insurance co. asking for paid settlement back!

[KristinAZ]

I was in a car accident on May 5, 2005. At the time I only had liability insurance with uninsured and underinsured medical coverage. There was no fault assigned. I received a ticket for failing to control speed the other person for no insurance. Anyways, my questions is about now, 9 months later, my insurance (State Farm) decided to give me a settlement of $3500 covering my medical debt. Now 4 days after I recieved it, and already paid off all my medical bills with it, State Farm called me and said that they recieved more info from the other person in the car accident finally and they were going to be requesting the claim back. They said the other guy said I hit him (which I did not and provided State Farm with pictures of the accident)and that he did have insurance at the time, however the other party refused to provide me at the time of the accident or my insurance company when they called with their insurance info. Mainly I am wondering if the can legally take back the claim they already paid me out? I provided them with all the information that I had and was all 100% true. What actions can I take?