Attorney Michael Politis remains accused of mishandling injured former detective’s money

A case involving a former Port Orange Police detective seriously injured in an off-duty motorcycle crash took another turn Tuesday during a hearing over a lawsuit against well-known local attorney Michael Politis.

Politis unsuccessfully attempted to seal the case from public view last week. Circuit Judge Dennis Craig denied the request.

On Tuesday, Craig dismissed the lawsuit against another attorney being sued alongside Politis.

David Fouts, the former detective, suffered serious head and leg injuries April 2016 while riding his motorcycle along U.S. 1 near Skyline Drive in New Smyrna Beach. Fouts' wife, Jennifer Fouts, 39, was killed in the crash.

The case was recently in the news with the arrest of former Port Orange Police Capt. Kimberly Kilpatrick, 48, of Flagler Beach. Kilpatrick was charged with grand theft and exploitation of a disabled adult, said FDLE spokeswoman Gretl Plessinger. Kilpatrick was accused of stealing $25,000 from an account created to help Fouts.

Another string in the case is unwinding in civil court where Fouts' guardian, Cathleen White, has sued Politis and his firm, Politis and Matovina, and also sued Steven Guardiano and his firm.

Fouts' son and daughter were not authorized to execute contracts on his behalf, but while he was in a coma and unresponsive, his daughter on April 28, 2016, entered into a contingent fee employment contract with Politis and Matovina and his son did the same on May 4, 2016, according to the lawsuit filed by Bradstreet.

In March 2017, Politis and his firm settled Fouts’ personal injury claim for $250,000 and his underinsured motorist claim for $100,000, the lawsuit states.

Politis failed to create a special needs trust or guardianship for Fouts and instead sent $217,678.81 to Fouts’ daughter without appropriate safeguards, the lawsuit states.

Politis and Guardiano were accused in the lawsuit of legal malpractice and breach of fiduciary duty related to Dan Fouts. The two attorneys have separate practices and law firms.

Ex-police captain arrested: FDLE: Former Port Orange police captain accused of stealing funds earmarked for injured officer

Capt. Kimberly Kilpatrick: Port Orange police captain under investigation after allegation of fraud and forgery

Fatal crash: Wife of Port Orange police investigator killed in New Smyrna motorcycle crash

More: Port Orange detective remains in coma after motorcycle crash that killed wife

'You're losing that cause of action'

White's attorney, Eric Bradstreet, filed the lawsuit against Politis and Guardiano.

Politis attended the hearing Tuesday in Daytona Beach but did not speak during discussion of the motion to dismiss which was filed by Guardiano and only involved the portion of the lawsuit against Guardiano.

Judge Craig granted Guardiano’s motion to dismiss, but allowed Bradstreet to amend the lawsuit and refile.

Based on the hearing, the judge appeared to believe the lawsuit against Politis and Guardiano had some holes.

Bradstreet could not provide a satisfactory reply for the judge's requests for a cause of action on which to base the lawsuit.

Craig noted that Guardiano said he was hired to do a power of attorney for Dan Fouts. But Bradstreet said Fouts was not competent to hire an attorney.

“Mr. Fouts was dragged there by his daughter,” Bradstreet replied. “Mr. Fouts has no recollection of what happened. Mr. Fouts has had six surgeries on his brain, sir.”

Craig asked Bradstreet if a court later determined that Fouts was incompetent did that make the earlier action by Guardiano malpractice? Bradstreet said he thought so.

“There’s at least three medical opinions that say he has been incompetent since the motorcycle accident April 2016,” Bradstreet said.

“That’s false and you know it,” Guardiano cut in.

Craig asked Bradstreet if he was saying that Guardiano should have set up a guardianship for Fouts even though Guardiano was not hired to do that. Bradstreet said yes, he should have.

Craig said that Bradstreet was arguing that not only can an attorney do that, but an attorney has a duty to do it.

“That’s what your saying your cause of action is?” Craig said.

“That is the beginning of the cause of action,” Bradstreet said.

“You’re losing that cause of action,” Craig said.

Bradstreet said that at some point it came to Politis’ attention that Fouts' daughter, Alexa Fouts, was using a home that was purportedly purchased for Dan Fouts’ benefit. Dan Fouts was not living there.

White has filed a separate lawsuit against Kevin and Alexa Fouts, accusing them of exploitation, civil theft, fraud in inducement and conversion.

Guardiano became involved and “works out a deal” where the house is deeded not to Fouts, but to his son, Kevin Fouts, Bradstreet said. Kevin Fouts later sells the house, Bradstreet said.

Craig questioned how Bradstreet could hold Politis or Guardiano accountable for anything that Fouts' son or daughter may have done independent of the two attorneys.

Bradstreet said it was negligence and breach of fiduciary duty on the attorneys' part, saying the house should have been deeded to Dan Fouts, not to Kevin Fouts.

Craig asked Bradstreet repeatedly what Politis and Guardiano did that gave rise to a cause of action for the lawsuit.

Bradstreet argued they did not protect Fouts’ interest.

But Craig apparently was not convinced by Bradstreet's arguments.

"So you are telling me you sued Mr. Guardiano before you knew what was going on?" Craig asked.

"I knew a lot of what was going on sir. The problem is that Mr. Fouts has very little recollection," Bradstreet said.

Guardiano said later during the hearing that he did not have "positive proof" but that Bradstreet should ask White some questions.

"Ms. White, his own plaintiff, actually had Mr. Fouts make either herself or her mother the beneficiary of his pension plan and his social security, I don’t know exactly. I may be in the process of discovery but I’m sure he can talk to Cathleen White about that," Guardiano said.

Motion to seal

Last week, Hannah Clark, representing Politis, asked Craig to seal the case file and the progress docket in the lawsuit against her client. That would have blocked the public from knowing about the case.

Clark cited a rule which she said states that certain files, including documents alleging misconduct against individuals licensed or regulated by the courts, can be sealed until a finding of probable cause.

“Well, as I’m sure you’re aware, Mr. Politis is a very recognizable name within Volusia County and he represents numerous individuals in all stages of litigation before this court. Undoubtedly any allegations that are brought forth from this document are going to have a significant effect on his reputation within the community. And that's going to prevent his ability to diligently represent his clients, your honor.”

Craig said that if someone is in business long enough, they are likely to be sued.

Bradstreet said during that hearing that he did not believe the case should be sealed since it was a civil lawsuit that was not grounds for any action against his law license. And probable cause was not something that would be found in a civil lawsuit.

“If anything, the right to a free press is obligated here and the community has a great deal of interest in this case,” Bradstreet said.

Politis did not attend the Zoom hearing over sealing the case. Guardiano did and joined the motion for the case to be sealed.

Craig denied the motion to seal but said Politis and Guardiano could ask again for it to be sealed if something changes, such as the allegations in the lawsuit.

This article originally appeared on The Daytona Beach News-Journal: Michael Politis sued for attorney malpractice in personal injury case