Diaz has accepted substantial libel damages over The Sun's story that alleged she was having an affair with a married man. The Sun has since accepted that "the relevant incident involved no more than Ms Diaz giving a friend a goodbye hug".
"The publication of these allegations has caused damage to the claimant's personal and professional reputation, in addition to obvious distress to both herself, Mr Timberlake, Mr Nickerson and his wife," said Mr Smith her lawyer.
Because, News Group Newspapers who are the publishers of The Sun have agreed to pay undisclosed damages to the actress and reimburse her legal costs, her lawyer said "In those circumstances and in light of this vindication my client is prepared not to proceed any further against The Sun newspaper."
Diaz must have a great relationship with her lawyer, she pays, he wins
Although this time she won't have to pay as News Group Newspapers are paying her legal bill.
I bet Mr Smith her lawyer thinks he's struck gold having her as his client, considering anyone who steps on her toes will swiftly find themselves in a legal case.