"We reached an agreement that is satisfactory to both parties," Alcatel-Lucent spokeswoman Mary Ward said Monday.
Oracle originally filed the lawsuit in May 2008, claiming the telecoms giant was in violation of a number of Oracle patents.
The software vendor's suit centered on a number of Alcatel-Lucent products, including the OmniTouch My Messaging system and the 5350 XML Document Management Server, according to Oracle's original complaint.
But Alcatel-Lucent had rejected Oracle's charges and charged in turn that some of Oracle's software, including its database, infringed on some its own patents, according to court documents.
An Oracle spokeswoman did not respond to a request for comment.