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The city of Bull Shoals heads to federal court Friday for a settlement conference in a civil rights lawsuit brought by two residents who say they were falsely arrested and maliciously prosecuted after trying to protect property they were hired to manage.
The case, Ferrell v. Nixon et al., is scheduled for a 9 a.m. settlement conference before Magistrate Judge Christy D. Comstock at the Fayetteville Federal Courthouse. If the parties do not reach a settlement, a jury trial is set to begin April 13 before Judge David Clay Fowlkes, who took over the case Feb. 18 after it was reassigned from Chief District Judge Timothy L. Brooks.
Bull Shoals City Council members are expected to travel to Fayetteville for Friday’s conference, a roughly three-hour drive each way. Several residents have expressed frustration that the hearing is being held so far from the community and that settlement conferences are typically closed to the public. City council touched on the lawsuit at its most recent meeting, drawing sharp reactions from residents in the audience.
The lawsuit is the latest in a string of legal and ethical crises to engulf the small lake town, which has cycled through three mayors in a single year, seen its former mayor arrested on felony theft charges and faced a state audit that uncovered missing public funds.
The Mountain Home Observer has reviewed the full case record, including the amended complaint, the defendants’ motion for summary judgment and its supporting exhibits, the plaintiffs’ opposition brief and exhibits, a 249-page criminal trial transcript, sworn affidavits from both sides, and the defendants’ reply brief filed March 2. What follows is drawn entirely from those court filings and public records.
The night of Aug. 15, 2022
The dispute at the center of the case traces back to a summer evening at 616 Marilyn Avenue in Bull Shoals.
Charles and Brenna Ferrell had been hired by property owner Nick Knopick to manage several of his properties in Bull Shoals, replacing Dave Hotchkiss, who had previously served in that role. Hotchkiss also served as police chief in nearby Lakeview.
On the night of Aug. 15, the Ferrells received a call that someone was at the Marilyn Avenue property and appeared to be breaking in and removing items. They called police, then drove to the property.
When they arrived, they found several people actively removing items from the home and garage. The locks the Ferrells had placed on the doors had been cut, according to court filings.
Brenna Ferrell, a former Florida law enforcement officer, carried a legally owned pistol. In his sworn affidavit filed Feb. 25, 2026, Charles Ferrell states that Brenna “kept it pointed down at all times. Never pointed firearm at anyone, never threatened anyone with it.”
Bull Shoals Police Officer Dustin Sanders responded to the scene. The individuals at the property told Sanders that Hotchkiss had given them permission to be there. Charles told Sanders the individuals were trespassing and that he and Brenna were the current property managers acting on Knopick’s behalf.
“Tried to explain they were property managers under Knopick, but Sanders refused to believe them and told them to leave scene,” Charles states in his affidavit.
Curtis J. Boland, one of the individuals at the property that night, gave a voluntary statement to Bull Shoals police that tells a different story. Boland said he was helping a friend move tools when a woman emerged from the house with a handgun, pointed it at him, cocked it and shouted at them to freeze and drop their items. He said he complied and waited for police to arrive.
Sanders later filed a probable cause affidavit for Brenna Ferrell’s arrest on two counts of aggravated assault, a felony. In his original incident report and affidavit, Sanders stated he could “clearly identify Brenna aiming a weapon at the two males” after reviewing cellphone video from the scene. Police Chief John Ainsworth endorsed the affidavit.
But in a new sworn declaration filed as part of the civil case, Sanders’ account shifted. He now states he “could not directly see Mrs. Ferrell pointing the gun” but could see “light from the firearm” and could see her bringing it down by her leg “as if it had been pointed at them.”
In her own affidavit opposing summary judgment, Brenna Ferrell calls this a contradiction of Sanders’ original sworn statements. She says there was no light on the gun. She had a cell phone flashlight in her left hand and the firearm in her right. She provides what she describes as a second-by-second breakdown of the video showing the gun was at her side, pointed down, at every point she appears on camera.
Charles Ferrell is equally direct. “I personally viewed the alleged cellphone video,” he states. “It does not show Brenna pointing or aiming a firearm at anyone.”
