Action alleges contract breach, fraud.

Tom Petty has been hit with a bad-faith lawsuit over the origins of the album and single "The Last DJ" (Warner Bros.). The suit, filed Oct. 6 in Los Angeles Superior Court, names Petty, KLOS-FM Radio and DJ Jim Ladd as defendants.

The suit alleges that James Michael Wagner sent Ladd a demo of his song, "The Last Great Radio DJ," in 2000. Wagner claims that Ladd called him, requesting permission to use the composition as the theme song on his nightly radio show.

Wagner says he was "thrilled, and readily agreed to Ladd's request without even requesting any form of compensation." However, they agreed to rerecord the song since the quality of the demo was "insufficient," the suit claims, creating an implied contract.

Ladd gave Petty the demo, the complaint states, and Petty took the "idea, theme, title and overall 'feel' of the song," then wrote and recorded "The Last DJ" nearly two years later.

Petty's recording was released as a single in October 2002, peaking on the Billboard Mainstream Rock Tracks chart at No. 22. The album by the same name peaked at No. 9 on The Billboard 200.

"Nothing of the kind ever happened," Petty says in a statement on his Web site. "I write my own music, and if I collaborate with anyone, I always share the credit. It's been that way since I began writing 30 years ago, and it will always be that way. That's the way I work. To this date, I have never heard the recording the lawsuit claims influenced my song. The plaintiff is accusing me of stealing. I do not take kindly to such accusations, as the plaintiff and his attorney for hire will find out."

The suit seeks damages for breach of an implied contract and fraud, claiming that "the commercial value of Wagner's song was 'dead' after Petty and Warner Bros. Records released" Petty's song. It says Wagner would have earned "at least $1.5 million from exploitation of the song, especially if the song had been utilized as the theme song for Ladd's KLOS-FM radio program." It also requests $4.5 million in punitive damages.

Although the complaint refers to Petty's "infringing song," it does not assert a claim of copyright infringement.

Petty's manager, Tom Dimitriades, says Petty has no additional comment. Wagner and KLOS have no comment on the pending litigation.