A restaurant owner who settled a harassment lawsuit against Stockbridge for $1.7 million in March is being sued by the insurance company that paid the bill.
Atlantic Specialty Insurance, the Henry County city’s insurer, says it mistakenly paid Arick Whitson and his business, Georgia Championship Barbecue Company, an extra $1 million and the insurer claims they have been unable to get Whitson to commit to returning the overpayment.
The settlement agreement dictated that the insurer pay Whitson $1.2 million and his attorneys $500,000. The insurer initially provided Whitson a $1 million deposit of the funds before the restauranteur’s attorneys requested a wire transfer instead, according to the lawsuit.
After wiring the money, the insurer thought it had successfully stopped the direct deposit. But a week later it discovered that both had gone into Whitson’s bank account, the lawsuit said.
“ASIC has demanded that Whitson and GCBC return the $1,000,000 on at least three occasions: on April 16, April 19, and April 26,” the lawsuit says.
Whitson, who received the additional $200,000 at a later date, could not immediately be reached for comment.
The insurer is asking to get the money back plus “reasonable attorneys’ fees.”
The settlement between Whitson and the city stems from a 2017 lawsuit alleging City Councilman Elton Alexander — now Stockbridge’s mayor pro tem — harassed the restaurant owner after he refused to give the councilman a free $60 meal.
Whitson’s lawsuit alleged Alexander sicced the city’s code enforcement officials on him as well as made it difficult for the restaurant owner to get sign and liquor licenses.
Alexander has denied the accusations and has said he disagreed with Stockbridge’s decision to settle the lawsuit. Stockbridge Mayor Anthony Ford and two City Councilmembers have called on Alexander to step down, but he has refused.
The city’s insurance company claims in its lawsuit that Whitson’s former attorney, Greg Hecht, said the restaurateur promised to return the funds but wanted to first check with a tax attorney to avoid “an inadvertent tax liability and to ensure the correct way to do this.”
Ted Afield, an associate law professor at Georgia State University, said checking with a tax attorney makes sense. Though the money was put in his account mistakenly, it’s better to understand any tax exposure he may have because of it and to have a solid explanation if questions about the additional funds come up in an audit.
“I think that’s a smart move anytime you find yourself receiving a significant amount of money,” he said.
About the Author
