By SUN ONLINE REPORTER
A RULING ordering Hello! magazine to pay £1million damages over the wedding pictures of Catherine Zeta Jones and Michael Douglas to rival publication OK! was today overturned.
Hello! claimed a victory after the Court of Appeal allowed its challenge to a High Court order that it should pay more than £1million damages and another £1million in legal costs to OK!, which had an exclusive contract with the Hollywood couple to cover their New York wedding.
But Hello!s appeal against the ruling in favour of the Hollywood couple over privacy and commercial confidence was dismissed.
However, the appeal judges also threw out the couples claim for more damages and OK!s cross appeal based on unlawful interference with business.
Chris Hutchings, solicitor for Hello!, said after the judgment was handed down that the ruling meant that his magazines liability to OK! was now nil.
He said: "This was a spat between two rival publishers and not between Hello! and the Douglases.
"The judgment is a resounding win for Hello!"
He added: "As a result of our win, Richard Desmond (owner of Express Newspapers and OK! owners Northern and Shell), will now have to write a cheque to Hello! for a very large amount of money indeed."
But a statement issued by Northern and Shell said the appeal court had "fully vindicated" the Douglases action against Hello! - and vowed to take the case to the House of Lords.
"This decision will impact all publishers with exclusive rights as it means rivals will be free to run spoilers with no redress in law.
"OK! will therefore be appealing this judgment to the House of Lords."
Hello! had admitted at a Court of Appeal hearing last December that the snatched pictures were published as a "spoiler" to lessen the impact of OK!s exclusive £1million contract with the Douglases to cover the wedding ceremony in November 2000.
James Price QC, representing Hello!, told three judges headed by the Master of the Rolls, Lord Phillips, that "spoilers" were a well-known tactic in the newspaper and magazine industry and his clients had been victims in the past.
"This was something previously not considered unlawful. We are in the
position that if you are going to compete in this industry you have to publish spoilers.
"But what happened to Hello! was that it was caught by a law which said 'stop it' retrospectively."
The ruling against Hello! came after a six-week High Court hearing in 2003 at which the actress told how she felt "devastated, shocked and appalled" when she realised unauthorised photographers had gatecrashed her wedding at the Plaza Hotel.
She said she and her husband had signed the deal with OK! after turning down a higher offer from Hello!
Mr Justice Lindsay ruled that Hello! had breached the couples rights of confidence. He awarded the couple a total of just £14,600 but OK! got £1,033,156 for what the judge said was commercial damage to its expected exclusive coverage.
Freelance paparazzo Rupert Thorpe, son of former Liberal Party leader Jeremy Thorpe, managed to evade the massive security cordon guarding the wedding hotel and surreptitiously took photos of the groom and bride, her dress and the cake.
Eduardo Sanchez Junco, Hello!s editor in chief and the proprietor of Hello!s Spanish parent company Hola SA, bought the rights to publish these photos in the UK, France and Spain from Philip Ramey, another paparazzo and photographic agent based in the US.
Two days later, learning that Hello! was about to publish the unauthorised photos, OK! obtained a High Court injunction to restrain publication.
But a few days later, the Court of Appeal discharged the injunction.
Hello! published six of the unauthorised photos. The Douglases and OK! brought forward their plans to approve and publish the authorised photos, and both titles hit the news stands on the same day.
The 13 claims at the original trial included breach of confidence, invasion of privacy (the Douglases alone), breach of the Data Protection Act 1998, intention to damage and conspiracy to injure.
The Douglases and OK! succeeded against Hello! only for breach of confidence, breach of the DPA and an injunction to prevent further publication of the unauthorised photos.