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City Charges Major Landlord with Illegally Raising Tenant's Rent During Wildfire Emergency
By Jorge Casuso
February 8, 2021 -- The City has sued a major Santa Monica property owner engaged in a legal battle over its housing polices for allegedly raising a tenant's rent during a State emergency.
The lawsuit charges WS Communities, LLC and 1433 Euclid Street, LLC with unlawfully raising a tenant’s rent by more than the allowed 10 percent during a declared emergency.
According to the complaint, the defendants raised the tenant's rent at 1433 Euclid Street from $865 to $2,336 in February 2020 after the Governor extended a wildfire emergency through the end of the year.
The rents were raised again in March and April to $3,000, according to the complaint.
California law prohibits businesses and owners from "advertising, offering, or charging a rental price for housing to existing or prospective tenants, that has been increased by more than 10 percent" during a state of emergency, the City Attorney's office said.
The defendants counter that the lawsuit "is both baseless and retaliatory" and that "it is wrong on the facts and wrong on the law," said Thomas P. O'Brien, the attorney for the defendants.
O'Brien notes that WSC and NMS -- who together own 32 Santa Monica properties -- have filed lawsuits in federal and state courts challenging the City's recent restrictions on residential leases ("Apartment Owners Sue City Over Leasing Requirements," December 16, 2020).
"The City has a long history of targeting these particular property owners," O'Brien said in a statement this weekend.
"This latest move is a clear attempt to punish them for challenging -- through both federal and state court actions filed in late 2020 -- the City’s recent improper and unconstitutional ordinance restricting who can live in Santa Monica."
Under California’s price gouging law, violations are a misdemeanor punishable by imprisonment in a county jail up to one year, a fine up to $10,000, or both.
A violation is also deemed to constitute an unlawful business practice and an act of unfair competition, subject to civil penalties of up to $2,500 per violation, injunctive relief and restitution, City officials said.
The City is charging the defendants with three counts for each of the rent increases on the unit.
An arraignment hearing is set for March 24 in Los Angeles Superior Court.
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