On November 24, 2014, the New York State Court of Appeals, in a majority opinion, upheld the rulings of the Appellate Division, First Department granting class certification in actions brought on behalf of tenants of separate New York City apartment buildings seeking damages for rent overcharges. The Court held that, although the city’s Rent Stabilization Law imposes punitive damages when a landlord’s violation is willful, and New York State law prohibits a claim for penalties to be brought as a class action, these cases may proceed as class actions because the tenants seek only to recover actual, compensatory overcharges and have waived punitive damages.
The Court’s decision is a major victory for all New York City tenants in that the ruling will allow tenants, many of whom may not have the resources to pursue individual legal actions against landlords, to recover rent overcharges on a class-wide basis.
These actions arise from the landmark decision obtained by the firm from the New York Court of Appeals in Roberts v. Tishman Speyer Properties, L.P., where the Court ruled that the New York statutory scheme prevents landlords of rent-stabilized buildings from charging market-rate rents while receiving New York City known as “J-51” benefits. The Court did not address the legitimacy of the class action. The Roberts case, brought on behalf of tenants of the Stuyvesant Town and Peter Cooper Village rental apartment complexes in Manhattan, settled in April 2013.
Partner Christian Siebott represented tenants in two of the actions before the Court of Appeals. The cases are captioned Borden v. 400 East 55th Street Associates, L.P., N.Y. Sup. Ct., N.Y. Co., Index No. 650361/09E and Gudz v. Jemrock Realty Co., LLC, N.Y. Sup. Ct., N.Y. Co., Index No. 603555/09.
A copy of the New York State Court of Appeals’ decision is available on the New York Daily News’ website, which can be read here: http://www.nydailynews.com/blogs/dailypolitics/court-apeals-class-action-lawsuits-tenants-blog-entry-1.2022032.
For more information please contact Christian Siebott, Esq. at (212) 779-1414.