Motor racing boss Max Mosley wins record damages over reports of the orgy in which he had taken part. Newspapers are angry and consider the judgement an assault on freedom of expression.
A judge ruled last week in London that there was "no evidence" that an orgy in which he took part had any Nazi theme, as reported by News of the World, a popular tabloid.
Delivering his verdict at the High Court, Justice Eady awarded the FIA (Federation Internationale de l'Automobile) president £60,000, which is a record damages payout for a breach of privacy in a case decided by a court.
The newspaper had claimed that the son of the wartime fascist leader Sir Oswald Mosley had developed an unhealthy addiction to sadomasochism, spending £75,000 a year on violent orgies. It also said that his behaviour was a matter of public interest due to his position as Formula One boss.
It added that an orgy on which it reported and secretly recorded on March 28, 2008, was deliberately designed to be a Nazi-style event, with Mosley posing as a concentration camp prisoner and the prostitutes acting as guards.
However, Justice Eady agreed with Mosley that the newspaper had recklessly ignored his right to privacy and was only interested in the material gain from publishing its exclusive story and the accompanying video, which sent its website ratings soaring. He dismissed the allegation that the orgies had Nazi connotations.
Standing outside court after the judgment, a smiling Mosley said the judgment proved the Nazi claims were a "lie".
"I would like to say I am delighted with a judgment which is devastating for the News of the World," he said, in a short statement.
"It demonstrates that their Nazi lie was a complete invention with no justification.
"It also shows they had no right to go into private premises and take pictures and film adults engaged in activities which are no one's business but their own to know. I am very pleased with this result."
In his ruling, Justice Eady dismissed claims that the orgy had any Nazi theme, saying that there was "no genuine basis" for the suggestion that Holocaust victims had been mocked.
"I decided that the claimant had a reasonable expectation of privacy in relation to sexual activities, albeit unconventional, carried on between consenting adults on private property," he said.
The judge also flatly rejected the argument of the newspaper that there was any public interest or defence in recording the activities.
"There was bondage, beating and domination which seem to be typical of S and M behaviour," he said.
"But there was no public interest or other justification for the clandestine recording, for the publication of the resulting information and still photographs, or for the placing of the video extracts on the News of the World website - all of this on a massive scale.
"Of course, I accept that such behaviour is viewed by some people with distaste and moral disapproval. But in the light of modern rights-based jurisprudence, that does not provide any justification for the intrusion on the personal privacy of the claimant."
On compensation, the judge said, "What can be achieved by a monetary award in the circumstances is limited. Any award must be proportionate and avoid the appearance of arbitrariness.
"I have come to the conclusion that the right award, taking all these considerations into account, is £60,000."
Colin Myler, editor of the News of the World, said after the ruling that the newspaper still believed that publishing details of Mosley's orgy was justified.
He argued the newspaper had been a victim of European privacy laws which judges in the UK had to implement. "Our press is less free today after another judgment based on privacy laws emanating from Europe," he said.
The £60,000 award is a new record for damages for a breach of privacy in a case decided by a court. The previous highest sum was £14,600 awarded to Catherine Zeta-Jones and Michael Douglas over unauthorised use of their wedding pictures in Hello magazine, in May 2003.
Out-of-court settlements have gained higher sums, but even there the highest to an individual was £37,500 paid to Sienna Miller by The Sun for pictures of the actress nude on a film set.
A settlement of £58,000 was agreed to be paid to Elizabeth Hurley, Hugh Grant and Arun Nayar by Big Pictures (UK) Ltd, Eliot Press SARL, Associated Newspapers and News Group Newspapers for invasion of privacy while on their holiday in the Maldives.
Newspapers are predictably angry. It was a "good day for the grubby and corrupt," as the judgement effectively means "the law in Britain is now morally neutral," lashed out the Daily Mail.
By declaring the story has no public interest, the judge removed any shame attached to adultery, undermining marriage, it said.
"While the Mosley case may have added to the gaiety of the nation, Mr Justice Eady's judgment will make it more difficult to expose those in positions of power who do wrong," it concludes.
The Times observed that the judgement had "tipped the scales in favour of privacy over press freedom".
But it also notes the judgement in the "sensational" case is a blunt reminder to journalists that they stand and fall by the accuracy of their reporting.