2026 Spring Status Update: Racketeering complaint and still waiting…

It’s about a year after Mamás decided to withdraw its motion for preliminary injunction that sought to prevent school and we’ve learned a lot more about why Denver Public Schools is constantly out of money, is failing kids—especially the most vulnerable—and not meeting teachers’ most basic needs. Our litigation strategy continues to attack DPS’ central incompetencies and to hold accountable the third parties who are aiding and abetting DPS’ misuse of funds for their own profit.

After Mamás withdrew its motion for preliminary injunction, it filed a second amended complaint in its lawsuit that was motivated by school closures that DPS announced and effectuated in November 2024. The second amended complaint names School District No. 1, the Denver Board of Education, the Denver School Facilities Leasing Corporation (which even DPS calls a “shell corporation”), a number of charter schools (including DSST, Rocky Mountain Prep, and more) and the “building corporations” that are acting as the real estate shell corporations for those charter schools, and Forvis Mazars LLP (DPS’ accounting firm - if the name Mazars sounds familiar, that’s because it was the accounting firm that ultimately was forced to admit that its accounting records prepared for The Trump Organization were not “reliable”). The complaint seeks to achieve equity in all its forms, and targets decades of the district’s financial misconduct as a root cause of inequity for Denver’s public school students.

In addition to explaining the ways that DPS uses race- and class-based segregation in its schools, the Second Amended Complaint more clearly lays out the real estate “leasing schemes” that the district facilitates using its own shell corporation, the Denver School Facilities Leasing Corporation, and that it allows charter schools to engage in using their own “building corporations.” Ultimately, the Second Amended Complaint explains that today, that the ownership of at least 31 school buildings that were once owned by School District No. 1 has been transferred to the Denver School Facilities Leasing Corporation so that the Leasing Corporation could do what School District No. 1 is prohibited by the Colorado Constitution from doing: use the buildings as collateral in mortgages that have saddled Denver taxpayers with billions of dollars of off-the-books debt that can never, realistically be repaid.

The Second Amended Complaint also explains that various charter schools authorized by DPS to operate in Denver are engaged in the same scheme: they create building corporations to acquire real estate that the charter schools then lease from themselves using taxpayer monies that were supposed to be used for educating public school students. Because these buildings are owned by shadow building corporations that do not have any direct relationship with the school district, if the charter school stops operating, the buildings can be sold and the profits retained by private interests.

All the defendants in our lawsuit filed motions to dismiss the Second Amended Complaint. They all claim that Mamás lacks legal standing to sue over the use of taxpayer monies because, in the defendants’ view, what DPS and the charter schools do with taxpayer money is none of taxpayers’, parents’, or voters’ business. They also claim that both the Denver School Facilities Leasing Corporation and the charter schools’ building corporations are legal subsidiaries of DPS and the charter schools, respectively (even though the Colorado Constitution prohibits government shareholding in private corporations—this defense itself is illegal) and so every defendant (other than the accounting firm) is entitled to governmental immunity. In other words, DPS, the charter schools, and their shell corporations all assert that they are unsuable, no matter how unlawful their conduct may be. In any case, these defendants argue, it is routine practice in Colorado for government entities to create non-voter approved financial obligations through leasing agreements that are specifically designed to evade the constitutional prohibition on non-voter approved debt. The sum total of the defendants arguments, in our view, is that what government does with taxpayer money, and how government treats schoolchildren, is not a public matter.

While Mamás had optimistically hoped that bringing this leasing scheme to light would induce DPS to take immediate steps to fix its untenable debt situation, it did the opposite. Various people speaking on behalf of DPS, including the superintendent, the chief financial officer, and at least one board member, chose to make multiple false statements to the public about DPS’ financial condition and about the leasing scheme described in the Second Amended Complaint to create the impression that Mamás was not being truthful in that complaint, or to suggest that DPS is a good steward of taxpayer money even though it is billions of dollars in debt that it cannot pay, and our school buildings are mortgaged to the hilt. One former school board member went so far as to outright deny that the buildings are mortgaged, even though the mortgages are a matter of public record (that’s how we found out about them!!).

Mamás ultimately decided that DPS’ efforts to mislead the public regarding its financial condition and its debt-related behavior, and to create false narratives to explain its inability to adequately fund schools or create a fair, equitable, neighborhood school system were so serious that additional legal action was necessary. That’s why, in February 2026, the grassroots parent organization filed a second lawsuit alleging a single claim under the Colorado Organized Crime Control Act (“COCCA”), which is designed to punish and remedy racketeering activity. The COCCA complaint alleges that DPS and Wells Fargo Bank, which is the current mortgage holder for DPS’ leveraged school buildings and which has reaped extraordinary sums from DPS’ leasing scheme, have engaged in two types of unlawful racketeering activity: wire fraud and money laundering. The complaint describes two independent “schemes to defraud,” the first being the leasing scheme and the second related to DPS’ bond debt. It then describes multiple fraudulent misrepresentations that DPS has made in furtherance of these schemes. The core of Mamás’ request for relief in the COCCA complaint is an injunction that would invalidate the deals that have led to this mess, including ordering return of Denver’s school buildings to DPS’ ownership, and appoint an independent third-party (like a receiver) to recoup whatever losses can be recovered in order to repair the financial damage that these schemes have done.

As we sit here today, we continue to await a ruling by the Denver District Court on the motions to dismiss the defendants filed in Mamás’ first lawsuit.

Please stay with us as we give additional updates on the progress of both lawsuits, and as we continue to add information to our website to help you understand exactly how DPS is misusing taxpayer funds, and why it’s such a big deal.