Prkic v. Sezzle Inc.

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IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Civil Action No. 24-cv-02624-PAB-NRN
MARIA J. PRKIC,
Plaintiff,
v.
SEZZLE, INC.,
Defendant.
REPORT AND RECOMMENDATION ON
DEFENDANT’S PARTIAL MOTION TO DISMISS PLAINTIFF’S FIRST AMENDED
COMPLAINT (ECF No. 125)
N. REID NEUREITER
United States Magistrate Judge
This matter is before the Court pursuant to an Order issued by Judge Philip A.
Brimmer, ECF No. 126, referring Defendant Sezzle, Inc.’s (“Defendant” or “Sezzle”)
Partial Motion to Dismiss Plaintiff’s First Amended Complaint (“Motion”), ECF No. 125.
Plaintiff Maria J. Prkic (“Plaintiff” or “Ms. Prkic”) filed a response, ECF No. 138, and
Defendant filed a reply, ECF No. 141. On January 5, 2026, the Court held a hearing on
the motion. ECF No. 145. The Court has taken judicial notice of the case file and
considered the applicable federal and state statutes and case law. For the reasons
discussed below, it is hereby RECOMMENDED that Sezzle’s Partial Motion to Dismiss
Plaintiff’s First Amended Complaint, ECF No. 125, be GRANTED in part and DENIED
in part.
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I. 	BACKGROUND1
Sezzle, a financial technology company, hired Plaintiff as a paralegal on
February 24, 2023, and she began work on March 8, 2023. ECF No. 114 at 14. Plaintiff
has extensive experience working in banks and law firms. Id. at 2. Based on this
experience, Jack Cohen (Plaintiff’s supervisor) asked her if she would be willing to
serve as an Anti-Money Laundering (“AML”) Officer for the legal team, which would be
accompanied by a pay raise and title change. On April 20, 2023, the Sezzle Board of
Directors approved Plaintiff’s appointment as an AML Officer, and she assumed her
new job duties.
An AML Officer is responsible for “ensuring that an organization complies with
anti-money laundering regulations and preventing financial crimes.” Id. at 36. Duties
include “[t]raining employees on AML policies and procedures, and how to identify and
report suspicious activity,” “[i]dentifying, assessing, monitoring, and managing risks
associated with money laundering, terrorist financing, and child and human trafficking,”
“[c]onducting internal audits and ensuring compliance with financial regulations and
personal data requirements,” “[r]eporting suspicious transactions or financial crimes to
law enforcement agencies,” “[w]orking with law enforcement officials and financial
institutions when there are signs of organizational financial crime,” “[d]eveloping,
updating, and implementing policies and procedures that address key issues, risk
1 Unless otherwise noted, all factual allegations are taken from the First Amended
Complaint (“FAC”), ECF No. 114, and are presumed to be true for the purposes of the
Motion. Any citations to docketed materials are to the page number in the CM/ECF
header, which sometimes differs from a document’s internal pagination. Additionally, the
Court considers documents attached to the FAC. See Gee v. Pacheco, 627 F.3d 1178,
1186 (10th Cir. 2010).
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appetites, and acceptable behaviors,” “[a]ssisting with the implementation of an
organization’s AML program,” and “[a]rranging inspections from third-party
organizations and fixing any oversights in the program.” Id.
After assuming the AML Officer position, Plaintiff noticed that “Sezzle was
utilizing an algorithm that failed to report when a consumer borrower had paid their
balance to Sezzle and, due to that failure, the algorithm automatically reported
consumer borrowers to the collection agencies even if they were current with their
Sezzle repayment obligations.” Id. at 3. Plaintiff alleges that she “flagged” this issue but
does not allege what “flagged” means or who she spoke to about the issue.
As of April 8, 2024, Plaintiff had not received a pay increase or change in title. In
a Slack message, she told Lee Brading (Sezzle’s Chartered Financial Analysis and
Senior VP of Corporate Development, Investor Relations, and Operational Excellence)
“that the inconsistency with her title was a potential violation of bank sponsorship
regulations and that the bank sponsors Sezzle was dealing with required proof that she
was the official AML Officer.” Id. at 4.
