According to the suit, “Willy” follows a child discovering he has magical powers and was published ten years before the first “Harry Potter” book was published and three years before Rowling says she dreamed up the Harry, Ron and Ginny.
He allegedly sent the manuscript to Christopher Little, the literary agent at Bloomsbury Publishing who went on to represent Miss Rowling, but it was rejected.
Instead his book was published by a smaller company under the title The Adventures Of Willy The Wizard No 1: Livid Land.
Mr Jacobs, who lost all his money in a stock market crash in 1991, died in 1997, so did not live to see the Harry Potter books’ success.
But his estate – which includes his son and grandson – now claims Miss Rowling’s fourth book, Harry Potter And The Goblet Of Fire, was plagiarised.
In both books, the boy wizard competes in a magic contest.
The lawsuit also notes both have the boys trying to rescue human hostages held by half-human creatures from a bathroom.
Shared references to a wizard train and a wizard prison are also part of the allegations.
Legal proceedings have been issued at the High Court against Bloomsbury, and the Jacobs estate also says it will file a lawsuit against Miss Rowling.
The estate is also seeking an injunction to prevent further sales of Harry Potter And The Goblet Of Fire, and damages or a share in the book’s profits.