Favorable Settlement Reached in Lawsuit Against Landlords’ Law Firm
consumer law
Consumer Law Unit
Pro Bono
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Legal Aid and Wiley Rein LLP are pleased to announce that they favorably resolved a lawsuit against a D.C.-based law firm alleging persistent consumer law abuses in the firm’s landlord-tenant court filings. The settlement not only provides for monetary damages to the named plaintiffs and seven additional affected tenants, but also includes important provisions requiring the defendant law firm to implement strict due diligence procedures and reporting for its landlord-tenant filings over the next year.

The lawsuit, filed as a class action in federal district court in October 2014, alleged that the law firm and its attorneys engage in the unlawful practice of filing complaints on behalf of landlords in D.C. Superior Court that contain false information with respect to the status of the tenants’ federally-subsidized rental properties, in violation of the federal Fair Debt Collection Practices Act. In June 2015, the federal district court issued a ruling that denied defendants’ motion to dismiss the tenants’ complaint, allowing the case to proceed on the merits.

The settlement announced today requires the law firm to implement detailed procedures to correctly determine whether a property is subject to a subsidy and to confirm that any amount of alleged unpaid rent is consistent with the landlord’s ledger and other available documentation and does not include any fees or other charges that may not be included as rent by law. The settlement also requires the law firm to submit a declaration with each landlord-tenant complaint confirming that it has followed these detailed procedures. In reaching this agreement, the defendants made no admission of wrongdoing.

The impact of this settlement may be wide-reaching, as roughly 90% of tenants appearing in landlord-tenant court are not represented by an attorney. The eviction complaint form used in landlord-tenant court requires the landlord or its attorney to disclose whether the property at issue is subsidized. This alerts the judge that the tenant may have special defenses that the tenant may not be aware of or know how to raise. Consequently, whether eviction complaints truthfully and accurately disclose the subsidy status of a property can be critical to how the case proceeds.

Legal Aid is grateful to our co-counsel, Theodore Howard and Bonnie Wise, of Wiley Rein, without whom this lawsuit and settlement would not be possible, and to our clients—Natasha Lipscomb, Kimberly McLaughlin, Margaret O’Brien, and Felicia Pate—who were willing to stand up for their rights and serve as named plaintiffs.

January 7, 2015 update: Wiley Rein also issued a statement on the settlement.

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