After 8 years, Milford strip club settles lawsuit with dancers

A hearing in the case had been scheduled for Monday morning on a request from the dancers’ lawyer to have a $200,000 judgment in the case taken from a land use settlement between the town of Stratford and Gus Curcio, a resident convicted of extortion in the 1980s who is also linked to the club.

Krayeske would not discuss the specifics of the agreement Monday.

“The matter is settled,” he said, declining further comment. 

The settlement comes a month after a bankruptcy trustee in the case of Joseph Regensburger, a Fairfield man who was once president of the club, said he could not find any assets to satisfy the dancers’ claims, even though a Department of Justice lawyer has alleged the bankruptcy was a ruse designed to hide assets. 

The bankruptcy hearing had seemed to have left the former exotic dancers who sued the club in 2015 alleging wage theft years away from seeing a dime of a judgment first awarded by an arbitrator in the case in 2019, Krayeske said at the time.

“For the debtor who stole money, the bankruptcy court served its purpose,” the Krayeske, said. “What are my clients supposed to do?”

Though the underlying lawsuit filed by the dancers has been settled, a complaint filed by federal lawyers connected to Regensburger’s bankruptcy remains pending.

A judge confirmed the arbitrator’s ruling in favor of the dancers in October 2020, days before Regensburger filed a bankruptcy petition in federal court listing assets totaling less than $9,000 and liabilities of more than $582,000.

But in a complaint filed in December, Holley L. Claiborn, a trial attorney in the Office of the United States Trustee William K. Harrington, said the bankruptcy filing was “an attempt to hinder, delay or defraud” Regensburger’s creditors.

In court last month before U.S. Bankruptcy Judge Julie Manning, Richard Coan, a lawyer appointed as a trustee to administer the case, told the judge he didn’t plan on taking any further action in Regensburger’s original bankruptcy case.

Coan told the judge a theoretical claim he had considered bringing against one of the attorneys who represented Keepers, Stephen Bellis, could not be pursued because he couldn’t find another lawyer willing to pursue it on a contingency basis.

“At this point, I’m unaware of any assets I can liquidate for the benefit of the creditors,” Coan said, noting that the case would remain open because of the pending complaint filed against Regensburger by the federal trustee. “There’s nothing left for me to liquidate.”

“I don’t know anything about this man’s assets,” Bellis said after last month’s hearing, citing his decades of practicing law without any discipline or grievances filed against him. “I’m a trial lawyer.”

Krayeske told the judge he was “extraordinarily disappointed” and frustrated.

“My clients were subjected to wage theft. If my clients stole this quantity of money from Mr. Regensburger, Keepers Incorporated, Mr. Curcio or any other entity affiliated with Mr. Curcio, they would be incarcerated for a long period of time,” Krayeske said. “Instead what we have is a system designed to allow wage theft, essentially.”

“I understand that in a system that was built on slavery that not paying wages and having systems that don’t pay wages and allow capitalist business owners to get by without paying wages is par for the course,” Krayeske said.

The judge said she understood his frustration.

“Unfortunately, as you correctly noted, the bankruptcy court is limited in what the bankruptcy court can do under the circumstances you described,” Manning said. “Your frustration is warranted insofar as this court’s power and ability is narrower than the claims that you’ve brought, and that would have to be addressed outside this court regardless.”

Regensburger did not appear for the hearing and has denied wrongdoing in court filings and depositions, saying he acted as an unpaid “runner” for Curcio by cashing the checks cited by Claiborn. Krayeske said the explanation “stretches the bounds of credulity.”

Claiborn told the judge she would file a request for judgment against Regensburger, preventing him from having his debts discharged through bankruptcy.

“We’ll have to see what happens in that case,” Manning said.