Retna Digital 1 / 5

By Melissa Hunter

The ongoing beef between American Apparel and Woody Allen has finally been squashed. Sometimes all it takes is an apology. Or a $5 million settlement.

Last year, American Apparel ads featuring Woody Allen popped up on billboards in Hollywood and Manhattan and also appeared on the website. The image was a frame from "Annie Hall" showing Allen dressed as a Hasidic Jew with Yiddish text that means, "The Holy Rebbe."

Related: Check out some authentic celebrity-endorsed products.

Considering the line's penchant for extremely provocative ads featuring models who are largely under-clothed and over-sexed, the implications of Woody's ads were less-than-subtle.

Allen sued the clothing line for $10 million. His lawyers said the company wanted to "tarnish Mr. Allen's reputation a second time" and was a "despicable effort to intimidate him."

Related: See how stars are nothing like us!

But American Apparel's lawyer said, "Woody Allen expects $10 million for use of his image on billboards that were up and down in less than one week ... I think Woody Allen overestimates the value of his image."

American Apparel didn't stop there. They promised to bring Mia Farrow, his ex-wife, and Soon-Yi Previn, Farrow's adopted daughter who is now married to Allen, to the stand. They were hoping to prove that Allen's reputation has already been ruined.

Oh, snap! So what American Apparel is trying to say, Woody, is multi-layered: 1) you're a sleazebag; 2) you're a worthless sleazebag, and 3) you're worthless sleazebag, and it's already a proven fact.

Related: See young celebs borrowing Woody's style with nerd glasses

The trial was settled out of court this morning for $5 million, just minutes before it was scheduled to commence.

Charney has insisted that there are no hard feelings, saying, "We would never try to malign the dignity of Mr. Allen ... I have respect for Mr. Allen ... I hope to meet him on more friendly terms at a different point."

Can't wait for that red-carpet showdown. It's gonna be a more explosive than a Jen Aniston and Angie run-in.