Waite v. Credit Service

• Court: Colorado Court of Appeals
• Decided: February 26, 2026
• Docket: 24CA2188
• Status: Unpublished

Opinion

24CA2188 Waite v Credit Service 02-26-2026

COLORADO COURT OF APPEALS

Court of Appeals No. 24CA2188 City and County of Denver District Court No. 20CV34153 Honorable Darryl F. Shockley, Judge

Zachary Waite and Catherine Woods-Sullivan,

Plaintiffs-Appellants,

v.

Credit Service Company, Inc.,

Defendant-Appellee.

JUDGMENT REVERSED AND CASE REMANDED WITH DIRECTIONS

Division VII Opinion by JUSTICE MARTINEZ* Tow and Moultrie, JJ., concur

NOT PUBLISHED PURSUANT TO C.A.R. 35(e) Announced February 26, 2026

Towards Justice, Alexander Hood, David H. Seligman, Brianne Power, Denver, Colorado; Vedra Law, L.L.C., Daniel J. Vedra, Denver, Colorado, for Plaintiffs-Appellants

Barron & Newburger, P.C., Kevin T. Crocker, Littleton, Colorado; Barron & Newburger, P.C., Michael S. Truesdale, Portland, Oregon, for Defendant-Appellee

*Sitting by assignment of the Chief Justice under provisions of Colo. Const. art. VI, § 5(3), and § 24-51-1105, C.R.S. 2025. ¶1 This appeal involves issues pertaining to an assignment of

medical debt between University of Colorado Health (UCHealth) and

defendant, Credit Service Company, Inc. (CSC). The named

plaintiffs, Zachary Waite and Catherine Woods-Sullivan, appeal the

district court’s C.R.C.P. 12(b)(5) order dismissing their “debt buyer”

claims and the grant of CSC’s motion for summary judgment, which

eliminated the remainder of their alternative “non-debt buyer”

claims. All claims allege wrongdoing on behalf of CSC. We reverse.

I. Colorado Fair Debt Collection Practices Act

¶2 The Colorado Fair Debt Collection Practices Act (CFDCPA), like

its federal counterpart, aims to protect consumers from harassing

and abusive debt collection practices. See §§ 5-16-101 to -135,

C.R.S. 2025; 15 U.S.C. §§ 1692a-1692p. The CFDCPA has “the

remedial purpose of protecting consumers against debt collection

practices that take advantage of gullible, unwary, trustful, or cowed

persons who receive a debt collection communication.” Flood v.

Mercantile Adjustment Bureau, LLC, 176 P.3d 769, 773 (Colo. 2008).

Both the federal and state statutes require debt collectors or

collection agencies to provide “debt validation” notice and refrain

from deceptive acts. See id. at 774.

1 ¶3 The CFDCPA imposes certain communication and disclosure

requirements on entities seeking to collect consumer debt; these

include, among other things, written notices sent to the consumer

detailing who the collection entity is and the amount of debt owed

to the original creditor. § 5-16-109, C.R.S. 2025. The CFDCPA

defines a “debt collector” as “any person employed or engaged by a

collection agency to perform the collection of debts owed . . . or due

to another.” § 5-16-103(9), C.R.S. 2025. The parties in this case

agree that CSC is a debt collector. A debt buyer is a “person who

engages in the business of purchasing delinquent or defaulted debt

for collection purposes.” § 5-16-103(8.5). All debt buyers are

considered debt collectors.

¶4 For debt buyers who pursue legal action, the statute requires

that the collection agency attach, among other things, a “copy of the

assignment or other writing establishing that the debt buyer is the

owner of the debt” to the complaint or form. § 5-16-111(2)(b),

C.R.S. 2025. Debt collectors who are not debt buyers, and who

elect to take legal action on consumer debt, must “[e]nsure[] that

the name of the original creditor . . . and the name of the debt

2 collector . . . are included in the case caption of the complaint” and

“[have] a complete and effective assignment.” § 5-16-111(1.5)(a)-(b).

II. Background

¶5 CSC operates as a collection agency that specializes in the

collection of medical debts. CSC contracts with UCHealth, the

largest healthcare conglomerate in Colorado, to collect unpaid

medical debts; the two entities operate under an “Amended

Assignment” that was initiated in 2014. The Amended Assignment

provides that accounts assigned to CSC for collection “include those

accounts placed for collection by any medium with CSC and

indicated by CSC as those upon which it intends to initiate

litigation, action to collect, or referral to an attorney.” The Amended

Assignment also provides that UCHealth “assign[s] all of its right,

title and interest in the subject collection accounts . . . to [CSC].”

¶6 Waite and Woods-Sullivan were contacted by CSC for unpaid

medical debts associated with services provided by UCHealth

providers. Determining that the outstanding medical debts were

ripe for litigation, CSC pursued litigation on the debts in its own

name. Plaintiffs brought this class action lawsuit and allege two

main arguments: (1) either CSC is a medical “debt buyer” and

3 committed violations of the CFDCPA, or (2) CSC is not a debt buyer

but the assignment is incomplete and invalid as a matter of law.

