Liberal Democrat science spokesman Evan Harris said last night libel laws need reforming to prevent a repeat of cases like Tesco's protracted legal battle with The Guardian.
Speaking at an election hustings on libel laws in England and Wales, Harris, who is also chair of the Parliamentary Libel Reform Campaign, clashed with the other leading parties on the issue of corporate libel actions.
The Liberal Democrats used the launch of their manifesto last week to call for change to current laws so that the burden of proof in libel cases brought by corporations was shifted to the claimant.
All three leading parties are broadly in agreement over the need for libel reform, each have tabling a series of measures to tackle the issue, however libel reform campaigners have praised the Liberal Democrats for putting forward 'the meatiest proposals".
Harris highlighted two recent cases pursued against the Guardian, including that brought in 2008 by Tesco's over allegations about its tax arrangements. The Guardian settled, apologised, and was left with an £800,000 costs bill by Carter Ruck.
He said: 'If you don't deal with the problem of corporations you still have the Guardian being bullied by Tesco and bullied by Barclays.
'Even if the law downstream changes it's easy for those people [corporations] to employ lawyers.
'The Guardian has to think how it can afford even the first stage of something like this, how many jobs will it cost if it has to settle and doesn't get awarded costs?"
Harris said the 'chill'created by the threat of cases like this - where news groups become wary of publishing because of the potential risks - was as problematic as any eventual costs resulting from legal actions.
The Liberal Democrats, along with the other parties, have also advocated the introduction of a public interest defence to support responsible investigative journalism.
Harris told the event, organised by the Libel Reform Campaign: 'If corporations can't sue for libel and can only have malicious falsehood then they would have have to prove malice or recklessness."
His stance brought a mixed response. Conservative justice spokesman Dominic Grieve said shifting the burden of proof solely in cases involving corporations may be possible but advocated consultation to find a package of libel reform measures.
Justice Minister Michael Wills said it 'was not on the agenda'of the current government to shift the burden of proof in any libel cases.
Wills said the measures proposed by the Government, including a statutory public interest defence and a planned reduction for success fees in so-called 'no win, no fee'cases, would help redress inbalance in libel cases.