First, let me say for the record, that I am not a lawyer or legal expert, and this is not intended as legal advice, but as an example of and commentary on best (and worst) practices.
I wrote about jumping to conclusions when reporting about the actions of specific persons or companies. I said that you can report what someone else said about the person as long as you say that that person said it and don't do anything to validate the statement. I didn't mention, and I should have, an important exception to that rule. If you know or have reason to believe that the statement is false, but print it anyway without acknowledging that you know or suspect it to be false, then you can still be held responsible for any damage to a person's reputation (or business) resulting from the publication of those statements.
Here's a case where the NY Post is being sued for just such an action. In this case, the NY Post cited unnamed sources "close to the defense" who made very damaging statements about the woman who accused Dominique Strauss-Kahn of sexual assault. The NY Post apparently accepted the word of people with every reason to lie in order to discredit the woman. If they did additional research to verify the claims, there was no mention of that in their report.
Without any attempt to verify or qualify the statements, it could be argued that the NY Post is validating their credibility. In fact, as CNN points out in the linked story above, the NY Post article specifically said the woman was "doing double duty as a prostitute, collecting cash on the side from male guests, The Post has learned." That statement in particular shows that the NY Post believes the accusations and strongly implies that they have investigated to back them up. It adds validity to the allegations backed by the reputation of the NY Post.
Anyone can go out and find someone to make stuff up about someone else for the sake of getting a sensational headline. That doesn't absolve a reporter or a publisher of their responsiblity if there's good reason to doubt the veracity of the statements. In this case, the allegations made involved a number of third parties, who presumably could have been tracked down and questioned by the NY Post, but apparently weren't.
A paper can be wrong, but they need to show that they undertook reasonable precautions to make sure what they were printing was true. If you actually go a step farther and treat third party allegations as facts that you have verified, you'd better make very sure that you did verify them. Perhaps, the NY Post did that in this case and will be vindicated, who knows. Better reporting could have prevented the situation in the first place.