Melky wanted $1.7M and the Yankees were offering $1.2M (which is still absurdly high) but the case won't go to arbitration. Cabrera settled earlier today for $1.4 million. He made about $461,000 last year.
Melky hit .249 last season and was sent down to Triple A in August. That, apparently, was good enough to earn him a 300% raise.