L.A. City Attorney Forces $9 Million in Restitution from Landlord

Given that over 60% of Los Angelenos are renters, and far too many of them are paying far too much in rent for substandard apartments, why isn’t this being treated as much bigger news? It’s been a long time since a landlord had to dig this deep into his pockets, possibly never in L.A. We’re not known as a slum town, still, that is what much of Los Angeles is for a great many reasons (none of which include rent control). Essentially there is a great deal of profit to be made in renting to the poor; they don’t know what their rights are, and to keep a roof over their heads they’ll put up with pretty much anything. In Europe no one would believe me when I said that lead poisoning still exists in America. Or that kids are regularly bitten by rats. Or that I worked with a doctor who pulled cockroaches out of the ears of several children every week of every year. It certainly beggars belief. Until now it has been a handful of community organizations working with tenants high in bravery and low on resources trying to stop this from happening without being evicted.

Until now. After many years of pressure from community and tenant rights groups, the Los Angeles City Attorney’s office has finally turned around an atrocious record for the prosecution of criminal landlords profiting from slum buildings and illegally evicting tenants, and are showing what a city can achieve on behalf of its residents. They charged Darren Stern (also known as Henry Shalom), the owner of Landmark Equity Management Inc., with using a calculated and criminal strategy to empty out his buildings, thereby evading rent control laws to increase his profits. Some of the tactics he used, all too common in a rapidly gentrifying Los Angeles, were:

Illegally shutting off utilities
Entering units without permission
Refusing to conduct repairs, resulting in dangerous slum conditions
Refusing to accept rent and then trying to evict tenants for nonpayment
Harassment, threats, and intimidation

This case is groundbreaking not only as a civil suit conducted on behalf of tenants by the city, but also as an effective and holistic campaign to target the entire business operation of the minority of truly criminal landlords. Instead of prosecuting building by building and collecting fines that do not even cover the city’s costs, they have started looking at companies like Landmark that have engaged in illegal activities in the 850 units that they own spread across the city.

To maximize the strength of these cases the city is working closely with community based organizations and the Legal Aid Foundation of Los Angeles for the first time in a new and very exciting way. The Morrison Hotel served as the first test case for this new approach. Working with Strategic Actions for a Just Economy (SAJE) and the Legal Aid Foundation of Los Angeles (LAFLA), the City Attorney took the criminal case to trial and won a precedent setting conviction of the owners on 21 charges which was based in part on extensive research and tenant testimony. In my time as lead tenant organizer at SAJE, this certainly counted as one of the high points where a clear victory had been won that would clearly have a strong ripple effect in the city. It is immensely encouraging to see that the City Attorney’s Office is working with many different tenant organizations, and truly pushing the envelope to try and solve one of the city’s worst, most intractable problems. This case has clearly taken the Morrison victory to another level with partners Los Angeles Community Action Network (LACAN) and LAFLA. Although much will depend on the actual enforcement of the settlement agreement, this is a huge step forward for the City Attorney’s Office and a meaningful victory for tenants across the city. There are a number of other landlords out there hiding the same illegal business practices behind the corporate veil, so I hope to see this work continue.

Shall we sum up this victory then? The City Attorney’s office had already filed a criminal suit for the code violations in the various buildings which was won in May of 2007, and resulted in a sentence of 150 days in jail for the owner, of which he served 30 days. The City Attorney’s office also filed a civil suit, and yesterday reached an agreement with Landmark Equity Management requiring Landmark to pay $1 million in damages to the city in addition to the city’s legal costs, and $9 million into a restitution fund for the tenants who they mistreated. Landmark will also be prevented from buying new buildings in L.A. for the next 4 and a half years, and is required to bring all the buildings it currently owns up to code. This sends a clear message that intimidation, slum housing, and illegal evictions will not be tolerated in our city of renters.

Want more information?
City Attorney’s Press Release: http://www.lacity.org/atty/attypress/attyattypress6938518_06142006.pdf

Need help enforcing your rights?

Los Angeles Community Action Network: http://www.cangress.org/

Legal Aid Foundation of Los Angeles: http://www.lafla.org/

Strategic Actions for a Just Economy: http://www.saje.net

Need to know what your rights even are?

Los Angeles Housing Department: http://www.lacity.org/LAHD/ten_land.htm

also published at http://www.allvoices.com/users/Andrea#tab=blogs&group=2,widget=blogs&page=2&filter=popular

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