Guardian admits Tesco libel but disputes malicious falsehood

by Daniel Farey-Jones Brand Republic 19-May-08, 09:15

LONDON - The Guardian has admitted to libelling Tesco by claiming it avoided corporation tax and has offered an apology and compensation, but is to defend against Tesco's claim for malicious falsehood.

In the latest stage of their legal battle, the newspaper made a formal offer of amends in a letter sent to Tesco's lawyers Carter Ruck on Friday.

In the letter the newspaper admits it was wrong to accuse the supermarket chain of attempting to avoid paying up to £1bn of corporation tax. However, it holds to its revised position of accusing Tesco of avoiding a smaller sum relating to stamp duty land tax.

Tesco is understood to be claiming special damages for malicious falsehood, which could result in a fine more punitive than its libel action.

The newspaper denies malice, saying it would have been "perverse", commercially and in terms of reputation, to publish something it knew to be false.

The retailer last week demanded a front-page apology from the newspaper, saying a correction published in its May 3 issue had been inadequate. The original apology was tucked away on page 38.

Such an apology may not be entirely forthcoming according to The Daily Telegraph, which claims the Guardian is offering "to publish a notice on the front page, with the main apology inside in a prominent position".

The row has already caused Guardian Media Group chief executive Carolyn McCall to resign from her position on the Tesco board.