Former News of the World editor Andy Coulson used "phone hacking, surveillance and confrontation" in a bid to confirm a false tip about then-home secretary Charles Clarke having an affair, a jury has heard.
The tabloid newspaper heard a false rumour in May 2005 that Mr Clarke was seeing his "attractive special adviser", prosecutor Andrew Edis QC told the Old Bailey.
The News of the World's private investigator Glenn Mulcaire was tasked with hacking Hannah Pawlby's voicemails, she was "door-stepped" and Mr Coulson called and left her messages, a court heard.
During the period she was being investigated, Ms Pawlby's grandparents received anonymous calls asking for information about her and two reporters oversaw surveillance of her movements, Mr Edis said.
The story turned out to be a "non-runner" as there was no affair between Mr Clarke and Ms Pawlby, the jury heard.
Andy Coulson was told about a recording of a voicemail from actress Sienna Miller on actor Daniel Craig's phone, his trial has heard.
Jude Law discovered for the first time today that a relative had allegedly been paid by a newspaper for information.
A former tabloid reporter has revealed to the phone-hacking trial how the "dark arts" were used by newspapers to secure stories.