I agree with everyone else. It's not your dog's fault, he was doing what dogs do. I've said this before, but people take dog attacks too personally and expect a dog to ignore it's prey drive instincts because to a human it's a bad thing to kill a cat. The cat shouldn't have been outside and the dog shouldn't have been able to get out, so you and your neighbor are to blame, not the dog. I don't know what kind of leash laws you have where you live, but in my town there is a leash law for dogs and cats and neither of them can have access to public streets or sidewalks without being on a leash. Of course there are still outside cats around here, but if something bad happens to them, it's no one's fault except the owner, so I would check into your local leash laws in case the neighbors still try to make a fuss about this. Whatever you do, don't tell them he's a Pit Bull cause then they will freak out even more and continue to demand he be put down or they'll call animal control.