Koreantown Tenants Receive $2.5 Million in Federal Lawsuit
Century City investment firm Optimus Properties LLC and several affiliated companies agreed to pay $2.5 million to settle a federal lawsuit alleging that they pressured minority Latinos and mentally challenged tenants to leave Koreatown buildings so the firm could raise the price of its rental units. The lawsuit also alleged Optimus violated state and federal anti-discrimination and fair housing laws. The company has denied any wrongdoing but agreed to abide by fair housing laws to make repairs to the tenants’ units and to ensure that property managers and onsite managers receive fair housing training in the future.
Optimus Properties also agreed to make the next seven vacancies in its buildings available to tenants receiving Section 8 government-subsidized payments and agreed to accept late rent payments from three disabled tenants who had been sent numerous eviction notices for paying a few dates after the due date when they received their Social Security checks. The tenants’ attorneys said the defendants had made “important commitments to ensure fair housing policies and practices are in place for its Koreatown apartment buildings.”
In total, the settlement will provide $52,000 each to thirteen tenants. Approximately $208,000 will go to Strategic Actions for a Just Economy and Step Up on Second, agencies that advocated for and supported them. The remainder will go to four law firms who took up the cause.
Four building are covered in the terms. At the time Optimus purchased them, the buildings were occupied primarily by Spanish-speaking Latino tenants, families with children, and people with mental disabilities. Three of the tenants dropped out over the course of two years, two of the buildings were sold along the way, and an additional tenant in a sixth building was added.
The tenants described receiving dozens of notices from Optimus including requests to enter their units, complaints about noise and their children, and untimely three-day notices to pay or vacate their homes. Some of the tenants alleged they received notices of rent increases exceeding mandated limits. Others received increases without the required prior approval of the Los Angeles Housing and Community Investment Department.
Demetrius Allen, a former homeless tenant who has physical and mental disabilities, received a whopping 43 such notices in an 18-month span. They included five utility cutoff notices for renovations of other apartment units, six pest control treatments, two showings of his apartment, thirteen eviction warnings, and one notice that his Section 8 subsidy would no longer be accepted. Allen routinely paid his rent on the fifth of the month after receiving the funds, but never missed a payment.
Allen said the notices stopped right after the federal lawsuit was filed. In the settlement, Optimus agreed to accept his checks on the fifth of the month and to allow him to keep a service dog to help with this disability needs, which had been denied before.
Thomas H. Citron, lead counsel for the defendants, said of the terms, “My clients are looking forward to continuing their commitment to fair housing practices while implementing new policies to provide superior protections for residents.”