- Rebekah Brooks calls first phone hacking arrests "a huge story if nothing else"
- Brooks says she and Andy Coulson were good at keeping "Chinese wall" between their papers
- Brooks, Coulson and five others are on trial facing phone hacking charges
- The defendants deny the charges against them
Chasing stories on soccer star David Beckham for rival papers put a strain on the relationship between former newspaper chief Rebekah Brooks and ex-Downing Street spin doctor Andy Coulson, a court heard Wednesday.
Brooks, Coulson and five others are on trial facing phone hacking charges, including conspiracy to intercept the voice mails of high-profile figures in Britain. All seven deny wrongdoing.
Brooks, the former chief executive of Rupert Murdoch's UK newspaper arm, News International, and onetime editor of the News of the World and The Sun newspapers, has denied having a long-running affair with Coulson but said they were close.
Continuing her defense testimony Wednesday, Brooks told the court how her personal relationship with Coulson affected their professional relationship when she was editor of The Sun and he was editor of sister paper -- yet fierce rival -- News of the World. Coulson became editor of the News of the World after Brooks.
"It was our own fault complicating the friendship," Brooks told London's Old Bailey court, saying they had previously been good at keeping a "Chinese wall" between the two newspapers.
She said their professional relationship became especially strained in April 2004 when the News of the World broke a story about an alleged affair by Beckham. It had put out a "spoof" edition on a Saturday evening, and The Sun would not know about the story until it reached newsstands. Other newspapers such as The Daily Mail and Daily Mirror, however, learned about the story before Brooks, who said: "I was not best pleased about that situation."
She told the jury she knew Beckham and his wife, Victoria, socially and would occasionally go out to dinner with them to try to encourage the sports star to write for the paper.
"Andy would have known that I had a direct line to the Beckhams," she said.
When asked if she would have hesitated in stealing the story, she replied, "No, probably not."
Letter read aloud in court
Allegations that the two defendants had a clandestine affair emerged earlier in the trial when the prosecution read out a letter written by Brooks to Coulson, a former communications director for British Prime Minister David Cameron, as he tried to end their relationship.
The prosecution said the affair ran from 1998 to 2004 -- during some of which time both Brooks and Coulson were married to others -- and it revealed the level of trust between the defendants.
Testifying in her defense Friday, Brooks said there were periods of physical intimacy at that time, including from 2003 to 2005, when her marriage to actor Ross Kemp was breaking up, and again briefly in 2006.
Brooks also told the court Wednesday about how she learned while on vacation in Italy in 2006 that police had raided the News of the World offices and royal editor Clive Goodman had been arrested, accused of intercepting voice mails of members of the royal household. She described initial confusion about the allegations, saying she almost certainly would have called Coulson, who was then editor of the News of the World, to find out what was going on.
"It was a huge news story if nothing else," she said.
Private investigator Glenn Mulcaire was also arrested on phone hacking charges. Brooks said there was a "certain amount of grumpiness" from the Sun team in reaction to the allegations at the News of the World. "They (the Sun team) felt they were cheating by intercepting voice mails," she said.
Brooks said police later told her that Mulcaire had hacked her own phone for 18 months. She said she was "pretty shocked" about being hacked and "certainly surprised" because she had a personal PIN code and thought it would be secure.
In a raid on Mulcaire's house, police found notebooks with reference to Kemp, Brooks' former husband.
She said she met with police because "being a journalist by nature," she wanted to find out as much as possible about how the investigation into the News of the World was going.
They gave her no indication at that stage they were investigating any wrongdoing at the News of the World during her editorship, Brooks said. She told the court she later agreed with senior management at The Sun not to pursue a case against Mulcaire over the hacking of her phone.
Mulcaire and Goodman were jailed after pleading guilty to phone hacking in 2007.
A job offer and 'a delicate situation'
Brooks told the court she believed a line had been drawn under the phone hacking scandal after Goodman and Mulcaire were sentenced.
She had lunch with Goodman shortly after his release from prison in April 2007 and offered him a job because he was taking News International to an employment tribunal over his dismissal while he was in prison.
She told the court he was alleging that other people at News International knew he was accessing voice mails, that others knew about the practice and were involved in it. Brooks said she had "a very sound belief that there was no foundation to these allegations."
"It was a delicate situation. Clive was angry he had been dismissed. He felt he had been unfairly treated by the company," she said.
Goodman did not take up the job offer.
Hacking of missing schoolgirl's voice mails
On Tuesday, Brooks denied ever having approved the practice of phone hacking while editor of the News of the World. She said she was aware of the possibility that some voice mails could be accessed by the late 1990s.
But asked by her defense attorney if she was ever asked to sanction the practice while editor of the News of the World, from 2000 to 2003, she said: "No."
Questioning focused Tuesday on the News of the World's actions in the case of 13-year-old Milly Dowler, a British schoolgirl who went missing and was later found murdered in 2002.
The News of the World was closed down in July 2011 amid public outrage over allegations that its employees hacked the young girl's voice mail messages while she was missing.
Brooks said the first time she heard the newspaper had accessed Dowler's voice mails was on July 4, 2011, and she was shocked. She was on vacation during the week that the News of the World hacked Dowler's phone, she testified, and it was not brought to her attention. Her then-deputy, Coulson, was editing the paper that week, she said.
Last week, Brooks was cleared of one of two charges of conspiracy to commit misconduct in a public office, at the judge's direction.
She still faces two charges of conspiracy to pervert the course of justice, one of conspiracy to hack voice mail messages and the remaining charge of conspiracy to commit misconduct in public office.