The 66-year-old actor had sued the paper late last year after it had published an article, which was later deleted, alleging that the Sydney Theatre Company had received a complaint against Rush, who had starred in 2015-2016 production of "King Lear".
Rush had claimed the Daily Telegraph made him out as a "pervert" and "sexual predator" with their "KING LEER" headline.
In a case management hearing in the Federal Court of Australia, Rush's barrister Richard McHugh said the paper's defence was "hopeless" and "dead in the water", reported Australia's ABC News.
McHugh then argued that information should not be made public as it contains fresh allegations that could further harm Rush's reputation.
Justice Michael Wigney ordered that information remain confidential until the next hearing on February 19, at which time it might be amended.
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