Tinder’s founders first sued Match and its former owner IAC in August 2018, claiming they had undervalued the app to avoid paying billions of dollars.
When Match and media giant IAC bought the founders out in 2017, the firm was valued at $3bn.
But Tinder’s founders claim it was really worth $13bn at the time.
The case has been on trial since mid-November at the New York Supreme Court.
Match Group’s shares dropped 2% on the news to $127.93.
Match Group, which also owns Match.com, OKCupid, Hinge, Meetic, PlentyOfFish, Ship and OurTime, is worth $36.6bn today.
The plaintiffs, consisting of 10 current and former top staff including Sean Rad, Justin Mateen and Jonathan Badeen, were given stock options in Tinder as part of their compensation in 2014.
But because Tinder is a private company, they were not allowed to cash in their stock options and sell shares on the open market.
Their total stake, equivalent to a fifth of Tinder, could only be sold to Match and IAC on specific dates, when the stock options would be independently valued.
The lawsuit claims that when Tinder was sold to Match and IAC, the firms merged Tinder into Match without the consent of Tinder’s board of directors and cancelled future dates for when options could be exercised.
Match and IAC paid the plaintiffs $600m at the time, equivalent to Tinder being valued at $3bn.
The plaintiffs said they had been forced to accept the $3bn valuation and were seeking at least $2bn in damages.
However, the lawyers for Match and IAC argued that Mr Rad was suffering from “seller’s remorse” and had not taken the opportunity to argue that Tinder was worth more than $3bn when it was being valued in 2017.
Match Group’s filing with the US Securities and Exchange Commission (SEC) on Wednesday declared that the firm intends to pay the settlement using cash on hand.