The former partners went their separate ways last year after collaborating on Lopez' much-hyped Sweetface label, which flopped at New York Fashion Week.
It has been reported that Hilfiger also argued with the singer because he resented her husband Marc Anthony's interference with her business affairs.
According to the New York Daily News, both parties are now planning to take action.
A source said: "It is expected that she will file suit and that he will countersue. They're likely to sue each other."
Hilfiger has now returned to work at his brother Tommy's fashion empire.