Rajendran had filed a civil suit alleging that 'Sarkar' director A R Murugadoss had copied his work "Sengol".
When it came up for hearing before Justice M Sundar, a memo of compromise was filed by the Sun Pictures and the writer.
Both the parties acknowledged that their scripts, 'Sengol' and 'Sarkar', revolved around the same theme of a reform of the electoral process to weed out bogus voting.
Murugadoss said he had no objection to Rajendran producing any film based on his registered script 'Sengol' and its updated versions, based on his imagination, in any language.
He also agreed to display a 30-second long message acknowledging Rajendran's writing skills. The writer too gave an undertaking not to object to the screening of 'Sarkar' now and in the future.
The two sides resolved not to pursue the matter further in any court of law.
They acknowledged the efforts of Film Writers Association led by its president K Bagyaraj for having mediated and enabled the settlement.