BRIDGEPORT — A federal government lawyer says a Fairfield man who used to own a Milford strip club should be barred from declaring bankruptcy, citing dozens of separate instances in which he allegedly concealed assets or “knowingly and fraudulently” failed to disclose details of his financial affairs — including tens of thousands of dollars in checks signed by a former reputed mobster.
The feds’ complaint in the case of Joseph Regensburger, former president of Keepers, comes weeks after the Woodmont Road “gentlemen’s club” asked the state Supreme Court to overturn a $113,560 judgment to dancers who worked there affirmed by the Connecticut Appellate Court in October.
Regensbuger did not return a message seeking comment Tuesday – and declined to speak during a hearing in the bankruptcy case last month before Judge Julie Manning.
The latest developments come more than seven years after the exotic dancers first filed a lawsuit in the case claiming they were not being paid a minimum wage or overtime after working 40 hours in any week and were fined for breaking the club rules — and more than three years after an arbitrator initially ruled in their favor.
A judge confirmed the arbitrator’s ruling in October 2020, days before Regesnburger filed a bankruptcy petition in federal court listing assets totaling less than $9,000 and liabilities of more than $582,000.
But in a 56-page complaint supplemented by more than 800 pages of exhibits, Holley L. Claiborn, a trial attorney in the Office of the United States Trustee William K. Harrington, said the bankruptcy filing was a ruse.
“Based upon information sufficient to form a reasonable belief, the Debtor, with an attempt to hinder, delay or defraud creditors and/or the Debtor’s chapter 7 trustee and estate, concealed or permitted to be concealed property of the bankruptcy estate within one year before the date of the filing or after the date of the filing of the Debtor’s bankruptcy petition and thus has forfeited his right to obtain a discharge of his debts,” Claiborn wrote in the complaint, dated Dec. 7.
In the filing, Claiborn cited more than $150,000 in checks cashed by Regensburger from various accounts which were signed by Gus Curcio, a Stratford resident who was convicted of extortion in the 1980s. Regensburger cashed another $29,550 in checks signed by Curcio’s wife drawn on an account for Keepers.
Claiborn wrote that while Regensburger admitted to cashing the checks, he was “unable to provide detailed explanations” about where the money went — and had testified at a February 2021 hearing that he had not received any money from Curcio, with whom he has several business relationships with and has testified to working for as a “runner” and titular “figurehead.”
Kenneth Krayeske, the lawyer representing the six exotic dancers and subpoenaed much of the information cited by Claiborn, said Tuesday he hopes to collect for his clients sooner rather than later.
“The end is near,” he said. “There’s not a lot of room left for them to maneuver.”
A judge has not yet issued any rulings on Claiborn’s complaint, and Regensburger has not yet filed a response.
As the bankruptcy plays out, a lawyer representing the club in the dancers’ original lawsuit has asked the state Supreme Court to set aside an Appellate Court decision from October upholding the 2020 judgment of the trial court confirming the arbitrator’s 2019 award in the underlying case.
In the lawsuit, filed in 2015, the dancers — Sugeily Ortiz, Crystal Horrocks, Zuleyma Bella Lopez, Jacquelyne Green, Dina Danielle Caviello and Yaritza Reyes — claimed they were not being paid a minimum wage. They also argued they were not paid overtime after working 40 hours in any week and were fined for breaking the club rules.
The defendants argued the dancers were independent contractors, like hairdressers, and weren’t entitled to the benefits enjoyed by full-time employees.
In its appeal of the arbitration ruling, the club claimed the calculation of damages constituted a disregard of the law because the arbitrator “should have based his damages calculation on the defendants’ written records, not on the plaintiffs’ oral testimony,” according to the decision.
But the Appellate Court stated the arbitrator considered the evidence presented by the defendants but concluded that the defendants’ record keeping was “inadequate and incomplete” and, consequently, “relied on both the plaintiffs’ testimony and the partial records of the defendants” to determine the damages awarded.
In the petition to the Supreme Court, the club’s lawyer, Stephen R. Bellis, says the Appellate Court could have reviewed the “entertainment leases” signed by the dancers, “severed the illegal portions of the agreement and enforced those provisions which pertained if an Arbitrator found the dancers employees.”
Krayeske filed a response calling the petition “obnoxious, and filed in bad faith” designed to delay paying damages.
The court has not yet issued a ruling.
