A federal judge on Wednesday appeared to accept that despite going out of his way to accommodate their participation, a trio of Gunnison landlords will continue to disobey his orders and ignore the housing non-discrimination agreement they voluntarily entered into with the government four years ago.

At the same time, U.S. District Court Judge Gordon P. Gallagher ruled out, for now, the possibility of jailing David Welch, John Welch and Ruth Welch for contempt.

“I don’t know what else we can do at this point,” Gallagher admitted at a hearing in his Denver courtroom. “We were hoping to get some cooperation. But, unfortunately, we did not.”

The Welches, despite being summoned to appear, did not attend the hearing. Nor did they show up at the federal courthouse in Grand Junction, where Gallagher normally is stationed.

The unusual case revolves around the Welches’ 12-unit complex at 1412 W. Gunnison Ave. and a consent decree they signed with the U.S. Department of Housing and Urban Development in early 2020. The department received allegations the Welches denied or discouraged families with children from renting at their property in violation of the Fair Housing Act.

Through the consent decree, the Welches agreed to take certain steps like advertising their property with the phrase “families with children welcome to apply” and providing records of rental inquiries and applications to the department over a three-year period.

Federal judge gives Gunnison landlords final chance to show up, avoid arrest

Instead, they have effectively told Gallagher they believe the process is a witch hunt.

“This whole situation was started with untruthes (sic) and absolute lies,” Ruth Welch wrote to Gallagher one week before the scheduled hearing. “At the time, I responded to the fact that I do not know how to deal with people that lie. I still don’t.”

She added that her “priorities have changed” and the department is “at the bottom of the list!”

Federal judge to Gunnison landlords: Comply with anti-discrimination measures or 'punishments are going to start'

Originally, after the Welches failed to appear at a hearing in 2022, U.S. Magistrate Judge N. Reid Neureiter recommended holding them in contempt. U.S. District Court Judge Daniel D. Domenico, who was presiding over the case at the time, held off on imposing punishment after the government indicated it may be making progress with the Welches.

Last summer, Gallagher took the extraordinary step of traveling to Gunnison to hold a hearing at the Welches’ local courthouse. He told them that compliance with the consent decree “needs to start now.”

“I’ve never seen a court put somebody in jail for this,” Gallagher added. “But at some point, the court’s going to say, ‘Enough is enough,’ and the punishments are going to start happening.”

Instead, the government continued to report the Welches were ignoring the terms of the consent decree by continuing to advertise their property without the family-inclusive language and withholding the required rental records.

Prior to the hearing, Gallagher’s courtroom deputy returned a call Ruth Welch had made to the court. According to a docket entry, Welch said one of her sons could not attend because he was undergoing medical treatment, her other son was “out of the USA” and she was 88 years old and “could not drive herself” to the courthouse.

After being told Gallagher could reschedule the hearing to accommodate the family, “Ms. Welch refused to provide a date stating that she would not come to Court, ever, as she has more important priorities and does not agree with this process,” the docket entry read.

“The conversation last week was fairly disheartening,” Gallagher conceded at the hearing. “It was, ‘We’ll do this whenever you can do it,’ which is not how courts usually offer court dates.”

Federal judge gives Gunnison landlords final chance to show up, avoid arrest

Assistant U.S. Attorney Zeyen J. Wu indicated he would likely submit a motion for financial sanctions. He also suggested installing an independent property manager to oversee the Welches’ property in compliance with the consent decree.

“We view that as the more effective and direct way as opposed to the fine,” Wu said. “I honestly don’t know. We’ve not really been in this situation that I can recall.”

Feds tell judge Gunnison landlords continue to thumb nose at non-discrimination order

“It would appear to me that financial sanctions are reasonably appropriate sanctions in this circumstance given the age, the health of the people involved and the behavior,” Gallagher agreed. He added he was unlikely to agree to more severe penalties in the near term.

“What I don’t think is appropriate, at least at this point and probably never given the nature of the conduct, is incarcerative circumstances,” Gallagher said. “I don’t want to take all the cards off the table, but that doesn’t appear appropriate at this juncture.”