A lawsuit over a $2.2 million defaulted loan remains pending against U.S. Rep. Tom Graves and state Senate Majority Leader Chip Rogers, despite the failure last week of the Cartersville bank that filed it.
Bartow County Bank, which sued the lawmakers in May 2010, failed April 15.
A lawyer for the failed bank who filed the suit told The Atlanta Journal-Constitution Thursday that the case is still pending.
Hamilton State Bank of Hoschton would become the plaintiff as the purchaser of Bartow County Bank’s assets, said the attorney, Edward Hine.
Among those assets was the loan on the Oglethorpe Inn, a now-defunct Calhoun motel. A company belonging to Rogers and Graves, Tich Hospitality, took out the loan in January 2009 to buy and renovate the motel, according to the suit.
The lawmakers are guarantors on the defaulted loan, according to the suit.
Rogers and Graves have denied they owe the money and have countersued.
They contend they sold the inn and the company that took out the original loan to another man. They also claimed the bank reneged on promises to refinance the loan at more favorable terms.
In a statement, Graves, a Republican congressman from Ranger, said: “We remain committed to working out a positive solution for all parties involved, and since this process is pending, we are still unable to discuss any details.”
Rogers, R-Woodstock, said in a statement, "Nothing has changed with respect to our lawsuit against the bank. We remain committed to reaching an agreement."
In general, pending lawsuits by a failed bank are inherited by the Federal Deposit Insurance Corp., unless the underlying asset in the dispute is assumed by the acquiring bank.
David Barr, a spokesman for the FDIC, said Thursday that Hamilton State acquired the bulk of Bartow County Bank’s assets, including the disputed loan, and under that agreement, this lawsuit goes with it. The bank's failure resulted in a nearly $70 million loss to the FDIC's insurance fund.
There has been some confusion over what organization might take responsibility for the case. Earlier this week, The Chattanooga Times Free Press, quoting a different FDIC official, reported the regulator would decide within 60 days whether it would continue the case.
A spokesman for Hamilton State deferred comment to the FDIC.
The case has been on hold. Under Georgia law, state lawmakers and staff are immune from civil suits while the General Assembly is in session and for three weeks after adjournment. That would end May 6.
Hine declined to speculate about next steps in the case.
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