A newspaper is being sued for publishing articles based on the findings of a council report.

The Abuse in Early Years report, which centred on two nursery workers, was followed up by The Evening Chronicle in Newcastle in 1998.

In a High Court case that began last week, the paper, as well as the authors of the report and Newcastle City Council, are being sued for libel by the two workers. The pair were acquitted at Newcastle Crown Court of indecently assaulting a number of young children in their care but the report later concluded there had been sexual, physical and emotional abuse.

The report received blanket media coverage at the time it was published, and drew widespread attention and comment among the local community, various organisations and MPs.

The Chronicle published the findings of the report and followed it up in detail, raising questions and other issues - but the nursery workers are saying the report's contents are incorrect.

As the hearing got under way, acting editor Murray Morse said that news coverage of extracts from inquiries and reports such as this were protected by privilege as long as the reports were fair, accurate and balanced.

He said: "We are claiming we had privilege because it was a document produced by the council. We were justified in pursuing those people as we did."

The High Court case is expected to last until May.