¶7 Plaintiffs did not attach the Amended Assignment with their

class action complaint. In CSC’s motion to dismiss the complaint,

it stated, “CSC assumes the facts alleged in Plaintiffs’ Complaint are

true only for the limited purpose of this Motion, except to the extent

that facts recited herein are based upon the undisputed facts

contained in the [Amended Assignment] . . . attached hereto as

Exhibit A.”

¶8 The district court dismissed plaintiffs’ claims regarding the

“debt buyer” arguments pursuant to C.R.C.P. 12(b)(5) and

concluded that plaintiffs failed to allege sufficient facts to support a

finding that the assignment of debts constituted a purchase under

the CFDCPA. The district court later denied plaintiffs’ cross-motion

for summary judgment regarding their unjust enrichment claims

and ultimately dismissed plaintiffs’ remaining claims by granting, in

part, CSC’s motion for summary judgment. Plaintiffs now appeal

the order dismissing claims and the summary judgment.

4 ¶9 We first address whether the dismissal pursuant to C.R.C.P.

12(b)(5) was proper. We then turn to a discussion of the district

court’s grant of summary judgment in favor of CSC.

III. Debt Buyer Claims

¶ 10 Plaintiffs contend the district court erred by dismissing the

debt buyer claims pursuant to C.R.C.P. 12(b)(5). The three “debt

buyer” claims dismissed by the district court are summarized as

follows:

• Count I — CSC was unjustly enriched; by ignoring its

legal obligations as a “debt buyer” under the CFDCPA,

CSC received benefits, including contingency payments,

at the expense of plaintiffs and those similarly situated

under circumstances that would make it unjust for CSC

to retain the benefits.

• Count III — CSC failed to comply with requirements of

the CFDCPA and thereby engaged in false and deceptive

collection practices.

• Count VII — Plaintiffs requested an injunction enjoining

CSC from pursuing cases for unpaid medical debt

5 purchased from UCHealth without complying with the

statutory requirements for debt buyers.

¶ 11 The district court dismissed these three claims and found that

plaintiffs had failed to allege sufficient facts for the court to find

that (1) the assignment constituted a “purchase” of accounts

receivable or (2) CSC constituted a “debt buyer” under the CFDCPA.

A. Standard of Review

¶ 12 We review a ruling on a C.R.C.P. 12(b)(5) motion de novo,

applying the same standards as the district court. Norton v. Rocky

Mountain Planned Parenthood, Inc., 2018 CO 3, ¶ 7. Accepting all

the allegations in the complaint as true and viewing them in the

light most favorable to the plaintiff, the district court properly

grants a C.R.C.P. 12(b)(5) motion only where the plaintiff has not

alleged sufficient facts that show plausible grounds for relief.

Jagged Peak Energy Inc. v. Okla. Police Pension & Ret. Sys., 2022

CO 54, ¶ 25. On review, we must accept all factual allegations

asserted in the complaint as true, but we are not required to

“accept bare legal conclusions as true.” Norton, ¶ 7. “When

considering a motion to dismiss for failure to state a claim, we may

consider the facts alleged in the pleadings, documents attached as

6 exhibits or incorporated by reference, and matters proper for

judicial notice.” Id.

B. Analysis

¶ 13 Plaintiffs first argue that the district court’s finding that the

creditor’s assignment of a debt could not be a “purchase” of debt

under any circumstances was in error. Because section

5-16-111(2)(b) of the CFDCPA provides that an assignment can be

evidence of the ownership of a debt, plaintiffs maintain that some

assignments are purchases. Plaintiffs also argue that they

plausibly pleaded that the assignment between UCHealth and CSC

conveyed all right, title, and interest in alleged debts, which

demonstrated that CSC had complete ownership over the debts and

constituted a purchase.

¶ 14 In its ruling, the district court found that the assignment, on

its face, was simply an assignment of accounts receivable for

collection purposes and not a purchase of debt. The district court

based its decision on a review of the Amended Assignment and

looked beyond the allegations in plaintiffs’ complaint.

¶ 15 Even if we were to look to the language of the Amended

Assignment to make this determination, we would not agree with

7 the district court that, on its face, the agreement evinced solely an

assignment of accounts receivable and not a purchase of debt. The

clause that UCHealth assigns “all of its right, title and interest” in

the collection accounts to CSC is difficult to distinguish from a

purchase. While the district court also seems to have relied on the

clause that the assignment is made “for and in consideration of

CSC’s retention of counsel and initiation of litigation,” this clause

does not appear to be written as a restriction on the rights

transferred, but instead as a statement of the bargained-for

exchange of the agreement. Further, if this clause were read as a

restriction on the rights transferred, it could also be read as

contradicting the earlier language of the transfer of all “right, title

and interest,” a conflict that the district court does not address.

Thus, we would conclude that the Amended Assignment is

ambiguous and does not support the district court’s conclusion.

