James Cretella Lawsuit: Otterbourg, Privacy Claims, and Response

The James Cretella lawsuit is actually two active cases: a New York state suit filed by his former law firm, Otterbourg P.C., and a federal suit in Connecticut brought personally by two of the firm’s leaders. Together they accuse Cretella of breaching his obligations when he left Otterbourg for Blank Rome LLP in February 2025, submitting false expense reports, and secretly accessing partners’ private computer files. Cretella denies the core allegations and has called the litigation retaliation for his departure. As of mid-2026, both cases remain pending.

Who James Cretella Is

Cretella spent more than 20 years at Otterbourg, where he chaired the banking and finance department and focused on asset-based lending work for institutional lenders.¹ On February 11, 2025, he joined Blank Rome as a partner in its Finance, Restructuring and Bankruptcy group in New York, where he still practices.² A second Otterbourg partner, Ikhwan A. Rafeek, moved with him.³

The two people driving much of the litigation are Otterbourg’s chairman, Richard L. Stehl, and its president, Richard G. Haddad. Stehl had worked alongside Cretella at the firm for more than two decades.⁴

The Otterbourg Lawsuit in New York State Court

Otterbourg sued Cretella on November 7, 2025, in the Supreme Court of the State of New York, New York County. The complaint pleads four causes of action: breach of contract (violation of the firm’s by-laws), breach of fiduciary duty, fraudulent concealment, and unjust enrichment. The firm seeks damages exceeding $10 million, plus restitution and disgorgement.⁵

The Bonus and Client Meetings

Otterbourg alleges Cretella was already planning to leave for a competitor during the final months of 2024 but hid that plan so he could collect a seven-figure discretionary bonus paid on December 31, 2024. The complaint also alleges that he and Rafeek used client meetings and dinners in cities including Chicago and Atlanta, nominally on Otterbourg’s behalf, to persuade clients to follow them to their new firm, and that in November 2024 Cretella shared confidential firm data on pricing, market share, and competitive strategy with a competing firm.⁵

Expense Reports and Firm Resources

A forensic review of Cretella’s firm-issued phone, the complaint says, showed thousands of dollars in expenses submitted under false pretenses, with personal travel and activities labeled “business development.” The filing includes specific allegations that during a November 2024 business trip to Houston, Cretella exchanged dozens of text messages with a person identified as an escort advertising as “Goddess Kat,” and that he used firm-paid services to arrange a Valentine’s Day couples massage. Otterbourg said in a footnote it included these allegations to demonstrate misuse of firm assets and to support its fraudulent concealment and ethics claims.⁵

Access to Partners’ Private Files

The state complaint also folds in what the firm calls a “sustained, multi-year pattern of unauthorized surveillance” of Stehl and Haddad. Otterbourg alleges forensic evidence shows Cretella accessed private, non-client files in restricted folders on the firm’s system, including home security codes and live camera feed credentials for the Stehl family residence, personal tax returns, Social Security-linked passwords, privileged communications about divorce and custody matters, medical records concerning a family member’s psychiatric condition, and private financial documents.³ The complaint also alleges Cretella viewed confidential board emails about partner compensation and management strategy, describes “hundreds of deliberate intrusions” often late at night, and says Cretella initially denied the activity before partially admitting to it when shown forensic proof.⁵

The Federal Privacy Suit by Stehl and Haddad

Months before Otterbourg filed its firm-level suit, Stehl and Haddad brought their own personal case against Cretella. They filed on March 10, 2025, in the United States District Court for the District of Connecticut, seeking $20 million in damages. The case was assigned to Judge Sarah F. Russell, and the two partners pleaded a single claim of intrusion upon seclusion under Connecticut common law based on the alleged access to their personal data.⁶⁷

On February 27, 2026, Judge Russell granted Cretella’s motion to dismiss, ruling that New York law governed the dispute and that New York does not recognize the tort of intrusion upon seclusion.⁸ The dismissal wasn’t the end. The court gave the plaintiffs leave to file a second amended complaint asserting intentional infliction of emotional distress, with a March 20, 2026 deadline.⁹

The plaintiffs filed a retooled second amended complaint that dropped the “Goddess Kat” allegations. Cretella’s attorney, H. Christopher Bartolomucci, said those allegations came out after he sent plaintiffs’ counsel a draft Rule 11 sanctions motion. Cretella then filed a formal Rule 11 motion targeting what he described as “salacious and legally unnecessary statements,” and Stehl opposed it, calling the motion “purely performative” and the objections “faux outrage.”³¹⁰

Cretella’s Response

Cretella has pushed back on both cases. In an affidavit filed in the federal action, he said the personal files at issue weren’t locked behind restricted access but sat on a firm-wide network visible to anyone with standard credentials. He said he came across documents through the network’s “preview” function while looking for work-related material such as financial statements and board minutes, not while hunting for private information. He also pointed to an internal audit conducted roughly a year before the federal suit that flagged personal files as accessible on the network, after which the firm changed folder permissions, and he asserted that Stehl separately confirmed with his home security company that the home network had not been accessed by unauthorized parties.³

Cretella has characterized the litigation as retaliation for his move. In his affidavit he said his decision to leave Otterbourg, “and not any grand privacy-related injury that plaintiffs now claim, brought on this lawsuit.” His motion to dismiss also argued the plaintiffs failed to plead specific facts about how he supposedly bypassed security controls or used forensic evasion techniques. Blank Rome did not respond to at least one media request for comment on the litigation.³

A Parallel Suit Against Rafeek

Otterbourg filed a separate lawsuit in June 2025 against Rafeek, the other partner who left for Blank Rome. That complaint alleges he coordinated client meetings with Cretella for the benefit of their future firm while still at Otterbourg, knew of Cretella’s planned departure and did not disclose it, and “repeatedly and systematically” accessed private computer files belonging to Stehl after those files were inadvertently made accessible following a system upgrade.³

Where the Cases Stand

As of mid-2026, both actions are still open. No ruling or settlement has been reported in Otterbourg’s New York state case.³ In the Connecticut federal case, Cretella’s motion to dismiss the second amended complaint and his Rule 11 sanctions motion are both awaiting rulings from Judge Russell, and discovery has been stayed.⁹ Cretella continues to practice at Blank Rome in New York.²

1
Blank Rome LLP. Blank Rome Adds Finance Pros James M. Cretella and Ikhwan A. Rafeek as Partners in New York
2
Blank Rome LLP. James M. Cretella
3
ABA Journal. Suit Alleges Blank Rome Partner Engaged in Cyberstalking Campaign by Accessing Private Computer Files at Ex-Firm
4
CaseMine. Stehl v. Cretella
5
Above the Law. Otterbourg P.C. v. James M. Cretella, Verified Complaint
6
Law360. Otterbourg Chiefs’ $20M Suit Against Atty Nixed for Now
7
Leagle. Stehl et al v. Cretella
8
Bloomberg Law. Otterbourg Ex-Partner Beats Privacy Suit From Former Colleagues
9
PACER Monitor. Stehl et al v. Cretella
10
Law360. Otterbourg Leader Slams Faux Outrage in Sanctions Bid