* Correa says daily tried to destroy his reputation
* El Universo lawyer says Correa attacks independent media
* Rights groups say freedom of expression under threat
QUITO, Feb 16 (Reuters) - Ecuador’s highest court early on Thursday upheld a ruling sentencing three newspaper directors to jail and setting damages at $40 million for libeling leftist President Rafael Correa.
The combative Correa has been sparring with local media ever since he took office in January 2007 promising a “citizens’ revolution” in the South American OPEC member.
He often accuses privately owned television networks and newspapers of spreading lies to undermine his government and has called them “the real opposition,” while news organizations say he is trying to censor critics.
“Thank God that the truth has prevailed and we’ve been allowed to overcome this tough challenge successfully,” Correa told reporters, after accusing El Universo of orchestrating a campaign to destroy his reputation.
The original ruling last year sentenced columnist Emilio Palacio and three owners at El Universo to three years in prison and set payment of $40 million in damages to Correa over a column criticizing Correa’s handling of a police revolt in 2010.
Palacio’s February 2011 opinion column titled “No To Lies” referred to Correa as “the Dictator” and alleged he ordered troops to open fire “without warning on a hospital full of civilians and innocent people.”
Thursday’s ruling by the Supreme Court was issued shortly after midnight, and it applied only to the sentence against the newspaper directors. It was the first high-profile sentence issued by the newly appointed court, which was selected amid complaints from opposition lawmakers that some of the chosen judges had ties with Correa’s party.
Correa, 48, attended the hearing, which lasted for over 14 hours, while outside the courthouse his supporters clashed with journalists and citizens protesting that the socialist leader is curbing media freedom.
Correa sympathisers ripped up copies of El Universo, while critics held banners that read “Say no to dictatorship.”
El Universo’s lawyers have argued that the original sentence was out of proportion and accused Correa of pressing judges to get a favorable ruling.
“It’s obvious that the President has a very clear goal, to finish with independent media, not only in Ecuador, but he also wants this to reverberate all over America,” Joffre Campana, a lawyer for El Universo, told reporters.
The ruling will likely draw strong criticism from rights groups, which have slammed Correa’s hard stance against the media for months.
“This shortsighted ruling will only keep Ecuadorean journalists from investigating powerful politicians; it represents a serious setback for democracy in Ecuador,” the U.S.-based Committee to Protect Journalists said in a statement.
Correa is highly popular thanks to high government spending on roads, hospitals and schools, and his government has not faced the kind of widespread social protests that forced three presidents to step down in the decade before he took office.
But he has come under fire for undermining Congress and the judiciary to concentrate power in his own hands, as well as for his constant attacks against the media and for his hardball governing style.
A civil court judge last week sentenced two journalists to pay $1 million each for libeling Correa in a book that alleged that he was aware his older brother, Fabricio Correa, was illegally awarded public contracts. (Reporting By Jose Llangari, Alexandra Valencia and Eduardo Garcia; Editing by Philip Barbara)