The slug-fest between American Apparel and Woody Allen is over, as reported by The New York Times. After months of threats and name-calling, the legendary director agreed this morning, before the trial was to begin, to settle the $10 million lawsuit for a cool $5 million, sparing the controversial clothing company from what was sure to be a nasty, not to mention costly, court battle with the aging film icon.

Ironically, it wasn't one of American Apparel's racy ad campaigns that got them into trouble this time. The battle began last year when the company used an unauthorized image of Woody Allen dressed as a Hasidic Jew from his 1977 film "Annie Hall" on billboards. Next to "Rabbi Allen's" image appeared the words "the holy rebbe" written in Yiddish.

American Apparel picked the wrong celebrity to mess with. According to the lawsuit, Woody "does not endorse commercial products or services in the United States." Someone at the clothing company or its ad agency should probably have checked on that before running the campaign. Nevertheless, founder Dov Charney posted a statement on the company blog defending the use of the image as a matter of free speech.

From the outset of this controversy, the battle threatened to get pretty ugly. In a deposition last December, Woody was quoted as calling the ads "sleazy" and "infantile." Firing back, the American Apparel legal team sought to parade a bunch of witnesses before the jury to embarrass Woody during the proceedings. In the end, it would seem that defending the case wasn't worth the costs to the apparel brand's insurance company. From Dov Charney's statement:

Today the lawsuit filed against American Apparel by Woody Allen will settle whereby he will receive a 5 million dollar payment. The vast majority of this payment will be paid by our insurance carrier who is responsible for the decision to settle this case and has controlled the defense of this case since its inception.

Naturally, there is some relief of not having to go through a trial but I also harbor a sense of remorse and sadness for not arguing an important issue regarding the First Amendment, particularly the ability of an individual or corporation to invoke the likeness of a public figure in a satiric and social statement.

As reported by The New York Times:

"Threats and press leaks by American Apparel designed to smear me did not work, and a scheme to call a long list of witnesses who had absolutely nothing to do with the case was also disallowed by the court," Mr. Allen said outside the federal courthouse, reading from a statement. "I suspect this dose of legal reality led to their 11th-hour settlement," he added.

Charney's final sentiment,"I'm not sorry for expressing myself," he said. "I wish him [Allen] the best with his career, and I am looking forward to his next film."