Durango business owners hit by predatory lawsuits – The Durango Herald

Sixteen federal complaints filed by a single plaintiff in Rouse that has become old hat for lawyers

Bill Hermesman stands in the handicapped parking he recently installed in front of his business, North Point Furnishings at the North Point Mall, after he was served with a lawsuit he said looked like a jolt for $10,000. (Jerry McBride/Durango Herald)

Business and real estate owners across Durango were hit by a spate of lawsuits in mid-October that forced them to fight to protect themselves from what they term a $10,000 shakedown.

At least 16 establishments have been the subject of lawsuits because they did not have handicapped parking, which is a violation of the Americans with Disabilities Act. Steven Daniel Felix, address unknown, is the plaintiff listed in the lawsuits. His attorney is Texas-based attorney and former wrestling promoter Richard Bruce Tharpe. Self-identified compliance “testers” like Felix are freelance operators who do not represent the government.

These federal ADA Title III lawsuits are not an anomaly. The same thing happened in Durango in 2016 with a different plaintiff with a different attorney citing different ADA violations. A quick internet search reveals some simple facts. Lawsuits are a scourge across the country and they all follow the same pattern.

The pattern goes something like this: 1) Lawsuits are filed against business owners threatening thousands if not hundreds of thousands of dollars in federal fines for ADA violations. 2) The vast majority of entrepreneurs deal with violations immediately. 3) The plaintiffs’ attorney agrees to drop the case for a cash settlement.

The Americans with Disabilities Act, enacted by Congress in 1990, prohibits discrimination against persons with disabilities in several areas, including employment, transportation, public housing, communications, and access to programs and services of the state and local government.

Organizations and businesses can be fined up to $75,000 for a single ADA violation and $150,000 for additional violations. Such high fines can close a business, as in the case of Clark Kelman, owner of the North Main Laundry and the Town Plaza Laundry in Durango.

Kelman was discounted for not having handicapped parking in front of the Town Plaza laundry room. The lawsuit threatens a federal fine in the neighborhood of $100,000, he said. Kelman had no idea he was supposed to have handicapped parking out front, but he hired a contractor, purchased the necessary signage, and had one completed within days.

“I reached out to attorney Tharpe and told him I was sorry and that I had sorted it out and he said it was fine but refused to drop it,” Kelman said. “Now he wants me to settle out of court for $10,000.”

The Herald of Durango managed to contact seven of the 16 businesses served and they all reported the exact same thing. Everyone was caught off guard by the lawsuits. All were told they faced a fine of around $100,000. All had handicapped parking spaces installed immediately. And they were all told by Tharpe that he would drop the lawsuits if they paid him $10,000.

Six of them have hired lawyers. Kelman contacted a Denver-based company that quoted him nearly $10,000 just for representation. And the firm said it probably still would have to pay Tharpe $5,000. Kelman decided to try negotiating with Tharpe on his own.

“So yeah, I’ve been trying to negotiate the amount ever since,” she said. “And I offered to donate to the local VFW because the guy who filed the lawsuit, Steven Felix, claims in the lawsuit that he is a disabled war vet. And I’ve offered to donate to the Southwest Center for Independence here in Durango. But Tharpe said no.

Longmont attorney Courtenay Patterson, who practices labor and employment law, including ADA Title III cases, has seen this all before. He represents two of the Durango companies that have been served.

“I’ve filed probably 35 of these lawsuits and I’ve done it in multiple states, including Colorado,” he said. “I have represented clients in Pennsylvania, Washington and Arizona. And I’ve dealt with Tharpe before when he sued companies in the Denver area.”

The $100,000 fines mentioned by Kelman and others for the lawsuits are to scare them into agreeing, he said. The penalties if found guilty in federal court are real enough, but the lawyers like Tharpe who are behind these lawsuits are entitled to nothing but the attorneys’ fees and costs.

“That’s why they’re filing these lawsuits,” Patterson said. “Basically it’s just a scam to try to extort legal fees and costs from companies. And they throw in these numbers like $75,000 and $100,000 to scare people.

In cases where the defendants have brought their business or property into ADA compliance, what happens is that the attorney reports to the court that the work was done, which makes the case “mootable,” meaning the court he has no jurisdiction and the case goes away, Patterson said.

“In (Kelman’s) case, the lawyer is just trying to scare the guy. I’m not going to let my clients pay money to the other side,” he said. “With these unrepresented companies that’s what they’re going to try to do, just force them into some sort of deal.”

But he said the cases are difficult to navigate for those unfamiliar with the law and the federal justice system. Defendants can’t represent themselves if they’re a company in Colorado, that’s just the law, Patterson said. Or in federal court if they are an LLC or a corporation.

“So that’s the other issue,” Patterson said. “These companies find themselves in a corner where they don’t want to have to hire an attorney and so they’re just paying this guy because it’s going to be cheaper to pay $10,000 than it is to pay for an attorney.”

But for those who hire a lawyer it’s pretty straightforward.

“The attorney provides the necessary information and is fired,” Patterson said. “And if not, it’s, ‘Good. Don’t push back. I’ll take him to court and come get you for fees and expenses.’ So they don’t want to deal with a lawyer.

Durango businessman Jay Bruton received his lawsuit while collecting leaves on Saturday. He owns the property where Animas Glass is located. He was quite dizzy to be served, he said. He claims to do everything possible to make things handicapped accessible, he thinks it should be. He took care of the handicapped parking right away.

“But I guarantee you they won’t get $10,000 from me,” he said. “I’d rather pay my lawyer who works on my behalf and deprive this other lawyer of what he thinks is his just reward for him.”

Bruton also had questions about Felix, the plaintiff listed in all of the lawsuits.

“It would be very interesting to hear from him because as far as I know and from other people who have been sued, they have cameras and they don’t think this guy ever got out of his car,” Bruton said. “They walk by and take pictures. They never got into the business. They have never bought anything. It’s just such a bogus business. It’s so frustrating.

Durango businessman Bill Hermesman, who had a couple of properties that have been filed lawsuits, also questions Felix, saying the lawsuits allege how much pain and suffering the businesses have caused him by not having handicapped parking.

“I was like Jesus, give me a break,” Hermesman said. “We fixed the parking lots and now he just wants the $10,000. For what? For what?”

All people the Herald he has spoken to those who have received lawsuits supporting ADA requirements, but all say the law should require companies to be given a strike with time to comply before facing lawsuits. As it stands, the loophole for predatory lawsuits is large enough to drive through a semi-truck convoy full of lawyers “chasing ambulances,” Hermesman said.

“It’s being presented to Congress all the time,” Patterson said. “Apparently, our country has bigger problems to deal with. The fix was actually proposed by Rep. Ted Poe from Texas in 2017 or maybe ’18 and I was going to testify before Congress, but the whole thing was tabled.

Calls to attorney Richard Bruce Tharpe have not been returned. And the Herald he was unable to locate Felix or confirm his military record until Thursday afternoon.

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