Macon businessman hit with about $5.2M fraud lawsuit by Atlanta group

A group of metro Atlanta residents claim a Macon businessman defrauded them of about $5.2 million and their case could go to trial this fall.

The civil lawsuit alleges Austin Sapp Jr., owner of Confederate Land Company Inc. and Splash and Dash Laundry Inc., overstated past income and revenues of the businesses — including car washes, a mini-storage warehouse and a coin-operated laundry in Bibb and Pulaski counties — to influence the group to buy the businesses in April 2007. The owners and members of Show N Tell Car Wash LLC and SSMH Holdings LLC, Stacy Smith, Steven Duer, Noah Murphy and Mike Hofrichter, allege Sapp and his companies manipulated the businesses’ computers to overstate sales. According to the suit filed in Bibb County Superior Court in February 2008, Sapp provided the group with fraudulent written records including false business records and incorrect tax returns.

No criminal case has been filed, according to court records.

Messages left for Sapp, of LaGrange Court in Macon, and his attorney John McGoldrick Jr. were not returned Tuesday.

Duer, of Fayetteville, is listed as the registered agent of Show N Tell Car Wash LLC and Hofrichter, a Fayetteville lawyer, is listed as the registered agent for SSMH Holdings LLC, according to Georgia Secretary of State records.

A phone message left for Hofrichter was not returned Tuesday. The plaintiffs’ attorney, Hubert Lovein Jr., could not be reached for comment.

Sapp and his companies denied wrongdoing in a written answer filed March 21, 2008, in response to the lawsuit, according to the court records.

After paying about $5.2 million for the businesses April 20, 2007, the purchasers learned that Sapp allegedly “bragged to associates that after the bank foreclosed upon the purchasers he would be able to buy the businesses back at a much lower price,” according to the lawsuit.

With the new information, the purchasers gave notice to Sapp and his two companies that they wanted to rescind the sale and offered to return the businesses in exchange for a refund, according to the lawsuit.

As of the filing of the lawsuit, the sale had not been rescinded, according to court records.

Sapp and his companies deny that the purchasers are entitled to rescind the sale and they acted promptly after the sale, according to the defendants’ written answer to the lawsuit.

As an alternative to receiving a refund, the purchasers are seeking to recover monetary damages, according to the records.

Sapp has filed a counterclaim against Murphy, Show N Tell Car Wash LLC and SSMH Holdings LLC alleging Murphy made slanderous statements to a customer of one of the purchased businesses.

The counterclaim alleges a tenant of a mini-storage warehouse on Thomaston Road in Macon purchased by Show N Tell Car Wash and SSMH found that the contents of her storage bin were empty. Murphy allegedly told the woman the items were stolen by Sapp to satisfy a debt owed to him or Confederate Land Company by her, according to the counterclaim.

Sapp alleges in the records that Murphy knew the statements were false and that he said them maliciously “with the intent to disparage and damage” Sapp and his reputation in the community.

He further alleges the purchasers acted in bad faith and have put him to unnecessary trouble and expense, according to the records.

To contact writer Amy Leigh Womack, call 744-4398.