Teri Hatcher, the Desperate Housewives actress, accepted "very substantial" libel damages today over allegations that she had regular sex with a series of men in a VW camper van parked outside her Los Angeles home.

The American star’s solicitor-advocate, Simon Smith, told a High Court judge in London that an article was published in the Daily Sport newspaper on July 25 entitled "Teri’s Passion Wagon".

It alleged that Ms Hatcher "takes lovers for steamy bangs in a battered old banger" and that she has "turned a hippie-style VW van parked in her driveway into a shagging wagon".

Mr Smith told Mr Justice Tugendhat that the tabloid alleged that the claimant’s purpose in doing so was "to stop her seven-year-old daughter catching her at it at home".

Certain statements were falsely attributed to the 40-year-old actress, such as "when my van’s a-rockin’, don’t come knockin"’,and "it is sexy and hot to get to grips with a guy in my Passion Wagon".

Mr Smith said the article was accompanied by a large photograph of a smiling and apparently amused Ms Hatcher and a photo of a VW van, which was accompanied by the caption "Tasty Teri’s old VW van helps her with her sex drive". The allegations were repeated in full in a second article published on August 3.

"The purpose of the second article was to boast of the fact that the defendant had scooped its competitors by publishing the allegations on an exclusive basis some eight days before its competitors," Mr Smith said.

He added: "The grossly defamatory allegations are entirely false, deeply offensive and utterly without foundation. The truth is that the claimant is a proud single mother to her seven-year-old daughter and naturally finds extremely insulting the lurid suggestion that she neglects her daughter in order to have regular sex with a series of men in a van parked outside her home. Such allegations are without any substance at all."

He continued: "Although the claimant does have such a VW van, which she keeps for nostalgic reasons, and which she occasionally uses to take her daughter on family trips and holidays, that is where the similarity ends."

In the light of the Daily Sport’s articles and the fact that "such serious allegations were repeated extensively here and abroad", Ms Hatcher felt it necessary to issue a claim for libel against the defendant, publisher Sport Newspapers Limited, last month.

Mr Smith said: "As a mark of its regret, the defendant has since agreed to publish a prominent front-page apology and to enter into this statement to unequivocally apologise for the deep distress and acute embarrassment caused by its allegations, which it acknowledges were completely false.

"The defendant has also agreed to pay very substantial damages to the claimant for the libel and to reimburse the claimant’s legal costs in full. Finally, the defendant has undertaken not to repeat the libel ever again."

David Hirst, counsel for the defendant, told the judge that through him it "sincerely apologises for the distress and embarrassment caused by the defamatory articles, which it fully accepts were entirely false.

"The defendant received the story from a source who it trusted, who in turn read the allegation elsewhere," he said, "The defendant was not alone in publishing the allegations, but accepts that this does not relieve it of liablity for its own publication."

The damages figure was not disclosed in court.

A statement issued on behalf of Ms Hatcher, who was not in court, said: "I consider myself lucky to have experienced a resurgence in my career with my role in Desperate Housewives.

"It is in light of that gratefulness I have tolerated many ridiculous and fabricated lies and gossip in the tabloids. Like many celebrities, I have embraced that some of the nonsense that tabloids write just comes with the territory of fame.

"Anyone who has ever entered a legal proceeding knows that when you are totally in the right, it still takes a lot of energy to move forward this kind of proceeding. This is probably why more celebrities do not fight back against every made-up story - from who they date, to where they shop, and what they eat.

"But when a story appeared about me, insinuating that I am an irresponsible and neglectful parent, I had to draw the line. I will never allow any tabloid to so egregiously attack the area of my life which I give top priority, and that is my parenting."

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