Restaurant Wanting to Sue Customer Over $3,000 Tip He Left for Waitress Sparks Online Outrage

A restaurant considering suing a customer for reportedly reversing a $3,000 tip he gave a waitress has left the internet in an uproar, with commenters expressing shock and confusion over the incident. Managers at Alfredo's Pizza in Scranton, PA, say they paid the waitress her tip, and now claim to be left $3,000 out of pocket after the credit card tip was reversed and they were left footing the bill. The story has sparked commenters to share tips and strategies to avoid a similar situation from happening. Here's what people have to say.

According to managers at the restaurant, customer Eric Smith contacted them almost three months after he left a generous $3,000 tip for a waitress, saying he was now disputing the charge. "A little over a month ago, we received something in the mail that Eric was disputing the charge for the tip that he left," manager Zachary Jacobson says. "We thought somebody was actually trying to do a good thing. And then now we are, what, three months later? Not even, and there's nothing. There's nothing to show for it at this point."

Jacobson claims communications with Smith halted, and he now plans to go to court and attempt to get the money back. "It's just a little aggravating right now. It's been causing a lot of nonsense and drama," he says. "Unfortunately, we had to file charges through the magistrate's office because now we're just out of this money at this point. And he told us to sue him. So that's what we're going to end up doing, I guess. I hope that he owns up to his actions and comes forth and does pay this because you shouldn't have done this if this was the end result."

One commenter makes the point that if the receipt was signed, it's harder for them to later claim fraud. "Usually if the customer signed the receipt, the store will win. If there's no signature, the customer almost always wins. If it's Amex, the customer always wins. If it's Discover, the customer usually wins. If it's Mastercard, or Visa it's usually just the signed receipt that decides it. Bonus for an itemized receipt. That's my experience from defending chargebacks from slimy customers that probably file chargebacks for cigarettes at the gas station. I hate unnecessary chargebacks. Just because you don't like something, doesn't mean you get your money back. Return the product, and we'll talk about it. Don't just hit me with a chargeback 6 months later. Legit chargebacks are fine. I'm happy to sign off on those. Fortunately, I'm out of the cc processing game now. It gets tiresome."

There is plenty of confusion about why the money was reversed after such a long time. "3 months later?" one commenter says. "I mean, 3 weeks seems to make that story work. It's a weird amount of time and a large amount of money. Guy was obviously loaded to even be able to tip that much – but to want it back after 3 months is the strange part."

One commenter seemed confused about the logistics of what happened. "Wait how did the restaurant end up in debt? Was the waitress able to keep the tip?" Another responded with, "Yes, the restaurant paid her after making sure the card charge went through. The cancellation happened a while later, leaving the restaurant holding the bag. They went to a judge or something and they told the restaurant all they could do is sue."

One commenter says the restaurant and bank are both in a tricky situation. "The customer pretty much called their bank or credit card company and said 'Hey! I did not authorize this charge' so they took $3,000 back from the restaurant and gave it back to the customer. However, the restaurant had already given the $3,000 to the waitress, so they took money that was not rightfully the mans [sic] anymore, leaving the restaurant with -$3,000 when the waitress was the one with the money now."

A commenter pointed out that banks make money through fees. "The money was taken back from the restaurant plus the merchant has to pay a chargeback fee to the bank. The banks make money on chargebacks. Terrible thing to do to a business." 

Some commenters were surprised that it's possible to dispute a charge up to three months later. "I didn't even know it was possible to reverse a charge after a few days," a commenter says. "Dispute process is 90 days after the last statement date," another responds. 

Commenters are wondering if there was camera footage, and what impact that could have legally. "Wouldn't there be physical proof? Like a signed credit card slip? Possibly camera footage? (I know most places don't keep their cctv footage that long, but you'd think a server getting a multi-thou tip would be worth saving any proof of in case of this eventuality)," one commenter asked. "Depends how the transaction was processed," another responded. "At a hotel I worked for a few years ago, we received a dispute because the pre-authorization the guest provided on check-in was processed by manual entry (i.e. the front desk agent input the numbers and had the guest sign) rather than chip and pin. So even though the guest was physically present and signed the receipt, it's a transaction that didn't require them to be present, which gave them reasonable doubt when the guest said 'I didn't authorize this.'"

Some commenters are confused about the timeline of events. "It could have been a scam, why did the customer wait three months before disputing the charge? If I saw it on my statement, I'd notify the CC company right away."

People are sharing helpful tips on how to reverse a charge if they suspect any fraud might be happening. "The two times I charged things back it was very much skewed in my favor. For the first one I emailed the car wash that ripped me off, they didn't reply, so I sent a screen shot to my credit card company showing I tried to contact the vendor and photos of the advertised price (which I was charged 3x). Eventually the vendor didn't even reply to Visa, so the charge automatically reversed."

One commenter makes a point several other people made, which is that tips should be honored. "If the restaurant ran it through the credit card company and got paid, than the amount was good. People shouldn't play with servers that work hard, then renege on the tip, whether large or small. When you sign something in good faith, in this case a credit card payment, you need to follow through."

A commenter made the point that there are times when the money is question is held by a third part while a dispute is taking place. "Sometimes, when there is the possibility that a credit could be disputed, the amount in question is held in 'escrow' until the claim period has passed."

One commenter advised always tipping the server directly. "Always give your tip directly to the server. Restaurants in Florida gather all the tip money and use it to pay equally everyone in the place as they can claim everyone a tipped employee weaseling their way out of paying minimum wage but rather a lower wage for tipped employees."

A commenter made the point that fraud is far less likely with cash. "One year ago I put a $10.00 tip on my credit card bill receipt and the server changed it to $100.00, I discovered it on my credit card bill and called the business to let them know. They said too bad! I went there with the original receipt to show them how it was changed. I was given $100 back (original tip included) and now I Never add a tip on my credit card bill ANYWHERE/ANY PLACE!"

Some commenters are advising caution before taking sides. "I would like to hear his side first before making a decision here. seems we are only getting 1 side of the story. I know when I leave a cash tip on the table/bar I always mark it on the tipline that it was left on table/bar to keep people honest from adding another tip on the bill itself."

Commenters agree small claims court is the way to go for monetary amounts in this range. "Sue him? Just take him to small claims court and be done with it. The max in PA is $12K so $3K isn't a problem and the restaurant will have its money a LOT faster."

Commenters were giving the restaurant credit for giving the waitress her tip, even if it hurt them down the line. "Kudos to the restaurant for actually giving the server the $3,000. Many restaurant owners would have balked at it or somehow 'justified' giving her a small portion of it. Wish you luck on recovering the $3,000 from the customer."