Volkswagen AG has reached a settlement deal with Broadcom Inc., ending a $1 billion patent lawsuit filed by the U.S. chipmaker against the German carmaker in early November, Reuters reported Nov. 21, citing a source close to Volkswagen.

The parties signed an out-of-court settlement, canceling a court hearing scheduled Nov. 23, the source reportedly said.

Broadcom, which supplies semiconductors to Volkswagen cars, was earlier reported to have filed a patent infringement lawsuit against the carmaker for allegedly using 18 of its patents in Volkswagen's navigation and entertainment systems.

The latest report said Broadcom also threatened to seek a judicial ban on the production of several Volkswagen car models at that time.

According to a Nov. 2 report by Reuters, Broadcom also lodged legal action in the U.S. against Japanese companies Toyota Motor Corp. and Panasonic Corp. for alleged infringement.