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BRIAN WATT: Meanwhile, The Taiwanese company that manufactures Apple's iPod is defending itself. It has struck out at two journalists who accused it of shoddy working conditions in the factory. The company Foxconn alleges the reporters defamed it. And with backing of a local court in southern China, it's taken some drastic action against them. Jocelyn Ford reports.

JOCELYN FORD: The Taiwanese manufacturer is demanding the two journalists pay over $3.5 million for damaging its reputation and a local court has frozen their personal assets.

Foxconn says the reporters made exaggerated claims about poor factory conditions.

The journalists wrote workers were forced to do overtime, got less than minimum wage and lived in crowded dorms.

When Apple investigated it found workers put in more hours than allowed, but were not forced to do so.

Journalism Professor Li Kun says defamation suits are new to China.

LI KUN: "Before whatever media said because media is government, you know, no one would even think of challenging that. But now the public realizes they are businesses and the public realize their own rights."

Other newspapers have been rallying to support the journalists, who wrote for a business paper in Shanghai.

The government-controlled China Youth Daily said the case sends a dangerous signal to society, that courts can be used to suppress freedom of speech.

In Beijing, I'm Jocelyn Ford for Marketplace.