Katie Price pays substantial damages to ex manager

Katie Price's former manager has accepted 'substantial' undisclosed damages from the reality star over a slanderous claim that she had an affair with Peter Andre.

Claire Powell, whose company Can Associates Limited still represents Pete, who was divorced from Katie last October, sued over a comment made on The Graham Norton Show that month.

Her solicitor, Mike Brookes, said Katie told Graham, fellow guests Jackie Collins and Jo Brand, and a studio audience of 600 that Claire and Pete had had an affair, even though Claire was engaged to Neville Hendricks, the father of her child.

Mr Brookes told Mr Justice Eady at London's High Court that the BBC 'quite sensibly' edited the accusation from the broadcast, but the story was quickly picked up by various tabloid newspapers.

"To be accused of infidelity, with one of her longstanding and high-profile clients, was obviously very damaging and distressing for Ms Powell - the most obvious reason being that the allegation was completely untrue."

He said Katie, who was not in court, accepted that the allegation was completely untrue, apologised unreservedly and had agreed to pay substantial compensation and Ms Powell's legal fees.