The famed snapper was given the huge sum by bosses at Art Capital Group, to help escape her “dire” financial circumstances.
Leibovitz reportedly planned to sell her entire art collection and homes in Greenwich Village and Rhinebeck, New York, as part of the deal.
Instead, she was accused of flouting the terms of the loan and sued for breach of contract at Manhattan Supreme Court.
However, a judge agreed on Thursday (03Sep09) to grant Leibovitz her request to have another month to answer the suit.
Reports suggest Leibovitz is negotiating a deal with Art Capital Group bosses to lose her extensive picture catalogue to the company, in addition to her properties.
Her spokesperson, Matthew Hiltzik, tells the New York Post the two sides are trying to resolve their differences.
A representative for Art Capital declined to comment.