A Tulsa city councilor now has legal issues on at least two fronts - the tax commission, and his business partners.
City councilor Blake Ewing is also a business owner, and that's where his problems are - over not paying taxes, and, according to a lawsuit, taking money from one business to prop up the others.
Ewing missed the last few city council meetings as his financial and legal problems have grown.
The city councilor has claims against him from the Oklahoma Tax Commission and now a lawsuit filed by his business partners.
The lawsuit surrounds the Max Retropub.
They claim Ewing moved more than $300,000 from the pub's bank account to another one of Ewing's accounts "for no real reason."
Their lawsuit states Ewing was supposed to keep the pub’s dealings separate from his other businesses, but the lawsuit claims Ewing transferred some of their investments to his bank account at The Engine Room then used it for expenses at his other properties.
Ewing owned at least part of The Phoenix Cafe, Boomtown Tees and Joe Momma's pizza.
Their lawsuit spells out well over $100,000 in transfers out of The Max bank account.
The tax issue comes from the state, which, according to an investigation by our partner The Frontier, claims Ewing's businesses failed to pay $168,000 in sales taxes since 2010.
Ewing's paid most of that but still owes about $60,000.
Ewing blamed both sloppy accounting and a string of business failures for the problems.
“If your business is successful and you're making lots of money it's no big deal. When the tax bill comes you write the check,” he said. “But if you don't have the money in the account to cover the payment, you can either try to process it and it doesn't clear the account, or you just don't pay it all because you know the money isn't there.”
It was a fire at Joe Momma's that, according to Ewing, created most of the problems he's had paying bills.
Ewing was never able to rebuild and reopen the restaurant, and in the year after, his financial problems appear to have grown worse with time.
In a statement posted on his Facebook page, Ewing said:
“I understand that this story is of interest to our community. I'm certainly sorry that my constituents, friends, and family are having to read another story involving my businesses and me. Please know that I have been working diligently to resolve any and all issues regarding late payments of sales taxes and am proud of the progress we've made in that regard. Most importantly, we are in good standing with the tax commission. In fact, all of my businesses are in much better shape than they were just months ago.
“As for the lawsuit filed against me by two of my partners, I have been willing and available to work through any and all of their concerns over the past few months. Despite repeated overtures to sit down and resolve the matter face to face, they remained insistent on levying threats and making exorbitant and unsubstantiated financial demands, not with an eye towards transparency and reconciliation, but towards the obvious end of taking the company for themselves, even at the expense and without the knowledge of their fellow minority partners.
“They have refused to review the company's books or to meet to discuss their concerns, instead basing their claims on conspiracy theories derived from incomplete financial information. Sadly, they rejected my offer to pursue resolution and clarity by paying for an independent audit of the company's financials with the firm of their choosing. They've instead preferred to orchestrate a media storm, using the leverage of my public reputation as a part of their strategy. It's all very unfortunate.
“I'm confident the legal system will resolve this matter and will show these things to be true. I don't claim for a minute to have been without flaws or fault in the running of these businesses. I assume full responsibility for all of them and their issues. I did not, however, set out to defraud my partners and will defend my reputation as it relates to those claims.
“I am committed to doing all I can to right any wrongs and resolve outstanding issues so that we can get back to the important work helping our city to achieve its incredible potential.”
In response to the statement, attorneys for Ewing's business partners also released a statement saying:
"The filing of this lawsuit was not something Mr. Carrillo and Mr. Perkins preferred nor took lightly. They tried to resolve their legitimate issues with Mr. Ewing privately for the last two months. It was unsuccessful. Mr. Ewing is free to litigate this all he wants on Facebook. We are going to keep it where it belongs, in the court room, where veracity is required.
"The petition speaks for itself."
Fellow councilman Jack Henderson said he has had no problems on city council with Ewing, but added he hasn't spoken to Ewing about personal business.