The case spurred Letterman to tell viewers in October that he had slept with women on his staff.
Prosecutors say Halderman demanded $2 million to keep quiet about the talk-show host's affairs. Halderman says he was just offering Letterman a chance to buy -- and keep private -- a thinly veiled screenplay about Letterman's life.
Whether Halderman's conduct amounted to commerce or crime "is a classic example of an issue that is best left for a trial jury to decide," Solomon wrote.
The 52-year-old Halderman, a producer for CBS' "48 Hours Mystery," could face up to 15 years in prison if convicted. A trial date could be set at his next court appearance March 9.
Defense lawyer Gerald Shargel said he was "perfectly willing to put it in front of a trial jury." A Letterman lawyer has said the comedian would willingly testify.
Prosecutors say the financially strapped Halderman threatened to ruin Letterman's reputation with information he had gleaned from his then-girlfriend's diary. It described her relationship with Letterman, her boss, authorities said.
Letterman married longtime girlfriend Regina Lasko last March. They began dating in 1986 and have a 6-year-old son.
In subsequent meetings with a Letterman lawyer, Halderman laid out his cover story of selling a screenplay -- even insisting on drawing up a contract and getting paid by check in case of a tax audit, prosecutors said.
"The issue is your client does not want this information public," Halderman told the attorney in a secretly taped conversation, according to prosecutors. "I have said, for a price, I will sign a confidentiality agreement and I will not make this information public."
Letterman's lawyer ultimately gave Halderman a phony $2 million check. The producer was arrested after depositing it.
Halderman says the transaction was no shakedown.
The producer threatened nothing more than a sale to someone else if Letterman said no, Shargel said. He wrote in court papers that information about celebrity misdeeds is "routinely suppressed through private business arrangement."
Letterman's camp has said that argument is an attempt to deflect attention away from Halderman's behavior.
Halderman also said the criminal charge violated his free-speech rights to write a movie or book about Letterman. The judge rebuffed that argument, saying the producer "is not being prosecuted for authoring either a book or screenplay."
CBS on Tuesday declined to discuss Halderman's status at the network, where he has worked for more than 27 years.