Two lawsuits filed by Attorney General Mike DeWine against Willard & Kelsey alleged the firm committed fraud with a $5 million taxpayer-funded loan.
Ohio Attorney General Mike DeWine on Friday filed two lawsuits against Willard & Kelsey Solar Group and its shareholders, alleging the Perrysburg firm committed fraud with a $5 million taxpayer-funded loan and did not function as a legitimate business entity.
The suits, filed in the Hamilton County Commercial Court, seek to recoup more than $11 million in damages that stem from two state loans awarded to the firm. Willard & Kelsey, which idled its operations at the end of June, has faced myriad legal, financial, and professional problems since it was founded in 2007.
The state declared Willard & Kelsey in default of its state loans in fall 2012 after the firm failed to make loan repayments.
The suits allege two counts of fraudulent and unlawful transfers, two counts of civil conspiracy, and two counts of civil aiding and abetting. Those charges were among the 17 listed in documents obtained from the attorney general's office.
The legal action was taken by Mr. DeWine on behalf of the Ohio Development Services Agency and Ohio Air Quality Development Authority, both of which awarded Willard & Kelsey loans.
“Clearly, there is a lot to answer for here and it looks like we have a good case,” said Jeff Jacobson, vice chairman of the air authority, which loaned Willard & Kelsey an additional $5.1 million in 2010. “Whether we have any money there, I don’t know. It makes it easier to go after the shareholders individually.”
The lawsuit filed on behalf of the Ohio Development Services Agency states that Willard & Kelsey’s executives “wrongly exercised control over WKS in such a manner as to commit fraudulent, illegal, unlawful, or other unjust or inequitable acts” and that President Jim Appold “treated the corporate assets of WKS as his own.”
Richard Kerger, a Toledo-based attorney representing Mr. Appold, said he believes the state doesn’t understand what occurred with Willard & Kelsey’s finances and Mr. Appold, like many other company executives, invested heavily in the firm.
Chief Executive Officer Mike Cicak, who is named in both suits, said he was unaware of the lawsuits when called by The Blade on Friday. Chief Operating Officer Gary Faykosh, who also is named in the paperwork, said he hasn’t been in contact with anyone from Willard & Kelsey in a while and was unaware of the attorney general’s filing.
Chief Technical Officer Jim Heider was unavailable for comment.
Matt Cox of Columbus law firm McDonald Hopkins has been representing Willard & Kelsey in its dealings with the state and declined to comment.
Willard & Kelsey was touted by high-profile Democrats such as Vice President Joe Biden and former Gov. Ted Strickland, with the firm pledging to create more than 400 jobs in its state loan agreements.
The Blade reported in 2012 that Willard & Kelsey executives received frequent $30,000 to $40,000 payments from the firm, beginning in August, 2008. From May through August, 2009, executives also expensed more than $20,000 for spending that included tickets to the Detroit Tigers and Pittsburgh Steelers and airline tickets for family members.
Company documents obtained by The Blade included emails that stated company executives received payments from state loan funds.
Kris Turner can be reached at: firstname.lastname@example.org or 419-724-6103.