Magazine cancels $1.7m deal with Larry Birkhead claming 'he tricked us all'

American magazine OK! has made the shock decision to drop Anna Nicole's ex Larry Birkhead from a $US1.7 million deal, alleging he has "tricked us all".

The publication today it has cancelled the arrangement, which involved getting exclusive access to Larry and Dannielynn, his daughter with the late Anna Nicole.

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It has long promoted its relationship with the photographer - it printed the first pictures of the two after DNA results confirmed his paternity - and was scheduled to cover the toddler's first birthday.

The magazine's publicist said: "OK! Magazine has uncovered explosive allegations regarding Larry Birkhead, Howard K. Stern and baby Danielynn, prompting the magazine to cancel our exclusive coverage of Danielynn's first birthday party."

"The newly obtained allegations are detailed, shocking and potentially incriminating. It makes it impossible for OK!, in good conscience, to promote this family's highly questionable relationship in our pages."

Both were locked in a paternity battle over the child before DNA tests claimed to prove Birkhead as the father following the death of Anna Nicole.

OK's American editor Sarah Ivens said: "My biggest fear is that Larry and Howard may have tricked us all."

"It breaks my heart that OK! has to pull out of a shoot that would have chronicled the next great chapter of Dannielynn's life.

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A new book on Anna Nicole titled Blonde Ambition is reportedly due to expose shock new allegations about the pair, claiming they were somehow working together.

Legal wrangling continues over the estate of Smith's late husband, Texas oil tycoon J. Howard Marshall II, who died in 1995.

It remains unclear how much, if any, of Marshall's multi-million-dollar fortune Dannielynn might inherit and whether her guardian would have access to the money.