David and Albert Prentice won the settlement following a lawsuit taken out in Washington. Damages are thought to be around $1m (£630,000).
They brought the case against journalist Sean McPhileny and Roberts Rhinhart, publishers of the book The committee: political assassinations in Northern Ireland. Mr McPhileny and Roberts Rhinehart said in a statement they accepted that the Prentice brothers had not been involved in the activities described in the book.
"Sean McPhileny and Roberts Rhinehart sincerely regret the embarrassment and offence caused to Albert and David Prentice by the books."
A spokesman for the brothers said they were delighted at the settlement and that their name had been cleared from the "ludicrous allegations in the book".
Their US lawyer, Bill Taylor, also welcomed the settlement. "We are very happy with the amount of damages."
The book was on sale in the US, but not in Britain.