Nicole Catsouras of Ladera Ranch crashed into a toll booth on State Route 241 in south Orange County in 2006. The 18-year-old had taken her father's Porsche without permission and was driving at speeds above 100 mph.
Graphic photos of the aftermath taken by CHP investigators were leaked by two dispatchers. The images showed up on thousands of websites.
As part of the settlement, the Catsouras family will receive an undisclosed amount of money. The CHP will also help the family get the remaining images removed from websites.
An Orange County Superior Court initially dismissed the family's lawsuit, saying CHP did not breach any legal duty to the family.
But in 2010, the 4th District Court of Appeal reversed the decision, ruling that surviving family members have a right to sue for invasion of privacy in such cases.
The young woman was so badly disfigured her family hadn't been allowed to see her body after the crash, but the photos began proliferating on the Internet, and on many of the sites, Catsouras was dubbed "Porsche girl," mocked as a spoiled rich girl who deserved to die.
"It was refreshing, after 5 years of battling, to see the CHP come to the table willing to discuss the issues and the case reasonably, and for identifying the pain caused to this family due the CHP's failure to have the necessary protocol in place 5 years ago to prevent this type of cyber-bullying from occurring," an attorney for the family said in a statement. "The family is extremely happy the case has been resolved. It is equally pleased the CHP will work with the family moving forward to control this toxic environment."
The Associated Press contributed to this report.