Shortly thereafter, on April 26, 2024, Kerissa Hollis (Sezzle Interim General
Counsel) told Plaintiff that her AML Officer duties had been reassigned to another
employee. Id. Plaintiff alleges that, despite this change, “Defendant expected Plaintiff to
continue performing AML Officer duties under a title inconsistent with those duties (e.g.,
Paralegal) and in violation of bank sponsorship regulations.” Id. Plaintiff believes that
“Sezzle continued to hold Plaintiff out as the AML Officer and numerous members of
Plaintiff’s team and external partners continued to believe they could reach out to her to
assist with duties associated with an AML Officer.” Id.
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On May 28, 2024, Sezzle terminated Plaintiff’s employment. Plaintiff believes that
she was terminated for complaining that she had not received the pay increase and title
change in exchange for assuming AML Officer job duties, and for reporting to Sezzle
the wrongful practices that she had observed.
In her original complaint, ECF No, 1, Plaintiff alleged five causes of action
against Sezzle, including (1) retaliation in violation of the Sarbanes-Oxley Act (“SOX”);
(2) retaliation in violation of the Dodd-Frank Act (“Dodd-Frank”); (3) retaliation in
violation of the Colorado Equal Pay for Equal Work Act (“EPEWA”); (4) wrongful
termination in violation of public policy; and (5) breach of contract. Sezzle filed a Partial
Motion to Dismiss, ECF No. 38, seeking to dismiss counts 1–4 of the original complaint.
In an order dated September 17, 2025, ECF No. 102, Judge Brimmer granted Sezzle’s
Partial Motion to Dismiss in part, dismissing Plaintiff’s SOX and Dodd-Frank retaliation
claims with prejudice, dismissing her EPEWA retaliation claim without prejudice, and
denying dismissal of her public policy wrongful termination claim. Regarding the
EPEWA retaliation claim, Judge Brimmer granted Plaintiff leave to amend her complaint
to address the insufficient factual allegations related to the retaliation claim. Id. at 23.
Sezzle’s arguments for dismissal of Plaintiff’s public policy wrongful termination claim
were premised on the pre-emptive effect of the statutory remedies available to her
under SOX and Dodd-Frank. However, Judge Brimmer found that that the original
complaint included allegations outside the scope of the two acts and denied dismissal.
Id. at 19–20.
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Plaintiff now brings four2 claims against Sezzle.
In Count I, Plaintiff alleges that Sezzle violated the EPEWA because she was
paid “far less” than former Sezzle Deputy General Counsel Tim Joyce and Jonathan
[Last Name Unknown]. Under Count I, Plaintiff also alleges that Sezzle violated the
EPEWA by retaliating against her for exercising her rights under the statute.
In Count II, Plaintiff alleges that Sezzle wrongfully terminated her in violation of
public policy.
In Count III, Plaintiff brings a breach of contract claim based on Sezzle’s failure to
change Plaintiff’s title and increase her pay after she became AML Officer.
Sezzle now moves to dismiss Counts I and II for failure to state a claim under
Fed. R. Civ. P. 12(b)(6). The breach of contract claim is not challenged at this stage.
II. 	LEGAL STANDARDS
a. 	Federal Rule of Civil Procedure 12(b)(6)
Rule 12(b)(6) provides that a defendant may move to dismiss a claim for “failure
to state a claim upon which relief can be granted.” Fed. R. Civ. P. 12(b)(6). “The court’s
function on a Rule 12(b)(6) motion is not to weigh potential evidence that the parties
might present at trial, but to assess whether the plaintiff’s complaint alone is legally
sufficient to state a claim for which relief may be granted.” Dubbs v. Head Start, Inc.,
336 F.3d 1194, 1201 (10th Cir. 2003) (citations and quotation marks omitted). “A court
reviewing the sufficiency of a complaint presumes all of plaintiff’s factual allegations are
true and construes them in the light most favorable to the plaintiff.” Hall v. Bellmon, 935
2 Although the FAC contains only three counts, Plaintiff combines two separate EPEWA
claims in Count I.
