According to TMZ,The producer, Merion Joseph Powers, had sued Katt in Atlanta -- claiming the comic racked up a $28k bill in his studio, but refused to pay the debt ... and when he pressed Williams for the dough, Katt paid him a visit with his attack dog in tow.
Powers alleged Katt -- in an effort to intimidate him into backing off the debt -- showed up to his studio with an attack dog and gave it a "verbal attack signal" to go after Merion's dog ... which suffered "substantial and nearly life-threatening injuries."
But when Merion had his day in court -- the judge ruled in his favor ... and ordered Katt to pay the man a whopping $577k.
Calls to Katt's reps were not returned.
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