Court Orders Indemnity Costs Against Prince Harry and Fellow Claimants in Associated Newspapers Privacy Case

Court Orders Indemnity Costs Against Prince Harry and Fellow Claimants in Associated Newspapers Privacy Case

On 21 August 2026, England's High Court ruled that Associated Newspapers' legal costs must be assessed on the more generous "indemnity basis" after it defeated privacy claims from seven public figures, including Prince Harry and Sir Elton John. The claimants must also pay £9,544,355 on account by 28 August 2026.

Information last verified on August 27, 2026. This is a developing story; we update it as the record changes.

Jurisdiction scope: This article addresses civil litigation costs rules and privacy law in England and Wales, arising from a ruling of the High Court's Media and Communications List. It does not address Scots law or Northern Ireland law, which have their own court systems and costs regimes, and it does not address US privacy or defamation litigation. For the wider UK data-privacy framework, see our overview of data-privacy law in the UK.

What Happened

On 21 August 2026, Mr Justice Nicklin handed down judgment in the High Court of Justice, King's Bench Division, Media and Communications List, ruling that Associated Newspapers Limited's costs of defending six related privacy actions should be assessed on the indemnity basis rather than the standard basis ([2026] EWHC 2207 (KB)). The ruling followed the Court's 7 July 2026 judgment in the same litigation ([2026] EWHC 1637 (KB), referred to in the costs judgment as "the Main Judgment"), which dismissed the claims brought by seven claimants across six separate actions: Baroness Lawrence of Clarendon, Elizabeth Hurley, Sir Elton John, David Furnish, Sir Simon Hughes, Prince Harry (the Duke of Sussex) and Sadie Frost (named in the proceedings as Sadie Frost Law). The claimants had already accepted that, having lost at trial, they must pay Associated's costs; the 21 August judgment, handed down after a hearing on 29 and 30 July 2026, decided the basis on which those costs are assessed and the interim sum payable now.

The claimants alleged that Associated, through journalists, private investigators and other third parties, had engaged in "unlawful information gathering" against them over many years, and had used the resulting private information in newspaper articles. In the 7 July 2026 Main Judgment, the Court worked through the pleaded articles and incidents, numbered (1) to (57) in that judgment, one by one, and held in each case where a claim was advanced that the claimant had not proved unlawful information gathering to the required standard, or had not proved any act of unlawful information gathering for which Associated was legally responsible. Mr Justice Nicklin's conclusion at paragraph 1605 of the Main Judgment was unambiguous: "For the reasons given in this judgment, each of the Claimants' claims is dismissed."

At the costs hearing on 29 and 30 July 2026, Associated argued that the way the case had been brought, pleaded and pursued was serious enough to justify indemnity costs rather than the standard basis that normally applies to a losing party. The Court agreed. It held that Associated's costs should be assessed on the indemnity basis "save where costs orders have already been made" earlier in the litigation, covering the assessment at paragraphs 105 to 150 of the judgment. The Court was careful to explain what its ruling was not based on. As the press summary of the judgment records, "the Court stressed that its decision was not based simply on the fact that the Claimants had lost at trial. Nor did the Court make findings that any of the Claimants had acted dishonestly" (paragraphs 140 and 149 of the judgment).

Instead, the Court pointed to a combination of factors in how the litigation itself was conducted. The official press summary, summarising paragraph 109 of the judgment, lists them as "the exceptional breadth of the pleaded case; the gravity of the allegations advanced against many named individuals; the continued pursuit of serious allegations that lacked an adequate evidential foundation; the failure to withdraw allegations that could no longer properly be maintained; reliance upon the Burrows material; the way in which the 'Leveson Lies' allegations were advanced; and the putting of unpleaded allegations to witnesses in cross-examination during the trial." Summarising its conclusion in its own words, the Court held: "The claims, and the manner in which they were brought, pleaded, pursued, maintained and publicly advanced, involved a combination of circumstances and conduct which took the litigation outside the ordinary and reasonable conduct of civil proceedings" (paragraph 107), and later, "The cumulative effect of these matters takes the case well outside the norm. The conduct was unreasonable to a high degree" (paragraph 150).

