Once approved, the song will be in the public domain.
The cash settlements will be handed out to those who have paid to use the song for the past 67 years. What King's decision did was make the song in its entirety fair game for use.
In September a year ago, however, United States district judge George H. King ruled that Warner/Chappell did not, in fact, own the lyrics to the song - only some of the musical arrangements.
People who sing "Happy Birthday" in their homes or at private gatherings have typically never been at risk of a lawsuit.
The settlement money will be distributed to those who paid licensing fees for the use of the song.
A hearing on the preliminary approval of the settlement is scheduled for March 14, the report said.
Soon after, a 19th-century manuscript was uncovered at the University of Louisville, Kentucky, which was missing its first page, leading to questions over, whether its original composers, Mildred and Patty Hill, were "somehow unhappy with the published version" and whether the missing page represented a revision of the song.
Jennifer Nelson, one of the plaintiffs in the case, had been making a documentary about the song's origins and history when she was informed that she would have to pay the company $1,500 in order to use it in her film.
If all goes according to plan, everyone will have the rights to "Happy Birthday to You".
The settlement, unveiled in federal court in Los Angeles on Monday, would eliminate the music publisher's claimed ownership of the song.
Two other groups related to the Hill family also joined the settlement: the Association for Childhood Education International, a designated charity of the Hill family that receives a third of the song's licensing profits, and the Hill Foundation.
In a court filing, Rifkin said his law firm will seek a $4.62 million fee for its work in the case, plus up to $400,000 in reimbursement of out-of-pocket expenses.