updated 5/13/2008 9:34:43 PM ET 2008-05-14T01:34:43

A New York City restaurant has settled a lawsuit brought against it by a lesbian who said she was ejected because a bouncer thought she was a man in the ladies' room.

Caliente Cab Company, while denying the allegations, agreed to pay Khadijah Farmer $35,000 and train its staff to be sensitive to gender identity issues.

Farmer said she's happy with the outcome, saying it "does send a positive message."

She said she was humiliated last year when she and her party were thrown out of the restaurant after the annual Gay Pride parade.

Farmer, who wears her hair close-cropped and favors khakis and man-tailored shirts, said she has no intention of changing her look.

Copyright 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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