Associated told the Court that its total costs of defending the proceedings had reached approximately £34,481,622.54 by 9 July 2026, a figure the Court described as "striking" and, in ordinary language, "exceptionally high," noting that "costs of this order are unprecedented in the Media & Communications List" (paragraphs 169 to 170). The claimants asked the Court to cap the amount Associated could ultimately recover under the indemnity order. The Court held that it has the power in principle to impose such a cap, but declined to do so here, because it did not have the detailed evidence needed to fix a fair ceiling and any figure it chose would risk being arbitrary (paragraphs 158 to 173). That question, the Court said, "will be a matter for the Costs Judge if the costs are not agreed" (paragraph 170).

The Court also ordered the claimants to make an interim payment on account of Associated's costs of £9,544,355, described in the judgment as comprising 90% of Associated's approved budgeted costs (£4,669,127.10) and 60% of its incurred pre-budget costs (£4,875,228.24), payable by 28 August 2026 (paragraphs 189 and 191). According to the official press summary, that payment is due by 4pm that day. An interim payment on account is a first instalment pending a full assessment, not itself a determination of how much Associated will ultimately be allowed to keep.

What the Law Actually Says

"Unlawful information gathering" claims in England and Wales

The claimants' case rested on what English privacy litigation has come to call "unlawful information gathering," or UIG. According to the Main Judgment, the claimants alleged that Associated, "through its journalists and/or private investigators, blaggers or other third parties instructed on its behalf," carried out or commissioned unlawful acts to obtain private information used in its newspapers (Main Judgment, paragraph 5). The judgment defines the specific techniques pleaded: "the illegal interception of voicemail messages ('phone hacking'), the listening to and/or recording of live landline or analogue mobile telephone calls ('phone tapping'), the obtaining of private information through deception... ('blagging'), the use or instruction of private investigators (also known as 'search agents')... to commit these" (Main Judgment, paragraph 5).

These allegations were pleaded as the civil tort of misuse of private information, which is the primary cause of action English courts use to remedy an unjustified intrusion into a person's private life, and, for Baroness Lawrence in relation to one article, as breach of confidence (Main Judgment, paragraph 2). Neither judgment records the claimants pleading a claim under the UK's statutory data-protection regime; the Information Commissioner's Office and the Data Protection Act 1998 feature in the Main Judgment mainly as historical context for how such investigative practices came to be scrutinised industry-wide in the 2000s (Main Judgment, discussing "Operation Motorman" and related ICO inquiries). Readers researching how UK statutory data protection law works today, as distinct from the misuse-of-private-information tort at issue in this case, can see our explainer on the UK GDPR. For the separate question of when recording a phone call or conversation is lawful in England and Wales in the first place, a question the alleged "phone hacking" and "phone tapping" in this case bear on, see our guide to whether recording someone is illegal under English law.

Critically, the 21 August costs judgment is not a ruling on whether any of this alleged conduct happened. That question was already decided on 7 July 2026, when the Court dismissed all 57 pleaded claims for failure of proof. The 21 August judgment addresses a separate question entirely: given that the claimants lost, on what basis should the winning defendant's legal bill be assessed.

Standard basis versus indemnity basis costs

Under CPR 44.2, the general rule in civil litigation in England and Wales is that the losing party pays the winning party's costs, though the court retains a broad discretion. CPR 44.3 then sets out how those costs are actually assessed once a costs order is made, and it is this rule that was in dispute here. Under CPR 44.3(2), where costs are assessed on the standard basis, the court "will only allow costs which are proportionate to the matters in issue" and will "resolve any doubt... in favour of the paying party," meaning the party who has to pay. Under CPR 44.3(3), where costs are assessed on the indemnity basis, the court instead "will resolve any doubt... in favour of the receiving party," the party being paid, and proportionality no longer operates as a separate cap on what can be recovered.

The Court in this case explained the practical difference plainly: "That does not mean that the receiving party is entitled to recover all the costs it has incurred. Costs incurred unreasonably, or which are unreasonable in amount, will be disallowed" (paragraph 7 of the costs judgment). In other words, indemnity assessment removes the proportionality ceiling and flips the benefit of the doubt, but a paying party's costs still have to have been reasonably incurred and reasonable in amount; it is not, in the Court's words elsewhere in the judgment, a "blank cheque."

An indemnity costs order is unusual precisely because it departs from that default. The Court applied the test summarised by Tomlinson J in Three Rivers DC v Bank of England [2006] 5 Costs LR 714 at paragraph 25, quoted at paragraph 9 of the costs judgment: the central requirement is that "there must be some conduct or some circumstance which takes the case out of the norm," and, where a claimant's conduct is relied on, "the test is not conduct attracting moral condemnation... but rather unreasonableness." That is a lower bar than proving dishonesty, but the judgment stresses that "the hurdle is a high one" (paragraph 8), requiring conduct "outside the ordinary and reasonable conduct of civil proceedings" (paragraph 107).

