This all stems from the TOWIE 200th celebrations pub quiz night when a question about what Pete's dog was called led Kate to shout out Megan's name.
Kate said it was just banter and only intended as a joke, and during Sunday's episode (20 March), she defended herself to Pete as he told her the comment appeared to be "bitchy".
However, they soon managed to clear the air.
Now, Kate has had her say on the whole situation. Speaking in a new video on the TOWIE website, Kate said: "I was a little bit shocked because it was only a joke, I was only having a little bit of banter. I do get that he's just defending Megan but I think we've figured it out now and it's okay, he's not too worried about it.
"At first I was upset because I was only joking, I didn't want to upset Pete, we're all friends," she continued. "I do think that it was totally blown out of proportion. I was joking. I'm not the sort of person to shout out abuse to people across the room. It was a joke, there was lots of banter going on in the evening, Bobby was abusing me, I was abusing him, it was just a funny night so I didn't think anyone would take it personally."
TOWIE series finale airs Wednesday 11 November at 10pm on ITVBe.
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