WINTER HAVEN – After years of allegations of fraud and mismanagement at the Ritz Theatre, former Ritz Theatre manager Stella Heath recently reached a settlement with Florida Attorney General Ashley Moody.
The settlement, announced within the past two weeks and finalized April 8, marked the end of a long and often controversial road.
Starting sometime around 2014, the Ritz Theatre stopped making enough money to cover its $7,000 per month mortgage, as well as to make insurance and utility payments and to regularly pay Heath’s salary.
Court documents state Heath would use personal money to pay the theater mortgage and utilities while she was still in her role managing the facility. In January 2017, the former Ritz board and Heath signed a $250,000 lien stating that if the Ritz went out of business, that amount of money would have to be taken from the proceeds of a sale to pay Heath.
Shortly after, a group of people calling themselves “The Friends of the Ritz” alleged this lien was criminal, and asked State Attorney Brian Haas to investigate.
After a yearlong investigation, Haas concluded the lien was legal, but had questions about how much money was owed, stating in court documents that paperwork documenting the debt was incomplete.
Haas referred the case to then-Florida Attorney General Pam Bondi for further investigation.
Around a year ago, Bondi’s staff asked a local judge to forcibly remove the former Ritz board, block the private sale of the Ritz, contest the lien and appoint a third party to take over operations. After this, Heath resigned and filed a counter suit against the attorney general, alleging she was owed around $350,000, as she kept working for free after the $250,000 lien was filed.
According to her attorney, Benjamin Webster, of the Morgan & Morgan law firm, Heath settled with current Florida Attorney General Ashley Moody, sworn-in this past January, for more than half of the $350,000 she believes she is owed.
“Anything the (Florida) Attorney General’s Office, or anyone else, claimed about potential wrongdoing or a fraudulent lien was completely unfounded — simply not true,” Webster said.
Part of the settlement was a joint statement, which read in part, “This settlement resolves the claims by Heath for compensation and other money owed, and any claims or issues raised by the attorney general relating to Heath.”
However, in a press statement released March 29, the attorney general’s office repeated past allegations and claims.
“Sufficient concerns were raised to warrant a referral to the attorney general,” the statement read. “The Attorney General’s Office then pursued action to impede the financial repercussions and get the Ritz back on track.”
Webster responded to the statement.
“The AG’s press release ‘declaring a win’ is befuddling,” Webster said. “They tried to eliminate any chance of Ms. Heath receiving the money she is owed. ... These issues could have been resolved without (the attorney general’s) involvement. It’s still difficult to understand why taxpayer money was spent on this.”
According to retired Judge Charles Davis, who was appointed as the third party “receiver” at the Ritz, the settlement was the last major hurdle to having a new board installed to take over operations at the theater.
Davis said that he will be submitting a list of financial donors to the theater for court approval. These people, who have yet to be named, will then select the new board. Davis said he may be submitting this list and a final report to the judge any day now.
The exact amount of money Heath received is unknown, as the settlement agreement has not been publicly posted in online court documents. Webster said he and his legal team would have happily waited and continued to try to get Heath the full $350,000 she sued for, but that Heath instructed Webster to settle the case.
“Stella very much wants to see the Ritz achieve success and serve the community in the future, and always wanted to see the Ritz succeed,” Webster said. “Her claim was big enough that if she had gone forward, it would have caused additional complications for the Ritz, and that was not her goal. She was paid a significant portion of what she was owed and that was acceptable to her.”
Staff with an insurance company representing the Ritz agreed to make the payment.