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F.2d 1106, 1109 (10th Cir. 1991). “To survive a motion to dismiss, a complaint must
contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is
plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Bell Atlantic
Corp. v. Twombly, 550 U.S. 544, 570 (2007)). Plausibility, in the context of a motion to
dismiss, means that the plaintiff pleaded facts which allow “the court to draw the
reasonable inference that the defendant is liable for the misconduct alleged.” Id. The
Iqbal evaluation requires two prongs of analysis. First, the court identifies “the
allegations in the complaint that are not entitled to the assumption of truth,” that is,
those allegations which are legal conclusions, bare assertions, or merely conclusory. Id.
at 679–81. Second, the court considers the factual allegations “to determine if they
plausibly suggest an entitlement to relief.” Id. at 681. If the allegations state a plausible
claim for relief, such claim survives the motion to dismiss. Id. at 679.
b. Pro Se Plaintiff
The Court must construe the FAC and other papers filed by Plaintiff liberally
because she is not represented by an attorney. See Haines v. Kerner, 404 U.S. 519,
520–21 (1972); Hall, 935 F.2d at 1110. However, the Court should not be an advocate
for a pro se litigant. See Hall, 935 F.2d at 1110; Craig v. McCollum, 590 F. App’x 723,
726 (10th Cir. 2014) (“Our liberal construction of pro se petitions does not exempt them
from the rules of procedure binding the petitions of other litigants.”) (citation omitted).
III. 	ANALYSIS
a. 	EPEWA Discrimination Claim
The EPEWA provides in relevant part:
An employer shall not discriminate between employees on the basis of sex
. . . by paying an employee of one sex a wage rate less than the rate paid
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to an employee of a different sex for substantially similar work, regardless
of job title, based on a composite of skill; effort, which may include
consideration of shift work; and responsibility . . . .
Colo. Rev. Stat. § 8-5-102(1) (emphasis added). Under the law, an employer shall not
“[d]ischarge, or in any manner discriminate or retaliate against, an employee for
invoking this section on behalf of anyone.” Id. § 8-5-102(2)(d). The EPEWA became
effective on January 1, 2021, and few courts have had occasion to apply it. However,
the EPEWA is very similar to the federal Equal Pay Act (“EPA”), 29 U.S.C. § 206(d),
which provides in relevant part:
No employer . . . shall discriminate . . . between employees on the basis of
sex by paying wages to employees . . . at a rate less than the rate at which
he pays wages to employees of the opposite sex . . . for equal work on jobs
the performance of which requires equal skill, effort, and responsibility, and
which are performed under similar working conditions . . . .
29 U.S.C. § 206(d) (emphasis added). The Court notes that while the EPA protects
employees who perform “equal work” compared to employees of the opposite sex, the
EPEWA protects employees who perform “substantially similar work.” Nevertheless,
where the provisions and purposes of a state statute parallel those of a federal statute,
courts consider federal case law to be “highly persuasive.” McDonald v. People, 494
P.3d 1123, 1128 (Colo. 2021). Accordingly, the Court examines the pleading standards
courts apply in EPA cases in order to determine whether Plaintiff has adequately pled
an EPEWA claim in this case.
To plead an EPA claim, a plaintiff must allege facts that could plausibly show “‘(1)
she was performing work which was substantially equal to that of the male employees
considering the skills, duties, supervision, effort and responsibilities of the jobs (2) the
conditions where the work was performed were basically the same (3) the male
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employees were paid more under such circumstances.’” Paffe v. Wise Foods, Inc., No.
1:24-cv-00402-RMR-SBP, 2025 WL 685213, at *2 (D. Colo. Feb. 25, 2025) (quoting
Riser v. QEP Energy, 776 F.3d 1191, 1196 (10th Cir. 2015)); see also Merrill v. Cintas
Corp., 941 F. Supp. 1040, 1043 (D. Kan. 1996). “Work is substantially equal if it requires
equal responsibility, effort, and skill to that of the allegedly equal position.” Id. (citing 29
U.S.C. § 206(d)(1)). Applying this holding to the EPEWA context in this case, the Court
finds that one of the requirements for Plaintiff to plead an EPEWA claim is that Plaintiff
must allege facts that could plausibly show that she was performing work which was
substantially similar to that of a male employee. A determination of whether the work
was substantially similar is “based on a composite of skill; effort . . . and responsibility.”
