Nicky Hager knew information given to him by a hacker had been taken illegally, the Crown has argued.
The Dirty Politics author and investigative journalist is seeking a judicial review into the steps taken by police during a raid at his home last October.
The raid was carried out following a complaint from blogger Cameron Slater, who claimed his emails had been illegally hacked.
The emails taken from Slater were then disclosed to Hager, and formed the basis of his tell-all book Dirty Politics.
The object of the police search was to discover the identity of the hacker who had disclosed information to Hager.