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Sarah Palin has agreed to pay a New Jersey newspaper $15,000 to settle a lawsuit over her campaign's use of an iconic photorgraph taken on 9/11, court filings show.

(AP)

NEWARK — Sarah Palin agreed in December to pay a New Jersey newspaper $15,000 to settle a lawsuit over her campaign's unauthorized use of an iconic photograph of firefighters hoisting the American flag on 9/11 -- but the deal remains stalled over the former GOP vice presidential candidate's insistence on confidentiality, according to court papers filed Monday in U.S. District Court.

According to the documents, William Dunnegan, the attorney for North Jersey Media Group, which publishes The Record of Bergen County, says that on Dec. 22, 2014 -- four days after the two sides agreed in principle to settle the case -- lawyers for SarahPac, Palin's campaign organization, "asserted that there must be a broad confidentiality clause."

"Shortly thereafter, Palin's counsel, Ronald Coleman, Esq., told me that Palin required a confidentiality clause because her political action committee did not want any hint of a compromise associated with her name," Dunnegan writes.

Dunnegan included with his filing several emails exchanged with Palin's lawyers regarding the settlement.

"We have confirmed with our client, and accept your offer of a $15,000 settlement," Palin attorney Brian Farkas wrote in a Dec. 18, 2014, email that Dunnegan filed with the court. "We assume that this will include a mutual confidentiality/non-disparagement clause in the stipulation of discontinuance.''

NJMG sued Palin, the former governor of Alaska, in 2013, claiming she and her political action committee infringed the publishing group's copyright. The photo appeared on Palin's Facebook page beneath her photograph and the words "Never Forget."

NJMG claimed Palin was using the photograph "to promote Sarah Palin and to raise money for SarahPAC," the lawsuit says.

The photograph, by NJMG photographer Thomas Franklin, shows two New York City firefighters hoisting the American flag amidst the rubble of the World Trade Center.

Farkas declined to comment. Jennifer Borg, the vice president and general counsel for the newspaper group, could not immediately be reached for comment. A representative for SarahPac could not immediately be reached for comment.

In an email exchange in January, Palin's attorney, Ronald Coleman, suggested that as part of the settlement both sides be allowed to confirm the settlement but withhold further comment, the emails show.

"No reference to the settlement amount may be made in any response or court filing in this case," Coleman wrote in a Jan. 29, 2015, email to Dunnegan, the filings show.

The following day Dunnegan proposed that both sides be allowed to "respond freely" to questions about the litigation but only be allowed to confirm the existence of the settlement.

Judge Claire Cecchi is expected to issue a decision on the dispute in the coming weeks.

Thomas Zambito may be reached at tzambito@njadvancemedia.com. Follow him on Twitter @TomZambito. Find NJ.com on Facebook.