Brenna was arrested and released on $5,000 bond. At the time, she was running for the Bull Shoals City Council Ward 2, Position 2 seat against incumbent Dino Giannini. She lost that race.
The property owner speaks
Knopick’s sworn affidavit, dated Feb. 19, 2026, may be the most damaging document for the defendants.
Knopick states under oath that Hotchkiss was not the property manager at the time of the Aug. 15 incident. He says he did not tell Chief Ainsworth that night that Hotchkiss was the property manager. He says he did not tell Ainsworth that Brodin could be in the house. He says he did not authorize anyone to break in, remove property or cut locks.
Hotchkiss’s last act as property manager, Knopick states, was evicting Clinton Brodin from the property in June 2022. After that, the business relationship between Knopick and Hotchkiss had ended. Knopick says he was trying to evict Hotchkiss at the time of the incident.
A voluntary statement Knopick gave to Bull Shoals police days after the Aug. 15 incident is even more detailed. He says nobody had permission to remove anything from the property, “especially Hotchkiss.” He says Hotchkiss never called or asked permission. He disputes the police report’s claim that he told Ainsworth that Hotchkiss had authority over the property. He says Brenna and Charles Ferrell had been watching his property for over two months with full authorization to call police on his behalf.
Knopick says Hotchkiss was not the property manager, was his employee who could not serve legal papers, and that Knopick had taken his keys back.
Despite this statement from the property owner himself, the charges against Brenna moved forward.
A jury says not guilty
The criminal case went to trial Nov. 8, 2023, in Marion County.
The jury acquitted Brenna Ferrell of all charges.
The 249-page trial transcript, filed in the federal case as Exhibit 5, reveals significant problems with the prosecution’s evidence and its witnesses.
Clinton Brodin, one of the individuals at the property that night and a key witness for the state, was confronted on cross-examination with contradictions in his account. Defense attorneys highlighted that cellphone video from the scene showed Brodin acting casual and even mocking during the encounter, undermining his claim that he was in fear for his life. If Brenna had truly pointed a gun at him, his demeanor on camera did not reflect it.
More damaging for the prosecution: Chief Ainsworth himself took the stand and testified that he had told Brodin in June 2022, two months before the incident, to contact the Ferrells as the property’s caretakers. That testimony undercut the central premise of the arrest, which treated Brodin and the others as victims with legitimate permission to be on the property and the Ferrells as the aggressors.
The plaintiffs’ opposition brief cites body camera footage from Officer Wright showing Ainsworth and Wright meeting with Brodin in mid-June 2022, where Ainsworth told Brodin he had been evicted, had no rights to the property and needed to contact Charles Ferrell because Hotchkiss was no longer in charge.
Hotchkiss, whose claim of authority over the property was the basis for the others being there, admitted at trial that he had a falling out with Knopick before the incident.
The jury heard the evidence and returned a not guilty verdict.
The body cam allegation
Perhaps the most explosive claim in the case comes from paragraph 14 of Charles Ferrell’s affidavit, filed Feb. 25, 2026.
Charles states that Officer Sanders’ body camera footage, which is part of the federal court record as Docket Entry 35-3, contains a moment that he says reveals how the decision to charge Brenna was actually made.
“It is difficult to hear, but at the 19 min 20 seconds till 19 min 40 seconds mark, on Officer Sanders body cam (D.E. 35-3), Chief Ainsworth tells Officer Sanders that he was on the phone with ‘Dave’ and ‘he said I’ll write the affidavit for aggravated assault with a deadly weapon,'” Charles Ferrell states under oath.
If the body camera audio confirms what Charles describes, it would mean the decision to charge Brenna with a felony originated not from Sanders’ own investigation or from witness statements, but from a phone conversation between Police Chief Ainsworth and “Dave,” an apparent reference to Hotchkiss, the former property manager who had a grievance against the property owner and whose authority over the property had been revoked.
In their reply brief filed March 2, defendants’ attorney Sara Monaghan dismissed the allegation. There is “no evidence to support this assertion in Paragraphs 12-15 of her Affidavit, or anywhere in the record,” Monaghan wrote.
