By Lawrence Hurley

WASHINGTON (Reuters) – A federal appeals court ruled on Friday that the First Amendment right to free speech does not prevent a New York Times journalist from giving testimony in a high-profile government leak case.

The ruling by the Richmond, Virginia-based 4th U.S. Circuit Court of Appeals is a win for the Obama administration, but it could hurt efforts by Attorney General Eric Holder to improve relations with the media. The Justice Department last week pledged to tighten its criteria for targeting journalists in leak cases.

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Two other cases sparked a media outcry earlier this year about whether the Justice Department had been overzealous in investigating government leaks and had infringed on the right of free speech.

Prosecutors sought the testimony of reporter James Risen, author of a book, “State of War,” that contained information the government believed was leaked by former CIA officer Jeffrey Sterling.

In 2010, Sterling was indicted on ten charges relating to Risen’s book, including unauthorized retention and communication of national defense information.

The following year, Holder authorized the Justice Department to issue a subpoena seeking Risen’s testimony. Risen challenged the subpoena, saying he could not be compelled to testify under the First Amendment and federal common law.

In Friday’s ruling, a three-judge panel ruled on a 2-1 vote that there is no so-called “reporter’s privilege” under the First Amendment’s guarantee of freedom of speech, meaning journalists do not receive special treatment.

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“The reporter must appear and give testimony just as every other citizen must,” wrote Chief Judge William Traxler. “We are not at liberty to conclude otherwise.”

Judge Roger Gregory dissented, saying the majority had interpreted the law in a way that was “contrary to the will and wisdom,” of the United States’ founding fathers.

The Justice Department did not immediately respond to a request seeking comment. Risen’s attorney, Joel Kurtzberg, said he was disappointed with the ruling and that he and his client are “evaluating our next steps.”

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Various media organizations, including Reuters America LLC, which is owned by Thomson Reuters Corp, joined a friend-of-the-court brief in support of Risen.

MEDIA OUTCRY

Friday’s ruling comes one week after the Justice Department issued new guidelines that would curb the ability of prosecutors to seize reporters’ records when investigating leaks.

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In a recent case that prompted concerns among the media, prosecutors obtained a warrant to search Fox News correspondent James Rosen’s emails. He was named a “co-conspirator” in a federal leaks probe involving his reporting on North Korea.

In the other case that attracted attention, the Justice Department seized Associated Press phone records without prior notification as part of a probe into leaks about a 2012 Yemen-based plot to bomb a U.S. airliner.

(Reporting by Lawrence Hurley; Additional reporting by Jennifer Saba and David Ingram; Editing by Kevin Drawbaugh and Vicki Allen)