Cheryl Ann Walker, 60, had sought to be named guardian over her son's estate and his daughter but has abandoned that bid, according to dismissal papers obtained by PEOPLE.
Her attorney, Bela Lugosi, previously told reporters that the family, including Meadow's biological mother, Rebecca Soteros, wanted to resolve the matter out of court.
A hearing had been scheduled for April 30, but a judge had already dismissed Cheryl Ann's petition for temporary guardianship over Meadow following her son's tragic death in a car crash last November.
Cheryl Ann's papers seeking guardianship, which were filed in March, claimed that "parental custody would be detrimental to the minor" because of an alleged drinking problem.
A source told PEOPLE in March that Soteros agreed to go to rehab in order to regain custody of her daughter.