A tentative $600 million settlement is said to have been reached between France and the French bank Credit Lyonnais SA and the California Department of Insurance.

After much foot-dragging, France, Crédit Lyonnais and Mr. Pinault settled a related criminal case with the U.S. Justice Department for a record $760 million last year. But, until a few days ago, all three were continuing to fight the civil lawsuit brought by the California insurance-industry regulator. The suit alleges that Crédit Lyonnais violated California law when it secretly acquired Executive Life in 1993 and that the French government and Mr. Pinault later helped cover up the fraud, the Wall Street Journal reported on February 16.

For France and Credit Lyonnais this settlement would help avoid a huge-jury verdict as California insurance department is said to demand $3.7 billion in demages. After the pure criminal case turned into a diplomatic, good relations between Paris and Washington were put into question.

The representatives of both parties refused to comment.

The settlement can be taken advantage of by San Francisco lawyer Gary Fontana who has been involved in this case for 14 years. Mr. Fontana persuaded the Department of Insurance to hire him to sue the French State, Credit Lyonnais and Mr Pinault, because he later had acquired Executive Life from Credit Lyonnais and took the benefit from.

The French side has questioned Mr. Fontana’s contingency-fee agreement calling him a greedy trial lawyer and his lawsuit an extortion attempt, according to the Wall Street Journal.

If the civil case proceeds, Mr. Pinault appears to be the only defendant. Mr. Fontana is going to claim $970 million from the tycoon.