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A Florida man is standing down on his litigation that accused dozens of Colorado condominium and homeowners associations of fraudulently collecting federal pandemic money, according to recent court filings.
Plaintiff Wade Riner on April 8 withdrew his civil complaint, without prejudice, which means he reserved the right to refile the lawsuit.
Riner’s voluntary dismissal of the lawsuit also means that the seven local associations that it targeted — those representing Aspen Alps, Aspen Square Condominiums, Dancing Bear and North of Nell, along with Snowmass Village properties Crestwood, Stonebridge and Timberline — are no longer subject to civil accusations that they fraudulently applied for and received federal loans that were later forgiven.
Court filings made by the association said they acted properly and were eligible for PPP relief when they applied for the loans.
The associations received the loans through the Paycheck Protection Program, which was created under the Trump administration in 2020 to help employers compensate their workers during the pandemic. The lawsuit alleged that the condo and homeowners associations, because of their status as 501(c)(4) not-for-profit organizations, were ineligible for PPP relief. Generally speaking, most nonprofits with a 501(c)(3) status were eligible for the funds.
Riner’s lawyer, Randy Owens of Houston, declined to comment when reached by phone Monday. Riner also did not respond to previous interview requests made by the Aspen Daily News through Owens. Attempts for comment from counsel the defendant condo and homeowners associations, which included seven between Aspen and Snowmass Village, were unsuccessful.
Riner filed the suit under the False Claims Act in the U.S. District Court of Denver on Aug. 15, 2022. The suit was under seal until the U.S. government in October, after investigating the claims, said it would not participate in the lawsuit as a third party.
No reason was cited in Riner’s notice of voluntary dismissal, but the filing came on the heels of a motion to dismiss the lawsuit that the defendants jointly filed in March. Riner did not have standing to sue under the Federal Claims Act, which allows what are called “relators,” or private citizens, to sue on behalf of the U.S. government if they can furnish inside information they independently gathered, the motion argued.
Riner’s assertions about the PPP funds the associations received were based on information that he obtained through ordinary means and weren’t “based on any inside or special knowledge of the Defendants’ decision to apply for PPP loans, whether first or secondhand. It is based solely on the fact that. Defendants signed certifications for PPP loans — facts available in the public domain,” the motion said.
Whistleblowers who prevail in the litigation through a settlement agreement or otherwise can from 15% to 30% of the amount that the government recoups.
The U.S. government consented to the dismissal, saying it was “appropriate” and “in keeping with the public interest,” according to a court filing dated April 8.
The Department of Justice also could have participated as a third party to the litigation, but it opted not to following its own investigation. Even so, the DOJ, which monitored Riner’s suit, was required to consent to the dismissal under the False Claims Act.
“The United States has investigated this matter and consulted with the appropriate government officials,” the filing said. “Having considered the totality of the circumstances, including information provided by the Small Business Administration, the United States did not find adequate basis to intervene.”
The seven Aspen-Snowmass condo and homeowners associations were served with summons and lawsuits in December and January. They received a a combined $4.6 million in PPP loans that were forgiven in their entirety, including interest:
There were 23 defendants until Riner dismissed the suit, which originally named 25 defendants.