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Webbe, who represents her Leicester East constituency as an independent after being expelled from the party, was last year found guilty and handed a 10-week suspended sentence after targeting Michelle Merritt, 59, between September 2018 and April 2020.
She had faced the prospect of a recall petition, which could have resulted in a by-election in her constituency, as a result of the suspended custodial sentence originally imposed.
The reduced, non-custodial, sentence means she now avoids that prospect, although has Labour called for her to quit voluntarily.
A spokesman said: “The allegations in this case were extremely serious. The Labour Party rightly expects elected representatives to maintain the very highest standards at all times.
“Ms Webbe should now resign so the people of Leicester East can get the representation they deserve.”
Prosecutors said the 18-month harassment campaign was driven by “obsession” and “jealousy” over her boyfriend Lester Thomas’s relationship with executive assistant Ms Merritt.
Sexual text messages between the pair, which were revealed for the first time during Webbe’s appeal hearing at Southwark Crown Court, proved the pair were having an affair.
Helen Law, defending argued the messages showed Ms Merritt had repeatedly lied, having told the magistrates’ court they were just “good friends”.
But on Thursday, following an appeal hearing at Southwark Crown Court Judge Deborah Taylor and two magistrates dismissed the appeal.
The judge said: “We found that although Michelle Merritt was an unsatisfactory witness who told lies about the nature of her relationship with Lester Thomas until the downloads from her phone made the nature of the relationship clear, in other respects we accept her evidence.”
Ms Merritt told how Webbe branded her a “slag”, threatened her with acid and said she would reveal naked photographs to her family in a string of phone calls.
The judge said the court found Webbe had not “made a threat to throw acid over” Ms Merritt, but that a string of silent phone calls and threats to reveal naked pictures of her had been “a course of conduct which amounted to harassment”.
She reduced Webbe’s suspended sentence to a 12-month community order of 80 hours unpaid work, although Webbe has already carried out 150 hours, and cut the compensation from £1,000 to £50.
The judge said the evidence differed “considerably” from that heard in the magistrates’ court.
“We take into account you were under considerable stress at the time of these events, there were a number of election campaigns you were running at the time,” she said.
She said Webbe’s boyfriend’s affair caused her “great distress”, which was “exacerbated by lockdown”.
“In the circumstances we consider that the new evidence sheds new light on the nature and extent of your offending,” the judge added.
After the hearing, Webbe said in a statement: “I am deeply shocked by today’s outcome.
“As I said in court and repeat now, I have never threatened violence nor would I.”
Webbe claimed she was “facing domestic abuse” at the time she was recorded on April 25, 2020 telling Ms Merritt nine times to “get out of my relationship” and threatening to show naked pictures of her to her family.
“I was deeply frustrated that my partner and Michelle Merritt had been socialising in the middle of the covid pandemic, contrary to the rules and all health advice,” she said.
“I was frightened and frustrated by his behaviour.
“But that fear and frustration could not and should not have been interpreted as harassment.”
Webbe added: “She wanted to get rid of me from the moment she was aware of me, and far from being fearful or frightened of me was actively planning and plotting my downfall and humiliation.”
The MP had arrived at her magistrates’ court trial holding hands with Mr Thomas, who sat in the public gallery to hear his partner claim she was the victim of “domestic abuse and coercive control”.
Mr Thomas, a consultant at Crossrail, football coach and scout for Chelsea FC, had been expected to give evidence for the first time in Webbe’s appeal.
But the politician told how she had split up with her boyfriend in March this year, when the new messages between Mr Thomas and Ms Webbe came to light.
The court heard he bought Ms Merritt a £120 sex toy, frequently sent her pornography and would regularly meet with her to “play”.
Giving evidence from behind a screen, Ms Merritt admitted having sex with Mr Thomas – who she described as a “narcissist who likes attention” – between March 2017 and July 2020.
The MP’s barrister Helen Law suggested Ms Merritt had “lied” or “misled” the magistrates’ court when she said she and Mr Thomas were just “good friends”.
But prosecutor Susannah Stevens said: “What was going on between Michelle Merritt and Lester Thomas is actually unhelpful to the appellant’s case because Claudia Webbe’s suspicions as to all of that provide her not with a defence but with a motivation.”