When police arrived, they told Thompson he and his group had to leave the hotel. Thompson refused, saying the noise was coming from a different room.
Police claimed Thompson was belligerent and smelled of alcohol. After arguing with police for several minutes, he stepped out of the room and was arrested for public intoxication.
At trial in January 2007, five witnesses testified there was no alcohol in the room and that Thompson had not been drinking.
But a city judge believed the officers and found Thompson guilty. He was fined $69.
Thompson appealed the decision to the Oklahoma Court of Criminal Appeals, which ruled in February 2008 that the weight of evidence in the case did not support a conviction, overturning the city court's decision.
In addition to the settlement fee, the city will issue Thompson a letter of regret over the incident.