Combs' attorney, Benjamin Brafman, told the New York Daily News prosecutors have decided not to bring criminal charges against Combs.
The case apparently was at an impasse after the alleged victim, Stephen Acevedo, appeared to stop cooperating with police investigating the incident, the newspaper said.
Acevedo previously accused Combs of punching him during a physical confrontation that started as an argument over women.
Acevedo's attorney, Mark Jay Heller, said his client opted to take the "high road" because he believes in "good Karma," the newspaper said.
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