The body camera footage is in the court record. The audio at the cited timestamp has not been independently verified by the Mountain Home Observer.
The chief’s own words
While the defendants argue probable cause existed for the arrest regardless of any issues with the video or the body cam claim, court records contain a document that complicates that position considerably.
On June 20, 2023, ten months after the arrest and while Brenna was still awaiting trial on the felony charges, Chief Ainsworth authored a Bull Shoals Police Department incident report about the same property at 616 Marilyn Avenue. The report, filed in the federal case as Exhibit 6, is Incident No. 23-00080.
In that report, Ainsworth’s own narrative tells a very different story than the one his department used to justify Brenna’s arrest.
“The property of 616 Marilyn is owned by the VIC in this report and now managed by Charles and Brenna Ferrell,” Ainsworth wrote.
He described how Knopick “had Charles and Brenna Ferrell go to the home and cut all the locks that were placed on the garage to see what items where left inside the garage and to place new locks on until he could get back into town and go through the items left behind.”
On the night of the incident itself, Ainsworth wrote that Brodin “cut the locks to gain access into the property.”
Ainsworth cited Arkansas Code Annotated 18-16-108, the state’s abandoned property statute, which provides that property left behind after an eviction “shall be considered abandoned and may be disposed of by the lessor as the lessor shall see fit without recourse by the lessee.”
“Brodin was evicted from the property 2 months prior to the Incident that took place on 08/15/2022,” Ainsworth wrote. “The VIC believes there was ample time to contact him and get permission to remove the remaining items from the home but no contact was ever made from Brodin.”
In other words, the same police chief who endorsed the affidavit treating the Ferrells as armed aggressors in August 2022 was writing official police reports ten months later that recognized them as legitimate property managers, characterized Brodin as a trespasser who cut locks to access property he had no right to enter and cited state law supporting the property owner’s position.
He wrote that report while Brenna still faced the felony charges his department initiated. He referred the matter to the prosecutor for charges against Brodin and his associates.
The political dimension
The Ferrells’ opposition brief lays out what their attorneys describe as a political retaliation theory.
At the time of her arrest, Brenna was running for city council against Giannini, whom the Ferrells describe in court filings as a relative of Hotchkiss. The two men share a grandchild, according to the Ferrells’ interrogatory responses. Hotchkiss himself was the former police chief of Lakeview with deep connections throughout Bull Shoals city government.
The Ferrells allege that the city was already interfering with their business before the arrest, trying to condemn their property and sending police to tell them they could not operate even though they had a valid business license. They allege Sanders had a prior grudge against them because they had accused him of failing to act on reports about a violent neighbor.
After the arrest, the damage compounded. The Ferrells state in their interrogatory responses that the arrest report was publicized at the post office. Giannini called them “crackheads,” they allege. Social media posts accused them of laundering money for the Russian mafia and selling drugs to seventh graders.
They say they lost virtually all of their local business except Bush’s Pizza.
Charles states the events “caused severe emotional, reputational, and financial harm to both” him and Brenna.
The summary judgment fight
Defendants moved for summary judgment in January 2026, asking the court to dismiss all claims before trial. The Ferrells are represented by Luther Oneal Sutter and Lucien Gillham of Sutter & Gillham in Little Rock.
The lawsuit brings seven counts under 42 U.S.C. Section 1983, the federal civil rights statute, the Arkansas Civil Rights Act and state tort law: malicious prosecution, false arrest, Fourth Amendment violations, abuse of process, defamation, abuse of office and loss of consortium. The defendants are sued in their individual capacities. Sara Monaghan of the Arkansas Municipal League represents the city defendants.
On the malicious prosecution claim, the defendants’ central argument is that probable cause for the arrest existed independent of Sanders’ statement about what the video showed. They rely on a framework from the Eighth Circuit case United States v. Box, 193 F.3d 1032 (8th Cir. 1999), which applies the Franks standard. Under that framework, courts can strip out allegedly false statements from a probable cause affidavit and evaluate whether probable cause still stands on the remaining information.
Even without the video claim, the defendants say, Sanders’ affidavit contained statements from the “victims” at the scene that Brenna pointed a gun at them and that they were afraid.
