High court reversal upholds reporter source confidentiality

The Tokyo High Court on Wednesday overturned a lower court ruling, affirming a Yomiuri Shimbun reporter's right to refuse to reveal a news source over a 1997 report that a U.S. company's Japan unit underreported its income to lower its tax bill.

With the reversal of the district court's March ruling, all courts involved in a series of lawsuits filed by the U.S. firm have, in effect, been instructed that reporters can keep their sources confidential. The ruling was the second such decision by the high court.

The Yomiuri Shimbun reported in October 1997 that Japanese and U.S. tax authorities had conducted an investigation into a U.S. food maker's Japanese unit and determined it had underreported about 7.7 billion yen in taxable income.

After the story was published, the company filed a damages suit in the United States against the U.S. government, arguing that the tax information it supplied was conveyed to Japan's tax authorities and then leaked to the Japanese media, resulting in a series of news reports that damaged its reputation.

The Yomiuri reporter, along with reporters from Kyodo and NHK, and the editor and president of the monthly magazine Themis, last November refused to identify the source.