Colo. Rev. Stat. § 8-5-102(1).
Sezzle argues that Plaintiff’s EPEWA discrimination claim should be dismissed
because she has failed to plausibly plead the existence of a viable comparator. The
Court agrees. In her FAC, Plaintiff alleges that there were two proper male
comparators—Sezzle’s two former Deputy General Counsels, “Tim Joyce and Jonathan
[Last Name Unknown].” ECF No. 114 at 5. Meanwhile, Plaintiff was originally hired as a
paralegal and was later assigned the responsibilities of an AML Officer.
In support of her argument that Jonathan is a viable male comparator, Plaintiff
attached an exhibit to the FAC an email dated April 18, 2023, from Jack Cohen to
Charlie Youakim (CEO), which purportedly “confirms that Plaintiff . . . replaced Jonathan
[Last Name Unknown] in AML and legal oversight roles at Sezzle, Inc.” Id. at 63.3
3 The Court takes judicial notice of the email because it was attached to the FAC. In
evaluating a Rule 12(b)(6) motion to dismiss, the Court may consider documents
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However, the email does not support what Plaintiff alleges. Rather, it states that
Jonathan would be replaced by two employees—Plaintiff and an employee by the name
of “Crystal.” Id. at 64. Per the email, “Crystal” was to assume the role of “Chief Privacy
Officer,” and Plaintiff was to assume the role of “Trade and Sanctions Officer”—
collectively constituting a replacement for Jonathan. Id.
Plaintiff claims that she and the alleged comparators performed several
overlapping tasks including “[d]rafting [a] 60-page Anti-Financial Crimes Policy,”
“[c]onducting internal audits and attempting to correct algorithm errors,” “[m]anaging all
subpoenas and cease-and-desist notices,” “[s]tate registration filings,” and “[t]raining
staff on AML compliance.” Id. However, mere allegations of overlapping tasks is
insufficient to plead a viable comparator. As Sezzle argues, “it strains credulity to assert
a Deputy General Counsel is an appropriate comparator for a paralegal.” ECF No. 125
at 6. A paralegal does not have legal decision-making authority for the company or the
same educational requirements. The former requires a law degree whereas the latter
does not. If it were enough to merely allege overlapping tasks/duties, as Sezzle points
out, then judges and their law clerks could be considered appropriate comparators
under the EPEWA simply because both perform legal research and draft opinions. “It is
the overall job, not its individual segments, that must form the basis of comparison.”
Gunther v. Washington Cnty., 623 F.2d 1303, 1309 (9th Cir. 1979), aff’d, 452 U.S. 161
(1981).
incorporated by reference, documents referred to in the complaint that are central to the
claims, and matters of which a court may take judicial notice. Gee, 627 F.3d at 1186.
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Accordingly, the Court cannot find that Plaintiff has adequately pled an EPEWA
discrimination claim and recommends that this claim be dismissed.
b. EPEWA Retaliation Claim
The Court will now turn to Plaintiff’s EPEWA retaliation claim. In the “Factual
Allegations” portion of the FAC, Plaintiff claims that she “complained that her title and
pay had not been changed since taking on AML Officer duties after being appointed to
do so.” ECF No. 114 at 3. Subsequently, on May 28, 2025, she was terminated. Id. at 4.
Based on these alleged facts, Plaintiff brings an EPEWA retaliation claim pursuant to
Colo. Rev. Stat. § 8-5-102(2).
Sezzle argues that Plaintiff’s retaliation claim should be dismissed because she
has failed to allege that she engaged in protected activity under EPEWA. ECF No. 125
at 7–8. Sezzle argues that the FAC is devoid of claims that Plaintiff complained to
Sezzle that she was being paid less on the basis of gender discrimination, only that she
had not received the title change or pay increase in line with her newly assigned role. Id.
Sezzle argues that without any allegation that Plaintiff complained to the company about
gender-based pay discrimination specifically, she has failed to plead a claim of
retaliation under the EPEWA, a statute designed to address gender-based pay
disparities. However, Sezzle cites no case law or statutory authority to support its
position and the Court is aware of none.
