Chelsea and Jose Mourinho have reached a settlement with ex-team doctor Eva Carneiro over her claims that she was constructively dismissed by the club, and victimised by its former manager.
Dr Carneiro had brought the claim at an employment tribunal, accusing Mourinho of victimisation and discrimination.
She was due to begin giving evidence today but after last-minute talks between the parties, a settlement was agreed.
Mourinho made a surprise appearance at the hearing at the London South Employment Tribunal centre in Croydon.
Addressing the tribunal, Daniel Stilitz QC, for Chelsea and Mourinho, said: "We are pleased to be able to tell the tribunal that the parties agreed a settlement on confidential terms."
The case was expected to last seven to 10 days and could have led to potentially embarrassing witness statements and documents - including texts and emails - being made public.
On Monday, it was revealed that Dr Carneiro had refused £1.2 million to settle her claims with Mourinho and Chelsea.
Chelsea said in a statement: "The club regrets the circumstances which led to Dr Carneiro leaving the club and apologises unreservedly to her and her family for the distress caused.
"We wish to place on record that in running onto the pitch Dr Carneiro was following both the rules of the game and fulfilling her responsibility to the players as a doctor, putting their safety first.
"Dr Carneiro has always put the interests of the club's players first. Dr Carneiro is a highly competent and professional sports doctor. She was a valued member of the club's medical team and we wish her every success in her future career."
It added: "Jose Mourinho also thanks Dr Carneiro for the excellent and dedicated support she provided as First Team Doctor and he wishes her a successful career."
In a statement Dr Carneiro said: "I am relieved that today we have been able to conclude this tribunal case. It has been an extremely difficult and distressing time for me and my family and I now look forward to moving forward with my life.
"My priority has always been the health and safety of the players and fulfilling my duty of care as a doctor. In running onto the pitch to treat a player, who requested medical attention, I was following the rules of the game and fulfilling my medical responsibilities.
"I would like to thank everyone who has supported me including my husband, family and friends and members of the football community."
Mourinho remained tight-lipped as he left. He was escorted by security guards through crowds of the media as well as excited schoolchildren chanting: "Jose, Jose".
He was then bundled into a waiting black BMW, and refused to answer when asked: "Are you sorry? Why didn't you apologise?"