NZME super-injunction: Mystery foreign entities linked to Kiwi institution take Herald to Court of Appeal

An American man has enlisted a King’s Counsel and taken NZME to the Court of Appeal in his bid to stop the publication of his identity and the name of two of his companies subject to a sweeping super-injunction granted earlier this year.

The hearing on Wednesday is the latest twist in Herald publisher NZME’s battle to publish the names of the companies and the American, their links to a New Zealand institution and the findings of a journalistic investigation.

The heart of the matter was the question of whether publishing the names of the companies - therefore revealing the subject matter of the dispute - would mean “the cat was out of the bag”.

In other words, would they suffer the same damage through being identified as having brought defamation proceedings against NZME as if the subject matter of the injunction had been published?

The super-injunction saga kicked off on March 9, following routine inquiries from Herald senior writer Kim Knight relating to an investigation she was undertaking.

In response, lawyers for the American filed an application for a sweeping interim injunction suppressing not only the allegations they viewed as defamatory, but also the man’s identity, the names of two companies he controls, the subject matter of the dispute and the name of the New Zealand institution involved.

Justice Geoffrey Venning granted the interim injunction on all terms sought by the plaintiffs on an ex parte basis, meaning NZME’s lawyers were not given the opportunity to respond or submit.

NZME went to court to rescind aspects of the interim injunction ahead of a full hearing.

Tania Goatley, of Bell Gully, represented NZME at Wednesday's appeal hearing. Photo / Mark Mitchell

In particular, NZME sought to revoke the non-publication orders covering the subject matter of the dispute, the identities of the plaintiffs and the involvement of the New Zealand institution.

At a March 17 hearing, Justice Christian Whata immediately allowed the fact of the injunction to be reported for the first time. He also rescinded the suppression orders for the man and the companies.

Justice Whata granted the American man the right to appeal in relation to the ruling in favour of publishing his name.

But the judge denied the plaintiffs - the man and his two firms - ordinary leave to appeal regarding his decision to allow NZME to name the companies and NZ institution, and therefore the subject matter of the investigation.

As a result, the American’s legal team of Russell McVeagh lawyers led by Nathaniel Walker exercised their right to seek leave to launch the special appeal bid.

Wednesday’s Court of Appeal hearing in Wellington related to that bid to keep the names of the companies, and the New Zealand institution to which they are linked, under wraps for now.

Daniel McLellan KC argued the American’s case before a Court of Appeal panel comprising Justices David Goddard, Christine French and Edwin Wylie.

It was a colourful hearing replete with analogies that often came back to a single question: if the companies and the subject matter of the dispute are published, does that mean the cat is out of the bag in terms of the injunction as a whole?

“The cat is actually just the fact that these are the applicants in the proceeding,” said NZME’s lawyer Tania Goatley.

“What is the cat that is getting out of the bag? It is just the fact that these appellants are involved in the proceeding.”

While people might speculate about the American, his companies and their associations with the New Zealand institution, there was nothing to suggest they would necessarily come to adverse conclusions about their integrity, Goatley said.

“The extraordinary breadth of the orders that were sought and granted is what has generated the public interest in this proceeding,” she said.

Goatley said it was a fundamental principle of open justice that parties to civil proceedings in New Zealand courts are named.

“There is no damage through naming these applicants that is sufficiently high to overcome this issue,” she said.

“Particularly in circumstances that would prevent the entire subject matter from being reported. That is a step too far.

“Any litigant who files a civil proceeding can not have an expectation of privacy.”

Justice David Goddard was one of three judges who heard the appeal. Photo / Mark Mitchell

Many of the arguments advanced at the hours-long hearing cannot be reported at this stage without violating the ongoing suppression orders.

One unusual aspect of the case is that the American’s name was blanked out on the initial court order granting the injunction.

The Herald had already established the man’s identity but was hit with the injunction before it had the chance to approach him for an interview.

McLellan argued the fact the man was named on the court documents does not mean he should automatically be named as part of civil proceedings.

“There is a broad analogy between the facts of this case to be drawn with blackmail cases,” McLellan said.

“The very act of having to sue to prevent your name coming out and thereby risking publication.”

That received pushback from Justice Goddard.

“I’m not sure that is a very strong analogy,” the judge said.

McLellan said the case differed from others where people took defamation proceedings or injunctions to restore their reputations and clear their names.

“The plaintiffs don’t seek to vindicate their reputations, their case is the opposite.”

Goatley argued that because certain statements linked to the Herald’s investigation are already injuncted, on the basis they are claimed to be potentially defamatory, publishing the identities of the American and his companies could not damage his reputation.

Justice Christine French reserved the court's decision. Photo / Mark MItchell

“The orders that your honours are being asked to make are futile,” she said.

“This is not damage that crystallises through publishing his identity.”

She said the case law cited by the American’s legal team, which included several overseas defamation or injunction cases, was not persuasive.

During the lengthy legal arguments, the Court of Appeal judges asked probing questions of the lawyers delving into the technical details of the subject matter.

Justice Goddard at one stage suggested a site visit by the Judges to the New Zealand institution linked to the American.

Justice French said the court would reserve its decision, which will be issued in writing.

“There’s quite some weighty issues here that need to be considered,” Justice French said.