Colo. Rev. Stat. § 8-5-102(2)(d) states that an employer shall not “[d]ischarge,
discipline, discriminate against, coerce, intimidate, threaten, or interfere with an
employee or other person because the employee or person inquired about, disclosed,
compared, or otherwise discussed the employee’s wage rate.” Under a plain reading of
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the text, the Court finds that, Plaintiff’s allegation that she was discharged on May 28,
2024 after she had inquired about her rate of pay is sufficient to state a claim of
retaliation under § 8-5-102(2)(d). Nowhere in the text is there an explicit requirement
that the aggrieved employee/person have complained of gender discrimination in order
to have a cause of action.
Sezzle urges the Court to adopt the same standard for evaluating EPEWA
retaliation claims as under the EPA. It cites Melgoza v. Rush University Medical Center,
499 F. Supp. 3d 552 (N.D. Ill. Nov. 09, 2020), for the proposition that general complaints
about pay based on factors other than sex are not protected activity for the purposes of
the EPA. ECF No. 141 at 2. However, the EPEWA’s prohibition on wage discrimination
under § 8-5-102 goes beyond that of the EPA under 29 U.S.C. § 206(d). While § 8-5-
102(1) mirrors its federal counterpart in 29 U.S.C. § 206(d)(1), § 8-5-102(2) additionally
concerns itself with preventing employers from using a prospective employee’s wage
rate history to determine their wage rate and the free flow of information and dialogue
regarding wages in the workplace. § 8-5-102(2) provides:
(2) An employer shall not:
(a) Seek the wage rate history of a prospective employee or rely on the
wage rate history of a prospective employee to determine a wage rate;
(b) Discriminate or retaliate against a prospective employee for failing to
disclose the prospective employee’s wage rate history;
(c) Discharge, or 	in any manner 	discriminate or 	retaliate against, 	an
employee for invoking this section on behalf of anyone or assisting in the
enforcement of this subsection (2);
(d) Discharge, discipline, discriminate against, coerce, intimidate, threaten,
or interfere with an employee or other person because the employee or
person inquired about, disclosed, compared, or otherwise discussed the
employee’s wage rate;
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(e) Prohibit, as a condition of employment, an employee from disclosing the
employee’s wage rate; or
(f) Require an employee to sign a waiver or other document that:
(I) Prohibits the employee from disclosing wage rate information; or
(II) Purports to deny the employee the right to disclose the employee’s wage
rate information.
Colo. Rev. Stat. § 8-5-102(2). Under subsection 2(d), if an employee were discharged
for openly discussing their wage—conduct that has no relation to complaints of gender-
based pay discrimination—that would constitute retaliation under the EPEWA.
Retaliation of this sort would undoubtedly impede transparency around wage rates and,
in turn, prevent employees from uncovering whether they were being underpaid relative
to their opposite-sex peers. Similarly, if an employee were discharged for inquiring
about or discussing her pay with a supervisor/manager, that too would have a chilling
effect on an employee’s ability to demand equal pay.
Thus, interpreting the statute broadly and construing the well-pled allegations in
favor of Plaintiff, the Court finds that Plaintiff’s EPEWA retaliation claim is sufficient to
survive a motion to dismiss.
c. 	Wrongful Termination in Violation of Public Policy Claim
“In general, employment contracts are at-will and either the employer or the
employee may terminate the relationship at any time without incurring legal liability.”
Rocky Mountain Hosp. & Med. Serv. v. Mariani, 916 P.2d 519, 523 (Colo. 1996).
However, the Colorado Supreme Court has “recognized an exception to this general
rule in situations where the employer terminated the employment contract in violation of
public policy.” Castillo v. Denver Health & Hosp. Auth., 2022 WL 22926722, at *4 (Colo.
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App. Jan. 6, 2022) (citation omitted). The Colorado common law claim for wrongful
termination in violation of public policy “restricts an employer’s right to terminate when
the termination contravenes accepted and substantial public policies as embodied by
legislative declarations, professional codes of ethics, or other sources.” Wisehart v.
