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Globe and Mail reporter Daniel Leblanc speaks to his lawyer outside court in Montreal on Nov. 5, 2008.Ian Barrett/The Globe and Mail

The ability of journalists to protect their confidential sources hangs in the balance as the Supreme Court of Canada renders judgment in a landmark press rights case.

The court can choose on Friday morning to grant journalists a powerful tool with which to expose corruption and wrongdoing, or it can leave sensitive sources vulnerable to being unmasked in the courts.

The case pits a Montreal media company, Le Groupe Polygone Éditeurs Inc., against Globe and Mail reporter Daniel Leblanc, whose award-winning stories exposed the high-profile federal sponsorship scandal.

Polygone wants to force Mr. Leblanc to reveal the identity of a key source as part of its defence against a $35-million federal lawsuit aimed at recouping money the former Liberal government paid the firm.

Two years ago, a Quebec Superior Court judge ordered Mr. Leblanc to divulge the identity of an anonymous source who had provided key information about the scandal. Polygone lawyers were also permitted to ask Mr. Leblanc for the dates on which he spoke to his source and whether the person worked for a particular government department.

Mr. Leblanc did not answer the questions. Instead, The Globe launched an appeal of the order. It maintained that the information would in effect, identify the source, known as Ma Chouette.

During an oral hearing last year, Globe lawyers William Brock and Guy Du Pont warned the Supreme Court that reporters and their sources cannot be dragged into private disputes without gravely jeopardizing the news-gathering function.

They argued that anonymous sources have played a vital role in exposing many of the most notorious scandals in recent history, including the U.S. Watergate affair.

"What is at stake is whether Daniel Leblanc will have to stand before a court and violate what he believes to be a solemn promise," Mr. Brock said. "This would reduce freedom of the press to an empty shell."

However, Polygone lawyers argued that the rights of a person who leaks information cannot take precedence over the livelihood of a company that is trying to defend itself in a serious lawsuit.

They said that the onus should be on journalists to show why they should be allowed to conceal potentially vital information.

Dean Jobb, a Nova Scotia journalism professor and author of Media Law for Canadian Journalists, said that the Polygone ruling will be crucial for the public, because people rely on the news media to police governments and corporations on their behalf.

"This promises to be the first case to uphold a journalist's right to protect the identity of a source," Prof. Jobb said. "The Globe is trying to protect a key source who helped unravel a major government corruption scandal.

"It is difficult to imagine a more important public-interest story than this," he said. "Canada's courts have acknowledged that confidentiality may be justified when the story is of intense public importance, and that's clearly the case here. Besides, the justice system should be punishing the people who break the law, not the sources and journalists who bring their wrongdoing to light."

The ruling concludes a string of Supreme Court cases aimed at modernizing media law. Last year, it created a defence to libel and defamation based on taking responsible journalistic steps while researching a story.

In other cases, the court disappointed the press by upholding publication bans in most bail hearings and by declining to create a constitutional right to protect confidential sources from police investigators.

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