The Register Citizen (Torrington, CT)
Attorney awaits court decision
Accused of misusing funds, Friends of Fisher House money allegedly went to personal use
LITCHFIELD — A local attorney accused of misusing money from a fundraising account for Friends of Fisher House CT, an organization that provides housing for families of veterans who are being treated at a VA hospital, is awaiting a court decision to appoint a special receiver to his business so he won’t spend more money.
Friends of Fisher House CT is a local organization based on the national entity, Friends of Fisher House.
Kevin Creed, a Litchfield resident and founder and CEO of Friends of Fisher House CT, is under investigation for allegedly using $1.4 million of the group’s money for his own expenses. He has been ordered not to use any incoming funds from his law firm.
Attorney Monte Frank, representing Fisher House, filed a motion to charge Creed with contempt, alleging he is continuing to use money from his law firm to pay himself. According to a motion filed in March, Creed is prohibited from taking any money from his firm’s accounts.
“Despite the clear terms of the stipulation ... the Creed Law Firm LLC paid funds to Mr. Creed. The very purpose of the stipulation was to preserve the status quo, and to safeguard the assets of the Creed Law Firm, LLC, so that those assets would not be dissipated as well,” Frank wrote in the motion. “That is why there was a clear prohibition against payments to Attorney Creed. The payment of the funds to Attorney Creed violates the Stipulation and the order of the Court.
“Attorney Creed, as the sole member of the Creed Law Firm, LLC, made those payments to himself knowingly, willfully and in utter disregard of the court’s order,” Frank wrote.
Frank asked the court to find Creed in contempt, to order him to return any money taken from firm’s account since the stipulation was put in place, and to be fined $500 daily
from May 9 until the money is returned. Frank also asked for reimbursement for all costs related to his filing, on behalf of Fisher House.
Another hearing has been scheduled for June 4.
Creed, whose law firm is located in Bristol, has not been criminally charged.
In a separate motion filed on April 4, Creed’s attorney, Joseph Fournier, objected to the idea of appointing a receiver or overseer for the law practice.
“(A)ppointment of a receiver is a drastic step for this Court to take, and would destroy the expectation of confidentiality between attorney and client to which the present and future clients of the Creed Law Firm are entitled. Second, there exist other, less restrictive alternatives that would accomplish the Plaintiffs’ objectives without interfering in the operation of the Creed Law Firm, or in Attorney Creed’s ability to practice law. Third, there are less restrictive measures already in place to protect the property in dispute from waste or loss,” the motion says.
Fournier also said that since the Friends of Fisher House’s claims are still unproven, the move to control Creed’s law firm is unacceptable.
“The Plaintiffs’ Motion is only the most recent in a series of submissions to this Court that attempt to bypass the judicial process and find against the Defendants on the allegations in the Complaint – which are, at this early stage of the litigation, still only allegations,” according to the motion.
Creed, who is a veteran and has a long history of supporting veterans, established the friends group as a Connecticut nonprofit and operated it out of his law firm. Creed has since disconnected any affiliation, sources said.
In December 2018, the court granted a prejudgment remedy for $4.3 million, consisting of the $1.4 million Creed allegedly misappropriated, damages based upon the statutory theft claim, and attorneys’ fees. A previous court judgment authorizes the friends group to attach Creed’s assets. But according to the recent court action, they have been unable to attach assets “to satisfy even a small fraction of the prejudgment remedy.” Attaching Creed’s residence and bank accounts were not fruitful, the court filing claims.
The Friends group only found one bank account with any funds in it — and the amount was $3,000, the legal action states.
“Defendant Creed’s interest in the Creed Law Firm, LLC is the only presently identifiable asset Creed has that could potentially result in a recovery of any significance to Friends and/or other creditors,” the court filing states.
Having a receiver to oversee Creed’s finances is needed, the Friends’ attorneys said in their March filing: “The receiver is necessary to assume control of the books and records, and financial accounts of The Creed Law Firm, LLC, and would be well-positioned to ensure that any funds The Creed Law Firm, LLC receives by way of legal fees earned for the provision of legal services, including contingency fees from its personal injury cases, shall be held for the benefit of Friends and/or other creditors, after payment to clients the funds due them.”
A source involved in the case said any alleged actions by Creed did not affect the local Fisher House functioning or services. Construction of the 16 suites in West Haven cost $6 million and was 100 percent covered by donations. Operational costs for the suites will be covered by the facility budget.