The former Sports Illustrated model, says that the cosmetics company Irene Group together with Fortune Hills International had used images of her that had appeared in the international publication Sports Illustrated.
The newspaper reports referred to papers obtained by US news programme Celebrity Justice, in which Taylor said that the photos had been used to sell both body powders and perfumes, without either written authority or a licensing agreement.
The former Cover Girl pin-up claims the unauthorized shots of her have been used for marketing and promotional purposes by the Irene Group, a member of the Cosmetic, Toiletries and Fragrance Association, and maker of the Irene, Hermosa, Girlies and Isabel cosmetic brands.
Taylor is taking the action because she fears that the unauthorized promotion of these products may jeopardize her planned endsorsement of her own fragrance line, due to be launched in September of this year.
In the lucrative world of cosmetics sponsorship, all promotional activity is closely guarded, by both the stars and the cosmetics companies themselves.
Back in November last year, US cosmetics supplier Cosmojet took out a lawsuit against pop singer Jessica Simpson and the cosmetics provider she endorses, Dessert Beauty, claiming it still owed $200,000 for cosmetics supplied to the singer's Dessert beauty line.
Dessert Beauty claimed that it refused to pay for a portion of a $1 million delivery of products after some were found to be below the quality standards and specifications that it expected.
But with right sponsorships often proving to be make or break for many cosmetics companies, there is evidently a lot at stake.
Fragrances in particular have proved to be the biggest magnet for successful star sponsorships. Last Christmas the Britney Spears fragrance, Curious, proved to be Amazon.com's biggest selling fragrance during the all-important holiday season in 2004, helped to significantly boost Elizabeth Arden group sales.
Likewise Parlux has experienced a 73 per cent growth in net income to $10 million on the back of a 20 per cent growth in sales thanks mainly to the continued success of its branded Paris Hilton fragrance and accessories.