The figure is based on a percentage of global sales figures for the range, which included trainers, footballs and T-shirts. Nike has apologised and has also agreed to pay Hackney borough's legal costs as part of the agreement announced today.
The controversy arose in May this year when the range of clothing, featuring the distinctive Hackney 'H' symbol surrounded by the words "The London Borough of Hackney" and the Nike tick above it, first appeared.
Nike is famously protective regarding the use of its own trademarks and had used the Hackney logo without permission.
Jules Pipe, Mayor of Hackney, described it as a "great result" for the council.
"This is extra money to spend on sports activities in Hackney, and shows that it was worth standing up to Nike," Pipe said.
"This was always about more than cash -- there is a serious principle at stake here. Just because we are a public organisation, it does not mean that big corporations can take what they want from local people without asking."
Nike filmed its famous 1997 'Parklife' commercial, starring Eric Cantona, at Hackney Marshes, the famous football fields situated in the borough.
Hackney Council has been using the same logo to promote the borough since 1965.
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