The Victorian Court of Appeal has overturned actress Rebel Wilson’s record defamation payout, reducing the award of more than $4.5 million in damages to $600,000. The Court of Appeal handed down its decision in Bauer Media Pty Ltd v Wilson (No 2) [2018] VSCA 154 on 14 June 2018, finding that Ms Wilson was not entitled to any economic losses, and reduced the damages for non-economic loss by $50,000.

Record-breaking damages award by the Supreme Court of Victoria

In September 2017 the Supreme Court of Victoria ordered the defendants Bauer Media Pty Ltd and Bauer Media Australia Pty Ltd (collectively Bauer) pay Ms Wilson $4,567,472 in damages for losses she had suffered due to defamatory material published by Bauer-owned publications including Woman’s Day, Woman’s Weekly and OK Magazine. The articles conveyed a number of defamatory imputations, namely that Ms Wilson was untrustworthy and a serial liar, and had lied about her age, name and aspects of her childhood.

You can read our full summary of this decision here.

The sum, which was the largest defamation damages sum ever ordered by an Australian court, consisted of:

  • $650,000 in general damages, including aggravated damages; and
  • $3,917,472 in special damages for Wilson’s loss of opportunity for new screen roles.

General damages

Section 35 of the Defamation Act Victoria (2005) (the Act) outlines a statutory cap on damages for non-economic loss if the court is satisfied that the circumstances of the publication of the defamatory matter warrant an award of aggravated damages. The statutory cap applicable at the time of judgment was $389,500.

Justice Dixon of the Supreme Court found that the statutory cap did not apply to Ms Wilson’s case because Bauer:

  1. failed to properly investigate the allegations made by an anonymous source
  2. published the articles despite knowing the defamatory imputations they contained were false
  3. repeated the offending imputations in further articles in order to keep the articles current and trending to maximise Bauer’s commercial opportunities, as well as neutralise Ms Wilson’s response to its campaign.

As a result, Justice Dixon awarded Ms Wilson $650,000 in general (including aggravated) damages.

Special damages

Ms Wilson also claimed special damages for loss of opportunity, being the earnings she would have received from lead film roles from mid-2015 to the end of 2016 but, as a result of Bauer’s articles, did not. She called two well-known California-based talent agents as witnesses who both gave evidence that, following the release of Pitch Perfect 2, Wilson was expected to and should have received a number of offers for high profile lead roles.

Justice Dixon concluded that but for the “grapevine repetition” of the defamatory imputations contained in Bauer’s articles, Ms Wilson would have been cast in lead or co-lead roles totalling USD$15 million. After discounting this value by 80% for a range of factors, his Honour awarded Wilson special damages of USD$3 million, being AUD$3,917,472.

Appeal by Bauer

Bauer sought leave from the Victorian Court of Appeal to appeal the lower court’s award of damages on the following grounds:

aggravation of damage – that the trial judge erred in finding Bauer’s conduct was unjustifiable, improper or not bona fide and aggravated Ms Wilson’s damages

  1. aggravation of damage – that the trial judge erred in finding Bauer’s conduct was unjustifiable, improper or not bona fide and aggravated Ms Wilson’s damages
  2. s 35 of the Act – that the trial judge erred in finding that the statutory cap for non-economic loss could be exceeded
  3. general damages excessive – that the award of $650,000 for non-economic loss, including aggravated damages, was manifestly excessive
  4. consequential ground – that the trial judge’s assessment of damages for non-economic loss was affected by error and should be set aside
  5. special damages – that the trial judge erred in: a) finding that Ms Wilson had lost the opportunity to earn US$15 million b) finding that the Bauer publications were a cause of this lost opportunity c) his valuation of that lost opportunity (or, alternatively, failed to give adequate reasons for the valuation).

Court of Appeal decision

General damages

The Court of Appeal agreed with Justice Dixon’s finding that the statutory cap in s 35 of the Act can be exceeded whenever an award of aggravated damages is warranted. However, the Court held his Honour erred in determining such an award was warranted in Ms Wilson’s situation.

In particular, the Court held his Honour’s finding that Bauer’s pursuit of the defences of triviality and justification, as well as its adoption of an unjustified approach to the disclosure of confidential information, warranted an award of aggravated damages, should be set aside. As a result, the Court reduced the award of damages for non-economic loss from $650,000 to $600,000.

Special damages

The Court held that the evidence put forward by Ms Wilson – namely in the form of evidence given by the California-based talent agents – did not enable inferences to be drawn that:

  1. the valuable opportunity for which she contended had existed and had been lost
  2. assuming such opportunity had been established, that it had been lost due to the grapevine effect in the United States of the defamatory imputations conveyed in articles published in Australia being repeated
  3. Ms Wilson lost the opportunity to earn US$15 million in lead or co-lead roles in Hollywood films, as Justice Dixon found.

As such, the Court held that Ms Wilson did not make out her special damages claim and set aside the AUD$3,917,472 award for economic loss made by Justice Dixon.

Andrews damages

The Court then turned to whether, given the special damages claim was not made out, an award of damages for a general decline in Ms Wilson’s business should be made (Andrews damages). The Court decided against awarding Andrews damages, finding that the trial judge erroneously described Ms Wilson’s career trajectory, there was no causal connection between the publication of the articles and the alleged loss and, ultimately, that Ms Wilson had failed to prove her economic loss.

What next?

Ms Wilson has indicated on Twitter that she intends to appeal the decision, and described the Court of Appeal as being “absolutely flippant with regards to my economic loss, not to mention my overall hurt and distress at having to stand up to these bullies”.

Takeaway points

While the trial judge’s strong criticism of Bauer sent an important reminder to media outlets (especially publishers of gossip and tabloid content) to ensure their publications are factually accurate, this decision indicates courts will take a strict approach to awarding damages for defamation. In particular, plaintiffs who are unable to prove a causal connection between the publication of the defamatory material and a specific loss in earnings will find it difficult to succeed in a claim for economic loss.

Author: Eleanor Grounds

Contacts: Sydney Ian Robertson, National Managing Partner T: +61 2 8083 0401 E: ian.robertson@holdingredlich.com

Melbourne Dan Pearce, Partner T: +61 3 9321 9840 E: dan.pearce@holdingredlich.com