Judge: Tenn. restaurateurs must pay $4.8M to workers’ comp fundJudge: Tenn. restaurateurs must pay $4.8M to workers’ comp fund

NASHVILLE Tenn. Restaurateurs across Tennessee will be held accountable for a $4.8 million shortfall in a workers’ compensation fund that had been operated by the head of the state restaurant association, a judge ruled Wednesday.

Tennessee Restaurant Association members had asked for a cap on the amount they would be liable for, but their request was denied by Chancellor Claudia Bonnyman of the Davidson County Chancery Court here.

The $4.8 million is the amount necessary to bolster the fund that the state Department of Commerce and Insurance alleges was mismanaged by the TRA’s longtime president and chief executive, Ronnie Hart.

The fund, which was formed by the TRA in 1993 as a trust to provide workers’ compensation insurance for its members, has been under state control since 2005.

The state is suing Hart, the TRA’s longtime president and chief executive, alleging that he received excessive fees for administrating the organization’s workers’ compensation fund and that he dipped into reserves without authorization. Also named in the civil suit are the claims’ administrator and a Florida-based accountant.

Hart, who apparently managed the fund through a private company he controls, has publicly denied any wrongdoing. He did not respond to repeated calls seeking further comment.

Hart remains the TRA’s chief after the association’s board voted 7-4 to retain him, according to Nashville restaurateur Randy Rayburn who is also a director at the TRA.

Also at the hearing on Wednesday, Bonnyman approved the transfer of the trust liabilities to Brentwood National Insurance Co. A group of TRA members had hired a claims consultant to review the issue and had asked the Department of Commerce and Insurance to consider additional providers. The TRA members had expressed concern about whether the unrated Brentwood, Tenn., concern was solvent enough to cover future liabilities.