Olofsson said he would prefer not to reveal the "cash amount" promised to him after he had written a number of emails to the celebrity designer demanding an explanation.
"We have reached an agreement. It all took quite a long time but I am happy with how it has worked out," said Olofsson.
As far as he was aware, the firm would continue to sell the scarves as before.
Speaking to The Local last week, Olofsson expressed frustration that the issue had not been resolved to his satisfaction. But this, he said, was "probably largely due to language confusion".
Two weeks have passed since Olofsson first discovered that his father's scarf was still very much à la mode.
Being something of a jack of all trades, Gösta Olofsson designed the scarf when he was able to grab a spare moment while running the local petrol station and shop. The item was an immediate hit with tourists and villagers alike,
Fifty years after Olofsson first began selling the popular accessory, Marc Jacobs reproduced the symbols of Härjedalen county on a 'mountain bandanna' that bore an uncanny resemblance to the original.
Like the Linsell scarf, named after the family's home village, the Marc Jacobs creation contained a number of symbols of Härjedalen county, including two bears, pasque flowers and the coat of arms of the region.
The local church was also depicted on the scarf, at an angle suggesting that it could only have been sketched from the family's back yard (see picture above).
The Local has tried on a number of occasions to reach Marc Jacobs for a comment but has so far not received a reply.