ORLANDO, Fla. – A federal court here awarded Sperry Associates FCU a $4.5 million default judgment in a four-year-old suit over loan participations the New York credit union purchased from CU Business Capital LLC, the member business loan CUSO owned by defunct Eastern Financial Florida CU.

The suit revolves around two 2006 loans totaling $37.4 million originated by CU Business Capital in which the $340 million-asset credit union bought the participations. One loan, for $22.4 million, financed the purchase of 120 acres of speculative real estate in St. Lucie County, Fla., the other, for $15 million, financed the purchase of three New York apartment buildings.

Losses on dozens of MBLs underwritten by CU Business were major factors in the 2009 collapse of the $2.4 billion Eastern Financial, the biggest non-corporate credit union failure ever. The remnants of Eastern Financial, chartered to serve employees of Eastern Airlines, were eventually acquired by Space Coast CU, which was dismissed as a defendant in this suit earlier this year.

It is unclear if Space Coast is responsible for the default judgment against CU Business. Representatives of the $3.4 billion Melbourne, Fla., credit union did not immediately respond to a request for comment. A lawyer for Space Coast CU also did not respond.

Officials at Sperry Associates also did not return phone calls.

In its suit, Sperry Associates FCU said it bought the loans based on the underwriting of CU Business and the loans have been significantly devalued because of the Florida real estate bust, leaving it with a loss. Sperry Associates, which also lost more than $2 million in participations it bought from Cal State 9 CU, asserted that Space Coast CU, as the successor to Eastern Financial, is responsible for any losses it has realized from the two loans.

A number of irregularities occurred during the closing of the $22.4 million loan origination for the Port St. Lucie land, according to the suit. For one, the closing lawyer did not stay for the entire closing; the settlement was conducted in Spanish though the settlement agent did not understand the language; and the settlement agent was a principal and guarantor of the borrower.

The suit, filed in U.S. District Court for the Middle District of Florida, claimed that Space Coast, as part of a purchase and assumption agreement acquiring the remnants of Eastern Financial, received cash from NCUA that Space Coast is legally bound to share under contractual agreements related to the loan participations.