A former Scottish Socialist Party MSP told of the moment she asked Tommy Sheridan to step down as leader of the party.
Frances Curran said Sheridan was asked to resign after he admitted he had visited a swingers' club with a News of the World sex columnist.
Sheridan and his wife Gail, both 46, are accused of lying under oath during his successful defamation action against the News of the World in 2006.
Sheridan denies lying to the courts during the trial, which followed the newspaper's claims that he was an adulterer who visited swingers' clubs. He was awarded £200,000 in damages after the newspaper printed the allegations.
Sheridan told an emergency meeting of the party's top brass that he intended to sue the newspaper after the allegations were published in November 2004, his perjury trial at the High Court in Glasgow has heard.
Ms Curran became the 13th witness to tell Sheridan's perjury trial that she heard him make the admissions during the emergency meeting at the party's Stanley Street headquarters on November 9, 2004.
The following day, she said she met Sheridan and fellow SSP MSP Colin Fox for tea and biscuits in an Edinburgh hotel and asked him to resign.
She told the court: "The court action was the big problem for us. We couldn't get the party locked into lying in a court action. We were trying to decouple the party from the court action.
"He could stay as convener if he was prepared to either put his hand up or shut up," she said, adding that they told Sheridan "he was on his own" if he decided to sue the newspaper.
"We said to Tommy: 'Are you going to take the court action?' He said: 'Yes'.
"I said: 'Well, we want your resignation'. He said: 'For f***'s sake, Frances. I would have expected more loyalty from you'. I said: 'Tommy, I would have expected more honesty and principle from you'."
Ms Curran said Sheridan was convinced there was "not one scintilla" of proof that he had visited the club, and told her "There is nothing that can tie me to that".
"He said 'how did I know it was him'," she added."I said: 'Because you told me last night'. He admitted he had been to the sex club with Anvar Khan."
Ms Curran said she told Sheridan she was not prepared to lie for him, but also said she would not go "running to the tabloids" with the story.
She said she told Sheridan: "I'm not going to lie to people I have known and worked with for a long time and I'm not lying in court. I said, don't drag me into court because I'm not lying."
Ms Curran said she thought her former party leader and long-time Socialist colleague had been "stupid" in his actions.
She said: "I couldn't believe he had been so stupid. He went to a sex club with a News of the World columnist. I don't know what he thought she would write about afterwards.
"I also thought he was absolutely crazy to take a case to court."
The indictment against the Sheridans contains three charges in total, two of which are broken down into subsections. They deny the charges.
It is alleged Sheridan made false statements as a witness in the defamation action of July 21, 2006.
He also denies a charge of attempting to persuade a witness to commit perjury shortly before the 23-day trial got under way.
Gail Sheridan denies making false statements on July 31, 2006, after being sworn in as a witness in the civil jury trial. The trial, before Lord Bracadale, continues.
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