The jury in the phone hacking trial was told that material for the report in the now-defunct News Of The World about the Prince's time at the Royal Military Academy was derived from a voicemail.
Andrew Edis, the prosecution counsel, said the article, which appeared on December 18, 2005, was based on the contents of a message illegally accessed by private investigator Glenn Mulcaire on behalf of the tabloid's former royal editor Clive Goodman.
Edis said the report was one of a number of stories cited by Goodman as he tried to justify paying Mulcaire a weekly retainer.
Earlier the jury heard that Goodman had admitted he was breaking the law when he asked Coulson to approve a corrupt payment to a policeman.
He emailed the tabloid's editor, asking him to approve a 1,000-pound cash payment to the officer for a royal telephone directory.
But he acknowledged that he and Coulson would face "criminal charges" if the transaction was discovered, the court heard.
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