CARY - A federal lawsuit challenging Cary's notoriously strict sign ordinances advanced in federal court this week with indications of a pending settlement.

Lawyers for the town and for Cary resident David Bowden began preparing their cases and setting a hearing schedule, as both sides seemed unwilling to budge.

For months Bowden's sign reading "Screwed by the town of Cary" in big, orange letters has taunted the town from the front of his 305 SW Maynard Road home.

Cary officials had given Bowden until Nov. 19 to remove the sign or bring it into compliance with the town's strict appearance ordinances. Otherwise, it would impose fines, which start at $100 and escalate to $500 per day. To comply with town sign rules, he would have to reduce its size or change its color, according to a zoning violation notice.

Bowden sued the town saying his right to free speech was violated. "The town is trying to silence core political speech that is directed at the town itself," Bowden's lawyer Mark Sigmon wrote in the lawsuit.

The town agreed to delay fining Bowden until the matter is resolved. Cary says it is not asking Bowden to change the content of his sign. Instead, it wants him to alter the size and color, to comply with appearance laws.

"I think the town was acting in good faith and I think it just made sense for us to try to work something out and the judge encouraged that," Sigmon said.

If neither side can reach a settlement, the issue will be decided by a judge. And on Wednesday, no settlement seemed imminent.

Susan Moran, a Cary spokeswoman, said the town has no intention of allowing Bowden's sign to stay as is. "Our goal is to have Mr. Bowden express himself in a size and color that's consistent with the town's sign ordinance," she said.

Bowden had the sign painted in July, after his house was damaged by water runoff that he blames on town road construction. Cary issued a zoning violation the same day, which Bowden ignored.

The town offered to install a trench drain and new drainage pipe to re-route water away from Bowden's home. Bowden declined the offer and issued his own ultimatum: The sign wouldn't come down until the town buys his house. Bowden also declined third-party mediation, according to the town.

Cary issued another notice on Nov. 12, giving him seven days to comply. On Nov. 19, the last day before the deadline expired, the American Civil Liberties Union of North Carolina filed the lawsuit on Bowden's behalf.

"Generally, the municipalities -- when they learn their sign ordinances are unconstitutional -- stop the offending restrictions," said Katherine Lewis Parker, another lawyer representing Bowden.

Bowden, who has been talkative with the press ever since the debacle began in July, started withholding comment after the lawsuit was filed. He continued to stay mum last week. "I probably think the best thing right now is not to have any comments," he said.