TMZ reports Hilton and La Bonita were suing each other after both parties failed to come to an agreement when a deal in which Hilton was supposed to design a swimwear line went bad.
La Bonita sued Hilton first for over $200,000 alleging the heiress had failed to honor her 5-year contract with them. In turn, Hilton sued the lingerie company for $1.5 million.
But now, both parties have decided to drop their lawsuits and have agreed on another lingerie/swimwear deal.
McPhee, Cokas 'working on their marriage' after affair
Beautician charged with giving client fatal silicone butt injection