LA landlord accepts $12.5 million tenant deposit settlement

Prominent Los Angeles landlord Geoffrey Palmer has agreed to pay $12.5million to settle a class action lawsuit accusing his company of withholding security deposits from more than 19,000 tenants when they moved out of his resorts of apartments.

The proposed settlement, which will be submitted to Los Angeles County Superior Court Judge Elihu M. Berle on July 18 for preliminary approval, could mark the end of a four-year legal battle that has pitted the tenants against the housing company. Palmer, GHP Management Corp.

Court documents alleged that the company — a subsidiary of GH Palmer Associates, one of Southern California’s largest landlords with more than 15,000 apartments in 23 Southern California complexes — withheld security deposits for decades. years to thousands of tenants by charging repair and clean-up costs without properly informing residents.

California Civil Code states that landlords must disclose all repair and cleaning costs, as well as provide tenants with bills and receipts. Court documents allege the company failed to send these notices and, in some cases, duplicate invoices to make it appear as if more deliveries were delivered than they actually were.

Palmer is one of Los Angeles’ biggest landlords and a top donor to Republican causes. He’s also no stranger to lawsuits and controversy.

The developer is credited with pioneering the 2001 downtown LA revival, building fortress-like faux-Italian apartment complexes in freeway-adjacent spots that others had avoided. But along the way, it has antagonized design enthusiasts, neighborhood and tenant activists, city commissioners and some politicians.

Representatives of GHP Management and its attorneys did not respond to requests for comment on the proposed settlement, which was reached with the help of mediators.

“We are very pleased to have negotiated an exceptional resolution for more than 19,000 former tenants…whose security deposits were mismanaged for many years. The hard-fought $12.5 million settlement will likely result in the full refund of security deposits to former tenants dating back to July 2014,” said Jimmie Davis Parker and Damion Robinson, attorneys representing former residents in the class action lawsuit, in a statement sent to The Times.

The couple called it a “resounding victory for tenants”.

Hector Ibarra, a retired Los Angeles Police Department officer, rented a one-bedroom apartment from GHP Management in Montclair from 2014 to 2015. When Ibarra, 61, moved out, the company retained more than $1,000 of his security deposit, citing repairs and cleaning costs. Ibarra said he was shocked because he left the unit in great shape.

“It left a bad taste in my mouth,” he said. “I spoke to several people in the business at the time, but it fell on deaf ears, so I decided not to haggle. I’m glad they got caught .

Ibarra added that a $500 payout “would be nice,” especially given soaring gas prices. For its former owner, “I consider it a pat on the wrist,” he said.

“I hope it sends a big enough message that next time they think twice about doing it,” Ibarra said.

The proposed $12.5 million settlement includes a cash payment of $10 million for withheld security deposits. Additionally, GHP Management will release former tenants $2.5 million in claims covering things like painting or carpet cleaning when they move out.

The tenants suing GHP Management “believe that many of the defendants’ moving charges were false,” according to the motion for preliminary approval filed with the court on June 1.

In addition, GHP Management has agreed to “fully comply with legal disclosure requirements, providing future benefits to tenants of more than 15,000 residential units in Southern California,” according to the settlement approval petition.

The proposed settlement is about 130% of collective damages, meaning tenants will receive more than they were originally owed, according to court documents.

Payments will be based on what each renter was charged and will likely average $500-$600 per person. The proposed settlement covers tenants from July 13, 2014, the earliest possible date under the legal limit of four years from the filing of the complaint.

Palmer has a reputation as a badass, which is evident in his company’s legal and civic moves.

In August, GHP Management sued the city of LA over the COVID-19 eviction moratorium, saying 12 buildings the company manages lost more than $20 million as a result of the measure. The lawsuit seeks $100 million in damages.

In 2014, Palmer drew the ire of pedestrian advocates after requesting an elevated bridge at the downtown Da Vinci apartment complex to help its tenants avoid a nearby homeless encampment. Despite these objections, the city council approved the bridge.

In 2009, Palmer came under fire from housing activists after he persuaded a three-judge panel to strike down rules requiring developers near downtown to provide a specific percentage of affordable housing in their residential projects.

In 2003, Palmer infuriated then-alderman Ed Reyes when his firm demolished an 1887 Victorian home in Chinatown that conservatives were seeking to relocate. Palmer’s company fought back, arguing that the city had placed its client in an impossible position by ordering him to fix a troublesome property while blocking him when he sought to raze it. The city finally settled down.

The billionaire property developer donated more than $6.4 million to Donald Trump during the 2020 election cycle, and last year contributed at least $1.2 million to efforts to recall the governor of California Gavin Newsom.

Los Angeles Times

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