'Top Chef' Winner -- Cuts Deal in Matzoh Ball Lawsuit

Celebrity chef Ilan Hall -- the former "Top Chef" winner -- has just thrown in the dish towel in a lawsuit that accused him of fenneling money from investors.

Hall was sued for taking $37,500 from money men to help in the operation of his restaurant, The Gorbals in downtown L.A. And, fun fact ... it's known for bacon-wrapped matzoh balls.

But the investors claim Hall was as unkosher as his meals and pocketed the cash.

We just learned -- in a rosh to judgment -- the case settled for $25K.