Three-foot Simon, who was expected to outgrow his father Darius to become the world's biggest bunny, appeared healthy when he touched down at Chicago's O'Hare International Airport en route to a celebrity buyer but was found dead a short time later.
Giant bunny breeder Annette Edwards was paid a five- figure compensation by the United Airlines after the 1,800 pounds rabbit died in their care, The Sun reported.
Simon froze to death after bungling ground staff at Chicago's O Hare airport put him in a chiller by accident and they later cremated him before a necropsy could be performed, it said.
In a statement, Edwards, of Worcestershire, said, "I confirm that United Airlines has been in regular contact with me regarding the sad death of Simon the rabbit and that the matter has now been resolved to my satisfaction."
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Simon's new celebrity owner in Iowa is also thought to have been included in the settlement but no details were released, the report said.
"We were saddened by the loss of Simon and have worked with Annette Edwards to reach a satisfactory resolution," United Airlines told the daily.
This was one among a slew of public relations disasters for the United Airlines in a tormented month.
Three weeks ago, footage emerged of a doctor being violently dragged off from one their flights after overbooking meant United airlines staff had no seats. The matter was finally settled out of court last week.