TIPTON, Ind. (August 25, 2025) – A hearing took place on August 21 in front of Tipton Judge Thomas Lett to consider a motion for summary judgment and to strike evidence filed by the State of Indiana against Clinton County Sheriff Richard Kelly, his wife Ashley Kelly, and their LLC, Leonne, regarding alleged misappropriation of jail commissary funds. The State, represented by the Attorney General’s office, is seeking to recover over $329,000, including audit costs, stemming from an investigation into the use of commissary profits. The defendants vigorously oppose the motion, arguing their actions were lawful, based on professional advice, and that the State’s case lacks the necessary element of intent.
The Attorney General’s office, represented by attorneys Marielle Riedle and Shana Tesnar, announced the State would only seek summary judgement on Count One (Malfeasance, Misfeasance, and/or Nonfeasance) and forgo the request to Counts Two thru Five to keep their arguments “clean and concise.” Count Two was the request for Treble Damage and could have seen the State recover three times the original amount, in excess of $800,000. Count Three dealt with Unjust Enrichment while Counts Four and Five were claims against the individual Bond holders which the county had taken out for Sheriff Kelly and Ashley Kelly.
The State continued by stating the facts in this case are “undisputed.” They highlighted a trial court’s declaratory judgment and a Court of Appeals decision which found that payments from commissary profits were made without necessary county approval.
Attorney Riedle emphasized that for the primary charge (malfeasance, misfeasance, or nonfeasance) criminal intent is not a required element. They highlighted a prior ruling stating that recovery of misappropriated funds is “irrespective of whether the person who wrongfully received public money knew that he or she was not lawfully entitled to receive it.” The State also moved to strike the defense’s affidavits and exhibits, citing issues with proper designation, timeliness, and authentication.
Theodore Minch, attorney representing Richard and Ashley Kelly, addressed the court saying “multiple attempts to obtain documents which are relevant to Count One” were made available on the eve of the criminal trial in April by “third party” discovery from Clinton County Prosecutor Anthony Sommer and Attorney Thomas Little. He added Boone County Judge Lori Schein issued a “denial of protective order a day or two ago” in the criminal case involving the Kellys. According to Minch, those documents are now available for the State to review in the Tipton County case. He said in regards to striking the evidence it is “responsive evidence in of itself” that the motion is “abuse of Trial [Rule] 56” and the Kellys authenticate the very documents in their “affidavits.”
Minch continued saying mens rea or criminal intent is moot because “there’s been no malfeasance, there’s been improper conduct.”
On December 18, 2018, Attorney Little sent a text message to Richard Kelly with regards to a conflict form, which is at the “crux of the criminal case and the malfeasance as alleged by the attorney generals office”, and asked for the Kellys address. Unknown to the Kellys, at a “public meeting” held on December 27, 2018, the commissioners “met” and placed the conflict form “on the agenda” and the item was “heard for two-and-half minutes” and the conflict form “was accepted.”
Regarding the commissary contracts, Minch said those contracts have been “tendered and approved” under the “same terms” used by sheriff’s prior in Clinton County adding Ashley Kelly was last paid on September 15, 2021, under the “contracts the State alleges had not been accepted or approved by the commissioners.”
The State’s case is “predicated” on a SBOA report that “frankly is factually incorrect, never been corrected,” continued Minch. Adding, “we now have emails showing red-lining.” The Court of Appeal decisions that the State cited are part of an “ongoing litigation” that [Brian] Dehem (attorney for the Kellys in lawsuits against Sommer and Little) is now “being challenged” as a result of this new discovery having been “brought forth.”
Judge Lett took the matter under advisement and will review all written documents and arguments. He gave each side 14-days to issue proposed orders and will issue an order as soon as possible.
