In December, Judge Charlotte N. Sweeney of the United States District Court ruled that the federal court has jurisdiction over the class-action case because Tschetter Sulzer’s actions regarding a Stipulation and Advisement form qualify as debt-collection practices under the Fair Debt Collections Practices Act. The move came after Tschetter Sulzer tried to get the case dismissed on the basis that its actions weren't related to debt collecting.
The suit in question was first filed in January 2022 by Shawnte Warden on behalf of tenants whose landlords were using the local law firm to gobble up past-due rents and file evictions. Warden alleges that Tschetter Sulzer is not honest and up front about its eviction practices, specifically with a stipulation form she encountered when she lived at Mint Urban Infinity that the lawsuit contends illegally misleads tenants.
In an appeal, Tschetter Sulzer argued that there was a new legal precedent not considered in Sweeney’s December ruling, and that her initial determination about the firm acting as a debt collector was incorrect, since it had only argued that class representative Warden didn’t technically owe a debt.
“This is a huge stretch,” says Jason Legg of Cadiz Law, one of the attorneys on the case along with state Representative Steven Woodrow. “It’s really under exceptional circumstances that courts will ever do what they asked the court to do.”
On March 15, Sweeney shot down Tschetter Sulzer's second Hail Mary, ruling that its appeal would "protract the delay."
Still, the firm maintains that the case doesn’t fall under the FDCPA because it is not acting as a debt collector when it comes to the stipulation agreement.
In order to bring forth another appeal, it had to argue that there was a change in controlling law, bringing up Shields v. Pro. Bureau of Collections of Maryland, which was decided eleven days after Sweeney’s original December 5 ruling. In that case, the 10th Circuit Court ruled that Elizabeth Shields had not proved she was sufficiently harmed by letters regarding her student loan debt that didn’t indicate that her amount of debt could increase with interest and fees incurred after the date of the letters.
Still, the firm maintains that the case doesn’t fall under the FDCPA because it is not acting as a debt collector when it comes to the stipulation agreement.
In order to bring forth another appeal, it had to argue that there was a change in controlling law, bringing up Shields v. Pro. Bureau of Collections of Maryland, which was decided eleven days after Sweeney’s original December 5 ruling. In that case, the 10th Circuit Court ruled that Elizabeth Shields had not proved she was sufficiently harmed by letters regarding her student loan debt that didn’t indicate that her amount of debt could increase with interest and fees incurred after the date of the letters.
“The instant case is distinguishable from Shields, and it is not an intervening change in controlling law,” Sweeney wrote in her March 15 ruling, noting that Warden had shown that she suffered a concrete injury, unlike Shields. Sweeney went on to describe Tschetter Sulzer’s second argument — that the court had ruled incorrectly because the firm had only argued that Warden didn’t technically owe a debt, not that it wasn’t acting as a debt collector — as “unavailing.”
“It's like if someone said, ‘I've confirmed this is a peanut butter and jelly sandwich.’ And they said, ‘Well, we didn't say that. We just said there's no peanut butter,’” Legg explains.
In order to rule that Tschetter Sulzer was acting as a debt collector, Sweeney would have had to determine that there was a debt to collect.
Additionally, it is Warden’s burden to prove that she was a "consumer" and that Tschetter Sulzer was a debt collector that violated the FDCPA, which Sweeney said Warden had sufficiently done.
“They're grasping at technical straws to try to jam this up,” Legg contends.
Tschetter Sulzer also tried to get the issue of whether its stipulation agreement ultimately represented a collection of debt sent for interlocutory appeal, which is a legal term for pausing the case in order to have a higher court rule on an appeal of a specific element of a case. To qualify for such an appeal, the party has to show that there would be serious consequences to allowing the case to go forward without the appeal.
“It's a big deal,” Legg says. “Usually appeals are at the end of the case and then you go to a higher court, and they're saying, ‘Don't even let us continue with this case. Let us send this question of whether or not our motion to dismiss should be granted or denied to the circuit court to look at and pause the case in the meantime.’” He notes that it is unlikely the firm would prevail if that happened, but it would likely take at least a year, delaying the proceedings further.
In the end, Sweeney ruled that an interlocutory appeal was not appropriate.
“As Plaintiff notes, the issue of whether the Stipulation was solely limited to the issue of possession is in dispute, and this Court agrees,” Sweeney said in her March 15 ruling. “Furthermore, certifying the issue would not materially advance the termination of the litigation but rather protract the delay in this case.”
Legg wants the delays to come to an end. Discovery for the case is still not complete, but will likely wrap up by the end of May or early June barring attempts at another delay by Tschetter Sulzer. After discovery, Legg and Woodrow are planning to file a motion for class certification.
“Ultimately, what that will mean is that we can get relief for Shawnte and hundreds, or likely thousands, of other Coloradans who were subjected to this by Tschetter,” Legg says.
Relief could come in the form of clearing their records of past evictions and, potentially, monetary damages permitted by the FDCPA. The FDCPA has a one-year statute of limitations, so only those who had a situation similar to Warden’s from January 2021 to the present are eligible, but as Tschetter Sulzer pushes more delays, the class could expand. However, Legg notes, the firm could argue that it changed its practices after the lawsuit was filed so new cases don't apply.
“I’m just looking forward to ultimately prevailing and putting an end to this stuff and getting some relief for the people,” Legg says.
If he had it his way, that relief would come without further legal delays.
