ATLANTA, Ga. — A Georgia Court of Appeals ruling has significantly reduced the punitive damages awarded in a fraud case involving a doctor and a businessman. The court vacated a jury’s $65 million punitive award while upholding compensatory damages of $650,000 and attorney fees exceeding $500,000 against businessman Firoz Thakkar.
The appellate court noted that the “potential and actual harm” caused by Thakkar’s actions primarily affected one individual, leading to an economic loss rather than broader societal damages. The judges emphasized that under the circumstances presented, the punitive damages were disproportionate. If this ruling remains unchanged, the case may head to a limited retrial focused solely on the punitive damages aspect.
Both parties have the option of appealing the decision to the Georgia Supreme Court. Thakkar’s attorney, Laurie Webb Daniel, expressed satisfaction with the decision to vacate the punitive amount, asserting that the court’s analysis aligned with constitutional standards. Meanwhile, attorney representation for Dr. Kiran Parikh chose not to comment further on the ruling.
During the trial, Parikh asserted that Thakkar had a long history of defrauding individuals and characterized himself as one of Thakkar’s many victims. He claimed he invested more than $2 million in three Atlanta-area restaurants without ever receiving rightful ownership interests. Parikh’s legal filings revealed that Thakkar had a history of unpaid judgments amounting to millions, leading to limited success for previous victims seeking restitution.
Thakkar countered that the failed restaurant venture, which included locations named Gyro City Hiram and Santorini Taverna, was severely impacted by the COVID-19 pandemic. He stated that his business disagreements with Parikh did not warrant the hefty punitive award.
The legal entanglement began when Parikh filed a lawsuit in October 2020, alleging that Thakkar owed him $145,000 in loans and restaurant ownership interests. Parikh claimed that Thakkar misappropriated funds and left the establishments in financial disarray. In his defense, Thakkar contended that Parikh had not fulfilled his financial responsibilities, resulting in the businesses’ decline.
The jury found Thakkar liable for fraud, prompting the initial significant damages. However, the appeals court acknowledged inconsistencies in Thakkar’s testimony during the trial and affirmed that he admitted to not granting Parikh ownership of the restaurants. It was cited that funds intended for operational costs were wrongfully redirected to Thakkar’s private business.
The jury’s original recommendation for $1 billion in punitive damages was shaped partly as a strategy to gain media attention and discourage further fraudulent behavior, a notion the court found misguided. Ultimately, while the court recognized that Thakkar’s actions constituted fraud, it concluded that they did not reach the egregious level warranting a $65 million punishment.
As developments unfold in this legal saga, the outcome of any potential further actions by either party remains to be seen.
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