Court rejects Equity Residential's motion against Gural

The Chief Administrative Justice of the Office of Administrative Hearings today issued a strong opinion denying Equity Residential’s Motion for Summary Judgment in the case of Harry Gural vs. Equity Residential / Smith Property Holdings Van Ness LP.

The court affirmed the decision of the Rental Housing Commission (RHC), the appellate body which decides rental housing issues. The RHC had ruled in favor of Gural is his case against Equity Residential, finding that maximum annual rent increases must be based on the rent actually paid by the tenant — not the extremely high, fictitious amounts that Equity Residential had routinely been inserting into leases.

Today’s hearing by OAH indicates that Equity Residential is unlikely to prevail in its case against Gural in the Landlord and Tenant Branch of DC Superior Court, in which Equity claimed that Gural had not paid his rent in full because he refused to pay a rent increase that was greater than what is allowed under DC law. Gural has been forced to pay approximately $297 per month since 2016 into court escrow because of Equity’s claim, now proven false, that he had failed to pay his rent in full — approximately $24,000 to date.

Superior Court judge issues decision against Equity Residential in AG’s suit

DC Superior Court Judge Yvonne Williams today released a 22-page opinion in District of Columbia vs. Equity Residential Management, a lawsuit brought against the company by Attorney General Karl Racine. The case focuses on the use of “rent concessions” and false advertising to trick tenants into signing predatory leases that will result in rent increases that exceed what is permitted under DC rent stabilization laws. The suit was filed on behalf of the residents of that apartments at 3003 Van Ness Street NW and was a result of complaints about Equity Residential’s practices by the Van Ness South Tenants Association.

Judge Williams ordered that Equity Residential pay residents of 3003 Van Ness who were harmed $869,344 plus 2% interest — approximately $1 million total.

In her opinion, Judge Williams found that Equity Residential had misled prospective tenants by failing to reveal that they would be forced to sign leases with rents that were far higher than market prices and that a year later the company would attempt to enforce rent increases based on those inflated figures. Specifically, she wrote that:

“In nearly every communication with consumers, and beginning with persistent advertisements, Equity omitted, obfuscated, or otherwise misled prospective tenants into thinking that the concession pricing was the price from which an renewal increase would be determined. Equity misrepresented or omitted the accurate base price for renewals while touting that its apartments were rent-controlled as a key feature of living in the building. Every application failed to state pricing that would accurately or fully inform residents of future rent increases. Equity undoubtedly lured some residents into an initial year at concession pricing with the false belief that the rent would not skyrocket upon a lease renewal.”

However, Judge Williams declined to impose additional civil penalties on Equity Residential because she believed that Equity’s actions misrepresentation of actual rental costs were unintentional. Furthermore, she claimed that despite overwhelming evidence that Equity had demanded rent increases that far exceeded the annual percentage allowed under rent stabilization, that “Equity never violated rental housing laws.” In essence, Judge Williams accepted Equity Residential’s novel interpretation of the word “rent,” which the company claimed could be $1,000 or more above the amount actually paid per month.

Judge Williams decision was based in part on the assumption that Equity Residential had abolished “concession” pricing after the DC City Council passed the Rent Charged Definition Clarification Amendment Act in 2019, which upheld that the word “rent” in DC housing law was to be interpreted as the common dictionary meaning of the word. However, evidence shows that Equity Residential continues to this day to use “concession” pricing to force the president of the Van Ness South Tenants Association, Harry Gural, to pay an an additional $297 per month above the maximum legal rent into escrow while continues its lawsuit against him in Landlord and Tenant Court - more than $20,000 to date.

The Superior Court decision applies only to Equity Residential and its customers at 3003 Van Ness Street NW — not to the thousands of other Equity Residential tenants that have lived at its Washington DC apartments during the decade or more than the corporation and its divisions used “rent concessions” to overcharge tenants. The decision also does not apply to the large number of DC residents who have lived at properties owned and managed by other companies that used “rent concessions” to circumvent rent stabilization laws.

Both Equity Residential and the District of Columbia will have an opportunity to appeal the Superior Court decision.

VNSTA receives rent records of Equity Residential properties via FOIA

The Van Ness South Tenants Association, representing the tenants of the apartments at 3003 Van Ness Street, NW, submitted on January 31, 2019, a Freedom of Information Act (FOIA) request for rent records of seven properties owned or operated by Equity Residential Corporation or its affiliates. The DC Department of Housing and Community Development (DHCD) processed the request, releasing data on February 21, 2019.