¶ 16 Moreover, plaintiffs’ complaint alleges facts including that

“[w]hen contacted by patients disputing debts, UCHealth instructs

them that they must negotiate or otherwise interact with CSC, and

not UCHealth, to pay, dispute, or obtain information about the

debt.” Additionally, the complaint alleges that CSC (1) advises

8 UCHealth with respect to which claims to file; (2) manages the

collection of actions from beginning to end for UCHealth; (3) collects

judgments through further legal proceedings on behalf of UCHealth;

and (4) charges a fee for all of the legal services and advice it

provides to UCHealth. Accepting these factual allegations as true

and not accepting mere legal conclusions, we conclude they are

sufficient to survive a Rule 12(b)(5) motion to dismiss. See Rios de

Martinez v. Landaverde, 2024 COA 115, ¶ 27.

¶ 17 For these reasons, we conclude that the district court

improperly granted CSC’s motion to dismiss plaintiffs’ “debt buyer”

claims.

IV. Non-Debt Buyer Claims

¶ 18 We turn next to the “non-debt buyer” claims on which the

district court granted summary judgment. Plaintiffs contend that if

CSC isn’t a debt buyer, it can’t sue to collect debts in its own name

because CSC cannot establish an indisputable receipt of a

complete, valid, and irrevocable assignment of medical debts from

UCHealth. Additionally, plaintiffs argue that the assignment was

ineffective as a matter of law because (1) the debts were future

debts, and (2) the debts were matters of personal trust and

9 confidence. The district court ultimately granted summary

judgment in favor of CSC, which eliminated the remainder of

plaintiffs’ claims.

¶ 19 The five alternative “non-debt buyer” claims are summarized

as follows:

• Count II — By deceptively naming itself as a real party in

interest and committing the unauthorized practice of law,

CSC received benefits at the expense of plaintiffs that

would make it unjust for CSC to retain the benefits.

• Count IV — CSC engaged in the unauthorized practice of

law by collecting debts on behalf of UCHealth without

legally owning the debts and without abiding by

provisions of the CFDCPA.

• Count V — If CSC is not a debt buyer, then UCHealth did

not transfer ownership of medical debts to CSC before

CSC initiated legal proceedings to collect the medical

debts. By naming itself in the lawsuit, CSC is falsely

representing or implying that accounts have been turned

over to CSC as an innocent purchaser for value.

10 • Count VI — CSC never legally obtained a valid

assignment for debts, and therefore CSC deceptively

pursued collection action in its own name with no right

to collect.

• Count VIII — CSC should be enjoined from engaging in

the unauthorized practice of law in pursuing cases for

unpaid medical debt on behalf of UCHealth.

¶ 20 We review a ruling on a motion for summary judgment de

novo. Timm v. Reitz, 39 P.3d 1252, 1255 (Colo. App. 2001). A

reviewing court applies the same standard as the district court in

determining whether summary judgment is warranted. Smith v.

Boyett, 908 P.2d 508, 514 (Colo. 1995). A district court should

grant summary judgment only if the pleadings and supporting

documents show that there is no genuine dispute as to any material

fact and that the moving party is entitled to a judgment as a matter

of law. C.R.C.P. 56(c); Ringquist v. Wall Custom Homes, LLC, 176

P.3d 846, 849 (Colo. App. 2007).

11 B. Analysis

¶ 21 In dismissing plaintiffs’ remaining “non-debt buyer” claims,

the district court found that the assignment was not barred by

Colorado law. Thus, the court found that CSC was not unjustly

enriched under Count II, nor did it engage in the unauthorized

practice of law under Count IV, or falsely represent that accounts

were turned over as an innocent purchaser for value under

Count V. Regarding Count VI, the district court determined that

CSC was a real party in interest and had a legal right to collect the

medical debts assigned to it. Lastly, because the district court

concluded that CSC was not engaging in the unauthorized practice

of law, the court also dismissed the declaratory judgment claim

under Count VIII.

¶ 22 Plaintiffs argue in part that the district court erred because

genuine issues of material fact remain regarding whether CSC

received a complete, valid, and irrevocable assignment.

¶ 23 In its ruling, the district court did not address the

completeness of the assignment between UCHealth and CSC.

Instead, the district court focused its analysis on whether the

assignment involved matters of personal trust and confidence, and

12 whether it improperly assigned future debts. The district court

relied on its prior determination, ruling on the motion to dismiss,

that the assignment was not a purchase of debts but simply an

assignment of accounts receivable.

¶ 24 While we would ordinarily review orders granting motions for

summary judgment de novo and look to whether undisputed

evidence demonstrates a complete, valid, and irrevocable

assignment, we decline to do so in this case. Because the district

court did not apply the proper summary judgment standard to

determine whether the agreement between UCHealth and CSC

constituted a complete assignment and did not rule on plaintiffs’

argument that the Amended Assignment was not effectively

assigned in full, we decline to address an issue that the district

court has not addressed. City & County of Denver v. Bd. of Cnty.

Comm’rs, 2024 CO 5, ¶ 73 (“[T]he general rule is that we don’t

address an issue that has not been considered by the lower

courts.”). Thus, we reverse the summary judgment because the

district court did not fully address an argument necessary to enter

judgment.

13 V. Disposition

¶ 25 The district court’s judgment is reversed, and the case is

remanded for further proceedings consistent with this opinion.

JUDGE TOW and JUDGE MOULTRIE concur.