A West Australian university is withdrawing a multi-million-dollar financial damages claim filed against a whistleblower academic who spoke on the ABC's Four Corners last year.

Key points: Associate Professor Gerd Schroder-Turk is being counter-sued by Murdoch University after they threatened to remove him from the university senate

Associate Professor Gerd Schroder-Turk is being counter-sued by Murdoch University after they threatened to remove him from the university senate The academic had voiced concerns on the ABC about the welfare of international students

The academic had voiced concerns on the ABC about the welfare of international students Murdoch University wrote to staff to say it would continue pursuing legal action against the academic, but the financial component of its counterclaim would be dropped

Associate Professor Gerd Schroder-Turk was one of three Murdoch University academics who appeared on the program raising concerns about the welfare of international students.

He took legal action in the Federal Court seeking an injunction to stop the university from removing him from his position on the university's senate after the broadcast.

In response, Murdoch University counter-sued Dr Schroder-Turk for costs and damages.

Murdoch claimed that since Dr Schroder-Turk's comments the university's reputation had been damaged and it had suffered financial losses in the order of millions of dollars due to a drop in international student numbers.

The move drew international condemnation with more than 30,000 people signing a petition calling for the university to drop the counterclaim against him.

Dr Schroder-Turk said he was "greatly relieved" by the news in a statement from his lawyers.

"The counter-claim by the university has caused me and my young family a great deal of unnecessary stress," he said.

"I have always acted in the best interest of the university, its students and its staff, and have done so in very difficult circumstances.

"However, my concerns about the welfare of students remain."

His lawyer, Josh Bornstein from Maurice Blackburn, said the financial claim was an "unprecedented" attack on a whistleblower.

"The university clearly intended to try and frighten my client and any other staff member wanting to speak up about maladministration," he said.

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'Patently absurd' to sue, union says

The National Tertiary Education Union (NTEU) welcomed the university's decision to drop the financial claim, with general secretary Matthew McGowan saying it was "patently absurd to think that a university would sue a staff member for millions of dollars in damages".

Protesters showed support for Dr Schroder-Turk at a rally in October last year. ( ABC News: Hugh Sando )

Last month, Murdoch University Professor Robert Cribb resigned in protest from his position as the institution's Distinguished Visiting Scholar, telling the ABC he believed the legal action set a dangerous precedent and was "an attempt to intimidate other people from potentially revealing other poor practices".

Dozens of other high-profile academics from institutions around the world have signed open letters raising concerns about the implications of the case for academic freedom of expression.

Murdoch University told staff this morning it had advised lawyers for Dr Schroder-Turk it was withdrawing the financial component of its counterclaim "in the spirit of moving towards a resolution".

"We understand the financial component of the counterclaim as part of the university's defence has become a focus of commentary regarding this case," the statement said.

Lawsuit is 'not about academic freedom', university says

Murdoch University also used the statement to defend its decision to take action against Dr Schroder-Turk and denied the claim was a freedom of speech matter.

"The central issue is whether Associate Professor Schroder-Turk's actions have breached his duties as a member of senate," the statement said.

"Associate Professor Schroder-Turk's legal action and the university's subsequent defence is not and has never been about academic freedom. It is simply about senate governance."

Mr McGowan from the NTEU disagreed and called for the university's entire counterclaim to be dropped.

"This is about academic freedom — the right of a staff member to speak openly about issues and concerns about their institution without fear or favour — and if Murdoch management cannot understand this then they shouldn't be running a university," he said.