The late employee was driving a Model X using Autopilot when it collided with a highway barrier.

The case was set to be heard at California Superior Court this week, but the BBC reports that it will no longer be going ahead, with a judge still set to approve the settlement, details of which are not currently known.

The wrongful death lawsuit was filed in 2018.

Tesla argued that Huang was playing video game just before the smash and wasn't using the system correctly.

It's not the first instance, as The US National Highway Traffic Safety Administration has launched investigations into Autopilot accidents.

The news of the settlement arrives days after founder Elon Musk claimed the Tesla Robotaxi will be unveiled on August 8.

The billionaire businessman previously declared that his EV firm was working to get more than a million "robotaxis" on the streets by 2020.

The ambitious prediction was made during an investors conference in Palo Alto, California, in 2019.

He said at the time: "I feel very confident predicting autonomous robotaxis for Tesla next year."

And now, Musk has said the Robotaxi will be revealed to the world this summer.

He wrote on X: "Tesla Robotaxi unveil on 8/8."

It was previously reported that drivers who own one of the auto company's cars will be a able to add their motor to an app similar to Uberm, which will enable them to send out cars to pick people up, with Tesla making 25 to 30 per cent from the revenue generated.

Musk said that drivers could earn up to $30,000 a year from the rides.

He stated that they "won't have regulatory approval everywhere," but said he's "confident we will have at least regulatory approval somewhere."

He didn't provide any further details on where the robotaxis will be made available.

But Musk did admit to not always meeting his deadlines.

He said: "Sometimes I am not on time. But I get it done and the Tesla team gets it done."