The Town of Cohasset will pay $285,000 to a settle a long-running lawsuit brought by a former town manager who alleged he was fired for blowing the whistle on unethical dealings, the town announced.

Michael Coughlin, who was hired to supervise Cohasset’s town government in 2011, was fired in early 2012 after run-ins with town officials that crested in a dispute over the future of the town’s water service.

Coughlin sued soon after, alleging that he’d been fired because he raised concerns about a proposed town water deal, and revealed violations of the state open meetings law; the town alleged Coughlin was difficult to work with, and raised ethics complaints only after his termination appeared likely.

A joint statement announcing the settlement, released by the town on Friday, said Coughlin and town officials would have no further comment on the matter.

In a spat that emerged in 2011 and in court filings later, Coughlin and the water commissioner, Peter DeCaprio, squared off, occasionally in heated e-mails, over the town’s search for a company to operate its municipal water service.

Coughlin, who was hired as Cohasset’s water budget faced a $1.1 million deficit, raised concerns about the possibility of entering a 20-year deal, known as a concession agreement, that would have given a private firm substantial control over the town’s water service.

Water concession agreements are relatively rare, according to advocacy groups that have raised concerns about the practice.

“These deals are very non-transparent. Cities often enter into them when they’re cash-strapped,’’ said Mary Grant, of Baltimore-based Food & Water Watch. A 40-year deal in the New Jersey city of Bayonne has come under intense criticism for rate hikes. Hingham has spent years in court trying unsuccessfully to buy its water system, privately owned since 1879, from Aquarion Water Co.

Coughlin also accused DeCaprio of conflict of interest, because a bank that owned part of Aquarion had invested in DeCaprio’s financial management firm. Aquarion, which already provided water to North Cohasset as part of the Hingham system, had been considered a possible bidder in Cohasset.

After Coughlin was fired, the town water commission eventually awarded a short-term operations contract to Woodard & Curran, an engineering firm.

In January before the settlement was finalized, Coughlin said he was seeking to protect the financial interests of the town from deals that have gone bad elsewhere. “All these contracts overburden municipalities, because most municipalities are not on an even playing field with a major corporation,’’ said Coughlin.

DeCaprio said Coughlin’s efforts to kill the water deal were misguided and ineffective. The conflict of interest allegation “was an utterly baseless charge from the start and [Coughlin] knew it,’’ DeCaprio said.

DeCaprio left the water commission in 2014. Town Manager Christopher Senior said $200,000 of the settlement would be paid by insurance.

Nestor Ramos can be reached at nestor.ramos@globe.com.