Meganck, 66 P.3d 124, 127 (Colo. App. 2002) (citing Rocky Mountain Hosp. & Med.
Serv., 916 P.2d 519).
The public policy exception generally allows “at will employees to pursue
claims for wrongful discharge if they allege that they were discharged
because they either (1) refused to engage in conduct that would violate
public policy, or (2) engaged in conduct that is protected or encouraged as
a matter of public policy.”
Id. (quoting Coors Brewing Co. v. Floyd, 978 P.2d 663, 666–67 (Colo. 1999)).
Plaintiff brings a claim for wrongful termination in violation of public policy against
Sezzle on what appear to be three separate bases. She claims that she was wrongfully
terminated for (1) exercising her rights under the EPEWA; (2) complaining to Sezzle
that her title and pay did not reflect the actual roles/duties she was performing; and (3)
informing Sezzle that it was “in violation of financial regulations due to not being
licensed in states in which it was operating and that it was using incorrect and
detrimental algorithms that were wrongfully sending borrowers’ paid-up accounts to
collections.” ECF No. 114 at 6–7.
1. 	Wrongful Termination in Violation of Public Polic—EPEWA
Violation
To the extent that Plaintiff bases her wrongful termination claim on her alleged
EPEWA complaints to Sezzle, the Court agrees with Sezzle that this theory of liability
fails because EPEWA provides its own wrongful discharge remedy. “Colorado law is
clear that a separate public policy wrongful discharge claim is not available where the
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statute at issue provides a wrongful discharge remedy.” Miles v. Martin Marietta Corp.,
861 F. Supp. 73, 74 (D. Colo. 1994) (citing Smith v. Colo. Interstate Gas Co., 777 F.
Supp. 854, 858 (D. Colo. 1991); Gamble v. Levitz Furniture Co., 759 P.2d 761, 766
(Colo. Ct. App. 1988)). Hart v. Digitalzone Inc., No. 23-cv-00531-GPG-SBP, 2025 WL
1927622 (D. Colo. May 30, 2025), involved a similar situation where the plaintiff brought
both an EPEWA retaliation claim and a wrongful termination claim based on the same
set of facts. There, the court held that because the plaintiff had “a statutory remedy for
th[e] [alleged] conduct, he cannot also bring a [wrongful termination in violation of public
policy] claim,” and dismissed the wrongful termination claim. Id. at *17 (citing Basile v.
Missionary Sisters of Sacred Heart of Jesus-Stella Maris Province, No. 11-cv-01827-
REB-KMT, 2011 WL 5984752, at *2 (D. Colo. Nov. 30, 2011)). Accordingly, the Court
finds that to the extent Plaintiff’s wrongful termination claim is predicated on the same
facts underlying her EPEWA claims, she has an available statutory remedy (which she
has sought under Count I), and therefore her claim for wrongful termination is subject to
dismissal.
2. 	Wrongful Termination in Violation of Public Polic—Failure
to Confer AML Title and Pay
Next, the Court agrees with Sezzle that Plaintiff’s wrongful termination claim also
fails to the extent that it is based on allegations that Plaintiff complained to Sezzle that it
violated “FinCEN, FDIC, and bank sponsor guidance and rules” by not providing her
with a formal AML Officer title and corresponding pay.
“The identification of a sufficiently clear expression of public policy is an issue of
law for the court.” Kearl v. Portage Env’t, Inc., 205 P.3d 496, 498 (Colo. App. 2008). “A
plaintiff asserting a claim for wrongful discharge in violation of public policy must also
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allege that the public policy invoked ‘truly impacts the public in order to justify
interference into an employer’s business decisions.’” Id. (quoting Crawford Rehab.
Servs., Inc. v. Weissman, 938 P.2d 540, 552).
Plaintiff fails to articulate how Sezzle’s alleged refusal to match Plaintiff’s internal
title and pay to her external facing role would concern public policy or the public at
large. Furthermore, the FAC does not specify any statute or rule that would be
implicated by her discharge.
