A lawsuit claiming the sitting Tourist Development Council (TDC) chairman Andrew Phillips had embezzled and misappropriated more than $400,000 during his employment with Counts-Oakes Resort Properties Inc has been dropped.

PANAMA CITY — A lawsuit claiming the sitting Tourist Development Council (TDC) chairman had embezzled and misappropriated more than $400,000 during his employment with a property management company has been dropped, according to court records.

Counts-Oakes Resort Properties Inc. filed a voluntary dismissal Tuesday of their lawsuit in the 14th Judicial Circuit Court against former employee Andrew S. Phillips. Owners of the company had claimed that Phillips, since becoming treasurer and a director of the business in 2014, defrauded Counts-Oakes of about $412,000. In the dismissal, Counts-Oakes told the court they would like to voluntarily drop the allegations against Phillips, the current chairman over the TDC on the west side of the Hathaway Bridge, of theft, conversion and unauthorized misappropriation of company funds, court records show.

The terms of the dismissal were not available. However, lawsuit has been dismissed without prejudice, which means Counts-Oakes could file similar allegations in the future.

The decision comes weeks after Phillips filed a countersuit of defamation against Counts-Oakes, claiming that because of their allegations he has been unable to find work in his long-time career field of rental management.

According to the charter of the TDC, board members are required to either be elected officials, in the service industry or responsible for contributing to bed taxes. Members serve for four years. If during their term they are no longer qualified, they either have to resign or be removed by the County Commission.

TDC Director Dan Rowe said that situation does not apply to Phillips because, after severing his ties to Counts-Oakes, he started his own vacation rental business in July.

“Someone with a vested interest is able to serve on the board,” Rowe said. “It is our attorney’s legal opinion that Andy Phillips’ business satisfies that requirement.”

While the theft lawsuit against Phillips has been dismissed, his defamation countersuit against Counts-Oakes is pending. In his lawsuit, Phillips claims that because of the allegations of embezzlement and misappropriation he was unable to find work.

“As a result of the defamatory statements, Mr. Phillips has been unsuccessful in his efforts to obtain employment,” the lawsuit states. “Despite having decades of experience, Mr. Phillips has been denied employment for 10 positions within the rental management business industry because of the damage caused to his professional reputation by the defamatory statements.”

Phillips has alleged two counts of defamation, a count of aiding and abetting and a count of civil conspiracy against his former business partners. A follow-up trial date has not been scheduled.