The distinction can move a costs bill by millions of pounds for a second, less obvious reason: cost budgeting. English courts routinely approve a "cost budget" in advance for large pieces of litigation, which ordinarily caps what a winning party can recover for future costs even if it later spends more. The Court's ruling explained that this budgetary restriction only bites on a standard-basis assessment; because costs here are to be assessed on the indemnity basis, in the words of the official press summary, "that restriction no longer applies, and Associated may therefore seek to recover costs exceeding its approved budget," though any amount above budget still has to survive the ordinary reasonableness test before a Costs Judge (costs judgment, paragraphs 92 to 104 and 144, and the official press summary at paragraphs 10 and 17).

Analysis: Why This Matters

The following is analysis from the Recording Law Editorial Team.

The headline figures in this ruling, roughly £34.5 million in stated costs and a £9.5 million interim payment, are unusually large even for a High Court media case, and the Court itself said so, calling costs of that order "unprecedented in the Media & Communications List." But the more durable significance of the ruling is in how narrowly the Court framed the basis for its indemnity order. Mr Justice Nicklin went out of his way to say the order did not follow automatically from the claimants losing, and did not rest on any finding that any claimant lied. That distinction matters for how this case should be read: it is a ruling about the conduct of litigation, not a fresh finding about the underlying conduct alleged against Associated, which was already resolved, against the claimants, in the separate 7 July 2026 liability judgment.

The Court's refusal to cap Associated's recoverable costs is also notable, because it shows the limits of what a trial judge will decide at the costs-order stage as opposed to leaving to detailed assessment. The Court accepted it has jurisdiction, in principle, to impose a ceiling on indemnity costs, but declined to exercise it here for lack of the evidence needed to draw a fair line, effectively deferring the real scrutiny of Associated's £34.5 million bill to a specialist Costs Judge working through the underlying billing in detail. That two-stage structure, a broad-brush order at trial followed by granular assessment afterward, is a recurring feature of large English costs disputes and is worth understanding on its own terms rather than assuming the 21 August figures are the final word on what Associated will actually collect.

What Happens Next

Two separate processes now run in parallel. First, if the claimants and Associated cannot agree the final costs figure between themselves, the amount Associated is entitled to recover, above the £9,544,355 interim payment already ordered, will go to detailed assessment before a specialist Costs Judge, who will scrutinise the actual work done, time spent, fee-earner seniority, duplication and reasonableness of the sums claimed. Second, the Court has set a timetable for any appeal: any application for permission to appeal the 7 July 2026 liability judgment or the 21 August 2026 costs judgment must be filed by 2 October 2026. Unless the Court considers a hearing necessary, permission will be decided on the papers rather than at a further hearing, and the deadline for filing an Appellant's Notice with the Court of Appeal, if permission is sought or granted, has been extended to 6 November 2026. Nothing in either judgment indicates how any such application would be decided.

How This Affects You

This case does not create new legal rules; it applies existing costs and privacy principles to one piece of litigation. For anyone considering privacy litigation in England and Wales, the practical lesson from the costs ruling is that the manner in which a case is pleaded and pursued, not only whether it is ultimately won or lost, can materially affect the costs exposure of the losing side. Conduct such as advancing very broad allegations without narrowing them as evidence develops, or maintaining serious claims after the evidential basis for them has become doubtful, is the kind of thing an English court can treat as taking a case "out of the norm" for costs purposes, separate from any question of dishonesty. This is general background on how the system works, not guidance on any individual's own case; anyone weighing privacy, defamation or data-protection litigation in England and Wales should get advice from a solicitor qualified in that jurisdiction. For a related route some public figures pursue instead of, or alongside, a privacy claim, see how claimants sue for defamation in England and Wales; for the separate statutory mechanism some individuals use to have personal information removed from search results, see the right to be forgotten under UK law.

This is general legal information, not legal advice. It covers England and Wales and reflects sources verified on August 27, 2026. Laws change and this story is developing; consult a lawyer licensed in your jurisdiction about your specific situation.

Related articles

• our overview of data-privacy law in the UK
• how claimants sue for defamation in England and Wales
• the right to be forgotten under UK law

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Last updated: 2026-08-27. This is a developing story; details verified as of 2026-08-27.