of Appeal held that exemplary damages remain available in libel only within narrow, established categories, including cases where a defendant calculated that publication would be profitable even after paying compensation.
- The court concluded the jury’s damages required appellate intervention.
- The court substantially reduced the exemplary award and adjusted compensatory damages to bring the overall award within principled and proportionate limits.
- The court identified deficiencies in the trial directions that failed to provide adequate rational constraints on the jury’s discretion.

## Legal Principles

- Compensatory damages are the primary remedy in defamation and must compensate for reputational harm and distress rather than punish the defendant.
- A defendant’s conduct may aggravate compensatory damages only insofar as it increases the claimant’s injury (e.g., persistence, failure to retract, or lack of apology).
- Exemplary damages are exceptional and must be confined to narrow categories; they are not a routine add-on to high compensatory awards.
- Appellate courts should intervene where libel awards are excessive, including where combined compensatory and exemplary damages risk functioning as an impermissible penalty and creating an undue deterrent to speech.
- Proportionality and the risk of a chilling effect on expression are relevant constraints when evaluating large defamation awards, especially against the press.

## Conclusion

The Court of Appeal reaffirmed that exemplary damages may be awarded in libel only in tightly limited circumstances, emphasized compensatory damages as the core remedy, and reduced an excessive jury award to ensure rational, proportionate damages that do not unduly deter lawful expression.


John v. MGN Ltd. (CA) [1997] Q.B. 586 (Eng.)