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A Californian man wrongly imprisoned for almost 40 years over the killing of his girlfriend and her 4-year-old son is to receive a $US21 million ($A29 million) payout.

According to Reuters, Craig Coley, 71, was originally sentenced to life in prison without parole for the murder of his ex-girlfriend, Rhonda Wicht, and her 4-year-old son, Donald. The sentence Coley faced was the longest one overturned in California.

"While no amount of money can make up for what happened to Mr. Coley, settling this case is the right thing to do for Mr. Coley and our community", Simi Valley City Manager Eric Levitt said.

Often, the wrongfully convicted face lengthy battles over how they should be compensated for their imprisonment as localities blame previous administrations and squabble over what monetary sum amounts to atonement. Months later, Coley filed a federal civil rights lawsuit, and now the city is handing over millions more.

Simi Valley will be liable to pay for $4.9 million of the $21 million settlement, while the rest is expected to be paid by insurance and other sources, officials said.

But Coley always maintained his innocence and a retired Simi Valley detective named Mike Bender persuaded authorities to re-examine the case.

A year later, Simi Valley Police Chief David Livingstone also launched an investigation, just as he was taking the helm of the department.

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A California city has agreed to pay a $21 million settlement to Craig Coley after he was wrongly imprisoned for 39 years.

Coley's case was troubled from the start, CBS Los Angeles reported.

Eventually, DNA evidence from a bed sheet in Wicht's home turned out to have another man's sperm on it. Coley was then released from prison in 2017 and a judge officially declared him innocent.

One of Wicht's neighbors was a key witness in the conviction of Coley since she claimed to have heard banging noises and saw his vehicle parked outside the apartment complex the morning of the murders. However, the prosecution believed a different version of events: that Wicht was going to break up with Coley, whom she had been seeing, and he used a key to enter her home to commit murder. None of them matched Coley.

Boxes of evidence once thought destroyed were found in a storage unit, and the company that had tested Coley's biological samples had been bought by a private company, which retained the samples.

By the end of the new investigation, it became clear that Coley was innocent.