The data can be found in three compressed files:

  1. FOIA pages 1-50

  2. FOIA pages 51-100

  3. FOIA pages 101-164

FOIA REQUEST
SUBMITTED JANUARY 31, 2019
BY HARRY GURAL, PRESIDENT, VAN NESS SOUTH TENANTS ASSOCIATION

I would like all rental housing records, especially RAD-9 forms, submitted to DHCD by Equity Residential Management (also doing business as Smith Property Holdings) and all related companies, for the following buildings that are subject to the DC rent stabilization statute:

1) 3003 Van Ness

2) Cleveland House Apartments (2727 29th Street)

3) 1500 Massachusetts Avenue

4) Connecticut Heights Apartments (4850 Connecticut Avenue)

5) Alban Towers (3700 Massachusetts Avenue)

6) Corcoran House Apartments (1616 18th Street)

7) Calvert-Woodley Apartments (2601 Woodley Place)

In the interest of time, please process the records for 3003 Van Ness first. The others can be processed separately, and they can be sent individually as they are ready or in a single batch.

Thank your for your help.

(Date Range for Record Search: From 01/01/2018 To 02/01/2019)

Fair Rent DC sends a fourth letter to Mayor Muriel Bowser asking her to take action on the rent "concession" scam

Harry Gural, founder of Fair Rent DC and president of the Van Ness South Tenants Association, today sent a fourth letter today to Mayor Muriel Bowser, requesting that she take strong action to investigate and speak out about  the rent "concession" scam. The Bowser administration has not responded to the organization's first three emails and Gural's in-person discussion with the Mayor in October.

 

 

VAN NESS SOUTH TENANTS ASSOCIATION


March 15, 2018

Mayor Muriel Bowser
John A. Wilson Building
1350 Pennsylvania Avenue, NW
Washington, DC 20004

Dear Mayor Bowser,

On the occasion of your State of the District Address, I am writing again to request that you take public action against the rent “concessions” scam that likely has cost District residents tens of millions of dollars.

I am the president of the tenants’ association representing the residents of 3003 Van Ness, the building that is the focus of Attorney General Karl Racine’s suit against Equity Residential for false advertising and effective circumvention of DC rent stabilization laws. I have helped over 100 residents fight demands for very large rent increases. I discovered via FOIA information suggesting that the same scam is used in other buildings. Other sources suggest that many large corporate landlords may be involved. This issue deserves an immediate and thorough investigation.

I have asked for help from members of your administration, including high-level housing officials, for almost two years. When I talked to you at length at an ANC-3 meeting at UDC on Oct. 17, you promised that your administration would quickly respond to my request to investigate by examining easily available city records. Sample records in my possession show that one company is filing “rents” to the city of well over $3,000 for a modest one-bedroom apartment in Van Ness – an impossibly high figure. I sent you additional information and repeated my request for action in three subsequent letters. Five months later, I have received absolutely no response.

In addition to the Attorney General’s suit, a recent decision in favor of the tenant by the Rental Housing Commission in the case of Gabriel Fineman vs. Smith Property Holdings (a subsidiary of Equity Residential) confirms my claim that the “concessions” scam violates DC law. Other tenants (including me) have pending tenant petitions. A class action case has been filed. Another case was filed in Superior Court. In addition, I continue to receive pleas for help from tenants every day.

Every month more and more DC tenants get caught in the scam and end up paying hundreds or thousands of dollars more in rent than the law permits. This drives up the cost of housing in the District overall. The issue should be of highest concern to your administration.

Nevertheless, there has been complete silence from you and other city officials on this issue. I urge you to speak out about the rent “concessions” scam because doing so will help thousands of new tenants avoid the trap. I also repeat my request for you to instruct your administration to review easily available rent filings that will reveal the scope of the “concessions” scandal.

Sincerely,                               

Harry Gural
President, Van Ness South Tenants Association
Founder, Fair Rent DC

Fair Rent DC praises Attorney General Racine for taking legal action against Equity Residential

FOR IMMEDIATE RELEASE
CONTACT: Harry Gural
PHONE: (202) 527-2280
DATE: 12/13/2017

Harry Gural, founder of Fair Rent DC and president of the Van Ness Tenants Association (VNSTA), applauded the announcement today by Attorney General Karl Racine that he has filed a lawsuit against Equity Residential and Smith Property Holdings, the manager and owner of the apartment buildings at 3003 Van Ness Apartments.

