By LORNE MANLY and DAVID D. KIRKPATRICK Published: July 1, 2005 (NYT)

In the months leading up to the decisive court rulings this week on whether Time Inc. had to turn over documents to a grand jury, its editor in chief, Norman Pearlstine, pored over histories of how other editors, publishers and public officials had handled cases where the ultimate law of the land went against them.

Visitors to his office on the 34th floor of the Time & Life Building in Midtown Manhattan would see old Supreme Court cases sitting on his desk. Mr. Pearlstine, who has a law degree, would wander into colleagues' offices or call other journalists, lawyers and academics and bring up case law, according to people with whom he discussed the case.

Did you know, he would ask, that in 1952 President Harry S. Truman bowed to the Supreme Court when it blocked his plan to seize control of the nation's steel mills? And that the Nixon administration turned over the Watergate tapes after the courts determined that executive privilege did not trump investigators' demands?

"This was the kind of issue that began engaging me in ways I had not predicted," Mr. Pearlstine said yesterday in a telephone interview. His first, "kneejerk" reaction, he said, was that nothing was more important than a journalist's keeping his word. But the more he looked at all this, he added, the more he came to believe that it was more detrimental to hold on to the files.

"The journalist and the lawyer were fighting in my head," he said. "But if presidents are not above the law, how is it that journalists are?"

Mr. Pearlstine said that he concluded about two weeks ago that no one, including Time Warner, Time Inc.'s parent, was above the law. So once the Supreme Court declined on Monday to review a trial judge's order that Time magazine turn over a reporter's documents for a grand jury investigation or face mounting fines - and the judge made clear Wednesday that he would not reconsider - Mr. Pearlstine announced that Time Inc. would comply.

Some journalists and media experts were critical of Mr. Pearlstine's choice, wondering whether corporate pressures played a part. "It is very disturbing," said David Halberstam, the author of "The Powers That Be," a seminal 1979 study of media giants including Time Inc. and The New York Times. "It is a strange company and it is a different company now, and it is really part of an entertainment complex. The journalism part is smaller and smaller. There is a great question out there: is this a journalistic company or an entertainment company?"

But Mr. Pearlstine dismissed any talk that corporate overseers had prompted his decision. "This was not a decision of anyone but me," he said, adding that he told Richard D. Parsons, the company's chairman and chief executive, at 7 p.m. Wednesday.

Mr. Pearlstine, 62, has a law degree from the University of Pennsylvania and passed the bar in Pennsylvania and the District of Columbia. But he pursued a journalism career instead, eventually rising to the top editorial position at The Wall Street Journal. He became editor in chief of Time Inc. at the beginning of 1995, taking over a company, started by Henry Luce, that published 24 magazines including Time, Fortune, People and Sports Illustrated.

Time Inc., which is part of an even bigger empire after Time Warner merged with Turner Broadcasting and America Online, is itself much larger now, publishing 140 magazines, including newer successes like InStyle and Real Simple.

Time Inc. and its flagship, Time magazine, have a longstanding reputation for defending their journalists. Beginning in the early 1990's, the magazine spent years and significant expenses to defend a reporter and his article against accusations of libel from the Church of Scientology over an article calling it a "cult of greed." In the 1967 Supreme Court case of Time v. Hill, Time Inc. successfully defended itself against charges of invasion of privacy related to a Life magazine article.

That history, and his understanding of his duties, led Mr. Pearlstine to assert control over the company's legal strategy after Matthew Cooper, a Time reporter, and the company were cited for contempt by Judge Thomas F. Hogan of Federal District Court in Washington. Mr. Cooper has been ordered to testify before a grand jury investigating who disclosed the identity of a Central Intelligence Agency officer named in an online article by Mr. Cooper. The company has been ordered to turn over documents including notes of Mr. Cooper's interviews.

(Mr. Cooper, along with Judith Miller, a reporter for The Times, faces jail time for refusing to testify. Ms. Miller conducted interviews on the matter but did not write an article.)

Mr. Pearlstine kept Paul T. Cappuccio, executive vice president and general counsel of Time Warner, abreast of his thinking throughout the appeals process, said three executives involved in the internal deliberations, speaking on the condition of anonymity because the company did not want them talking publicly about the matter. Mr. Pearlstine also made clear that "in terms of what would happen if in the final decision the Supreme Court said no to us, Norm felt very, very, very strongly that this was his call," one of the executives said. The executive added, "I think he felt as strongly about who gets to make these decisions about what to do if we lose as he did about the privilege decision."

Mr. Pearlstine said that was indeed the case: "As editor in chief, I am totally responsible not only for the editorial independence of this division, but decisions like these."

After a three-judge panel of the Court of Appeals in Washington rejected the reporters' appeal of their contempt orders in February, Mr. Pearlstine decided to switch legal representation from Floyd Abrams of Cahill Gordon & Reindel to Gibson, Dunn & Crutcher and lawyers there including Theodore B. Olson, a former solicitor general of the United States. Time Inc., unlike The Times, is a defendant, Mr. Pearlstine pointed out, and the various legal interests may diverge.

In addition, Mr. Pearlstine said he thought all the defendants could benefit from a different legal approach, one that did not center on reporter's privilege and the First Amendment but on due process.

Late last week, Mr. Pearlstine called Mr. Cappuccio, who had clerked for two Supreme Court justices, to tell him that he had all but made up his mind to turn over the documents if the Supreme Court ruled against them, executives briefed on the call said.

Still, on Monday morning, executives involved in the internal strategy said, Mr. Pearlstine was not ready to give up. He held out hope that, as the case evolved from one involving national security into one dealing with obstruction of justice, the judge might be willing to re-evaluate the balance of interests. But the judge's reaction in the courtroom convinced him that the judge was openly hostile to any further delay, and might jack up the $1,000-a-day fines Time Inc. was facing, these people said. Mr. Pearlstine told colleagues that he was not going to keep going just for the sake of fighting.

"I tend to be one who temporizes and doesn't make a decision before I have to," Mr. Pearlstine said.

After the hearing on Wednesday, Mr. Pearlstine told a disappointed Mr. Cooper his decision. "I understand reasonable people disagree," Mr. Pearlstine said.

Mr. Pearlstine said that he still believed in the confidentiality of sources, but that each situation had to be determined on its merits. "Thinking we're above the law rings wrong to me," he said.

What would have happened if Mr. Pearlstine, whose contract runs through 2006 but who is expected to hand over the editorial reins to his deputy later this year, had made the opposite decision?

Thanks to Mr. Pearlstine, a company official said, Time Warner will not have to face that choice.