The House of Lords’ ruling, by a 3 - 2 majority in favour of OK! magazine’s £1 million claim against Hello!, will further strengthen the grip that celebrities have over the exploitation of their fame. The use of “spoilers”, in which one publication beats another to an “exclusive” story, will now carry a much greater risk of large compensation claims.

Michael Douglas and Catherine Zeta-Jones married in New York in November 2000 and sold the exclusive rights to the photographs to OK! Hello! obtained unauthorised pictures taken surreptitiously by a freelance photographer and published them. OK! sued for just over £1 million, which it claimed was its loss of profit resulting from Hello!'s spoiler. It would, if it won, also seek to recover a large proportion of its legal costs.

The ensuing litigation has dragged on for six-and-a-half years, appearing before the High Court no less than eight times, the Court of Appeal four times and now, finally, the House of Lords. The lower courts initially ruled in OK!'s favour, awarding £1 million, but this was overturned by the Court of Appeal, which said Hello! had not breached its confidential information.

The Douglases did not actually take part in the appeal to the Lords - instead, they bowed out of the dispute, having been awarded just over £14,500 in compensation. This left OK! and Hello! to fight over the issue of whether Hello! owed any obligations of confidence to OK! Magazine, or alternatively, whether Hello! had interfered unlawfully with the contract between the Douglases and OK! magazine.

Lord Hoffman, delivering the main judgment for the majority of the law lords, agreed with the judgment of the initial trial judge, Mr Justice Lindsay, that the Douglases had the right to sell exclusive images of their wedding – including unauthorised photographs. He said the rights that the Douglases sold to OK! were the same as any other trade secret, and both the Douglases and OK! magazine were entitled to stop Hello! disclosing that secret information - that is, any photographs of the wedding.

The result is a landmark in the establishment of privacy law in the UK. It means celebrities have a right to trade in their fame. As far as the courts are concerned, there is no difference between secrets held by a commercial organisation and what happens at a private function hosted by a celebrity. They have a legally enshrined right to stop others interfering with commercial contracts through which they exploit their fame.

Celebrities will now likely find it easier to secure injunctions to stop newspapers or magazines publishing unauthorised material, even if they are using a private function to profit from a competing publication. The ruling also means that, while newspapers and magazines face relatively small damages for infringing a celebrity's privacy - in the mere thousands of pounds - the damages they face for interfering with commercial arrangements can be very substantial indeed.

The ruling is good news for the parts of the media that pay celebrities for exclusives including, as it happens, Hello! But life just got tougher for those who get scooped.

Ian De Freitas is an intellectual property partner at Berwin Leighton Paisner

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