Dec. 9 (Bloomberg) -- Judith Regan, fired from News Corp.’s HarperCollins unit in 2006, settled a lawsuit against the publisher over her dismissal for $10.75 million, according to a court filing by her former law firm.

The amount, previously undisclosed, was included in a filing in New York state court in Manhattan by Dreier LLP, a New York law firm that sued Regan for legal fees following her settlement of the News Corp. case. The namesake of the law firm, Marc Dreier, was charged yesterday by New York federal prosecutors with directing an unrelated $100 million fraud.

In March, Regan was sued by her former lawyers who accused her of firing them to avoid paying fees from a settlement with Rupert Murdoch’s News Corp. Regan’s lawyers declined to confirm or deny the settlement amount in Dreier’s court filing.

In its complaint filed in New York Supreme Court in Manhattan, the Dreier law firm alleged Regan retained it to represent her in February 2007 and agreed to pay 25 percent of any money she recovered as a result of a judgment or settlement.

“Regan terminated petitioners for the single purpose of attempting to avoid the contingency fee,” Dreier alleged in its complaint. “Upon finalizing the settlement, Regan terminated” the law firm “and has since failed and refused to pay them the fees and disbursements to which they are entitled.”

Regan’s Behalf

Dreier sued News Corp. on Regan’s behalf. Regan and the firm’s first agreement called for her lawyers to receive 25 percent of any funds Regan got as part of a settlement.

Both sides discussed modifying their agreement so that Dreier would get $125,000 plus 20 percent of any amount Regan received in excess of $6.5 million, the firm said. Regan never signed that agreement, according to the complaint.

The law firm accused Regan in the suit of breach of contract and seeks to enforce a lien against her for any funds she’s collected in connection with the settlement. Bertram Fields, a lawyer who represented Regan in her settlement, was also named as a defendant in the suit.

Dreier said in its complaint that its attorneys spent 1,240 hours on Regan’s case and learned through her new lawyers on Dec. 14 that the firm had been terminated by Regan. Regan settled the case for an undisclosed sum in January and was represented by Fields, according to the complaint.

Yesterday, Marc Dreier, managing partner and founder of the 250-lawyer New York firm Dreier LLP, was charged with cheating hedge funds out of more than $100 million.

Dreier, who has represented U.S. radio broadcaster Clear Channel Communications Inc., was ordered detained by a magistrate judge in Manhattan federal court, where he faces securities and wire fraud charges. The judge will hold a bail hearing Dec. 11.

The case is Dreier LLP v. Judith Regan, 103251/2008, New York Supreme Court (Manhattan).

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Last Updated: December 9, 2008 15:04 EST