The dispute between the two firms began in earnest in February of this year, when PayPal informed Bank One that its online bill payment system represented an infringement of PayPal's patented technology, which allows internet users to make secure payments and to authenticate transactions.

However, things really came to a head last month, when Bank One sued the online payment firm over patent infringement claims brought last year, and PayPal launched a separate suit over the disputed online bill payment system.

Although settlement amounts have not yet been announced, both firms have released statements explaining that the agreement should not have a noticeable effect on their finances or operations.