Donald Neely was arrested for trespassing in Aug. 2019. The officers on horseback tied a rope to Neely as he was handcuffed and had him walk several blocks as they rode next to him.
In a lawsuit filed, Neely said the incident caused him to suffer "embarrassment, humiliation and fear."
Videos and photos of the arrest quickly gained attention on social media at the time.
A spokesman said the city does not comment on pending litigation.
Galveston Police Chief Vernon Hale addressed the public after the arrest.
"We have stopped the practice immediately and we will be looking for more appropriate methods," he told a crowd in August.
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Neely's family and their attorneys told the crowd the incident was racially insensitive.
"It's the judgement of an officer or officers who don't understand the racial insensitivity of such a tactic," said Melissa Morris, the attorney for the Neely family.
WATCH: Protest over Donald Neely's arrest in Galveston
Video shows Neely was initially wearing a welding mask during the incident, which one of the officers removed.
"Especially being African-American. Not that we lived in that day and time, but we all studied. We know the history, and to think in 2019 they saw fit to treat him like they would have treated us back then, it's just very disturbing," Christin Neely, Neely's sister-in-law, told our sister station KTRK-TV in August.
Neely, they said, despite their efforts, is homeless and mentally ill. They feel like the officers took advantage of him.
He complied with the officers' instructions, he told his family, because he was afraid a horse would kick him.
Chief Hale apologized for the "unnecessary embarrassment."