British newspapers are reporting that Zara Phillips is standing by her husband, English rugby captain Mike Tindall, who has been caught on video embracing another woman at a Queenstown bar.
Footage from the bar had been gaining thousands of
online views on YouTube.
British newspapers are carrying the story, fuelled by reports that Tindall's wife of six weeks, the Queen's granddaughter Zara Phillips, is due to join her husband in New Zealand next week.
UK tabloid The Sun says a source close to Phillips has insisted the incident has been "blown out of all proportion".
The paper quotes as spokesperson for the 30-year-old royal as saying: "This girl's a friend of Zara and Mike and has known Mike since university days.
"She is an English girl out in Australia on holiday who was at their wedding.
"Zara's very relaxed about all this and the whole thing has been blown out of proportion."
It is claimed the video comes from a bar where Tindall was celebrating with his teammates after their World Cup win against Argentina last weekend.
Footage reported stolen
The bar's manager has since contacted the police, claiming the footage was stolen.
The footage shows a man who looks like Tindall putting his arm around a blonde woman who then kisses his forehead.
It follows claims published in The Sun that he kissed and groped a blonde woman while on a night out with teammates.
The video has since been removed from YouTube.
Jonathon Dixon, who uploaded the video, would not answer questions about why he put the video up.
He told ONE News he has been "hammered by reporters from around the world all day" and he took it down because he was asked to by a "security guard".
The security company Dixon works for has been dropped from working for Altitude Bar.
The bar's general manager told ONE News he had been in touch with the England rugby team to warn them about the video.
"[We] said 'this is coming, beware'," Blair Impey said.
"It's got nothing to do with us. We're doing all we can, we've contacted the police."
The video footage ends around 2am and the man and the mystery blonde leave the camera's line of sight together.
Management stick by their man
England's management yesterday defended Tindall and his teammates after the claims were accompanied by pictures of them involved in pub games with some dwarves.
The Rugby Football Union issued a statement on Thursday saying: "Mike and several of the players were enjoying an evening out after he had led the team to a hard-earned victory over Argentina.
"Like all the lads, he plays for England with a massive amount of passion and he was relaxing after a tough match."
England manager Martin Johnson dismissed the story as "rugby player drinks beer shocker". Johnson, who gave the players permission to go out before a planned day off training on Monday, said there had been nothing out of the ordinary, despite the players being photographed in in mock-wrestling matches and scrums with the stars of one club's "Mad Midget Weekender" event.
"There is no implication from anyone there that we have heard that there has been any bad behaviour," Johnson said.
The players attended various bars in Queenstown on Sunday following their 13-9 victory over Argentina in their opening game in Dunedin the night before.