Former Jasper Police Chief Rodney Pearson has agreed to an $831,000 settlement in a federal discrimination lawsuit he brought against the East Texas town and its mayor after his 2012 firing, according to a statement issued by his lawyers Thursday.

Pearson became Jasper's first black police chief in 2011. The landmark was of special significance in the town where the brutal hate crime killing of James Byrd Jr. took place in 1998. But Pearson's tenure brought intense public feuding that awakened bitter racial tensions.

Appointed three years ago by a majority black city council, Pearson was fired after 16 months in office, after a largely white group of residents mounted an effort to recall black council members. After they succeeded, one of the new, and now majority white, city council's first acts was a vote to terminate Pearson, saying that he was never qualified to hold the job.

The evidence in the case showed that Mayor Mike Lout used the local radio station he owns to "systematically cherry [pick] negative components from Chief Pearson's file to portray him as a thief and a criminal in an attempt to stoke racial animosity in the community," Pearson's lawyers said in a written statement.

That also included developing a rigged scorecard ranking system to prove Pearson was inferior to other police chief candidates and hiring a private investigator to uncover details from Pearson's past, according to his lawyers.

In a statement released to news outlets, Lout's lawyers said they "categorically deny" that Pearson was terminated because of his race.

"The evidence that was developed in this case did not show anything other than a crafty attempt to manipulate facts in order to extort money from the citizens of Jasper," they said.

When Lout spoke to the Tribune for a 2012 story on Pearson's firing, he said that "if there was any race involved in it, then I don't know about it" — and that Pearson was dismissed because of his incompetence. The political infighting surrounding the recall election and Pearson's position as chief had inflamed racial tensions in the town, he said, on "both sides."

"In this town we've got black, we've got white, and a big Hispanic population, and we all need to come together because we have to live here," Lout said.

As The Texas Tribune reported in 2012, the recall campaign turned particularly nasty on social media, including a widely viewed Facebook comment from the leader of the recall effort, using a racial slur to refer to black city council members. He also circulated an image of a Photoshopped Trojan condom advertisement in which Pearson’s headshot appeared between pictures of President Obama and Michelle Obama and two black Jasper City Council members. Underneath it said: “Could things have turned out better ... had their parents listened????”

At the time, the recall effort's leader told the Tribune he had created the image in jest.