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Appeal court ruling could trigger "explosion" of malicious falsehood claims

22 June 2010

The Court of Appeal has rejected arguments that the single meaning rule applicable in libel cases should be imported into malicious falsehood, potentially reviving the rarely used tort.

“It’s very much an important point of law,” said Stuart Jackson, partner at Kempner Robinson, representing the respondents, Asda.

“It could trigger an explosion of malicious falsehood claims, because this gives claimants a much greater chance of winning,” he added, saying permission to appeal has already been sought.

The case started when Ajinomoto, one of the world’s largest producers of aspartame, claimed that Asda’s packaging for its own-brand health food range suggested there was a risk that the sugar substitute could be harmful.

The retailer’s packaging said the products contained “no hidden nasties”, words that were usually used together with “no artificial colours or flavours and no aspartame”.

Asda responded that under the single meaning rule, which requires judges to construe the words by reference to what a single reasonable reader would understand them to mean, this could only mean that the retailer’s products were for consumers who found aspartame objectionable.

In a unanimous ruling, the appeal judges held in Ajinomoto Sweeteners Europe v Asda Stores [2010] EWCA Civ 609 that the single meaning rule did not apply to malicious falsehood claims, giving Asda a temporary reprieve but increasing Ajinomoto’s chances of success when the case returns to the High Court.

Lord Justice Sedley is yet to make a consequential order but Asda has already sought permission to appeal to the Supreme Court.

If permission is not granted – or the Supreme Court upholds the appeal ruling – Ajinomoto could be back in the High Court, claiming on the basis of the multiple meaning rule that there is a significant enough group of consumers that can take the controversial labelling to mean that aspartame could pose a health risk.

Although the company would still need to prove malice and falsity, this could reopen the potential for an increase in the use of malicious falsehood, a forgotten tort.

“The Court of Appeal ruling is clear in that the High Court must reject the single meaning rule and envisage the number of possible meanings; rather like passing off,” added Jackson.

“It opens the door to substantial damages if the claimant can show a significant number of consumers find that it is open to several possible meanings.”

According to Jackson, as little as ten per cent of the target group could be a significant enough number whose understanding would need to be considered.

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Risk & Compliance Procedures Local government