The 'Get Lucky' hitmaker, whose released the song, which features on his new album 'G I R L', claims he gave the track to Cee Lo but the ''powers that be'' decided it wasn't right for him to release it.
In an interview with Howard Stern for his US radio show, Pharrell said: ''[Cee Lo Green] wanted to do it .. and he did do it. He sounded amazing on it. He burns my version! But ... how do I say this diplomatically? The powers that be, at the time, did not see it fit for him. Some folks on his team just felt that the priority should be on [Cee Lo's] album at the time [2012's 'Cee Lo's Magic Moment'], so they elected not to do that song.''
'Happy' found success on the soundtrack 'Despicable Me 2' before appearing on Pharrell's album and the singer insists Cee Lo wasn't bitter about it being a chart success.
He added: ''There was a much bigger agenda for [Cee Lo], he had an album to put out.
''It's not his fault - he was totally down with it .. He was one of the most gracious people about it when 'Happy' came out.''