Capital Factors will receive a US$10.8m settlement from one defendant in a lawsuit in which it claims that customers defrauded it of more than US$30m.
Chicago-based Whitehall Jewellers agreed to the payment. The judge also ruled that the former president of New York-based Cosmopolitan Gems, the now-closed main defendant, owes Capital Factors US$32m stemming from what it maintains were fraudulent transactions between early 2001 and May 2003.
The developments, in a civil suit Boca Raton-based Capital Factors filed in August 2003, left questions of whether Joshua Kestenbaum, who was Cosmopolitan's president, will be able to pay Capital Factors and whether other defendants might reach settlements.
Analysts say it is likely that parent company Regions Financial Corp. based in Birmingham, Ala., will try to sell Capital Factors after the suit is fully settled. Javier Holtz, Capital Factors' president, referred comments to Regions officials.
