The Oklahoma Department of Tourism and Recreation told a judge in a 2022 civil lawsuit that Swadley's Foggy Bottom Kitchen owes the state more than $4.7 million for wrongdoing.
“Because punitive damages are determined by a jury, this number represents actual damages,” Assistant Attorney General Gentner Drummond wrote in the filing.
Swadley's Foggy Bottom Kitchen is accused of breach of contract for fraudulently billing the state while operating a restaurant at a state park. The company denies wrongdoing and says the accusations are politically motivated. About $16 million was paid, according to legal filings.
more:Swadley's Bar-BQ owner Brent Swadley and two others charged with conspiracy and fraud
In February, the company complained in a new legal filing that it actually still owes about $2.6 million. He asked Oklahoma County District Judge Sheila Stinson to order the state to pay.
“It's clear what happened in this case,” the lawyer told the judge. “Tourism suffered a $4 million budget shortfall, faced intense scrutiny, panicked and made Swadley's FBK a political scapegoat in an election year. But the indisputable evidence is that tourism In fact, the evidence shows that tourism is the problem.'' Swadley's FBK is to blame, not the other way around. ”
In their March 15 response, the AG's assistants told the judge they needed to review all 269 invoices filed by the company. The review found that “defendants repeatedly breached their duty of good faith, causing damages to the public in excess of $4.7 million.”
“Some of the violations and misrepresentations are intentional acts that rise to the level of criminal acts,” they wrote in their response. “Other violations…may only result in civil liability.…But this is all for a jury to hear and decide.”
This response is the first time that specific numbers have been provided in a lawsuit regarding alleged national losses. A hired expert examined only administrative fees and found that Swadley's Foggy Bottom Kitchen had overbilled the state $455,252, according to the response.
A dispute over a state park restaurant has turned into a criminal case.
A multi-county grand jury in the state indicted Swadley's Bar-B-Q owner Brent Swadley and two others last month.
All three are charged with a felony count of conspiracy to defraud the state and five felony counts of making fraudulent claims to the state. They deny any wrongdoing.
What led to the lawsuit between Swaddles and the State Tourism Board?
Swadley's Bar BQ has signed an agreement with the state to develop and operate Foggy Bottom Kitchen Cafes at six state parks. The first store opened in 2020 during the pandemic. The last one opened in 2022.
The Department of Tourism and Recreation terminated its contract with Swadley's Bar-B-Q in April 2022, citing “alleged fraud and questionable business practices.”
Days later, the head of the Department of Tourism and Recreation resigned and the state sued Foggy Bottom Kitchen in Swadley.
Foggy Bottom Kitchen in Swadley countersued, saying, “The tourism board got exactly what it wanted by quickly building a top-notch restaurant during a pandemic.”
The ruling in February asked a judge to force the state to pay the final bill and cover operating losses and other costs for the 2022 fiscal year.
“The tourism industry has not addressed anything that we have not already addressed in our complaint,” Brian King, an attorney for the company, said Friday. “They have done nothing to disprove the fact that they owed Mr. Swadley $2,592,846 and he did not pay.
“As we have said all along, if there is a mistake on your bill, we are ready and willing to correct it. We have always done so, as evidenced by the fact that we have offered credit. …This is a small family run business that is tasked with large projects, so we apologize for any inconvenience that may arise from time to time regarding billing. That's not surprising at all.”
more:Swadley claims to be state's 'political scapegoat' in Facebook post
Lawyers said the state's response did not take into account the work Mr. Swadley was asked to do outside of his contract and for which he was not paid.
“It's unjust enrichment and it violates Oklahoma law,” he said.