But the Ferrells counter that those “victim” statements came from individuals who were themselves trespassing on property they had no authorization to enter. Brodin’s credibility was destroyed at trial, they argue. The video contradicted the claims. And the entire basis for treating Brodin, Boland and others as victims rather than suspects rested on Hotchkiss’s word, a man who had been replaced as property manager, who had a falling out with the property owner, and who, according to Charles Ferrell’s sworn affidavit, may have been the one directing the prosecution from behind the scenes through a phone call with the police chief.
On the defamation claim, the defendants say Sanders was simply relaying information he was given: that the Ferrells were not the property managers and that Brenna pointed the gun. The defendants argue qualified privilege applies.
The Ferrells point out that Ainsworth’s own June 2023 report directly contradicts this, acknowledging the Ferrells’ authority in an official police document. And Ainsworth’s trial testimony, in which he admitted telling Brodin two months before the incident to contact the Ferrells as caretakers, raises the question of how Sanders could have reasonably believed the Ferrells were not who they said they were.
In an unusual concession in their reply brief, the defendants acknowledged they had argued against a conspiracy and retaliatory arrest claim “by mistake” in their opening brief, because the Ferrells had not actually included that specific claim in their amended complaint. “Defendants presented arguments for this claim in their opening brief by mistake,” Monaghan wrote. The defendants asked the court to disregard both sides’ arguments on the issue.
The defendants also argue several other claims should be dismissed as abandoned because the Ferrells did not respond to specific arguments in the opening brief, including the Fourth Amendment seizure claim, abuse of office and loss of consortium.
Judge Fowlkes has not yet ruled on the motion. Summary judgment briefing was completed March 2. The court extended the deadline for dispositive motions in late January but noted a ruling was unlikely before Friday’s settlement conference.
A city’s troubled history
The Ferrell case does not exist in a vacuum. Bull Shoals, a city of roughly 1,800 people on the shores of Bull Shoals Lake in Marion County, has been mired in controversy for years, with a pattern of disputes between city officials and residents who challenge them.
David Nixon, the former mayor named as a defendant in the Ferrell lawsuit, is himself facing criminal charges. Nixon was arrested in February 2024 on two Class C felony charges: theft of property over $5,000 and abuse of office. The Attorney General’s Public Integrity Unit found Nixon received $5,915 in unauthorized Medicare Part B reimbursements from the city during his time as mayor. Investigators examined council minutes from 2017 to 2022 and found no readings, votes, ordinances or resolutions authorizing the payments.
Nixon told investigators his actions were “administrative discretion.” His criminal case remains pending in Marion County Circuit Court and has been repeatedly delayed, a source of ongoing frustration for Bull Shoals residents.
“Abuse of office and theft of public funds are serious breaches of the public’s trust,” Attorney General Tim Griffin said at the time of Nixon’s arrest.
The investigation into Nixon was triggered by his successor, Mayor Michael Savu. When Savu took office in January 2023, city staff approached him with a reimbursement check for Nixon already signed by Councilman Giannini. Savu asked what it was for and was told Nixon had been receiving quarterly reimbursements for Medicare Part B premiums. Savu found no council authorization for the payments and declined to sign the check, setting the investigation in motion.
Nixon himself faced a previous federal lawsuit filed in 2019 by Paula Flippin, a Bull Shoals business owner who alleged he entered her property, cut the locks on her storage building, placed crime scene tape around it and had her belongings thrown in a dumpster and hauled away. The lawsuit alleged nearly $50,000 in destroyed property. The case was voluntarily dismissed. The parallels to the Ferrell incident, in which locks were cut and property rights were disputed, are notable.
Savu resigned in April 2024, citing dysfunction and constant undermining by council members who met secretly to make decisions outside public meetings.
“Since the day I took office, I had to work every day,” Savu told the Mountain Home Observer in 2024. “You had to keep a constant eye on every part of the city, especially because there was such undermining activity going on by the City Councilmen.”
That same month, Merle Fawcett was arrested at the special council meeting called to address Savu’s resignation after he spoke out during the proceedings. Police Chief Brad Harper and several patrol officers attempted to remove Fawcett after Mayor Carol Duss ordered him to be quiet. He was charged with disorderly conduct and resisting arrest. Fawcett later ran for city council in November 2024.
