The libel trial starts next April, but this preliminary judgment established whether Collins Stewart could claim for the drop in its share price following the publication of an article in the FT entitled "Reputations on the line at Collins Stewart".
High Court judge Mr Justice Tugendhat said: "A trial of that issue would be a waste of time. I have struck it out."
However, a separate claim from Collins Stewart for at least £37m to compensate for losses in earnings as a result of the article will be pursued at the trial.
Andrew Gowers, editor of the Financial Times, said that the judge's decision vindicated the paper's position that the basis for Collins Stewart's £230.5m damages claim was manifest nonsense and untenable in law.
"It would be a very dark day for journalism and for a free press if publishers were to be held liable for a drop in share price following publication of an article reporting on company events. We were always confident that the judge would share our belief, and throw this unprecedented special damages claim out," Gowers said.
He added that the FT would continue to defend the Collins Stewart libel claim and believed it had a right to report on the allegations made last year in a fair and balanced way.
"Indeed, we were not the only national newspaper to report these allegations. The legal issues relating to the actual libel claim are relatively straightforward and we are pleased that the court will now be able to hear them in April without the spectre of a misconceived and, frankly, preposterous damages claim hanging over the trial," he said.
If you have an opinion on this or any other issue raised on Brand Republic, join the debate in the .
_1.jpg)
.jpg)
