Newsweek entity ordered to pay indemnity costs over disputed winding up petition

The High Court has ordered a US Newsweek entity to pay indemnity costs after finding it pursued a high risk strategy in threatening to present a winding up petition against its former UK affiliate over a debt that was genuinely disputed.

In NW Publishing UK Ltd v Newsweek Publishing LLC [2026] EWHC 1882 (Ch), ICC Judge Agnello KC resolved a costs dispute arising from an injunction restraining Newsweek Publishing LLC from presenting a petition based on a statutory demand, ultimately ordering Newsweek to bear the applicant's costs on the indemnity basis.

NW Publishing UK Ltd had provided back office and journalistic support services to the wider Newsweek business until a restructuring in 2022. It maintained that its operations were funded entirely by the US entities under what it described as a symbiotic relationship, an arrangement reflected in a rent deposit of £121,000 transferred to it by Newsweek Publishing LLC ahead of a lease entered into for the group's benefit. When the lease ended, the landlord retained that deposit against dilapidations, and Newsweek Publishing LLC, as guarantor, separately paid a further £180,000 settlement sum to the landlord. It then served a statutory demand on NW Publishing UK Ltd for both amounts.

NW Publishing UK Ltd disputed liability for both sums and sought an undertaking that no petition would be presented. Newsweek Publishing LLC's solicitors rejected the existence of any dispute in a detailed letter, offered only a short extension of time, and did not respond to a further request sent on the day that extension expired. NW Publishing UK Ltd, having by then paid the settlement sum to the landlord itself, applied without notice for an injunction, which was granted in August 2025. Newsweek Publishing LLC subsequently gave a permanent undertaking not to present a petition, leaving costs as the only live issue.

Newsweek Publishing LLC argued that the application had been unnecessary and precipitous, that it would have provided an undertaking had it been asked properly, and that the applicant had breached its duty of full and frank disclosure by failing to explain the circumstances of the landlord payment and by presenting an incomplete legal analysis of the underlying debts.

The judge rejected each argument. She found that Newsweek Publishing LLC had, through its own correspondence, made unequivocally clear that it did not accept either debt was disputed and had declined to extend its confirmation beyond the deadline that triggered the application, so it could not now complain that the applicant should have waited longer for a response. She held it made no difference that the applicant had separately paid the landlord the larger of the two disputed sums before seeking relief, noting that a debtor facing multiple claimed debts is entitled to discharge one while contesting another. Applying the principle established in Re a Company (No 0012209 of 1991) [1992] 1 WLR 351, the judge held that presenting or threatening a petition over a genuinely disputed debt is an abuse of process, justifying costs on the indemnity basis.

On disclosure, the judge found nothing material had been withheld from the court at the without notice hearing, holding that the respondent's own conduct, rather than any omission by the applicant, was what had made the application necessary, and that differences over the correct legal characterisation of the debts, whether as implied terms, a gift, or a restitutionary claim, went to the substantive dispute rather than to the fairness of the without notice presentation.

The costs of the injunction application were accordingly ordered to be paid by Newsweek Publishing LLC on the indemnity basis.