For weeks, publisher Judith Regan had been in trouble with higher-ups over the debacle of the canceled O.J. Simpson book and TV deal.

	Richard Drew, Associated Press Book publisher Judith Regan in the studio of her "Judith Regan Show" on Sirius satellite radio in New York last month. Click photo for larger image.

But her firing swiftly followed a Friday afternoon phone call from her Los Angeles office to a HarperCollins attorney that included comments that were characterized as offensive, two highly placed corporate sources said Saturday.

The comments, the precise nature of which were not disclosed, came just before News Corp., the parent company of HarperCollins, held its annual holiday party, an expensive hotel bash in Manhattan attended by more than 4,000 people. Regan's company, Los Angeles-based ReganMedia, is a unit of HarperCollins.

Meanwhile, as the book world gossiped over Regan's sudden fall, HarperCollins announced Saturday that Cal Morgan, her longtime editorial director, would take over the leadership of her division, which recently moved its offices from New York to Los Angeles' Century City area.

The company "will continue operations under the able leadership of Editorial Director Cal Morgan, reporting to Michael Morrison, president and group publisher of Harper/Morrow," according to a statement issued by Jane Friedman, HarperCollins CEO and president. The statement also said that "any future decisions relating to the imprint name or the publication of unpublished books will be addressed at the appropriate time."

One highly placed News Corp. source, however, questioned the viability of the imprint, and its ability to make further inroads into Hollywood, without its founder. "Without Regan, what's the point?" the source, who spoke on condition of anonymity, said.

As for Regan's alleged comments during the phone call, "we do not comment on personnel matters," said HarperCollins spokeswoman Erin Crum. Regan was unreachable Saturday, and Suzanne Wickham, chief publicist for ReganBooks, did not return calls. Morgan also did not return calls, and no one appeared to be home Saturday afternoon at his house in Los Angeles' Brentwood area.

Senior executives at News Corp. said Saturday that although Regan was let go just because of the controversy over either the O.J. Simpson project or another contentious book, a forthcoming fictional "reimagining" of Mickey Mantle's life that had drawn advance criticism for its salacious content. Still, both incidents contributed to her downfall at the company.

"It was an accumulation of her behavior," said one of those executives, who spoke on condition of anonymity because of the legal sensitivity of the issue.

The two News Corp. insiders said Regan was not held entirely responsible for the O.J. embarrassment because the project had been signed off on by senior management. But they added that the double whammy of the O.J. incident, closely followed by a wave of negative publicity about the Mantle book, scheduled for publication March 1, put her career at the company "on thin ice," as one executive put it.

The last straw, however, came Friday afternoon, when Regan, working in her office in Los Angeles, blew up on the phone at a lawyer from HarperCollins in New York who had been helping the publisher handle problems with the Mantle book. Regan was dismissed for cause shortly after that phone call, according to a high-level source.

Regan was informed of her dismissal by a letter faxed to her office late Friday, according to the source. Regan apparently packed up her office and left that evening, even as some of her colleagues attended News Corp.'s annual holiday party at the New York Hilton, where executives and the rank and file -- more than 4,000 people, some dressed in ball gowns -- crammed into various halls, each decorated in the theme of a different continent.

One person who was at the party said few people celebrating were aware of Regan's firing, outside of a handful of top executives, including News Corp. Chairman Rupert Murdoch, and HarperCollins' Friedman. News Corp. spokesman Gary Ginsberg said Saturday that Regan had been terminated but would not comment further.

On Saturday, Regan's Century City offices where shuttered, and no employees were available to comment on her termination.

"There was a lot of tension in that corporation, and this was a way to solve it," said veteran New York literary agent Ira Silverberg of the firing. "These companies are like any workplace; when there's a lot of tension, they think of the best way to defuse it for everybody involved."

Silverberg predicted that Regan, who has chalked up major successes in the publishing world -- promoting national best-sellers by Howard Stern and Rush Limbaugh, as well as Jenna Jameson's "How to Make Love Like a Porn Star" -- would continue to find success in new ventures.

Morgan, who is replacing Regan, is a veteran editor who spent 11 years at St. Martins Press before joining forces with Regan in May 1999. He had previously published authors including James Herriot, Patrick McGilligan and Florence King. At ReganBooks, he has worked on titles including "The Case Against Hillary Clinton" by Peggy Noonan and "Business Is Combat" by James D. Murphy. He also worked on Arianna Huffington's best-seller "How to Overthrow the Government."

Getlin reported from New York, Hofmeister from Los Angeles. Times staff writers Scott Timberg and Matea Gold contributed to this report.