The suit accuses the Los Angeles-area Splash News & Picture Agency of paying for cocaine that was allegedly used in 2006 by two of its photographers to entice Ledger, widely reported to have struggled with substance abuse, into being surreptitiously filmed using drugs.

The incident occurred on Jan 29, 2006, at the Chateau Marmont hotel on Hollywood's Sunset Strip, where Ledger was attending an 'after-party' following his winning of the Screen Actors Guild Award for Brokeback Mountain.

'This is bad stuff. You don't give drug addicts drugs so you can then tape them,' said Douglas Johnson, an attorney for the plaintiff, who is named in the suit only as Jane Doe, a former freelance reporter for People magazine.

The suit describes her as an unwitting accomplice of the two photographers, one of whom she was dating at the time.

A kind of whistle-blower

A person answering the telephone at Splash on Friday declined to comment or take a message, saying only, 'We can't help you.'

People magazine confirmed that the woman behind the suit was a freelancer for the magazine at the time but has not been associated with the publication since last year.

'We heard about an alleged encounter with Ledger, but there were too many questions surrounding the circumstances for us to write about it,' People spokeswoman Sandi Shurgin Werfel said.

The grainy video, which surfaced on numerous Web sites in recent months, does not show Ledger using drugs, but he can be heard admitting to smoking marijuana in the past.

Mr Johnson called his client a 'kind of whistle-blower' in the case.

'She does not seek publicity by the filing of this lawsuit ... but she does want to expose the bad actions' of the picture service and its employees, he said.

The suit seeks damages for fraud and invasion of privacy, claiming the alleged scheme 'damages her reputation by the inference that she somehow participated with paparazzi in the drugging and hidden taping of Mr. Ledger'.

The plaintiff claims that after meeting and befriending Ledger in the hotel lounge, her date and his colleague invited the actor back to her hotel room, where they gave him a package of cocaine, and all three men began snorting the drug. The suit says Ledger also had some cocaine of his own.

One of the two photographers later left the room, went onto the balcony, and unbeknownst to the actor began shooting video footage of everyone through the window, the suit says.

Ledger ultimately realised he was he was being taped and became angry, but was promised the video would be destroyed and was persuaded to stay for several hours more after he was brought more cocaine, according to the suit.

A spokeswoman for Ledger's publicity firm declined comment on the litigation. -- REUTERS

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