Legal papers refiled on Sunday claim the rap star, whose real name is Shawn Carter, and Combs drugged and raped the complainant, named only as the pseudonym Jane Doe, at an afterparty following the 2000 MTV Video Music Awards, while an unnamed female celebrity watched.
Mr Carter has described the case as a "blackmail attempt" by the claimant's lawyer, saying his "only heartbreak" was for his family.
Jay-Z appeared on a red carpet alongside his wife Beyonce and their 12-year-old daughter Blue Ivy. (AP PHOTO)
In a response on Tuesday, lawyer Tony Buzbee described the allegations that he tried to blackmail the rapper as "bogus" and he intends to address all of the allegations in court.
"Let me be clear: We will not be bullied or intimidated by these shenanigans. And our clients won't be silenced," he said.
"No one has made any threats.
His firm sent a standard demand letter seeking a mediation on behalf of a woman who alleges Jay-Z sexually assaulted her as a minor, Buzbee said.
"What you are seeing played out now is a coordinated and desperate effort to focus the public's attention on me personally to avoid attention on the allegations being made by my clients."
Mr Buzbee claimed the efforts included allegedly "harassing" his family and colleagues and offering his former clients money to sue the lawyer.
In a statement on social media on Monday, Mr Carter said: "My lawyer received a blackmail attempt, called a demand letter, from a 'lawyer' named Tony Buzbee. What he had calculated was the nature of these allegations and the public scrutiny would make me want to settle."
"No sir, it had the opposite effect! It made me want to expose you for the fraud you are in a VERY public fashion. So no, I will not give you ONE RED PENNY!!"
Mr Carter also branded the allegations as "so heinous" that he questioned why the lawyer had filed a civil case, rather than a criminal complaint.
The Grammy-winning musician added that his "heart and support goes out to true victims in the world, who have to watch how their life story is dressed in costume for profitability by this ambulance chaser in a cheap suit".
The claimant in the case has asked for a jury trial and is seeking compensatory damages for "all physical injuries, emotional distress, psychological harm, anxiety, humiliation, physical and emotional pain and suffering, family and social disruption, and other harm".
Sean 'Diddy' Combs awaits a criminal trial over allegations of sex trafficking, which he denies. (AP PHOTO)
The federal civil lawsuit was originally filed in October in the Southern District of New York, listing Combs as a defendant, but was refiled on Sunday to add Mr Carter.
Mr Buzbee has filed a number of lawsuits against Combs, with the hip-hop mogul pleading not guilty to charges that he coerced and abused women for years, aided by associates and employees.
Combs has been denied bail numerous times as he awaits a criminal trial over allegations of sex trafficking, which he denies.
Jay-Z appeared on the red carpet alongside his singer superstar wife Beyonce and their 12-year-old daughter Blue Ivy for the premiere of her new film, Mufasa: The Lion King, on Monday.
