In another blow to ex-president Suharto, a court yesterday rejected a multi-billion-dollar criminal defamation case he had filed against the US magazine Time.

Judge Sihol Sitompul, heading a panel of three judges at the Central Jakarta District Court, ruled Mr Suharto's defamation suit could not be accepted for lack of evidence.

"The panel of judges deems that in the reports of Time magazine, there are no elements of libel as has been alleged by the plaintiff. Therefore, the charges of the plaintiff should be all rejected," Judge Sitompul said.

Mr Suharto, now under house arrest, sued the magazine for US$27 billion over a cover story the magazine ran in May last year that claimed his family was sitting on a fortune of about US$15 billion. The report also alleged Mr Suharto had hurriedly transferred about US$9 billion from a bank in Switzerland to another in Austria shortly after he fell from power in May 1998 amid mass protests.

Endang Sumarti, a member of the panel of judges, said the picture of Mr Suharto on the cover of the magazine's issue on May 24 last year – which showed him, wearing an 18th-century wig, pictured on a US dollar note with multiple zeros and the words Mr Suharto Inc stamped on it – was "within the bounds of reasonable fairness".

He said that after the expert testimonies of journalists called to the witness stand, the picture of Mr Suharto could not be construed as depicting him being in control of a large business conglomerate, as Mr Suharto's lawyers charged.

"It is a victory for press freedom, for judicial independence and for the people of Indonesia," said Time Asia's Hong Kong-based editor, Donald Morrison. Morrison was one of those named in the suit.

Mr Suharto's lawyer, Juan Felix Tampubolon, blamed the judges. The failure of the court to provide what he called a "fair ruling" was because "of the mistake of the judges in bringing in expert witnesses".

The former strongman, who turns 79 tomorrow, suffered a mild stroke last year. He has been barred from leaving either Jakarta or the country since April 12 and the authorities put him under house arrest last month. His lawyers have taken the Attorney-General's Office to court over the house arrest order and that case is due to open at another court in Jakarta today.