It's the first settlement in the lawsuit since a federal appeals court revived it in January.
12-year-old Stephanie Crowe was stabbed to death in January of 1998 in the bedroom of her Escondido home. Her then teenage brother, Michael and two of his friends, were charged with her murder based on statements given during lengthy interrogations that involved psychologist Lawrence Blum.
The charges against the three teens were later dropped when a judge ruled police had coerced their confessions.
In 2004, Richard Tuite, a mentally ill transient, seen in Stephanie's neighborhood, was convicted of killing the young girl.
The Crowe family's civil lawsuit against the City of Escondido and police investigators still remains.
Read more: North County Times