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Mistrial declared in tax-evasion case

The founder of Hooters restaurants may be retried on charges he underreported his income.

TAMPA - A federal judge declared a mistrial Wednesday in the trial of a Hooters restaurant founder charged with tax evasion.

Lynn "L.D." Stewart, 62, was accused of conspiring with accountant and longtime friend Michael Maricle to defraud the government. He was tried on two counts each of tax evasion and filing a false return.

U.S. District Judge Susan Bucklew declared the mistrial Wednesday afternoon after the jury, which began deliberating Monday, sent a note to the judge for the third time saying it could not reach a verdict.

The Internal Revenue Service says Stewart owes about $4 million more in income taxes than he paid in 1997 and 1998. He's accused of underreporting his income by about $11 million during those two years, money earned by selling his stock and ownership in Hooters Inc.

If eventually convicted, he could face five years in prison on each evasion charge and an additional three years for each false return claim.

A status hearing was scheduled for Dec. 5 at which prosecutors are expected to announce whether they will try Stewart a second time, said his attorney, John Fitzgibbons.

Stewart testified on his own behalf for two days during the trial and said he only followed the advice of Maricle when he signed the tax returns. If anything illegal occurred, he said, he knew nothing about it.

Stewart, who was a building contractor at the time, and five friends opened the first Hooters restaurant in 1983 in Clearwater. They later sold franchise and licensing rights to Atlanta-based Hooters of America, but the men retained some Hooters locations in the Tampa Bay area and elsewhere.

[Last modified November 16, 2005, 15:31:06]