WASHINGTON, D.C. – Attorney General Karl A. Racine today filed a lawsuit against the owners and managers of 3003 Van Ness Apartments, a rent-controlled apartment property, for allegedly making misrepresentations to consumers about the true rental rates for rent-controlled apartments and about how much rent could legally be raised in the future. The complaint alleges that Smith Properties Holdings Van Ness, L.P. and Equity Residential Management, L.L.C. use rent concessions to mislead consumers into signing leases without providing them with all the material terms. As a result, consumers face rent increases that are significantly higher than they would normally expect under District rent control laws. Attorney General Racine is seeking to end these misleading practices and to recover restitution for consumers who have been harmed, as well as penalties and costs.
“Landlords should clearly inform consumers up-front about the base rent from which subsequent increases will be calculated – but, we allege in this case, the defendants misled them,” said Attorney General Racine. “Ensuring that residents of all income levels can continue to call the District home is a top priority for my office, and we will continue to use all the tools available to us—including consumer protection law—to preserve access to affordable and safe housing.”
The property that is the focus of the lawsuit – 3003 Van Ness – is subject to the District’s rent control law, which limits the amounts by which rents can be increased. According to the complaint filed in D.C. Superior Court, the defendants misled tenants by advertising one rental price for an apartment but reporting a significantly higher price to District authorities, and by offering false explanations for price discrepancies between advertisements and amounts listed in leases. Their ads failed to disclose that the listed rental prices include a monthly discount, or “rent concession,” and that they actually report a substantially higher monthly price—one that does not include the discount—to the District government authorities, allowing them to charge higher future rent increases. The Attorney General’s lawsuit alleges that consumers only discovered the official rental amount when they prepared to sign a lease.
When consumers questioned the discrepancy between the advertised rents and the higher amounts stated in their leases, the Attorney General’s suit alleges, the building owners and managers misled tenants. They claimed that the rent concessions were permanent and were offered through a District government program, when neither was the case. The defendants, the suit says, also gave the false impression that the advertised rental amount was the price on which future rent increases would be based under the District’s rent-control laws. However, when tenants renewed their leases, Smith and Equity calculated new rental prices based on the higher amount they reported to the government. As a result, the defendants offered tenants lease renewals that included price hikes much larger than tenants had been led to believe were possible.
A copy of the Attorney General’s lawsuit is attached.
Consumers who have complaints concerning 3003 Van Ness Apartments, other rental apartments in the District of Columbia, or any other consumer issue can contact our Office of Consumer Protection at (202) 442-9828, by sending an e-mail to SocialJustice@dc.gov, or online using our Consumer Complaint Form.