The 26-year-old actress signed the deal in 2008, shortly before she was slapped with jail time for her DUI and shoplifting convictions.
Now, she claims the southern California-based company failed to pay her USD 900,000 in guaranteed minimum royalties plus 10 per cent of net sales for her 6126 Collection, reported Ace Showbiz.
"They owe us a million dollars. We are suing to force them to pay," her civil lawyer Perry C Wander said.
According to the attorney, the company tried to find a way out by noting that the actress never took part in the promotional efforts.
"The agreement did not have a morals clause, and Lindsay Lohan had no responsibility to promote the line, so there's no defence for their actions," the lawyer added.
"They're trying to insert those as a defence, but they weren't part of this deal."
The 'Mean Girls' star started out her clothing line as a brand for leggings and cashmere leg warmers. The name refers to her idol Marilyn Monroe's birthday, June 1, 1926.
Now, the former Disney star plans to expand it into other clothing items.
"Lindsay is very passionate about her fashion design, and she's looking forward to re-launching the line with another partner. She wants to enter into negotiations to license a clothing line and accessories," the lawyer said.
"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," he added.
