COSTA FILES PERSONAL CH. 11, CITES SEX HARASSMENT SUIT
DALLAS — Designer Victor Costa has filed for personal bankruptcy protection here, citing legal costs to battle a sexual-harassment lawsuit filed in 1993.
Costa’s apparel firm here, Victor Costa Inc., has not declared bankruptcy.
The Chapter 11 petition, filed Friday in the U.S. Bankruptcy Court of the Northern District of Texas, estimates Costa’s assets at between $1 million and $10 million and liabilities in the same range. Creditors number from 16 to 49.
A definitive creditor’s list was still being compiled at press time, according to Costa’s lawyer, Chris C. Hudson.
“Victor’s personal bankruptcy is due to the substantial, personal expenses related to litigation. We don’t expect it to affect business at Victor Costa Inc.,” said Hudson. “We expect his long-term relationship with vendors to be unaffected by this temporary financial situation.”
“Filing for reorganization is regrettable but unavoidable,” Costa said in a prepared statement. “Defending myself against a claim by a disgruntled former employee has exhausted my personal financial resources. I am still resolved to defend myself to the fullest extent of the law and to vindicate my name.”
The filing automatically postpones the sexual-harassment trial that was set to begin Feb. 14. In that case, Lorna Pilgrim, Costa’s former house model and design assistant, was seeking an undetermined amount of actual damages and $5 million in punitive damages for alleged slander, invasion of privacy and emotional distress.
If she wins the case, Pilgrim could be viewed as a creditor.