Apple (AAPL) iPod's Chinese OEM Foxconn has decided against suing two Chinese journalists for CNY30 million.

Earlier this week, Hongfujin Precision Industry Shenzhen Company, a wholly-owned subsidiary of Foxconn, said it was suing China Business Net reporter Wang You and editor Weng Bao for CNY30 million for causing harm to Foxconn's reputation.

Foxconn also asked the court to seal and freeze the journalists' personal assets for picking up this story and reporting it in the Chinese media. For its part, CNB said that it would give full support to its journalists and protect their rights.

Now, apparently to make more of a moral statement than to seek a financial reward, Foxconn is merely asking for one yuan as compensation for loss of reputation. According to China's Xinhua News Agency, the court is still processing the case and has yet to make a decision.

A few weeks ago, Apple dispatched an audit team comprised of members from its human resources, legal and operations groups to carry out a thorough investigation of the conditions at the Foxconn manufacturing site. Apple says it found Foxconn to be in compliance in the majority of the areas audited. However, it did find violations of Apple's Code of Conduct, as well as other areas for improvement that Apple says it is working with Foxconn to address.

International journalist watchdog Reporters Without Borders has also petitioned Apple founder Steve Jobs to help get Foxconn to drop its lawsuit against the journalists.


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