ST-PCV TA to file for Sandy rent reductions

By Sabina Mollot

Workers stand by generators used to dehumidify building basements in Peter Cooper in late November.

For the first time in the history of the complex, the Stuyvesant Town-Peter Cooper Village Tenants Association is calling for a rent reduction due to a lack of basic services such as working elevators and laundry equipment in buildings that were hard-hit by Sandy.

On February 1, attorneys for the Tenants Association served ST/PCV General Manager Sean Sullivan and Andrew MacArthur of CWCapital with a notice that it would be filing a rent reduction claim before New York State’s Homes and Community Renewal (HCR) agency for a diminution of services under the Rent Stabilization Law.

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Letters to the Editor, Feb. 7

Roberts settlement a win

As I listened to Alex Schmidt, plaintiffs lead attorney in the Roberts case, make his fine presentation to the ST/PCV (Tenants Association meeting) audience this past Saturday morning (Jan.  26) I was struck by the fact that the settlement negotiated between the parties was not only an eminently fair one, but a compelling one. For that reason I wish to share my professional judgment about this settlement with the other members of the class, of which I am one.

This is undoubtedly the largest landlord-tenant class action settlement in our country’s history, and it’s the only one of the several “J-51” class actions that has been resolved to date. Three cash components ($100,000,000 former market rate tenants have saved in since the Interim Settlement in December 2009;  $68,750,000 to be refunded for past overcharges between 2003 and 2009; and future rent savings over the next eight years that could rise to as much as $275,000,000) form the core of the settlement. It is a staggering accomplishment.

If the Roberts case had not been settled but was lost either at trial or by class de-certification, none of these benefits would have been achieved.  Moreover, the 4,300 apartments at issue would have been returned to market rate from which residents could be evicted any time their leases came up for renewal. The more than 22,000 affected individual tenants would be facing the nearly impossible task of hiring their own lawyers and filing actions to recover past overcharges and establish future rents.

It is critical that all class members understand that the Interim Rents of 2009, damages and Preferential formulas under this settlement are more favorable to tenants than what the formulas likely would have been absent the settlement and left to the courts for decision.

One reason for this is the landlords who unlawfully deregulated while in the J-51 program, argued that after the Court of Appeals ruling returning the apartments to rent stabilization they should be entitled to all credits and increases they would have been entitled to under the Rent Stabilization Laws had they not deregulated the apartments. The Roberts plaintiffs argued that the landlords should not be entitled to any of these credits because of their unlawful conduct. The settlement resolved this issue in a manner very favorable to the class, while the law in other related J-51 cases was evolving in a direction decidedly unfavorable to our class members.

While rents will go up for most tenants under this settlement by a few to several hundred dollars per month, that is a result of how the law has changed in the landlords’ favor rather than the settlement. If there had been no settlement, rents certainly would have gone up much more and climbed much faster during the next eight years.

This is a sensational result for the class as a whole under any standard, but clearly when considering the turn for the worse the law was taking. And since the vast majority of class members achieved some combination of rent savings, rent refunds and future rent savings, the settlement is very good for each of us individually, too.

John J. Sheehy, Esq.

The writer was the chair of a large litigation department of a major international law firm and member of the New York State Commission on judicial conduct. He is presently a director of the ST-PCV Tenants Association, but is writing in his private capacity. The TA, which was not a party to the action, has taken no position on the settlement.

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