Divya Narendra (in picture), along with two other former Harvard students, founders of ConnectU, brothers Cameron and Tyler Winklevoss, had sued Facebook, the fast-growing social networking site.
The trio alleged that the Facebook founder Mark Zuckerberg took a software code and a business plan from them in 2003.
Facebook had filed a countersuit, accusing ConnectU of unfair business practices.
A California federal judge had ordered the parties into mediation last year.
According to ConnectU founders, they had hired Zuckerberg, a sophomore at Harvard in 2003 to help create a campus-wide dating site called Harvard Connection.
He stalled the project for months and later started TheFacebook.com. The ConnectU founders alleged Zuckerberg of pilfering their profitable idea.
A Facebook spokeswoman said the company would not comment on legal matters.
But a close source said motions to dismiss the cases were expected to be filed 'within weeks.'