EDO Injunction Case

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EDO MBM v. Smash EDO and others
Queens Bench
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The EDO Injunction was a High Court of Justice civil action brought by EDO MBM Technology Ltd a subsidiary of EDO Corporation against anti war protesters in Brighton UK, that began in April 2005 and was settled by March 2006. The name of the case changed in the course of the pre-trial hearings from EDO MBM v Smash EDO to EDO MBM v Axworthy as the first defendant an unincorporated association called Smash EDO was struck out in April 2005 due to being unrepresented.

Contents 1 Introduction 2 Preliminary issues trial 3 Attorney General's intervention in the case 4 Settlement of the case 5 Legal costs for EDO 6 References

[edit] Introduction

The anti-war protest campaign against EDO MBM began in 2004. The ongoing protests led EDO MBM and its employees, in April 2005, to seek a permanent high court injunction against 14 named protesters and two protest groups Smash EDO and Bombs out Of Brighton, on grounds of harassment. ^[1] The intended injunction brought under Section 3 of the Protection from Harassment Act 1997, applied to all protesters, not only those named in the court papers (who in any case strongly denied the allegations). The case created a public outcry because it was seen as a draconian, disproportionate and unjustified measure used by a US arms company to suppress the freedom to protest of UK anti-war protesters. Breach of any condition of the civil injunction carried a criminal penalty of up to five years in prison.^[2]

[edit] Preliminary issues trial

The High Court proceedings at the Royal Courts of Justice, opened up an argument to the defendants of 'preventing war crimes', that allowed them to put forward evidence of EDO’s complicity in war crimes, and refer to the International Criminal Court Act. The Brighton protester's war crimes legal argument was taken seriously by the court for the first time. It had previously been dismissed by lower criminal courts in Brighton as beyond their jurisdiction.

Although a defence argument that protesters could have been justified in harassing employees of the company to stop a war crime being committed, was rejected by the high court in a preliminary issues trial of November 2005 on the grounds that such crimes could not be prevented over a long term, only in immediate actions to stop imminent and specific crimes, the court accepted that a further defense argument should be open. This was that if the protesters could show they were acting reasonably in the circumstances on the basis of an objective evidential test, then there was a defense that any harassment, if it had taken place, could be lawful.

The defendants had collated a dossier of evidence that outlined the links between EDO Corp and war crimes which included statements given by witnesses and bombing victims from Palestine. It also included reports from journalists and human rights groups on war crimes in both Iraq and Palestine. A High Court judge praised the detailed document as 'admirable'. The document detailed incidents of war crimes related to air strikes on civilian areas and infrastructure in both Iraq and Palestine, and argued that the attack and invasion of Iraq in March 2003 was itself illegal as a war of aggression in contravention of the UN Charter.

[edit] Attorney General's intervention in the case

The barrister David Perry was instructed by the UK Govt Attorney-General Treasury Solicitors Office to defend the legality of the war on Iraq, and apparently bolster EDO's case for the injunction. Perry described the protests and non-violent direct actions (NVDA) in Brighton as 'a mask for anarchy' and suggested that the protesters belief that EDO MBM were complicit in war crimes was imaginary and even dangerous. The written submissions of the AG to the High Court supported EDO MBM's claim that the arms company did not supply Israel with military equipment, yet in a Freedom of Information response in 2006 the British Government admitted that it had simply taken the word of the company on this issue and assumed it to be true even though they had not verified it.^[3]

Despite this intervention by the Attorney-General, the High Court did not accept the Government's argument that taking into account the honest belief of protesters that war crimes had taken place was wrong. The High Court found that if there was an imminent war crime that the protesters believed on reasonable grounds, was about to take place, in which EDO were complicit, then preventative direct action COULD LAWFULLY be taken against EDO MBM, without waiting for the authorities of the state to intervene. The ruling effectively allowed proportionate direct action against companies by protesters, if the threat of the crime was imminent and specific.

'It was not necessary to show that any crime was actually committed, merely that the course of conduct had been pursued to prevent the commission of crime. Further, it need not be proved that the person to whom the conduct was directed was the person who was about to commit the crime. The word 'prevent' in the provision did not, however, extend to any long term prevention of crime. '

(Independent barristers note on this point here...[1]). On the news of this judgment EDO Corporation's share price dropped dramatically on Wall Street in the following days.

