In his sworn statement of evidence, Mr Parker claimed to have read books written by Mr Karam, on which he said he based some of the statements.
But Mr Reed presented him with a message from the Justice for Robin Bain Facebook page written a year after the statement of evidence. In it, Mr Parker asked fellow members if anyone had a copy of Mr Karam's books because he had not read them.
"You're just telling lies Mr Parker, aren't you?" Mr Reed asked.
"You're misleading the court aren't you? Because you've never read the books and that is untruthful to try and mislead the courts, isn't it?"
Mr Parker replied: "Yes it was untruthful."
"Have you any idea the seriousness of telling lies under oath?" Mr Reed continued.
"I do," said Mr Parker.
"So today you stand here admitting that you lied in the High Court of New Zealand?"
"I do," said Mr Parker.
He went on to offer an apology to Mr Karam for the harm he had caused to him and his family.
But he later told the court that he had been confused and "not in the right state of mind to adequately answer".
"I apologise to the court but I got up at four in the morning and am just surviving on coffee at the moment."
In his statement of evidence, he said, he had been referring to extracts of a book which he had read in various articles.
"I retract my admission that I lied."
Mr Parker argued that the statements he made about Mr Karam were protected by the legal defences of truth, honest opinion and legal privilege.
He said Justice for Robin Bain was a political-activist organisation, and the campaign they launched on the David Bain case should be seen in that light.
"Having a nuisance factor is usual for a campaign of that nature," he said.
Earlier, the court heard from Mr Karam's son Richard, who gave a sometimes-tearful testimony about the impact the "vindictive and threatening" comments had had on his father.
"It got to the point that he became upset and seemed genuinely concerned for his safety and that of his family," he told the court.
Richard Karam said his company, the Coffee Guy Limited, of which his father is a former shareholder, was also harassed as a result of the comments.
Joe Karam's daughter, Simone Ngaire Tatton, also gave evidence in support of her father.
"Dad has always been a man with incredibly strong values or morals .. he has always stood up for what is right or wrong," she said.
"It is easy to see how the defendants' daily comments shattered him.
The hearing, before Justice Patricia Courtney, is expected to finish tomorrow.
