Google announced they have added a new supported user agent that can be used to block Google from indexing stories specifically on Google News. You can now specific the user agent Googlebot-News in your robots.txt file to exclude documents from being crawled and displayed in Google News.
Google has several user agents for controlling how Google has access to your content. They have Googlebot, Googlebot-Image and so on. Each can be used to block specific content from showing up in specific Google search properties.
In an effort to please some of the news providers, Google announced yesterday an amendment to the first click free program, allowing publishers to restrict it to the first five free accesses per user each day. This is Google’s second move to show publishers how they can manage their content in Google News.
The Google Webmaster Blog post has a lot more technical details on how to use this new user agent in your robots.txt file.
Also see Josh Cohen Of Google News On Paywalls, Partnerships & Working With Publishers from last month, which goes into more detail about issues some publishers had about wanting to block just Google News automatically rather than all of Google. Google said it would consider this type of change in that interview.
Note that it was always possible to block Google News by making a manual request to Google. In fact, inclusion into Google News in the first place is done through a manual process, rather than automated.