Mulcahy house

Lee Mulcahy is suing the Aspen-Pitkin County Housing Authority in federal court, his latest legal maneuver to try to prevent the forced sale of his Burlingame home.

Burlingame resident Lee Mulcahy is making a federal case out of his years-long battle to stop the forced sale of his home by the local housing authority.

Mulcahy’s attorney, Jordan Porter of Denver, filed a lawsuit against the Aspen-Pitkin County Housing Authority in U.S. District Court on Sunday. It alleges that he has been deprived of his civil rights, contending that APCHA didn’t follow its compliance protocols and sent a violation notice prematurely.

APCHA attorney Tom Smith said Monday that Mulcahy failed to raise that issue in state district court, which he added could be fatal to the federal lawsuit.

The authority has prevailed at every court level thus far, with a Pitkin County District Court judge ruling that Mulcahy failed to exhaust administrative appeals with APCHA, a finding that was upheld by the Colorado Court of Appeals last year. The Colorado Supreme Court in April announced it would not hear his case. He has since said he’ll try to get the U.S. Supreme Court to hear it.

APCHA began investigating Mulcahy in 2015 after receiving an anonymous tip that he was not meeting residency and employment rules required by owners of deed-restricted homes. The authority eventually sent him a notice of violation when he failed to show he was meeting the criteria, and then sued him to force the sale of the home.

But the federal lawsuit says Mulcahy did respond to Julie Kieffer, APCHA qualifications specialist, which Porter argues should have triggered a 60-day period to provide documentation and end the inquiry.

“In particular, after receiving APCHA’s first compliance notification letter on July 17, 2015, Mr. Mulcahy promptly began communicating with [Kieffer],” the lawsuit says. “Ms. Kieffer informed Mr. Mulcahy that APCHA’s primary concern was with the employment components of the deed restrictions that require Mr. Mulcahy to work a certain number of hours [1,500 annually] in the city of Aspen and to ‘not worry about the other restrictions.’”

The lawsuit cites his “non-traditional employment,” contending he was working over 40 hours a week as a property manager, leasing agent, artist, fundraiser and substitute teacher in the Aspen schools.

“Ms. Kieffer and APCHA seemingly categorized employment as only those activities that generated profit, which, notably, is in direct contradiction of Internal Revenue Service guidelines and regulations that indicate activities need not necessarily generate profit in order to be considered a business venture,” Porter wrote. “During this time period, it was also unclear to Mr. Mulcahy why APCHA would not accept the various other work he had done within the city of Aspen as evidence of his employment.”

The first letter, attached as an exhibit to the lawsuit, told him that he had 14 days to respond and 60 days to fully resolve the issue. Mulcahy believed that because he had responded, talking with Kieffer and exchanging emails, that left him 60 days to document compliance.

Instead, the lawsuit alleges, APCHA proceeded as though Mulcahy had never responded to the compliance notices at all. Per authority enforcement language, a second letter, dated on Aug. 5, 2015, was sent 14 days after the first one. Two weeks later, APCHA sent the official notice of violation.

“Importantly, the notice of violation was sent almost a full 30 days before the expiration of the 60-day time period Mr. Mulcahy should have been entitled to as delineated” in the first letter, the lawsuit says.

Mulcahy was out of the country at the time the violation notice was sent, which left him 15 days to request a hearing with the APCHA board or otherwise lose his right to contest the authority’s findings.

But even that Sept. 9, 2015, “administrative remedy final deadline was before the expiration of the full 60-day period Mr. Mulcahy was allowed,” Porter wrote.

APCHA attorney Smith called the lawsuit’s compliance-notice approach “a clever argument,” but said it should have been raised in state district court. Mulcahy is hoping for a “second bite at the apple,” he said, referring to legal principles that generally hold a person gets one chance to bring a case against another party.

“There’s nothing really new here, he did have the opportunity for a hearing,” Smith said of the federal filing.

He also said the lawsuit misreads the deed-restriction requirements and that it’s “very clear” from APCHA written records that Mulcahy never provided documentation showing him to be in compliance.

“You still have to respond to the request for information, and you still have to request a hearing in the time provided,” Smith said. “And he didn’t do that.

“APCHA will oppose this case and will take the position that we did in state court.”

As it stands now, Judge Chris Seldin of Pitkin County District Court has not lifted his stay of enforcement of his judgment, which would allow APCHA to send a listing contract for Mulcahy’s home. It is valued at over $750,000 and could be sold for a maximum of $995,000.

Chad is a Contributing Editor for Aspen Daily News. He can be reached at chad@aspendailynews.com or on Twitter @chad_the_scribe.