A major Los Angeles landlord accused of bilking tens of thousands of renters out of their security deposits will fork out $12.5 million to pay them back.
Billionaire Geoffrey Palmer has agreed to pay $12.5 million 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 apartment complexes, the Los Angeles Times reported.
The proposed settlement could mark the end of a four-year legal battle that has pitted tenants against Palmer’s company, GHP Management Corp. It goes before Los Angeles County Superior Court Judge Elihu M. Berle on July 18 for preliminary approval.
GHP Management is a subsidiary of G.H. Palmer Associates, one of the largest landlords in Southern California, with more than 15,000 apartments in 23 apartment complexes.
Court documents alleged the company withheld security deposits for years from thousands of tenants by charging repair and cleaning fees without properly notifying residents.
They also allege that the company violated state law by failing to send tenants notices of repair and cleaning charges, while duplicating invoices to make it seem as if more were delivered than actually were.
Representatives of GHP Management and its attorneys did not respond to requests for comment from the Times on the proposed settlement.
Jimmie Davis Parker and Damion Robinson, attorneys representing the former residents in the class-action lawsuit, called the settlement “a resounding victory for tenants.”
Among them is Hector Ibarra, a retired officer with the Los Angeles Police Department, who rented a one-bedroom apartment from GHP Management in Montclair from 2014 to 2015. When Ibarra, 61, moved out, the company withheld more than $1,000 of his security deposit, citing repairs and cleaning fees. Ibarra said he was shocked because he left the unit in great shape.
“It left a bad taste in my mouth,” he told the Times. “I spoke to multiple people in the company at the time, but it fell on deaf ears, so I decided to not haggle over it. I’m glad they got caught.”
The proposed $12.5-million settlement includes a $10-million cash payment for security deposits that were withheld. In addition, GHP Management will release former tenants from $2.5 million in claims covering things such as painting or carpet cleaning when they moved out.
GHP Management also agreed to “full compliance with the statutory disclosure requirements, providing future benefits to the tenants of over 15,000 residential units across Southern California,” according to the settlement approval motion.
Palmer is one of L.A.’s biggest landlords and a prominent donor to Republican causes. He also is no stranger to lawsuits and controversy.
He donated more than $6.4 million to Donald Trump in the 2020 election cycle, and last year, he poured at least $1.2 million into efforts to recall California Gov. Gavin Newsom.
The developer is known for building fortress-like faux-Italian apartment complexes in freeway-adjacent spots others had shunned. But along the way, he has antagonized design enthusiasts, neighborhood and tenant activists, city commissioners and some politicians.
[Los Angeles Times] – Dana Bartholomew
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