By Verna Gates
BIRMINGHAM Ala. (Reuters) - "To Kill a Mockingbird" author Harper Lee has settled a lawsuit with a museum in her Alabama hometown she had accused of illegally profiting from her Pulitzer Prize-winning novel.
A federal judge dismissed the case on Thursday after lawyers for Lee and the Monroe County Heritage Museum agreed to drop the suit, according to Lee's attorney, A. Clay Rankin.
Lee, 88, said the museum never paid her a licensing fee to use the book's title and a mockingbird image on merchandise sold in its gift shop.
Details of the agreement were not made public, but court documents said the parties agreed to pay their own attorney fees and costs.
Last month, a judge reinstated the lawsuit at the request of Lee, who argued the museum was attempting to change the terms of an out-of-court settlement reached in March.
Lee's suit, first filed in October, alleged the museum earned more than $500,000 in 2011 by selling goods including aprons, kitchen towels, clothing and coasters emblazoned with the title of her sole published work.
The museum is located in Monroeville, the rural town that inspired the setting for Lee's 1960 bestseller about racism and injustice.
The tourist attraction includes the old courthouse that served as a model for the courtroom in the book's 1962 film version, which earned Gregory Peck the Academy Award for Best Actor for his portrayal of small-town lawyer Atticus Finch.
Museum officials argued that Lee never requested compensation for the souvenirs honoring her literary legacy before filing the lawsuit.
Lee is in declining health after a stroke and lives in an assisted living facility in Monroeville, according to court papers.
(Editing by Kevin Gray and Peter Cooney)