“The “concession” scam costs residents hundreds or thousands of dollars. It relies on false advertising and deliberate deception. Dozens of tenants have come to me for help. I’m just glad that the Attorney General is moving forcefully to help stop it.”

For more information about how the rent “concession” scam works, see www.FairRentDC.org

 

 

Fair Rent DC founder sends third letter to Mayor Bowser asking for action on rent "concession" scam

Harry Gural, founder of Fair Rent DC and president of the Van Ness South Tenants Association, today sent a third letter to Mayor Muriel Bowser, requesting that she take immediate and strong action to further investigate the rent "concession" scam.

VAN NESS SOUTH TENANTS ASSOCIATION

December 14, 2017

Mayor Muriel Bowser
John A. Wilson Building
1350 Pennsylvania Avenue, NW
Washington, DC 20004

Dear Mayor Bowser,

I am contacting you for the third time to request that you take strong action on the rent “concessions” issue, a scam used by major landlords to circumvent the DC rent stabilization law and consequently overcharge DC residents by what likely is tens of millions of dollars. The Attorney General’s announcement yesterday that he is filing suit against Equity Residential for this practice substantiate the claims I have made to your administration over many months.

My renewed request today follows our one-on-one discussion after the ANC-3 meeting on Oct. 17th, my letter to you on Oct. 19 and my follow-up letter with additional documentation to you on Oct. 21, which was cc’ed to your key housing and members of your staff. It also follows many emails cc’ed to those officials and also to your previous Rent Administrator that were written to Equity Residential on behalf of tenants fighting to escape predatory rent increases and to assert their legal rights. Since we spoke on Oct. 17th I have received no acknowledgement from your administration whatsoever.

As the months pass, more and more of your constituents are ensnared in the “concessions” scam, which costs each one of them hundreds of dollars a year at best and well over one thousand annually at worst. This should trigger urgent action on behalf of your administration, but to my knowledge action has yet been taken.

High-level officials in your administration have turned a blind eye to this predatory practice. The current and former head of the Rental Administration Division and director of the Department of Housing and Community Development have long been aware that major landlords are submitting false rent filings to the RAD and using these false filings as the basis for subsequent rent increases. Because the RAD and DHCD have failed to investigate these filings, I submitted FOIA requests for the legally-mandated records. These reveal that at least one major landlord, Equity Residential, frequently claims under penalty of perjury that the “rents” it collects apartments are as much as $1,500 per month above the going market price.

At the Oct. 17 ANC meeting I specifically asked you during the Q&A if you would instruct the DHCD to investigate false filings by major DC landlords. You stated at the time that you would need to gather more information from your department heads, but almost two months have passed and I have received no response to my request.

I believe that use of the “concession” scam is not confined to Equity Residential. Month after month, more and more DC residents become ensnared by the “concessions” scam. This likely costs them thousands of dollars each, and the cost to DC residents as a whole likely is in the tens of millions of dollars.

The evidence to find out whether this predatory practice extends beyond Equity Residential is already filed at your DHCD. I have FOIA’ed some of this material, but the matter could be greatly expedited if your administration were to take action on this issue.

To be clear, it is likely that “concession” leases are a widespread problem. If so, this predatory practice not only does substantial harm to the individual tenants, but also drives up the cost of housing overall. The failure to bring this practice to a halt undermines goals to make housing in the District more affordable.

For these reasons, I renew my request for you to direct members of your administration, specifically the DHCD and RAD, to investigate the false rent filings that become the basis for illegal rent increases. I also ask that you use every tool at your disposal to make DC residents aware of the rent “concessions” scam, and to work forcefully to protect tenants’ rights under the law and to help making housing more affordable.

 

                                                                        Sincerely yours,                                                                 

                                                                        Harry Gural

                                                                        President, Van Ness South Tenants Association

                                                                        Founder, Fair Rent DC

cc: Members of the Van Ness South Tenants Association, Members of Fair Rent DC

Fair Rent DC provides more evidence of rent scam to DC Mayor Bowser

Founder Harry Gural sent a second letter to DC Mayor Muriel Bowser, providing additional evidence that a major DC housing provider is filing false rent figures to the city and using those as the basis of what likely are illegal rent increases. An attachment to the letter includes screen shots of web pages advertising apartments at market rents, followed by official rent filings obtained by FOIA that report rents many hundreds of dollars per month higher than those advertised rates.

