The moneybroker Collins Stewart Tullett and the Financial Times finally drew a line under their bitter two-year battle yesterday when Collins Stewart accepted £300,000 in damages and an apology from the FT to be printed in today's paper.
The brokerage, headed by the combative Terry Smith, sued the newspaper at the High Court in London over four articles which contained allegations made by a former Collins Stewart analyst, James Middleweek, and appeared in August 2003.
The FT also agreed to pay all of the broking firm's legal costs of £2.2m. The newspaper's own costs came to £1.8m. The total legal bill of £4.3m relating to the case will be fully covered by the FT's insurance policy. The news came as the FT's owner, Pearson, reported that the newspaper broke even last year after three years of losses.
Collins Stewart's solicitor, Rod Christie-Miller, told the High Court yesterday: "The defendant, through its solicitor, is here today to express on behalf of the Financial Times its regret at the way in which it reported Mr Middleweek's allegations against Collins Stewart in August 2003. The Financial Times is happy to clarify that it did not ever endorse Mr Middleweek's allegations and apologises for any impression to the contrary that may unintentionally have been given."
The FT's solicitor, Rupert Grey, merely said that he accepted everything that Mr Christie-Miller had said.
The newspaper said it would publish an apology on the front page of its companies and markets section today, with a trailer on the front page of the paper.
Collins Stewart initially sought a record £230.5m damages for the decline in its share price and lost business. That claim was thrown out of court in 2004, whereupon the broker brought a damages claim of £37m. The firm claimed the FT's coverage of Mr Middleweek's allegations against Collins Stewart to the Financial Services Authority in the course of an employment dispute was defamatory and damaging. It accused the FT of "thoroughly irresponsible journalism".
A Collins Stewart spokesman said the libel action was not just about money but "a matter of principle", adding that the FT's apology represented "clear evidence of our vindication".
Hopes of a settlement were raised in November when Andrew Gowers was ousted as editor of the FT and replaced by Lionel Barber, as the dispute became widely regarded as a personal battle between Mr Gowers and Mr Smith.
The two sides agreed a settlement after two weeks of negotiations. The High Court case was due to start on Monday and was expected to last four weeks.
Mr Barber said in a statement: "After two and a half years of litigation, this agreement enables both sides to put this matter behind us and move on." Mr Smith commented: "I and Collins Stewart wish the editorial team at the Financial Times well and the matter is now closed as far as we are concerned." Neither of the two men appeared in court yesterday.
A source close to the newspaper said previous attempts to settle the case foundered because "the demands of the other side were so unbelievable that there was no basis for a settlement."
Mr Middleweek has emigrated to Australia. He settled his employment claim against the firm in October 2004, with each side paying their costs.
If the case had gone ahead, the FT would have argued that it was entitled to report Mr Middleweek's allegations because they were contained in a public document. It would have also put forward a so-called Reynolds, or public interest defence.Reuse content