Loveland council to consider settling lawsuit

LOVELAND – The Loveland City Council next week will review and may approve a nearly $500,000 settlement of a 2007 lawsuit involving the owners of a local construction company.

The suit deals with issues surrounding the construction of a commercial building at 697 N. Denver Ave., part of the Anasazi Business Park in east Loveland owned by brothers Edward and Stephen Klen.

The Klens’ suit alleges that the city delayed building permits for construction of the building beginning in 2004. The original complaint involved various claims against the city and named several city employees as defendants, including City Attorney John Duval.

If council approves the settlement agreement, the Klens will receive a settlement payment of $495,000 in return for their release of all their claims against the city and its employees and the dismissal of the lawsuit.

The settlement will be paid by the city’s insurance carrier, the Colroado Intergovernmental Risk Sharing Agency, with no money coming from city accounts.

The city’s policy includes a deductible of $150,000 that was met years ago with the initial legal fees and expenses.

In 2010, a Federal District Court judge dismissed all of the Klens’ claims against all of the city defendants. The Klens appealed the dismissal to the U.S. Tenth Circuit Court of Appeals. That court upheld most of the federal judge’s rulings, but some were returned to the trial court.

More recently, Chief District Court Judge Marcia Krieger ordered the parties to participate in a settlement conference to be mediated by a magistrate judge.

The proposed settlement is a result of that conference.

“After years of legal action and expense, we believe that this settlement offers the best resolution to the problem,´ said City Manager Bill Cahill. “If approved, it will end the dispute and put an end to any continuing effort, expense and risk of additional costs.”

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