The High Court also rejected EDO Corporation's novel claim that even though there may well have been war crimes carried out with its products, the company was protected from prosecution as a supplier to the military by the Royal Prerogative which disallows the domestic courts from making judgements of government foreign policy. In response to this the Judge went so far as to compare the director of the EDO MBM to Bruno Tesch (Chemist) of the Zyclon B case [2], who was executed for assisting the genocidal policies of the Nazi regime in Germany in the 1940s.

[edit] Settlement of the case

In February 2006 in an out of court settlement several defendants who had been represented by lawyers funded by Legal Aid agreed that they would sign undertakings not to not do certain things that they had never done or had any intention of doing, on condition of discontinuence, and that defendants costs of the case were paid by EDO and EDO also pay their own substantial costs, but most importantly of all, that the injunction against all other protesters other than those in court be lifted.

This settlement effectively ended the blanket injunction against all protests at the EDO MBM factory in Brighton. It should be also noted that the legally represented defendants had no choice but to sign the undertaking because Legal Aid had become dependent on the offer of such a document by defendants to EDO, as a result of the nervousness of one QC employed by the defendants. The QC made the recommendation of such a settlement to the Legal Services Commission who themselves then made it a condition of continued funding. Legal funding would thus have been withdrawn from the defence case if the represented defendants had not signed the undertakings.

The legal action continued against three remaining defendants who were not dependent of Legal Aid so were able to refuse the written undertakings, and the large lump sums they were offered by EDO to sign them. EDO had hoped that these litigants in person would follow the lead of the lawyers, so that the company would not suffer the exposure of an abuse of process hearing against them that had been a major factor in the out of court settlement for the other defendants.

If the trial had taken place the evidence of EDO's complicity in war crimes would have been brought to light, but EDO's legal team dropped the whole case before the trial started, after a damning High Court judgement in March 2006, where a judge agreed with complaints from the defendants, that EDO had failed to prepare for what had been ordered by the court to be a speedy trial. An earlier judge had decided the interim injunction created serious infringements of protester's ECHR human rights to free speech and association. EDO Corporation agreed to pay the full costs to remaining defendants and included discontinuance against all defendants who had not even come forward to fight the action which thereby prevented EDO from seeking default costs against these invisible individuals. ^[4]

[edit] Legal costs for EDO

As a result of the collapse of the year long court battle, EDO MBM suffered legal costs of between £1 million -£1.5, more than an entire year's profit for the Brighton arms company. Their legal team, from the firm Lawson Cruttenden and Co, were found by the judge to have abused the legal process by delaying the full trial, and thereby held onto a temporary injunction that was in place till the full trial would decide if a permanent one was necessary. ^[5]

The legal costs of the injunction case led to an unexpected 1st quarter loss reported in EDO Corporation results on 27 April 2006. ^[6] citing unexpected legal costs as a cause. EDO saw a market value drop of approximately 200 Million US Dollars over the next twelve months, or around 30% of their total market value as investors ran for cover. ^[7] On 17th July 2006 EDO Corp was listed by Forbes website in a monthly overview of its Beltway Index of stock performance as the worst performing stock of the past year. ^[8]

EDO MBM's accounts for 2006 were withheld by the company and not filed with Companies House till March 2008.^[9] These were only filed after non-compliance with the Companies Act led to an international credit agency Experian reducing the company credit rating and credit limit to zero. Two days later the company filed all outstanding accounts and some others earlier than required by law.

EDO MBM' s 2006 accounts show that while turnover remained constant the company made a loss in 2006 of £470,000 down from a profit of £923,000 in 2005. The figure of £1,333,000 that makes up the difference is put down to a increased admin expense by £717,000 and a bail out of admin expenses of subsidiary EDO Rugged systems by £834,000 . These two figures totaling £1,551,000 are considered to be around the same figure the the legal costs of the injunction would count as.

The accounts for EDO(UK) Ltd parent of EDO MBM declare a loss for 2007.

According to their own accounts the number of employees of EDO MBM dropped from 171 to 132 between January 2005 and December 2007 a loss of 39 out of 171 or 23%.

[edit] References

Legal documents related to the EDO Injunction case. http://www.smashedo.org.uk/resources.htm#4