Hawrami v Journalism Development Network Inc & Ors

The Claimant Dr Ashti Hawrami served as the Minister of Natural Resources in the newly formed Kurdistan Regional Government of Iraq (“the KRG”) from May 2006 until July 2019 and then as the Assistant Prime Minister for Energy Affairs in the KRG until early 2022. He had had a lengthy career in engineering and production in the oil and gas industry. The First Defendant is a US company which publishes a website under the name of “The Organized Crime and Corruption Reporting Network”, which has a substantial readership in England and Wales. It describes its mission as being “to expose crime and corruption so the public can hold power to account”. The second and third Defendants are London-based journalists.

The Defendants published an article on the First Defendant’s website under the heading “The Rise and Fall of a US Oilman in Iraq”. The claimant contended that each version of the article conveyed the following meanings:

Dr Hawrami, whilst serving as Minister of Natural Resources in the government of the KRG of the autonomous region of Iraqi Kurdistan, had:

a) in November 2007, granted a highly lucrative contract to Gulf Keystone Petroleum (‘GKP’) because of and/or knowing of a secret, corrupt and illegal agreement entered into between Todd Kozel (‘Kozel’) of GKP and the company of Izzedin Berwari (‘Berwari’), a member of the governing Kurdistan Democratic Party (‘KDP’) politburo and a high level and senior public official with connections to the Prime Minister of the KRG (‘the kickback agreement’) whereby potentially huge revenues from the oil concession would be paid by GKP in kickbacks to Berwari’s company for securing the Shaikan Production Sharing Contract (‘PSC’) for GKP;

b) in 2010, been privy to a private agreement between GKP and the KRG to treat as void for illegality the kickback agreement just weeks before the UK Bribery Act was passed in 2010, but, corruptly and in violation of Kurdish oil law, which Dr Hawrami had pushed through the Iraqi Kurdistan Parliament, allowed GKP to retain the contract, instead of cancelling the contract by reason of GKP’s corruption, as the oil law required him to do; and

c) shortly thereafter, facilitated the secret funnelling of US $12m from GKP, a public company quoted on the London Stock Exchange, to an offshore company secretly connected to Kozel and the KRG, by introducing Kozel to a group of investors operating under the name of Etamic and to the idea of the transaction.

The defendants:

• pleaded that the Article was not defamatory of the Claimant, or alternatively conveyed only the meaning that “there were grounds to investigate whether the Claimant, through his office, had come to know about but failed to properly investigate and act upon an illegal agreement which benefited a high-ranking member of Iraqi Kurdistan’s ruling party”; a meaning which they said was not defamatory in any event;
• pleaded that parts of the Article were a fair and accurate report of the judgment of Sir Christopher Clark in Excalibur Ventures Inc v Texas Keystone Inc and ors [2013] EWHC 2767 (Comm), and of a small amount of documentary and oral evidence in that case; and accordingly those parts of the Article (by which, they contended, any relevant meaning was conveyed) were protected by section 15 of the Defamation Act 1996 and clauses 2 and 5 of part 1 of Schedule 1 of the Act;
• pleaded publication on a matter of public interest pursuant to section 4 of the Defamation Act 2013

A preliminary trial was ordered on the issues of meaning, whether the meanings found were defamatory at common law, and the section 15 defence.

1. The order in which the issues of meaning and qualified privilege should be determined;
2. The natural and ordinary meaning of the Article and whether it was defamatory in those meanings;
3. Whether the Article was protected by s. 15 qualified privilege.

On the order in which the issue should be resolved, Steyn J held that the question of whether and to what extent the Article was protected by qualified privilege should precede the question of meaning, and that the Defendants’ submissions to the contrary were inconsistent with Curistan v Times Newspapers Ltd [2008] EWCA Civ 432; [2009] QB 231.

On the question of statutory qualified privilege, Steyn J found:

• (at [68] ff) that the reader would have got the impression that the Claimant was “a man of integrity who has stepped up to serve the KRG following unification, in a field in which he has long experience and deep expertise”; and that “the impression that Dr Hawrami was acting in the interests of the autonomous region of Kurdistan comes across strongly”;
• that the multiplicity of sources, and the primacy given to sources other than the Excalibur material, were such it would not have been sufficiently apparent to the reader that the judgment and the additional material were the source of a substantial number of the paragraphs of the Article claimed to be a fair and accurate report (at [77]-[85]); and
• by reason of what the Article asserted and by reason of important omissions, the Article was not a fair report of the judgment or the additional material, and that that unfairness infected all the key elements of the narrative in respect of which reliance was placed.

