NEW ORLEANS (CN) – In a federal class action, New Orleans Saints players Charles Grant and Jeremy Shockey say their former teammate Kevin Houser took them to the cleaners in a scheme involving putative film tax credits.
The men say Houser was working as an agent in association with Securities America when he approached them about buying film tax credits that purportedly were available through Louisiana Film Studios LLC, a film producer. They say Houser claimed he was working with Wayne Read, a promoter who allegedly owned Louisiana Film Studios (LFS).
The men say that in December 2008 Houser told them that Read, through LFS, had qualified for Louisiana Infrastructure Tax Credits, which are credits marketable to third parties to raise capital for LFS, with tax benefits for the purchasers.
The plaintiffs say they understood they were purchasing tax credits, not investing in LFS or in any studio, motion picture, production or production company.
In January 2009, the men say, Grant paid $425,000 to Houser and Securities America, for which he was to receive $565,000 in state tax credits. Shockey says he paid $85,000 and was to receive $113,000 in tax credits.
Grant and Shockey say they believed their money was to be placed in escrow and held in trust until the tax credits were certified by the state and delivered to them by the end of March 2009.
But the men says that Houser and his wife were creditors of LFS and had an interest in the cash derived from the sale of tax credits, but didn’t tell Grant and Shockey.
At the times, the plaintiffs say, Houser and his wife owned 47 Construction LLC, which had a multimillion-dollar contract to improve the film studio operated by LFS, but Houser failed to tell Grant and Shockey of his relationship to 47 Construction or of the construction company’s relationship to LFS.
Rather than create an escrow account or other device to protect Grant and Shockey’s money while they awaited the tax credits, they say their money was instead “wasted, converted and dissipated by LFS” and others.
They say they never got the tax credits and Houser kept some of their money as a commission or finders fee
Houser was the longest-tenured Saints player until he was cut by the team before the start of the 2009 season, when news of the tax credit debacle began to surface, according to the Times Picayune.
In addition to Kevin Houser and Securities America Inc., the class sued American International Specialties Lines Insurance Co., Houser’s insurance carrier. It seeks damages for unfair trade practices and unjust enrichment. The class, estimated at more than 100 people, is represented by Fred Herman of New Orleans.