Jo Seong-ji, who heads up LG's home-appliance business, was indicted by South Korean prosecutors in February on charges of damaging four high-end Samsung "Crystal Blue" washing machines before a trade show in Berlin in September 2014. Jo also faced charges of defamation and obstruction of business.
LG denied the allegations and even published a YouTube video in an effort to prove Jo's innocence, but Samsung claimed the footage was edited.
Samsung and LG are two of the best-known technology brands in the world, although Samsung has been more dominant in recent years, given the success of its smartphone division and connected-appliance range.
Perhaps unsurprisingly given this rivalry, mud-slinging between the two companies has been rife over the years. The issues between the two even saw Samsung and LG go head-to-head in 2013 over whose fridge has the bigger capacity and could fit more vegetables inside it.
The peace deal between the tech giants extends to their subsidiaries, and affects a case involving Samsung Display and LG Display Co over so-called organic LED technology. Last month, Samsung employees were indicted by prosecutors on charges of stealing this technology from LG – something that Samsung denies.
Samsung and LG said it would solve the disagreements "through dialogue and cooperation, instead of resorting to legal action."
This is not the first time the two companies have agreed a truce, however. In 2013, Samsung and LG agreed to drop legal charges over a patent dispute regarding displays. This, of course, did not last long and could cast doubt over whether the latest peace deal can last.