One of the key allegations against Bryan Singer looks set to be settled out of court after the director agreed to pay $150,000 to resolve allegations that he raped a 17-year-old boy in 2003.

In December 2017, Cesar Sanchez-Guzman filed a lawsuit alleging that the director sexually assaulted him during a yacht party in Seattle. The move came shortly after Singer was fired from his role as director of Bohemian Rhapsody. Singer denied the allegations.

In a filing on Wednesday, a bankruptcy trustee recommended that the court approve a $150,000 settlement with Singer. Sanchez-Guzman filed for bankruptcy in 2014, and the case was discharged. The bankruptcy trustee reopened the case in 2018, on the grounds that Sanchez-Guzman’s claim against Singer had not been listed among his assets, and that any proceeds should be available to his creditors.

In a statement, Singer’s attorney Andrew Brettler said that the director maintains his innocence. He said:

The debtor filed a claim against Mr Singer that he had no basis or legal right to file. Mr Singer has denied even knowing this individual, let alone allegedly having interacted with him more than 15 years ago. The decision to resolve the matter with the bankruptcy trustee was purely a business one, as litigation costs would well exceed the amount requested by the trustee to pay off the creditors who were owed money when the debtor filed for bankruptcy.

Creditors would claim $61,000 under the terms of the agreement, the bulk of which represents student loan debt. Additional funds will be used to pay for administration of the case. Sanchez-Guzman will end up with the remainder.

If the settlement is approved, Sanchez-Guzman’s lawsuit will be dismissed with prejudice. Bohemian Rhapsody, the multi-Oscar winning Freddie Mercury biopic, has made Singer at least $40m.