Fair Rent DC believes that tens of thousands of DC residents may be paying rents that substantially exceed legal limits, costing them tens of millions of dollars.

October 21, 2017

Mayor Muriel Bowser
John A. Wilson Building
1350 Pennsylvania Avenue, NW
Washington, DC 20004

Dear Mayor Bowser,

I am writing to follow-up the letter I sent two days ago on Oct. 21. I sent the letter as an attachment to an email to eom@dc.gov but I did not receive an auto-reply. I also sent the letter to DHCD Director Polly Donaldson (polly.donaldson@dc.gov), Rent Administrator Lauren Pair (lauren.pair@dc.gov) and Chief of Staff John Falcicchio (John.Falcicchio@dc.gov) but haven’t received an acknowledgement from them either. Your office was unable to provide a fax number so I am resending my original letter and this one via USPS Priority Mail to ensure delivery.

I provided to you with my first letter information obtained by FOIA revealing that Equity Residential is filing with the Rent Administrator “rent” amounts that far exceed market rents advertised for the same building. I realized after sending you the letter that you may not be closely familiar with average market prices in Van Ness in 2016 when those rents were filed with the RAD, so I am enclosing a screen shot of Equity Residential’s advertised prices for June 26, 2016 – which falls within the dates covered by the RAD filings. This clearly demonstrates that many of the “rent” amounts filed with the RAD are vastly inflated. The RAD-8 forms provided with my last letter show that Equity Residential uses these falsified filings as the basis for extremely large rent increases that far exceed what is allowed under DC law.

I would look forward to the opportunity to discuss this further at your earliest convenience.

Sincerely yours,

                                                                         

Harry Gural
President, Van Ness South Tenants Association
Founder, Fair Rent DC

cc: Members of the Van Ness South Tenants Association, Members of Fair Rent DC

 

 

Fair Rent DC asks Mayor Bowser to help investigate the rent "concession" scam

Fair Rent DC founder Harry Gural today sent a letter to DC Mayor Muriel Bowser, asking her to direct the Department of Housing and Community Development to share information regarding the large housing providers that file what appear to be abnormally high "rents" with the city -- a sign that they likely use the rent "concession" scam. Along with the letter, he sent 22 pages of evidence suggesting that a major housing provider reports unusually high "rents" to the city.

LETTER

October 19, 2017

Mayor Muriel Bowser
John A. Wilson Building
1350 Pennsylvania Avenue, NW
Washington, DC

Dear Mayor Bowser,

Thank you for taking my question about the rent “concession” issue at the ANC-3 meeting on Oct. 17 and for taking the time to discuss the issue with me briefly.

I am writing to ask your help fighting rent “concession” leases, the method I described briefly to you by which some large housing providers use false advertising and deceptive leases to circumvent DC rent stabilization laws. Tens of thousands of Washington residents may be affected and it likely costs them tens of millions of dollars.

At the ANC meeting, I asked whether you would agree to instruct the Department of Housing and Community Development to produce information that would help us understand the scope of the problem. I have obtained records from the Rental Accommodations Division via a FOAI request revealing that Equity Residential appears to substantially inflate the numbers it reports as “rents” in its official filings (attached). Equity uses those false filings as the basis for rent increases, demanding amounts that can exceed $1,500 per month. It announces these to tenants on a form produced by the RAD, making it appear that the amounts are sanctioned by the city (attached). More information about how this works can be found at the website I create to educate the public about the issue, Fair Rent DC.

I respectfully request that you instruct the DHCD and its RAD to produce the names of corporations which appear to file “rents” that vastly exceed the advertised rents. Besides Equity Residential, there is evidence that Avalon and Bernstein also use “concession” leases. It would not require extensive research by the DHCD to find out what other major companies file “rents” with the RAD that vastly exceed market prices. A shortcut would be review the client list of the law firm Greenstein, DeLorme and Luchs, which apparently engineered the “concession” scheme.

Every day, new DC tenants unwittingly sign “concession” leases that obligate them to pay very large rent increases that exceed what is permitted by law. Every month, it is likely that tens of thousands of residents are forced to pay more in rent than the law allows. This very serious problem threatens the affordability of Washington, D.C. I ask your help in bringing an end to this predatory practice.

Sincerely yours,

Harry Gural
President, Van Ness South Tenants Association
Founder, Fair Rent DC