Douglass Files Two Suits Against Agent : Former Charger Alleges Fraud, Misrepresentation by Muller

Former Charger linebacker Mike Douglass has filed two lawsuits totaling $3 million against sports agent Lew Muller.

Douglass’ current attorney, Roy Bell of San Diego, is alleging in a civil lawsuit filed Tuesday in Superior Court here that Muller--who used to be Douglass’ agent--is guilty of misrepresentation and fraud. And Bell also says that two local banks--North County Bank and Bank of America--allegedly conspired to assist Muller in fraudulent activities.

Douglass also is suing Muller and Leon T. Theriault for failing to repay a 1983 loan worth about $30,000.

Moreover, Bell said that Muller has not been a licensed attorney since 1979 when he was suspended by the California Bar Assn. for not paying his dues. The association, based in San Francisco, confirmed Bell’s statement.

“He (Muller) has misrepresented his credentials,” Bell said Wednesday. “He’s told us he’s an attorney, so we’re seeking punitive damages. He’s got Mike in a terrible position. . . . The guy has totally misrepresented Mike. What he’s done is outrageous. He’s basically taken money under false pretenses from Mike.”

Muller, who is based in San Diego, did not return phone calls Wednesday.

According to Bell, Muller brought representatives from North County Bank and Bank of America to Douglass’ home about two years ago and asked Douglass if he would guarantee a real estate loan worth $90,000 ($45,000 from each bank). According to Bell, Muller told Douglass that it was a “non-recourse loan,” which meant if Muller couldn’t make his payments, Douglass would not be liable. Instead, according to Bell, Muller said the banks would seize Muller’s home.

Douglass signed.

But, this year, each bank has asked Douglass for $45,000. Douglass, according to Bell, asked: “What about Mullers’ home? Why are you coming to me?”

And according to Bell, the banks said that Douglass had signed a personal loan--not a real estate loan--and that the money had gone directly to Muller.

“They (the two banks) arranged for the transfers (of the loan money to Muller),” Bell said. “The proceeds of the loan went to Muller.”

Telephone messages left at the North County Bank offices were not returned Wednesday. However, Tom Chapman, assistant vice president of Bank of America, said: “The bank has not been served with that suit yet, so there’s nothing we can say at this point. When we receive it, we’ll need time to read it and investigate. So I don’t see us coming up with a statement for a couple of weeks.”

Regarding the second lawsuit--filed against Muller and Theriault--Muller had asked Douglass in 1983 if he would donate about $30,000 to Theriault’s fast-food restaurant in Salinas, Calif. According to Bell, Muller identified Theriault as his cousin and told Douglass that it would be a good tax shelter. Theriault was supposed to make payments every month to Douglass, but he made only two payments in four years, according to Bell.

Theriault also could not be reached for comment Wednesday.

According to Bell, Muller negotiated Douglass’ first National Football League contract--a four-year, $400,000 deal with the Green Bay Packers--but took a five-year percentage of the contract. In other words, Bell said, Muller’s percentage was calculated as if Douglass had signed a five-year deal. According to Bell, that meant about an additional $20,000 for Muller.

Douglass--who was waived by the Chargers last October and is now retired--fired Muller as his agent last year. Bell negotiated Douglass’ one-year contract with the Chargers last season.

Bell said that Douglass didn’t report his financial troubles to Bell until three weeks ago.

“Mike is very upset at a personal level because he’s a trusting individual, and this guy (Muller) was a friend from college,” Bell said. “He’s not so much angry. He’s just very hurt. It was the very trust he had in Muller which made him wait so long before complaining. He (Muller) has played off that trust. And it’s very tragic.”

Muller is also the former agent of Padre right fielder Tony Gwynn, who filed for bankruptcy last week.

Gwynn was in a similar situation with Muller, according to sources close to Gwynn. Muller had asked him to sign bank loans, and Gwynn felt a loyalty to Muller and obliged. Sources said two unnamed banks began calling Gwynn when Muller was behind on payments. Gwynn, who according to court documents owes $45,000 in back federal taxes, filed for bankruptcy.

Gwynn’s attorney, Bob Teaff, declined comment Wednesday.

Douglass and Gwynn are former San Diego State athletes. Gwynn said he was introduced to Muller by Douglass.

According to Bell, Muller recently sent out brochures to potential clients, offering his services. On the brochure, it says he’s a licensed attorney. Gwynn’s picture and Douglass’ picture appear on the brochure, plus a quote from each player, saying how much they like Muller.