The Prince of Wales has allegedly reached a settlement with the publisher of The Sun, the High Court was told on Tuesday.
The recent settlement with News Group Newspapers (NGN), publisher of the newspaper and the now-defunct News Of The World, was over claims of phone hacking.
The Duke is suing NGN over alleged unlawful information gathering at its titles.
The publisher is asking Mr Justice Fancourt to throw out both claims, arguing they have been brought too late.
But, responding to the NGN's strike out application, Harry's lawyers said it is an attempt to go behind a "secret agreement" between the royal family as an institution and NGN, which the Duke was informed of in 2012.
In documents before the court, David Sherborne, representing Harry, said the late Queen Elizabeth II was involved in "discussions and authorisation" of the agreement, which was that members of the royal family would not pursue claims against NGN until after the conclusion of the litigation over hacking.
Mr Sherborne said in written arguments that the agreement "meant that the claimant could not bring a claim against NGN for phone hacking at that time".
The barrister said William has "recently settled his claim against NGN behind the scenes".
Kensington Palace declined to comment on behalf of the Prince of Wales.
In part of a witness statement prepared for Tuesday's hearing, Harry said: "My brother and I were also told by either the institution’s solicitor … or someone else from the institution that there was no possibility of either of us bringing a claim against NGN for phone hacking at that time.
"The rationale behind this was that a secret agreement had been reached between the institution and senior executives at NGN whereby members of the royal family would bring phone hacking claims only at the conclusion of the Mobile Telephone Voicemail Interception Litigation and at that stage the claims would be admitted or settled with an apology.
"The reason for this was to avoid the situation where a member of the royal family would have to sit in the witness box and recount the specific details of the private and highly sensitive voicemails that had been intercepted by Clive Goodman.
"The institution was incredibly nervous about this and wanted to avoid at all costs the sort of reputational damage that it had suffered in 1993 when The Sun and another tabloid had unlawfully obtained and published details of an intimate telephone conversation that took place between my father and stepmother in 1989, while he was still married to my mother.
"This agreement, including the promises from NGN for delayed resolution was, obviously, a major factor as to why no claim was brought by me at that time."
The judge will determine whether their claims will progress to a trial, which is due to be heard in January next year.
The claim is one of a number of legal actions currently being brought by the Duke, who appeared in person at the High Court last month for a preliminary hearing against Associated Newspapers Limited (ANL), publisher of The Mail and Mail On Sunday. See his court arrival below...
He is also expected to give evidence at a trial over allegations of unlawful information against tabloid publisher Mirror Group Newspapers (MGN), due to begin next month, with Harry due to appear in court in June.
With additional reporting by PA.
Make sure you never miss a royal story! Sign up to The Royal Explainer newsletter to receive your weekly dose of royal features and other exclusive content straight to your inbox.