SYDNEY, Feb 26 (Reuters) - Australian media companies on Monday sought to join German magazine publisher Bauer Media in fighting a record A$4.56 million ($3.6 million) defamation payout to Hollywood actress Rebel Wilson, arguing it set a dangerous precedent.
The Australian arm of Rupert Murdoch's News Corp, Fairfax Media Ltd, Seven West Media Ltd and Nine Entertainment Co Holdings Ltd and the Australian Broadcasting Corp. filed a joint motion to "intervene" in the case, a lawyer representing the companies said.
The move is a rare show of unity in an industry increasingly divided along political lines. In 2017, a court awarded the "Pitch Perfect" Sydney-born star the country's highest defamation payout, smashing the A$389,000 maximum, by using the actress's global reach to justify a "special" damages payment.
The Supreme Court of Victoria found that Wilson missed out on Hollywood roles as a result of a string of articles published by Bauer which claimed Wilson lied about her age, real name and some childhood events, even after it knew the allegations were false.
In Australian law, companies are allowed to seek permission to intervene in a case if they believe the outcome affects their business directly. If allowed, they get to argue their case, separate from the plaintiff and the defendant, during a hearing.
"The concern is that Justice (John) Dixon (of the Supreme Court of Victoria) found that where aggravated damages are awarded, the damages cap no longer applies," said Justin Quill from Macpherson Kelley Lawyers, representing the media companies.
"This sets a precedent because if someone has an aggravated damages claim then they can be given unlimited damages – the sky is the limit," he added.
Wilson's lawyer did not respond to an email requesting comment.
Bauer wasn't "surprised to see Australia's largest media organisations supporting its position in relation to the cap on defamation damages", its general counsel, Adrian Goss, said in an email.
"That aspect of the court's decision has significant consequences for all media," Goss added.
Australian media companies routinely intervene in cases when they want to overturn suppression orders, but rarely in matters concerning defamation.
Bauer's appeal against the Wilson payout begins on April 18. (Reporting by Byron Kaye; Editing by Nick Macfie)