John Travolta — Cruise Ship Assault Lawsuit Mysteriously Dropped

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John Travolta is officially off the hook in an alleged high seas assault — the cruise ship employee who sued him agreed to drop the matter … just 2 days after a judge ruled the case would be argued in open court.

As our sources first reported, Fabian Zanzi sued Travolta last June … accusing the actor of exposing his penis in his stateroom, and hugging Zanzi during a 2009 Royal Caribbean cruise.

But on Friday a federal judge shut down Travolta”s attempt to handle the case in arbitration, instead of going to trial. The judge”s decision essentially left Travolta”s attorneys with 2 options — go through a messy public trial … or reach a settlement with Zanzi.

The case was dismissed on Monday, but terms were not disclosed — so it”s unclear if Travolta made a financial settlement with Zanzi.