Duss was appointed mayor after Savu’s departure. Under her administration, Harper came under fire for living at a publicly owned campground for free and for not meeting residency requirements for city employees. When the council moved to change the police residency requirement from 20 miles to 25 miles to cover officers living outside the legal radius, Councilman Wes Phelan admitted to the Observer that he, Duss and Giannini had coordinated the change over the phone before the meeting.
“I talk to City Council members on the phone. Yes,” Phelan told the Observer, acknowledging the communications violated the Arkansas Freedom of Information Act.
The Observer documented repeated dysfunction at council meetings under the Duss administration, with sessions that devolved into shouting matches, gavel banging and threats to remove residents by police force. In one meeting, Charles Ferrell was almost arrested for speaking out of turn against Duss and members of the Bull Shoals City Council during a heated exchange.
Phil Friese, who ran for mayor in 2024 on a platform of removing Harper as police chief, was charged with criminal mischief two days before the November election after a dispute over campaign signs. Harper publicized the charges in the Baxter Bulletin the day before voters went to the polls. Friese missed the runoff by a single vote. The charges were later dismissed when Prosecuting Attorney Kerry Chism declined to prosecute, saying he could not prove criminal intent. Friese has since filed his own civil rights lawsuit against Duss and Harper, alleging the charges were political retaliation.
Voters swept most incumbents from office in November 2024. Duss lost a December runoff to current Mayor Bill Stahlman, 283 to 250. Harper resigned as police chief on June 30, 2025.
A January 2026 state legislative audit found the former Bull Shoals district court clerk, Darla Hulen, failed to deposit or record 13 receipts totaling $2,190 in fines and costs. A $20 money order was recorded but never deposited. The U.S. Postal Service confirmed it was cashed. Hulen resigned in March 2025. The matter is under criminal investigation by the 14th Judicial District Prosecuting Attorney and Arkansas State Police.
The city has also faced environmental violations. The Observer reported in October 2025 that more than 1.2 million gallons of raw sewage flowed into the White River through 56 sewer system failures over six years. Arkansas environmental regulators reached a consent agreement requiring infrastructure repairs and $10,000 in penalties.
A decade before any of this, Bull Shoals Police Chief Daniel Sutterfield was arrested in 2014 by the FBI on charges of using excessive force against a handcuffed man during a domestic disturbance call. The indictment alleged Sutterfield kicked, stomped and tased the man after the arrest, then directed a junior officer to write a false report. A federal magistrate ordered Sutterfield to live with Bull Shoals Mayor Bruce Powell as a condition of his release. Despite the federal charges, Powell told the Baxter Bulletin his opinion of Sutterfield was “very, very high.” Sutterfield later resigned and surrendered his Arkansas law enforcement certification in a deal with prosecutors.
What happens next
If the parties do not reach a settlement Friday, the case moves toward trial on an aggressive timeline. A final pretrial conference is set for April 3 at 9 a.m. in Room 509 of the Fayetteville Federal Courthouse. The jury trial is scheduled to begin April 13 in the same courtroom.
The summary judgment motion remains pending before Judge Fowlkes. If the court grants the motion in whole or in part, some or all of the claims could be dismissed before trial. If it is denied, the case proceeds to a jury.
Settlement conferences are often closed-door proceedings intended for the parties and their attorneys to negotiate without going to a full jury trial. Residents wishing to confirm whether Friday’s hearing is open to observation can contact the Clerk’s Office for the Fayetteville Division at (479) 521-6980.
The Mountain Home Observer has reviewed the full case record in Ferrell v. Nixon et al., Case No. 3:24-cv-03038, including the amended complaint, the defendants’ motion for summary judgment and supporting exhibits, the plaintiffs’ opposition brief and exhibits, the 249-page criminal trial transcript, sworn affidavits from Charles and Brenna Ferrell and Nick Knopick, Officer Sanders’ declaration, Chief Ainsworth’s June 2023 incident report, and the defendants’ reply brief filed March 2, 2026.
