ST. PAUL, MINN., JULY 20 -- The state's highest court today overturned a $700,000 award against two newspapers that broke a promise of confidentiality to a political campaign worker.

The Minnesota Supreme Court also held that enforcing a promise of confidentiality under a doctrine that implies a legal contract where none exists would violate the First Amendment rights of the St. Paul Pioneer Press and the Star Tribune of Minneapolis.

The 4 to 2 decision overturned a jury verdict in favor of Dan Cohen, who said he will appeal to the U.S. Supreme Court.

Cohen sued the newspapers for 1982 stories identifying him as the source of documents showing the Democratic candidate for lieutenant governor was convicted of shoplifting 12 years earlier.

Cohen, then a Republican gubernatorial candidate's consultant, had given the newspapers' reporters the information in return for assurances of confidentiality. But editors overruled the reporters, believing readers should know the information came from the GOP candidate's campaign.

In his lawsuit, Cohen said he lost his advertising agency job after the newspapers breached an oral contract.

"It's a very important case, one with far-reaching implications," said Cohen's attorney, Elliot Rothenberg. "The issue is, to what extent do newspapers and the media have a constitutional right to violate promises to which everyone else in society would be held liable?"

Louise Sommers, an attorney for The Associated Press, called the ruling a major victory for the news media. The AP filed the only friend-of-the-court brief in the case.

Bill Salisbury, the Pioneer Press reporter who accepted Cohen's documents and objected strongly to his editors' decision to identify Cohen as the source, said the ruling makes his job more difficult.

"What the ruling tells reporters . . . is that if an editor wants to overrule your promise of anonymity to a source, he or she can do so," Salisbury said. "So, it will make me much more careful about granting confidentiality to sources, and it will make me much more reluctant to reveal the names of my sources to editors."

The ruling upheld a state Appeals Court panel's dismissal of Cohen's claim of fraudulent misrepresentation and a $500,000 punitive damage award. But it reversed the panel's ruling allowing Cohen's breach-of-contract claim and a $200,000 compensatory damage award.