Hollywood actress Kate Hudson has settled a lawsuit in which she was accused of stealing the idea for a line of haircare products.

The 'Almost Famous' star was named in the suit which alleged she took a sample given to her by bosses at 220 Labs and used it to create her own range of eco-friendly products with celebrity stylist David Babaii, reports tmz.com.

Bosses at 220 Labs claimed it was their idea to create a collection of shampoos and styling aids containing volcanic ash but now Hudson has reached an out-of-court settlement and the case has been dismissed.

'My clients are delighted it has been settled... everyone was pleased with the result,' said a lawyer.