The terms of the settlement are confidential -- but we're told Lindsay's team is "very happy" with the results ... and sources say Lindsay got some cash out of it.
As we previously reported, Lindsay claimed the stock trading company violated her rights by featuring a baby character named Lindsay who happens to be the "milkaholic" other woman in a baby love triangle.
Lindsay's high-powered attorney Stephanie Ovadia tells TMZ, "The case between Lindsay and E*Trade has been settled ... there is no further comment."
E*Trade reps tell TMZ, "E*TRADE has always maintained that the claims were without merit, which is why we moved to dismiss the case. With the case now withdrawn, we are pleased to have the matter behind us."
Dina Lohan also weighed in, saying, "The family is pleased that the case has been settled."