The woman filed the suit last year, claiming Copperfield spotted her in the audience of one of his shows in 2007 and then invited her to his private island in the Bahamas ... where the alleged incident occurred.
But this past January, authorities cleared Copperfield of any wrongdoing.
Authorities later brought charges against the accuser for filing a false police report in another case -- which didn't involve Copperfield -- in which she was also charged with prostitution.
UPDATE: The accuser issued a statement saying, "It's never been about money ... I just wanted him held accountable for what he did."
Copperfield also issued a statement in which he declares that he "would not and did not pay [the accuser] a dime to drop her lawsuit."