Oscar-winning actress Nicole Kidman has accepted a public apology and undisclosed but "substantial" libel damages at London's High Court over a Daily Mail story suggesting she had an adulterous affair with Jude Law and led him to cheat on his wife.
Mr Justice Gray was told that the story suggested she was the cause of the breakdown of Law's marriage to actress Sadie Frost.
Solicitor Gideon Benaim told the judge that the piece was published on 6 March this year.
He said the article had suggested that Kidman "had an adulterous affair with Law".
He said that, at the time, Law was married with young children and, although Kidman had denied the claims, the paper had claimed her denials were "dishonest."
Benaim said the paper now accepted the allegations were "untrue and without foundation".
But he continued: "The publication of this article has caused grave damage to the claimant's personal and professional reputation and she has suffered considerable embarrassment and distress.
"The claimant's embarrassment was particularly acute as the allegations coincided with the run-up to the Oscar awards ceremony in Los Angeles in which the claimant had been nominated for an award for the best actress in a leading role for her film The Hours.
Ian Felstead for the Daily Mail told the judge the paper apologised for the distress and embarrassment the article had caused.
In addition to the apology and damages, the paper is also to pay Kidman's legal costs.
By Roger Pearson