Daudt says he received no special treatment on debt lawsuits

Kurt Daudt presides as the 2016 session begins.
Minnesota House Speaker Kurt Daudt presides as the 2016 legislative session got underway on Tuesday in St. Paul. Public records show Daudt has been sued by debt collectors three times in the past year.
Jim Mone | AP

Minnesota House Speaker Kurt Daudt insists he got no special treatment from debt collectors who sued him over late credit card payments.

Daudt settled the most recent lawsuit with a credit card company Monday, just as the Legislature was gearing up to start its new session. He hasn't said how much he agreed to pay of the $9,300 U.S. Bank was after. Last year, another company sued Daudt and had judgments entered against him. Those judgments went away soon after and the case was abandoned.

Now some are questioning whether Daudt got a better deal than other debtors. And they want to know if the law firm in those cases played favorites because it also has a lobbying wing.

Daudt rejects that notion.

"All it is is speculation," Daudt said. "There is a firm apparently that has a debt collection arm and a lobbying arm. I'm quite certain the debt collection arm had no clue who I was."

That firm, Messerli and Kramer P.A., is defending its actions, too. Bill Hicks, who chairs the firm's debt division, says federal law prevents him from talking about specific cases. But Hicks says there's a clear line between his branch of the firm and the one that does lobbying.

"We don't have communications," Hicks said. "We simply might be under the same firm, but we don't have any communications with the folks in St. Paul."

Daudt owes the House more answers, says Minority Leader Paul Thissen. The top Democrat in the House says Daudt needs to release more information about the prior cases, the recent settlement and the arrangement Daudt had with another lobbyist who defended him in court.

"The more quickly that the speaker gets all that information out, the better it will be for the body and the better it will be for the whole process," Thissen said.

Daudt had also fallen behind on Isanti County property taxes. But he paid those Monday night after being informed that he had overdue taxes.

The speaker says he's caught up on his debt and is better for it.

"It gives me a real appreciation for the struggle Minnesotans have gone through," Daudt said. "I think that should be valued by Minnesotans, that their leaders are not sitting in an Ivory Tower casting judgment on them. That their leaders go through the same things they go through."

A look at hundreds of similar debt cases found that the way Daudt's cases were handled by the court was rare. The earlier two judgments were vacated and then dismissed with prejudice, meaning the credit card company represented by Messerli and Kramer couldn't come after him again.

Hicks challenged MPR News' findings but wouldn't produce the firm's own figures. MPR News looked at more than 650 cases filed in state courts over six months and found less than a handful where judgments were vacated like Daudt's. Hicks said that's surprising to him.

Mark Heaney, a lawyer who has dealt with debt cases on behalf of consumers, including some that Messerli and Kramer pursued, says the way Daudt's cases were treated isn't common.

"My concern after having represented so many low income individuals through the volunteer lawyer network in Hennepin County is to see the quick way that this case was apparently resolved," Heaney said. "I think it's up to Speaker Daudt to shed light on why that took place and to share with everyone what kind of settlement agreement that he received."

Heaney has contributed to Democratic candidates in the past. He was one of several attorneys who handles debt cases who raised concerns with MPR News about the outcome of Daudt's case.

Daudt says he will consider releasing the records related to his court cases and legal bills, but he didn't commit to anything.

MPR News reporter Mark Zdechlik contributed to this report.

Editor's note (March 10, 2016): This story has been changed to provide more background on attorney Mark Heaney.