The Mean Girls star claims bosses at D.N.A.M. Apparel Industries LLC have continued to design and sell products under the 6126 Collection banner without her input - and they haven't offered her a cut of the profits.
She also alleges they failed to expand the line to include swimwear and other apparel, as agreed when the deal was first signed.
The 26 year old, who filed legal papers at the Los Angeles Federal Court on Thursday (31Jan13), is seeking at least $1 million (GBP625,000) in royalties for breach of contract, and fraud and trademark infringement.
In addition, Lohan is asking for renewed control of her brand's trademark name, which was inspired by the birth date of her heroine Marilyn Monroe.
Lohan's attorney, Perry Wander, tells the Associated Press, ""Lindsay's very passionate about her apparel line and about designing. The purpose of this suit is to wrest control of her trademark away from this company that's been selling items overseas and online under the 6126 trademark.""
The new legal spat comes a day after Lohan was in court for a probation hearing linked to a traffic accident she had in California last year (12). Reports suggest the actress lied to cops investigating the crash - thus violating the terms of her probation for a 2011 jewellery theft.