Former beauty queen Carrie Prejean and the organization that directs the Miss California USA pageant have dropped their suits against one another and now "wish each other the best in their future endeavors."
"We are moving forward from the past and looking towards the crowning of two winners and the new look of the upcoming Miss California USA pageant, telecast live on November 22nd," read an official statement made by K2 Productions and pageant executive director Keith Lewis.
Though little else has been revealed by the two sides, celebrity gossip site TMZ.com claimed that the settlement was made after a lawyer representing the pageant organizer showed Prejean a compromising video of herself that has never been release publicly.
TMZ.com, which claims to have obtained the video months ago, also reported that the pageant organizer is paying around $100,000 to Prejean's lawyers and publicist and that it is also relieving the Southern California beauty queen of any financial obligations to them – including the $5,200 that was spent for a breast augmentation surgery.
The settlement comes less than a week before the release of Prejean's book, Still Standing, which conservative publisher Regnery Publishing says will reveal "her side of the story."
Prejean made headlines after the Miss USA pageant in April, when she famously said she believed marriage should be between a man and a woman in response to a question asked by celebrity gossip blogger Perez Hilton. The comments were believed to have cost Prejean the Miss USA title and sparked a flurry of responses – both positive and negative.
Adding to the media firestorm later were the unauthorized releases of photos showing Prejean in compromising poses, which Miss Universe Organization co-owner Donald Trump later deemed "acceptable, fine, and in some cases ... lovely."
Less than a month after Trump decided to allow Prejean to keep the Miss California USA title, the real estate mogul and pageant officials announced their decision to terminate Prejean, saying it was based "solely on contract violations including Ms. Prejean's unwillingness to make appearances on behalf of the Miss California USA organization."
Three months later, Prejean filed a lawsuit against pageant officials for libel, slander, and religious discrimination, claiming that there were no contract violations and that the 22-year-old beauty queen has been subject to public ridicule and humiliation and lost out on modeling over the past few months. Prejean has also reportedly suffered anxiety, depression and loss of sleep since her firing.
After Prejean was stripped of her crown, the Miss California organization crowned the pageant's first runner-up, Tami Farrell, who also said she believes marriage should be between a man and a woman.
K2 Productions and pageant executive director Keith Lewis later responded to Prejean's suit with their own, saying Prejean "might have avoided this legal battle" had she "heeded the guidance of the Gospel of John, who admonished only those who are without sin to cast stones in judgment."
Prejean's attorney, Charles LiMandri, called the countersuit "just the latest installment in K2 Production's ongoing smear campaign against Carrie Prejean."