Times v. Sullivan protect the media from slander against public figures. McCain is a public figure so he's fair game.
The photo was clearly defamation of character. The photographer sought a release for the photos she was contracted to shoot of Senator McCain for use with Newsweak. She also kept additional uncontracted photos that she manipulated (this is why Newsweak did not own those original images).
It was violation of her contract with Mr. McCain.
And you can shoot anyone’s photo out on the street without a release. But if you photograph a priest to make it appear he is soliciting a prostitute or other way defame his character, you are not free from lawsuit.
Even Enquirer, et al get sued.
The media claims to have a protection from charges of treason as well.
Perjury, slander, libel, treason, death threats, and there are other examples of things that are not protected free speech. Regardless of the individual or title held.