TMZ reports that Miss California USA pageant officials pulled out a sex tape featuring Carrie Prejean after she demanded more than a million dollars during settlement negotations.
TMZ claims it received the video months ago and that it is "extremely graphic." Prejean dropped her demands and walked away with nothing after officials said they had the racy home video. The pageant will pay $100,000 to Prejean's attorney and publicist.
Prejean, the former Miss California USA who created a stir at the national Miss USA pageant when she said she is not in favor of gay marriage, sued the pageant for religious discrimination and defamation. She alleged the real reason the pageant stripped her of her title was due to her religious beliefs. The pageant filed a countersuit asking for $5,200 it doled out to Prejean for breast implants.
Prejean told the Today show earlier this year that she would rather be "biblically correct than politically correct." Pageant officials claimed she was dethroned for missing appearances.