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The city of Winchester has settled a lawsuit with a local guitar shop that was deluged in a spring rainstorm nearly two years ago.

According to a joint press release, the city has consented to pay $100,000 to RS Guitarworks on Winn Avenue for damage sustained when the business was swamped by 10 inches of rain runoff during a storm on April 3, 2008.

The city’s insurance carrier, the Kentucky League of Cities Insurance Services, will fund the entire cost of the settlement.

“The city of Winchester considers RS Guitarworks to be a valued corporate citizen,” Mayor Ed Burtner said in the press release. “The city is pleased that this matter has been resolved through a mediated insurance settlement.”

RS Guitarworks is an internationally recognized custom guitar manufacturer that counts Brad Paisley, Buddy Guy and Rick Derringer among its many celebrity customers, according to its Web site.

The business filed the suit in November, seeking $150,000 for financial losses, water damage to the building, equipment and guitars.

In the suit, RS Guitarworks claimed that a nearby storm drain owned by the city and CSX Transportation failed to work properly.

Before Friday’s settlement, city officials said a mulch pile from an adjacent property may have caused the problem, and expressed uncertainty as to whether liability fell on the city, CSX or the adjacent property owner.

The settlement states that payment is not an admission of liability and cites further litigation costs as an impetus behind the move.

Still, Scott Leedy, a co-owner of RS Guitarworks, conveyed satisfaction in the press release and indicated that the business may expand its operations.

CSX installed a new, larger drain at the site in 2008.

City Manager Ken Kerns said officials continue to monitor the drain during periods of rain and have not observed any additional problems.

The city has received about 25 e-mails from across the globe in support of RS Guitarworks’ claim.

Kerns said letters will be sent to the customers alerting them to the settlement and expressing appreciation over the company’s business activities in Winchester.

Contact Mike Wynn at mwynn@winchestersun.com.

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