Labour will this week be formally notified of a batch of potentially costly new legal actions over antisemitism – days after a warning was issued to the shadow cabinet about the devastating toll the crisis is taking on the party’s finances. The Observer can reveal that lawyers from the Manchester-based firm 3D Solicitors, representing nine current and former Labour members, will notify the party’s high command early this week of the detailed basis of claims they are making for breaches of data protection and privacy rules. The nine individuals are all understood to have lodged confidential complaints to the party while Jeremy Corbyn was leader about what they saw as cases of antisemitism. But their email messages were contained in a report by party officials loyal to Corbyn that was leaked and reported in the media in April. A source close to the latest cases said: “This is about privacy and data protection. These were people who are or were normal party members and councillors who raised issues about antisemitism in good faith and confidentially with the party. They then found that they had been named in a report leaked deliberately, leading them to be abused on social media. No attempts, it seems, were made to protect their privacy.” Another informed source said: “If the party agrees to settle this, which it will if it has any sense, it will cost Labour a few hundred thousand pounds. If it reaches court and Labour loses, it will cost the party many millions.” The leaked report, which ran to 800 pages and was written when Corbyn was still leader, denied that under his leadership the party had failed to tackle antisemitism. On the contrary, it suggested that people who had not wanted him to be leader had deliberately stirred up the controversy in order to undermine him. It said: “At its extreme, some employees seem to have taken a view that the worse things got for Labour, the happier they would be, since this might expedite Jeremy Corbyn’s departure from office.”
The news of the latest cases follows the party’s decision last week to apologise and pay “substantial damages” to seven former party workers who turned whistleblowers over antisemitism in a Panorama documentary. They were accused at the time by the party of acting in bad faith and of being critics of Corbyn’s leadership. The decision to apologise and pay damages – which will cost the party more than £500,000 – underlines the determination of the new leader Keir Starmer to move on and end the crisis, whatever it takes. Last Tuesday, in a sign of growing anxiety about the potential for the crisis to cripple Labour, the shadow cabinet was briefed about the effect that legal actions are having on party funds and its ability to plan ahead. Members of Starmer’s office told the shadow cabinet gathered in a committee room in the House of Commons that while it was important that they began preparing for a huge year of local elections in 2021 – which will include elections to the Scottish parliament, the Welsh assembly, police commissioner elections, the London mayoral elections and council elections – there would be financial constraints. The officials said the next three big financial drains on the party all related to litigation involving the whistleblowers, fallout from the forthcoming report into antisemitism by the Equalities and Human Rights Commission (EHRC), and other civil cases being mounted by individuals against the party. Many believe the total costs could run into millions.
One shadow minister said: “The people responsible for all of this have created a toxic financial timebomb inside our party.” Another senior Labour figure said: “The message was that this is a big year, but don’t think there is much money to fight these elections.” It is understood that the nine individuals whose case will be submitted to the party next week are among a total of over 30 people, including the party’s former general secretary Iain McNicol, who are planning or considering legal action in the ongoing controversy. McNicol was named in the leaked report and after it was made public stepped down as a party whip in the Lords. Sources in the party say he believes it was a “hatchet job” by Corbyn supporters who fear they will be heavily criticised in the EHRC report and wanted to get their side of the story out before it is published in the next few months. One of those who may take legal action after being named in the leaked report said it was now clear that even the party’s most senior lawyer under Corbyn warned at the time that it was deliberately misleading and relied upon improperly obtained private correspondence. The individual said: “I’m appalled to see in black and white that Labour’s own legal advice was that these messages were being selectively used without context to create a misleading and damaging account.” But Corbyn said the legal settlement “risks giving credibility to misleading and inaccurate allegations about action taken to tackle antisemitism in the Labour party in recent years”. In a statement on social media on Wednesday, Corbyn criticised the agreement by the party to pay damages to the whistleblowers. He said: “The party’s decision to apologise today and make substantial payments to former staff who sued the party in relation to last year’s Panorama programme is a political decision, not a legal one.” This article was amended on 26 July 2020 to clarify that email messages, not WhatsApp messages, of the nine complainants were contained in the leaked antisemitism report.