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Bates 'could have avoided £1.5m legal bill'
A SIMPLE apology and a cheque for £15,000 could have saved Leeds United chairman Ken Bates an estimated £1.5m in libel damages and legal costs, it has emerged.
Former United director Melvyn Levi was awarded 50,000 in libel damages against Mr Bates at London's High Court.
Mr Levi, 65, sued Mr Bates, 77, over three articles written by the Leeds United chairman in the club's match-day programme in 2006 and 2007, and a letter sent to fans in 2007.
The articles variously accused Mr Levi – whose address was also printed in one of the programmes – of being a shyster, an "enemy within", attempting to blackmail the club and scaring off potential investors.
After the judgement, Simon Myerson QC, for Mr Levi, told judge Sir Charles Gray that in January 2009, Mr Levi had offered to settle the action for 15,000 damages and an apology, but Mr Bates declined to accept those terms.
The United chairman was ordered to pay the estimated 1.5m legal costs of the nine-day libel case.
Sir Charles said: "The costs are a horrific burden on him. They would be considered by almost everyone as absurd."
Mr Myerson said the costs run up by the businessman – who fought the case on a "no win, no fee" basis – were "just shy of a million pounds".
Mr Bates was refused permission to appeal and was ordered to make an "interim payment" of 400,000 in legal costs, pending final calculation of lawyers' bills.
Outside court, Mr Levi welcomed the judge's decision: "All I wanted to do was clear my name. I even offered to settle the matter before I came to court.
"It was a risk coming to court because of what I stood to lose, but you have to stand up for your rights."
The Leeds United website contains the following statement today from Mr Bates: "We were disappointed in the judgement, some aspects of which we find rather extraordinary, and we are considering an appeal.
"The judge refused us leave to appeal, but also refused to give any reason why, which is unusual. But he will give written reasons in due course. When we have received his written reasons we will consider whether to go to the Court of Appeal."
The dispute arose after Mr Bates took over the club in early 2005 from the Yorkshire Consortium Trust, of which Mr Levi was a member.
At the centre of their dispute was whether or not Mr Levi was obliged to give the green light to a share transfer which would have effectively given control of the club to Mr Bates and his backers.
Mr Levi said that he believed there were good legal reasons to believe that a "call option" on the shares had lapsed, but Mr Bates accused him of blocking the transfer for no good reason, and in doing so, forcing him to abandon a rights issue in the club.
As a result of their stand-off, new shares were issued, which diluted the importance of the call option, left Mr Bates in a stronger position than before and saw Cope Industrials Holdings Ltd – a company in which Mr Levi had an interest – 1.4m out of pocket.
Sir Charles said he was "not persuaded" that it was the dispute with Mr Levi which caused the rights issue to be abandoned.
Rejecting arguments that Mr Levi had been blackmailing the club, Sir Charles said he did not accept that Mr Levi's conduct could "justifiably be said to have amounted to blackmailing Mr Bates".
The judge said that the description of Mr Levi as a shyster was "substantially unjustified."
And he said that Mr Bates had "failed to justify" allegations that Mr Levi had acted "contrary to the best interests of the club or that he deterred would-be investors".
He said there had been debate in the case as to whether the title of the second programme article, 'The Enemy Within', published on March 3 2007, would have been "understood to hark back to the use of that phrase by the Nazis to describe the Jews."
But he added: "I do not accept that the ordinary reasonable member of the club reading the programme would have understood Mr Bates' words to be anti-semitic. 'The Enemy Within' is an age-old phrase used by those in power to describe dissidents."
In awarding damages, the judge said he had taken into account the "gratuitous inclusion" in the second programme of Mr Levi's home address in Leeds and the reference, in the third, to his phone number being in the telephone book.
The judge said the letter written to the club's fans had a defence of "qualified privilege" and was not libellous.
Bates could face further legal action
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Friday 10 February 2012
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