She also held, following Qadir v Associated Newspapers Ltd [2012] EWHC 2606 (QB); [2013] EMLR 15 that extraneous material was not relevant to the issue under section 15(1). Such material could be relevant to a complaint of unfairness arising out of the omission of extraneous material for the purposes of section 15(3), but that was not an issue in this case (at [35], [120]).

As to meaning, Steyn J found the natural and ordinary meanings of the original version of the Article to be:

a) There are strong grounds to suspect that the claimant, while serving as the Minister of Natural Resources of the Kurdistan Regional Government (‘the KRG’) granted a highly lucrative oil concession (the Shaikan oil concession) to Todd Kozel’s AIM-listed company, Gulf Keystone, knowing of and because Mr Kozel had entered into a secret, corrupt and illegal agreement (‘the kickback deal’) with the Dabin Group, the company of Izzedin Berwari, a high level public official, involving the payment of potentially huge bribes to Mr Berwari’s company for securing the Shaikan oil concession for Gulf Keystone.

b) The claimant subsequently failed to cancel the Shaikan oil concession, knowingly violating a Kurdish anti-corruption oil law that he had publicly supported, after the KRG and Gulf Keystone privately agreed to treat the kickback deal as void in light of tougher international corruption laws coming into force.

c) There are reasonable grounds to suspect that the claimant introduced Gulf Keystone to an offshore company, operating under the name Etamic, and proposed a secretive transaction which resulted in Gulf Keystone funnelling US$12 million to Etamic.

The meanings found were “obviously” defamatory at common law (at [168]).

Postscript — Costs

After judgment, the Defendants submitted that the costs of the Preliminary Issues Trial should be costs in the case. They pointed out that the defence under section 4 was yet to be tried and that the Claimant might ultimately be unsuccessful on the claim as a whole.

On 2 October 2024, Steyn J ordered the Defendants to pay the Claimant’s costs of the whole of the Preliminary Issues Trial. She held that the Claimant was undoubtedly the successful party on the preliminary issues. On the section 15 defence, the correspondence between the parties disclosed that the Defendants had been prepared to withdraw the defence, and it could be inferred from the correspondence that they recognised the difficulties they faced in maintaining it. On meaning she noted that her findings were much closer to the Claimant’s meanings, and that Defendants’ submissions on meaning were “quite unrealistic”.

The Defendants’ submission that meaning should be determined first, followed by qualified privilege, and that, if any part of the Article was found to be privileged, then meaning should be re-determined, was firmly rejected by the Judge. She noted at [14]-[15] that not only would such an approach potentially lead to the Court determining meaning twice, but also that it was inconsistent with what had been said in Curistan.

This case is a vivid example of the narrowed scope for preliminary trials of meaning where qualified privilege has been pleaded, in consequence of the decision in Curistan. In this case, the PIT was ordered on the basis that the Claimant would not allege malice, and upon the parties agreement that witness evidence would not be called on any issue under s. 15(3).

Steyn J found two Chase level 2 meanings (one at a very high level – “strong grounds to suspect”) and one Chase level 1 meaning (of actual guilt). The Claimant had pleaded three Chase level 1 meanings. Nevertheless, the meanings found by the Court were much closer to the Claimant’s meanings than to the Defendants’, a matter which became significant for costs (as to which see below).

Steyn J rejected the Defendants’ submission that Article 10 is relevant in determining meaning. On that point she applied the judgment of Nicklin J in Zarb-Cousin v Association of British Bookmakers [2018] EWHC 2240 (QB) (citing the judgment of Warby J (as he then was) in Barron v Collins [2015] EWHC 1125 (QB)): “the law of defamation must give due effect to Article 10 but … this is done by other means than the rules governing meaning.”

On costs, it is significant that Steyn J did not apply Sharif v Associated Newspapers Limited [2021] EWHC 343 (QB) and similar cases in which it has been held that, at least as to the costs of the meaning component of the PIT, the usual order was costs in the case. Nicklin J said in that case that the usual order might not be made when the unsuccessful party on meaning had not properly engaged with the issue. Having held the Defendant’s submissions to be “unrealistic” Steyn J awarded the Claimant the costs of the whole of the PIT.