Former CEO Battles Tenant Harassment Charges

By Mark McGuigan
Staff Writer

Oct 28 -- Two UCLA nurses claim they were harassed by the former CEO of American Express after complaining they were being over-charged for the Santa Monica apartment they rented from him, according to a case that will get underway in a Superior Court on Wednesday.

The lawsuit, which seeks punitive damages, was filed against owner Harvey Golub, the former CEO of American Express and current board member of Warnaco Textiles, Campbell’s Soup and Dow Jones.

The suit alleges that when tenants Randall and Julie King Sattazahn -- a married couple both working as nurses at UCLA -- complained and filed a rent overcharge complaint with the City, they were subjected to repeated harassment.

“On at least seven occasions,” the lawsuit alleges, “defendants or their workers entered Plaintiffs’ residence. Defendants say that the inspections were for repairs and to show the property to potential buyers, and the Plaintiffs say that the notices were served for the purpose of harassing them or inducing them to move out of their home.”

In March of last year, according to the lawsuit, the Sattazhan’s determined that the maximum allowable rent for their rental property during the time of their tenancy should have been $334 per month, instead of their actual rent of $1,000 per month.

Golub, along with wife Roberta Golub, Vreni Merriam and Don Glunt, have already paid the couple $22,122 in damages -- the amount the City found was the rent overcharge for three years -- for violating rent control laws while owning and managing the three-unit property located at 1020 Bay Street.

However, according to a report in the Daily Journal in August of this year, the couple is now seeking reimbursement for an additional year's rent as well as damages for emotional distress.

Amid claims that the Golubs and Merriam knew what they were doing, the case could be worth as much as $130,000, the Journal says.

The couple is “appalled” by the treatment they received at the hands of the City, according to the plaintiff's attorney Jack L. Schwartz, who says that all attempts to file a police report were ignored.

“The tenants are appalled that no one will take a police report,” Schwartz told The Lookout. “The City refuses to police its own laws.”

Landlords who partake in “outrageous and unlawful conduct” by repeatedly harassing tenants should be made to pay for their misconduct, especially if the City is unwilling to mete out punishment, according to Schwartz.

“The City of Santa Monica has refused to take action,” said Schwartz. “The police, the city attorney, every single member of the City Council has failed” to heed the plaintiffs calls of tenant harassment.

“No one in the City will enforce the law of landlord tenant overcharges,” he said.

The history of the case dates back to 1988 when defendants Vreni Merriam and Don Glunts discussed Merriam’s desire to find a place to live for free. The lawsuit alleges that the pair discussed the issue whereby an owner occupying a property is exempt from the City’s rent control laws.

According to statements made in the lawsuit, a landlord in this position “could charge anything they desired for rent, and that evictions would be easier.”

In January 1989, Merriam, along with Harvey and Roberta Golub purchased the apartment building. Having slept for a single week on the property in another couple’s apartment, Merriam then applied for, and received, an owner-occupier exemption from the City of Santa Monica, the lawsuit alleges.

The exemption lifted the restriction on the amount of rent a landlord could charge for all three units on the Bay Street property, since owner-occupied buildings that are three units or less are exempt from rent control, according to the suit.

Since February of 1995, the Sattazahn’s rented the apartment at a rate of $1,000-per-month along with a security deposit of $1,000.

The charges came to light when a disgruntled former tenant blew the whistle on the rent control scheme following the landlord’s failure to return his security deposit when he vacated his unit, according to the suit.

On investigation the City of Santa Monica lifted the rent control exemption, charging that the owners were in violation of the “maximum allowable rent” as defined by law because Merriam no longer lived on the property. The property itself was subject to the Santa Monica Rent Control Charter laws and regulations.

The Rent Control Charter states “that any landlord who demands, accepts, receives or retains any payment of rent in excess of the maximum lawful rent…shall be liable in a civil action to the tenant from whom such payments are demanded, accepted, received or retained.”

The lawyer for the defendants, Rosario Perry, could not be reached for comment.