Burke appeared, asked Abrams what he was doing there and, after concluding that his account was false, threw him to the ground, kicked him in the head and punched him in the eye, the suit said.
Mark McDonald, Mayor Nutter's spokesman, said the city agreed to the settlement last Friday but was making "no admission of liability," in the case.
"Most cases are settled," McDonald said.
Angelo Foglietta, attorney for the psychologist, said Abrams had decided to take the settlement before the case could go to trial because the city had refused to "indemnify," or stand behind, the officer financially should Abrams win the case.
This meant that if Abrams did win in court, Burke would be responsible for paying out any settlement, Foglietta said.
In that case, Abrams would have had to "chase [Burke] around for the rest of his life to pay the judgment," Foglietta said.
McDonald couldn't say why the city had refused to "indemnify" Burke, or if indeed it had even done so. A legal expert, who asked not to be identified because he was not familiar with the details of the case, said that the city commonly refuses to indemnify defendants and settles lawsuits.
Police spokesman Lt. Raymond Evers said he couldn't provide any further information other than that the case had been investigated by Internal Affairs, which recently turned over its findings to the police Board of Inquiry for a hearing soon.
The board will decide Burke's guilt or innocence and recommend to Police Commissioner Charles Ramsey any punishment it believes that Burke should receive, up to suspension or firing, Evers said.
The final decision would be up to Ramsey.
Burke could not be reached for comment. Evers said the incident with Abrams was the first time that Internal Affairs had investigated Burke, who has been on the force for four years.