Libel damages paid to defence company for article wrongly linking two executives with sale of weapons to Syria

The Daily Mail has apologised and paid £110,000 in libel damages to a London defence firm it wrongly linked with an alleged chemical weapons plot in Syria.

Britam Defence Limited complained that an article on the Daily Mail's website Mail Online falsely accused two of its executives of conspiring in a "nefarious and illegal plot" in the Middle Eastern state "for enormous financial reward".

The article quoted one email supposedly sent between two executives at the company which claimed to show that Britam had agreed to supply chemical weapons to Homs for use in an attack. However, the emails turned out to be forged.

In a statement at the high court in London on Wednesday, a lawyer for Britam said its founder, Philip Doughty, and its business development director, David Goulding, had "suffered considerable distress and embarrassment" over the article.

Adam Tudor, a solicitor at law firm Carter-Ruck, said on behalf on Britam: "The emails were not written or sent by the claimants (or by anyone at Britam Defence Limited or anyone associated with them), and the illegal hacking of Britam Defence's website remains the subject of a criminal investigation.

"The claimants had no involvement in any chemical weapons plot and would never contemplate becoming involved in the heinous activities which were the subject of the article."

Daily Mail publisher Associated Newspapers agreed the six-figure libel settlement after accepting that the emails were fabricated and that the allegation of a chemical weapons plot was untrue.

Martin Wood, for Associated Newspapers, said in a statement before the judge, Mrs Justice Nicola Davies: "My lady, on behalf of the defendant, I confirm that the defendant offers its sincere apologies to the claimants for the damage and distress caused by the publication of these false allegations, which had appeared on US websites.

"The defendant acknowledges that the emails in question were completely fabricated and that there is no question of any of the claimants being involved – or even considering becoming involved – in the heinous actions to which the article referred. The defendant is pleased to set the record straight."

The case is the second six-figure libel payout by Associated Newspapers in under a week. Last Thursday, the Daily Mail paid £125,000 in damages to the TV psychic Sally Morgan over an article that made an untrue allegation that she had used a hidden earpiece to deceive a theatre audience.

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