A federal judge on Wednesday overturned a $700 million verdict awarded over the 1992 acquisition of Executive Life Insurance Co.

A Los Angeles jury had issued the verdict in July against Paris-based holding company Artemis S.A., owned by billionaire Francis Pinault. While Pinault was cleared of wrongdoing, Artemis was found to have conspired with Credit Lyonnais and other French investors to defraud California regulators in the Executive Life purchase because it bought billions of dollars in junk bonds from the failed insurance firm. At the time of the sale, California law prohibited foreign ownership of insurers doing business in the state.

U.S. District Judge Howard Matz struck down the punitive damages award, which is limited to 10 times the compensatory damages. No compensatory damages have been awarded in the case against Artemis.

Norman Williams, a spokesman for Insurance Commissioner John Garamendi, said his office has not had a chance to review the judge’s decision.

“We’re disappointed that the judge rejected the jury’s findings,” he said. “Once we review the decision, we’ll determine where to go next.”

Executive Life collapsed in 1991, forcing the state to take over the company. In 1999, Garamendi sued the French investors who had purchased the firm, seeking to recover $3.5 billion in losses stemming from the sale.

Last month, a federal judge approved a $600 million settlement between Garamendi and a French government entity acting on behalf of Credit Lyonnais. Under that settlement, Garamendi will get $516.5 million to pay back Executive Life stakeholders. Another $75 million will go to Sierra National Life Insurance Holdings Inc., which also sued Credit Lyonnais.

In December 2003, Credit Lyonnais pleaded guilty to federal charges and agreed to pay $772 million to settle separate criminal charges.