Time Inc. on Friday may turn over to a special prosecutor notes of a reporter threatened with jail for refusing to cooperate with an investigation into who revealed the name of a CIA operative.

Click here to read Time Inc.'s statement.

Breaking ranks with The New York Times, Time Inc. Editor in Chief Norman Pearlstine (search) told FOX News on Friday that his company will turn over the papers to comply with a court order but that no one is happy about it.

"This could have a chilling effect. Look, I don't like this law, I'm not happy about it ... confidential sources are important to the journalistic process," Pearlstine said.

Click on the video box to the right to watch FNC's interview with Norman Pearlstine.

Pearlstine said the public may not find out the contents of the notes, since the grand jury proceedings are secret, and that it's up to the special prosecutor how much information is released. He also explained that Time Inc. has decided to hand over the information because journalists are not above the law.

"When you have a Supreme Court decision … you have a special prosecutor, you have a federal grand jury, I don't believe that journalists are above any other citizens and I think that we have to adhere to a law"

Time relented after just days after the U.S. Supreme Court rejected appeals from its White House correspondent Matt Cooper (search) and New York Times reporter Judith Miller (search), who have been locked in an eight-month battle with the government to protect their confidential sources.

"The same Constitution that protects the freedom of the press requires obedience to final decisions of the courts," Time said in a statement.

Representatives for both reporters said they believe that the turning over of the notes and other material would eliminate the need for Cooper or Miller to testify before a grand jury and remove any justification for jailing them.

A special counsel is investigating who in the Bush administration leaked the identity of CIA officer Valerie Plame (search), a possible federal crime. U.S. District Judge Thomas Hogan is threatening to jail Cooper and Miller for refusing to reveal their sources.

They are due back in Hogan's court next week for further arguments on whether they should be thrown in jail. The grand jury investigating the leak expires in October, and the journalists, if jailed, would be freed at that time.

The case represents one of the most serious legal clashes between the media and the government since the Pentagon Papers case more than 30 years ago.

Miller has not changed her position on refusing to disclose her sources, said her attorney, Robert Bennett. She was not available for comment, the newspaper said.

In a statement, Times publisher Arthur Sulzberger, Jr. said: "We are deeply disappointed by Time Inc.'s decision to deliver the subpoenaed records." He noted that one of its reporters served 40 days in jail in 1978 in a similar dispute.

"Our focus is now on our reporter, Judith Miller, and supporting her during this difficult time," Sulzberger said.

Cooper's attorney, Richard Sauber, did not immediately return a call for comment. Cooper, through a representative, declined to comment.

Outside court on Wednesday, Cooper said that he hoped the magazine would not turn over the documents requested by special counsel Patrick Fitzgerald, the U.S. attorney in Chicago who has been heading the grand jury probe into who disclosed Plame's identity days after her husband, former Ambassador Joseph Wilson, publicly disparaged the president's case for invading Iraq.

Time is a defendant in the case along with the two reporters. The New York Times itself is not a defendant because it did not publish anything. Miller did some reporting but did not write a story, while Cooper wrote a story about Plame.

Plame's name was first published in a 2003 column by Robert Novak, who cited two unidentified senior Bush administration officials as his sources. Novak has refused to say whether he has testified or been subpoenaed.

Thirty-one states and the District of Columbia have shield laws protecting reporters from having to identify their confidential sources. Legislation to establish such protection under federal law has been introduced in Congress.

The Associated Press contributed to this report.