The Kansas City-based greeting card giant and the hotel heiress have reached a settlement in a 3-year-old lawsuit over the card, a company spokeswoman said Tuesday.
The deal was sealed, and Hallmark spokeswoman Julie O'Dell declined to provide details. Messages left with Hilton's attorney were not immediately returned.
Hilton's lawsuit had sought a half-million dollars.
"All I can say is we did settle," O'Dell said. "We were able to reach a mutually acceptable conclusion."
Hilton's attorneys had said the company misappropriated Hilton's image and her catch phrase, which she trademarked in 2007, months before the lawsuit was filed against Hallmark.
Hallmark attorneys had argued that using Hilton's face on top of a cartoonish image was "transformative," meaning the image had been changed enough that it became Hallmark's own expression, the Kansas City Star reported. The company said the card warranted a "public interest" defense.
But that argument was rejected last year by an appellate court because a birthday card "does not publish or report information," according to the ruling.
O'Dell said it was unclear whether the settlement would change how Hallmark decides which cards to sell.
"Our card decisions are based on consumers and the kind of product they want at any time," she said. "One of our goals is to stay with the times, stay relevant. When we feel we can do that, especially in our humor lines, we probably will."