FORT SMITH — A Sebastian County Circuit Court jury decided Tuesday that a sports complex project headed by former state Sen. Jake Files and Lee Webb will not have to repay Fort Smith nearly $27,000 in state General Improvement Fund money Files authorized for the project but used for his own purposes.
The jury of eight men and four women deliberated for about an hour before returning with a verdict against the city’s accusations that River Valley Sports Complex breached its contract with the city in its failed attempt to build the eight-ballfield complex on city property at Chaffee Crossing.
In addition to the General Improvement Fund grant money totaling $26,945.91, the city had wanted the sports complex to pay any expenses the city incurred as a result of the breach, including any costs to the city if it decides to finish the complex, sell it or tear it down.
Files began serving an 18-month federal prison sentence Aug. 2 after pleading guilty to wire fraud and money laundering charges related to the taking of the grant money instead of using it to work on the sports complex project.
Fort Smith also will have to pay more than $200,000 to four companies for work they performed on the complex but were never paid. The companies sued the city for breach of contract, charging that River Valley Sports Complex was an agent of the city and that the city was responsible for the debt.
The city argued the sports complex was not an agent of the city but was hired to deliver the sports complex. The city argued that Files and Webb hired the four companies and that they were responsible for the debt.