AceShowbiz - Lindsay Lohan has one less legal problem to worry about - the troubled star has been cleared over allegations she stole a luxury watch. The "Mean Girls" actress - who is currently enrolled in a court-ordered rehab program in Los Angeles - was questioned by police in April in connection with the alleged theft of a $35,000 Rolex, which reportedly belonged to one of her acquaintances.

The alleged victim is said to have left the timepiece at Lohan's Los Angeles home, but never got it back. Lohan denied the allegations at the time and the case has now been dropped after her unnamed accuser decided not to pursue the claims, law enforcement sources tell TMZ.com.

And the actress could be set for more good news by August 25, when a judge is set to consider releasing her from rehab early. Lohan was sentenced to 90 days in prison and a mandatory 90 days in rehab for violating the terms of her probation stemming from a 2007 DUI arrest. She only served 13 days of her prison term and was transferred straight to a recovery clinic on her release on August 2.