He had refused to pay the original settlement of 600 euros and sign a non-disclosure agreement.
A police warrant was then issued to confiscate the laptop of the girl, who was aged nine at the time.
The anti-piracy group said it was acting “within the boundaries of Finnish legislation”.
The girl had searched blocked torrent site The Pirate Bay for an album by Finnish popstar Chisu.
Her father claims they were unable to download the album and purchased it legitimately the following day.
The action was taken by the country’s Copyright Information and Anti-Piracy Centre (CIAPC), known locally as TTVK, which contacted the father after it discovered his ISP account had connected with The Pirate Bay.
“We have now reached a settlement in the matter. The police investigation has stopped and the rights holders have been compensated. All parties involved are satisfied with the settlement,” said a spokesperson.
“We agree that individual lawsuits against file-sharers are a slow and ineffective process. We can only act within the boundaries of current Finnish legislation which does not permit rights holders to tackle piracy in softer and more efficient ways.”
The girl’s father described the situation as “the pinnacle of absurdity” when speaking to website Torrentfreak.
“I can see artists are in a position, but this requires education and information, not resource-consuming lawsuits,” he said.
Chisu herself suggested in a statement that her fans should listen to her music for free on Spotify.
“I hope that the matter will be resolved soon and sorry to my nine-year-old girls,” she said.
According to its website, several national film and music groups are members of the CIAPC, including the Finnish Musicians’ Union and the Finnish Film Distributors Association.
“A joint anti-piracy association benefits all parties involved by reducing costs, co-ordinating more efficient anti-piracy strategies and giving authorities an effective point of contact,” CIAPC says online.
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