A fan, Nicol Harness had been sued by a company representing the artist for selling 18 drink tumblers with his face on, earning a total of $380.
She discovered she was being sued when she checked her email spam folder after returning home from hospital, where she had been treated for congestive heart failure.
“We do have a company that goes after folks — only, supposedly, large corporations operating internationally that make millions and millions of dollars — making counterfeit T-shirts, things of that nature, running illegal businesses,” Combs said in an Instagram post.
“And apparently this woman, Nicol, has somehow gotten wrapped into that, and that makes me absolutely sick to my stomach.”
Combs learned about the accidental lawsuit after seeing a clip of her being interviewed on TV.
"It's very stressful. I don't have money to pay my bills," she said.
"I just want this resolved. I didn't mean any harm to Luke Combs. I quit selling the tumbler. I pulled it down. I just don't understand."
Combs then reached out to Ms Harness to apologise and gifted her $11,000, which is double the amount that was frozen in her account following a judge’s order.
The country singer has now started selling tumblers from his own merchandise store, with the proceeds going to Ms Harness.
“No fan should ever have to be involved in anything like this," he said.
"Money is the last thing on my mind - and I invited Nicol and her family out to a show this year so I could give her a hug and say sorry in person.”