The attorney declined to discuss terms. The case had been scheduled for trial June 18.
"It just got to a point where we agreed on what we needed to do," Zia Modabber said in a phone interview, adding that Jackson "was thrilled."
Calls seeking comment from the plaintiffs' attorney, Pierce O'Donnell, were not immediately returned.
Union Investment Corp. of South Korea and its financial adviser, Myung-Ho Lee, claimed Jackson owed them $12 million in unpaid fees and expenses for their efforts to put his financial affairs in order.
The agreement came as the judge was to rule on a request by Jackson's lawyer to dismiss the suit on grounds that Lee was not properly licensed to give investment advice in California.
Court TV was asking to televise the trial, which could have meant a public airing of records of Jackson's closely guarded finances.
The suit claimed that Jackson, who amassed a half-billion-dollar fortune as the "King of Pop" over the past 20 years, is saddled with debt and teetering near bankruptcy.
Jackson, meanwhile, was in Gary, Ind., for ceremonies honoring him in his hometown, which he had not visited for decades. Thousands of fans lined the streets to watch his dozen-vehicle motorcade go by. Jackson, 44, was 9 when his family left the city.
Stops included City Hall, where the mayor gave Jackson a key to the city, the neighborhood where he grew up and a high school where Jackson was awarded an honorary diploma.
Jackson's return to Gary Wednesday followed his trip to Indianapolis this week to give a deposition in a copyright infringement lawsuit.
By Linda Deutsch