In its Motion, Sezzle explains that “FinCEN regulations outline the requirements
for money services businesses’ anti-money laundering programs, which include, as is
relevant here, a requirement to ‘[d]esignate a person to assure day to day compliance
with the [AML] program and [31 C.F.R. Chapter X].’” ECF No. 125 at 11 (quoting 31
C.F.R. § 1022.210(d)(2)). Sezzle argues that all these “regulations require is that a
person be so designated; there are no requirements regarding conferral of an official
title or any particular pay.” ECF No. 125 at 11 (emphasis added). Upon reviewing 31
C.F.R. § 1022.210(d)(2), the Court finds Sezzle’s argument to be persuasive.
In her response, Plaintiff points for the first time to 31 U.S.C. § 5318(h) as a
potential source for a public policy mandate. ECF No. 138 at 3. This statute was not
cited in the FAC. Moreover, 31 U.S.C. § 5318(h) only mandates that financial
institutions “designate a[n] [AML] compliance officer,” which Sezzle had done. The
statute is silent on requirements regarding such an officer’s internal title or rate of pay.
As the Tenth Circuit has ruled, to prevail on a wrongful termination in violation of
public policy claim, “Colorado requires an employee to prove various elements,
including (as relevant here) that the employer directed him to violate some specific
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statute, regulation, or professional code related to public health, safety or welfare, or
some clearly expressed public policy related to his responsibility as a citizen or his
rights or privileges as a worker, or prohibited him from performing a public duty.”
DeFazio v. Starwood Hotels & Resorts Worldwide, Inc., 554 F. App’x 692, 694 (10th Cir.
2014) (emphasis added). Sezzle states that it is unable to locate any authority that
supports Plaintiff’s claims that the failure to confer an internal title and pay consistent
with her external designation is violative of any rule; and the Court is aware of none.
Plaintiff’s vague and conclusory allegation that Sezzle violated “FinCEN, FDIC, and
bank sponsor guidance and rules” is insufficient to state a public policy.
Accordingly, the Court finds that Plaintiff’s wrongful termination claim should be
dismissed to the extent it relates to Plaintiff’s dissatisfaction with her title and rate of
pay. See DeFazio, 554 F. App’x at 694 (wrongful termination claim failed where plaintiff
failed to identify any statute, rule, or public policy implicated by his dismissal).
3. 	Wrongful Termination in Violation of Public Policy—
Whistleblowing Activity
Finally, the third basis for Plaintiff’s wrongful termination claim is that she
informed Sezzle that it was “in violation of financial regulations due to not being licensed
in states in which it was operating and that it was using incorrect and detrimental
algorithms that were wrongfully sending borrowers’ paid-up accounts to collections.”
ECF No. 114 at 6. In the factual allegations portion of the FAC, Plaintiff alleges that
“Sezzle was utilizing an algorithm that failed to report when a consumer borrower had
paid their balance to Sezzle and, due to that failure, the algorithm automatically reported
consumer borrowers to the collection agencies even if they were current with their
Sezzle repayment obligations.” Id. at 3. She claims that she was terminated for
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informing Sezzle about their “fraudulent algorithm practices harming consumers” in
violation of public policy. Id.
Sezzle argues that this theory of liability for wrongful termination fails because
Plaintiff does not allege that “Sezzle required her to perform an illegal act, prohibited her
from performing a public duty, or otherwise directed her to take or not take a particular
action that violates public policy.” ECF No. 125 at 15. However, Colorado “is in line with
a number of other jurisdictions that shield whistleblowers from retaliatory discharge.”
Kearl, 205 P.3d at 499. See, e.g., Moyer v. Allen Freight Lines, Inc., 20 Kan. App. 2d
203, 885 P.2d 391, 393 (1994) ( “[T]ermination of an employee in retaliation for the
good faith reporting of a serious infraction of . . . rules, regulations, or the law by a co-
worker or an employer to either company management or law enforcement officials
(whistle-blowing) is an actionable tort.” (quoting Palmer v. Brown, 242 Kan. 893, 752
P.2d 685, 689–90 (1988))); Drury v. Mo. Youth Soccer Ass’n, 259 S.W.3d 558, 566 (Mo.
