10th Circuit upholds order for Colorado Springs landlord to comply with lead paint investigation

The federal appeals court based in Denver agreed that a Colorado Springs landlord must comply with an order to provide records to the U.S. Environmental Protection Agency, which is investigating whether he properly disclosed lead paint to tenants.

David H. Zook, who is the manager of the company that owns 806 E. Boulder St., has resisted the EPA's request for documents. He characterized the investigation as an egregious abuse of authority based on a disgruntled tenant's complaint, and argued, mistakenly, that chipped lead paint inside a home is not addressed under federal law.

But a three-judge panel of the U.S. Court of Appeals for the 10th Circuit found no merit to Zook's arguments last week, agreeing that a federal trial judge acted properly in deciding the EPA's subpoena against Zook was legitimate.

The agency received a complaint around December 2019 from a former tenant of the Boulder St. property, a multiunit building in Colorado Springs constructed in 1891. The tipster alleged the building was in "complete disrepair," that lead paint was "constantly chipping off from the building," and that Zook had only disclosed there "may be lead paint on the structure."

The EPA then asked Zook for documents to confirm whether he complied with the federal lead disclosure rule, enacted to address the adverse affects of lead on brain, organ and behavioral health. Under the rule, landlords must give specific forms of warnings to tenants.

Zook refused to provide the necessary compliance documents and questioned the EPA's authority to subpoena him "at random," as he characterized it. In response, the government filed a petition in Colorado's federal court in April 2021, asking a judge to order Zook to comply with the subpoena.

"The EPA, armed with administrative subpoena authority, is thus authorized to undertake an investigation and gather information under its subpoena power to shed light on the threshold question of whether or not certain actors are violating the Lead Disclosure Rule," wrote Assistant U.S. Attorney Lila M. Bateman.

Zook blasted the investigation as a "colossal, wasteful and misguided use of power." He believed the complaint stemmed from a former tenant who did not receive her full security deposit back. Zook elaborated that her efficiency unit did not fall under the lead disclosure rule's requirements and the EPA had no "reasonable suspicion" of a violation. He claimed that "chipped paint" is not addressed in federal law, even though chipped paint is explicitly covered under the terms defining a lead-based paint hazard.

U.S. District Court Judge Raymond P. Moore cast aside Zook's rhetoric. After noting the identity of the complainant was "irrelevant," he ticked through the list of requirements of a legitimate agency investigation, finding the EPA satisfied those criteria and its request for documents was reasonably relevant to the inquiry.

"The Supreme Court long ago concluded that, if Congress so authorizes, an administrative agency can use its subpoena power in order to determine the extent to which a regulation applies in a given case," Moore wrote.

Zook then asked Moore to reconsider his decision, alleging the judge misunderstood certain facts and "misconstrued the applicable law." He accused Moore of not addressing his claim that he was being blackmailed by the former tenant, with the EPA being "complicit."

Moore rejected the purported clarifications.

"Zook presents this Court with no authority, and the Court is aware of none, that would require it to conclude that when an agency acts on the basis of a tip from someone with allegedly improper motives, the agency’s actions that follow become improper," he wrote in February.

Finally, Zook appealed to the 10th Circuit, describing the underlying case as about a government agency, "for no articulated reason," asking for documents because a "bureaucrat is simply curious."

The appellate panel upheld Moore's refusal to change his order, noting that Zook's arguments simply "rehashed" what the judge had already rejected. As for Zook's claim that the EPA targeted him due to a vengeful tenant's attempt at blackmail, the panel explained the complainant's motivations were separate from the EPA's lawful power to investigate suspected violations.

"And contrary to Zook’s position, the burden to show an agency has abused the subpoena process is on the respondent to the subpoena, and 'unsupported allegations' are insufficient to meet that burden," wrote Judge Allison H. Eid in the Dec. 6 order.

Zook told Colorado Politics that he plans to seek a review by the entire 10th Circuit and also by the Supreme Court. He maintained he is complying with the lead disclosure rule for the Boulder St. property.

"This is the Environmental Protection Agency spending tens of thousands of dollars to persecute a simple landlord with an eight-unit apartment," he said. "They have no basis for it."

The case is United States v. Zook.