Claims of racial discrimination involving Denver nightclub Chloe warrant a settlement, according to sources close to the matter.

Francois Safieddine, owner of Lotus Concepts group — which includes popular LoDo clubs Chloe and Suite Two Hundred — issued a statement to The Denver Post Tuesday expressing disappointment over a Letter of Determination from the Colorado Civil Rights Division. The letter apparently references selective dress code enforcement at Chloe.

“We do have a dress code that limits access, and that seems to be the crux of the problem,” Safieddine wrote. “I am planning to meet with my staff to review our policies and the dress code, and emphasize that we don’t tolerate discrimination based on race or color.”

The decision stems from an Aug. 5 incident in which Denver resident Kandi Brown and her friends allegedly tried to enter Chloe but were turned away, even though they were dressed appropriately for the club. Brown, who is black, said white patrons were waved past while she and her friends stood outside. A Facebook group she founded to rally against Lotus Concepts swelled to over 1,000 members in a matter of weeks.

The Civil Rights Division does not comment on pending investigations, but director Steven Chavez said that when probable cause is found for discrimination, both parties mustengage in mediation before the Colorado Civil Rights Commission. Each year, similar cases are settled for about $1.4 million total, he said.