Ct. App. 2008) (at-will employee has claim for wrongful discharge if discharged for
reporting employer wrongdoing to superiors or for acting in manner public policy would
encourage); Barker v. State Ins. Fund, 40 P.3d 463, 468 (Okla. 2001) (“Oklahoma law
protects both internal and external reporting of whistle-blowers who establish a sufficient
public policy violation from retaliatory discharge.”).
In Kearl, the Colorado Court of Appeals found that the plaintiff sufficiently alleged
wrongful termination in violation of public policy where he claimed that he was
terminated for complaining to supervisors that certain technology the company was
recommending to the government for remediation services at a uranium enrichment
plant was unsound. Kearl alleged that he complained to his superiors about what he
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considered to be a fraud on the government at the price of public health. Kearl, 205
P.3d at 500.
The instant matter is analogous to Kearl. Plaintiff alleges that she was terminated
upon complaining to management that certain fraudulent company practices were
harming U.S. consumers and borrowers. Plaintiff’s allegations, if true, would clearly
concern the public at large. The Court finds that Plaintiff’s allegations are sufficient to
put Sezzle “on notice of the ‘clearly expressed public policy’ element of [her] claim for
wrongful discharge.” Id. 4
In line with Colorado precedent recognizing such wrongful termination claim for
whistleblower activity, the Court finds that, at least for the purposes of a motion to
dismiss, Plaintiff has stated a claim for wrongful termination in violation of public policy
premised on her internal reporting of violations of financial regulations.
IV. 	CONCLUSION
For the reasons set forth above, it is hereby RECOMMENDED that Defendant
Sezzle’s Partial Motion to Dismiss Plaintiff’s First Amended Complaint, ECF No. 125, be
GRANTED in part and DENIED in part as follows.
• 	As to Plaintiff’s EPEWA discrimination claim, the Motion should be
GRANTED.
4 In its reply brief, Sezzle argues that Plaintiff’s public wrongful termination claim is pre-
empted by the statutory remedy provided in Section 1057 of the Consumer Financial
Protection Act (“CFPA”). ECF No. 141 at 3. Sezzle argues that “Section 1057 not only
contains its own wrongful discharge remedy, but it also contains an administrative
exhaustion requirement which Plaintiff has not claimed to (and cannot) satisfy.” Id.
However, Plaintiff does not cite the CFPA in her FAC. And while Plaintiff’s allegation
“that Sezzle was violating ‘financial regulations’ is not precise, when construed liberally,
there is no reason to interpret her claim to be that she reported information pertaining
only to offenses identified” in the CFPA. ECF No. 102 at 20 (Order of Judge Brimmer).
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• 	As to Plaintiff’s EPEWA retaliation claim, the Motion should be DENIED.
• 	As to Plaintiff’s Wrongful Termination in Violation of Public Policy claim based
on alleged EPEWA violations, the Motion should be GRANTED.
• 	As to Plaintiff’s Wrongful Termination in Violation of Public Policy claim based
on Sezzle’s failure to confer on Plaintiff an official AML title and corresponding
pay, the Motion should be GRANTED.
• 	As to Plaintiff’s Wrongful Termination in Violation of Public Policy claim based
on Plaintiff’s internal reporting of the alleged violations of financial regulations,
the Motion should be DENIED.
NOTICE: Pursuant to 28 U.S.C. § 636(b)(1)(c) and Fed. R. Civ. P. 72(b)(2),
the parties have fourteen (14) days after service of this recommendation to serve
and file specific written objections to the above recommendation with the District
Judge assigned to the case. A party may respond to another party’s objections
within fourteen (14) days after being served with a copy. The District Judge need
not consider frivolous, conclusive, or general objections. A party’s failure to file
and serve such written, specific objections waives de novo review of the
recommendation by the District Judge, Thomas v. Arn, 474 U.S. 140, 148–53
(1985), and also waives appellate review of both factual and legal questions.
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Makin v. Colo. Dep’t of Corr., 183 F.3d 1205, 1210 (10th Cir. 1999); Talley v. Hesse,
91 F.3d 1411, 1412–13 (10th Cir. 1996).
Dated at Denver, Colorado this 17th day of March 2026
_______________________
N. Reid Neureiter
United States Magistrate Judge
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