When Sam Mather’s landlord changed his locks to digital “smart home” ones, they went a bridge too far by charging him for the pleasure, according to a new class action lawsuit filed Thursday.
The lawsuit alleges that Vivmark Residential, a major national landlord, has been charging tenants across the 5,300 units it owns and manages in D.C. fees for having keyless doors, digital thermostats, trash removal, access to hot water from a central boiler and third-party billing.
All told, the fees — which the lawsuit argues are excessive “junk” fees that the D.C. Council and attorney general have specifically ruled illegal — cost Mather, the plaintiff in the case, more than $2,000 in the five years he lived at 2501 Porter St. NW, one of dozens of apartment buildings the company owns and manages across the D.C. metro area, the lawsuit says.
The suit attacks a “proliferating problem” in D.C. housing that burdens renters already struggling to navigate a costly rental market, Tara Mikkilineni, a lead attorney in the case, told The Washington Sun.
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“It’s already so hard to find affordable housing [in D.C.], and on top of that, you’re being charged for these basic services the landlord is required to provide. It really eats away at folks’ disposable income,” Mikkilineni said.
A spokesperson for Vivmark Residential, a company formed in August by the merger of AvalonBay Communities and Equity Residential with headquarters in Chicago and Arlington, did not immediately respond to a request for comment on the lawsuit or why the fees were charged.
“For corporate landlords, there’s a lot of appeal in packing on these fees that create additional consistent revenue streams,” Mikkilineni said.
Tacking on fees could be attractive to property management firms in D.C. operating on slim profit margins and dealing with high rent delinquencies. That reality is why there are fewer reputable property management companies than ever in the District to contract with, landlords say.
“Property managers are often paid as a percentage of rental income collected. When collections fall, that fee may no longer support the time and effort needed to manage a property facing significant operating and maintenance challenges,” said Dean Hunter, the CEO of D.C.’s Small Multifamily Owners Association.
But companies aren’t allowed to charge their way into solvency. D.C. renters are protected by law from “junk fees” — which the D.C. attorney general’s office defines as “a blanket term for any fees that are unclear, are not used for their stated purpose, or are used to cover a service a landlord is required to provide to rent a livable space.”
That includes charges for services the landlord should be providing anyway when renting out a livable space, the AG’s guidance on the issue says, like service fees for providing utilities.
The D.C. Council clarified earlier this year that housing providers are barred from charging tenants for “services that they are required to provide under the implied warranty of habitability” and that should be covered by rent, specifically naming lockable doors and trash removal as examples.
The lawsuit — filed in D.C. Superior Court by law firms Halperin Petersen & Mikkilineni LLP, Tycko & Zavareei LLP and Migliaccio & Rathod LLP — seeks a jury trial, damages and disgorgement of ill-gotten gains.
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