WEST HAVEN Conn. (Tribune News Service) — Lawyers for the national charitable arm and local fundraising group of Fisher House — a place where veterans’ families stay while loved ones are being treated at a VA Hospital — are trying to recoup a large sum of money they allege went missing through the hands of Attorney Kevin Creed of Litchfield, Conn., founder and former CEO of Fisher House in West Haven.

Attorneys for Fisher House Foundation Inc. and Friends of Fisher House Connecticut Inc., are due to appear in court April 8 to ask a judge to appoint a “receiver” to take over the finances of Creed’s law firm in order to repay the money that a judge ruled Creed owes the organizations.

Neither attorney Monte Frank on the plaintiff’s team nor Creed’s attorney, Joseph Fournier, would comment on the pending case.

Creed, whose law firm is located in Bristol, has not been criminally charged.

The parties on both sides agreed Monday while at a court appearance in Superior Court in Litchfield to share the books and records of the law firm before the April 8 appearance.

The court action states the foundation “honors and supports our nation’s military personnel, veterans and their families” by building “Fisher Houses” nearby to military hospitals and Veterans Affairs medical facilities in the United States and Europe, for family use while a loved one is a patient.

The purpose of the friends group is to raise money to support the Fisher House in West Haven, which was built by the foundation.

A spokesperson at Fisher House Foundation released a statement Tuesday: “Fisher House Foundation is extremely disappointed that anyone would betray donors’ trust and misuse funds earmarked for veterans and their families and has never encountered an issue like this in its 29-year history.

“Fisher House Foundation continues to remain focused on the important work of serving our military and veteran community and hope this matter can be resolved swiftly and appropriately.”

Creed, who is a veteran and has a strong 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.

The court filing claims: “Unbeknownst to the plaintiffs, Creed did not observe corporate formalities, misrepresented who its board members were, and misappropriated approximately $1.4 million.”

On Dec. 20, 2018, the court granted a prejudgment remedy for $4.3 million, consisting of the $1.4 million Creed allegedly misappropriated, trebled damages based upon the statutory theft claim, and attorneys’ fees.

A previous court judgement 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.

As the sole member of The Creed Law Firm, Creed maintains complete control of the financial accounts and other corporate mechanisms of the LLC, the filing states.

“Defendant Creed’s prior conduct establishes sufficient exigency in this case to appoint a temporary receiver,” or person to run the finances of his firm, the court action states.

According to the recent court action, in 2014 Creed was the subject of a professional disciplinary proceeding, arising out of the “commingling his and client’s funds. “

“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.”

The filing by Frank’s team goes on to state:

“To be clear, this motion to appoint a receiver is not requesting any significant infringement on Defendant Creed’s ability to practice law. However, the ugly circumstances presented in this case requires extraordinary relief, including the appointment of a receivership to protect Friends and/or other potential creditors’ interests, and to safeguard the funds which are owed to the law firm’s clients.”

Fisher House Connecticut offers free, private housing to families of patients at the VA Connecticut Healthcare System.

A source involved in the case said any actions by Creed did not affect Fisher House functioning or services.

Construction of the 16 suites cost $6 million and was 100 percent covered by donations. Operational costs for the suites will be covered by the facility budget.

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