Michael Jackson has dropped a lawsuit against his accountants Bernstein, Fox, Whitman, Goldman and Sloan who he had accused of making deals and hiring people without his permission.

Court papers obtained by Reuters yesterday did not say whether Jackson had reached a settlement with the firm or dropped the litigation for another reason.

Jackson’s lawsuit alleged the accountants failed to pay workers' compensation payments on his behalf in 2004 and 2005 and was late paying taxes he owed, besides hiring people and entering into contracts without his authorisation.

Legal action in a countersuit by the accounting firm against Jackson, claiming the singer owed almost $US1m (₤505,000) in unpaid bills, has been dismissed.