Tenants Win in Pierre v. Cox Oakland Rent Control Trial

Posted by msch on Aug 12, 2010 11:20:00 AM

Steve McDonald and Kurt Bridgman in Cox v Pierre Landlord Tenant Trial

UPDATE (April 12, 2011): 
On December 16, 2010, the Court entered Judgment in this case in favor of Plaintiffs in the amount of $538,963.98.  This is three times the jury verdict, and reflects the provision in Measure EE which requires that a tenant recover treble damages for all harms caused by a landlord’s knowing or reckless violation of the Ordinance.  The jury specifically found that the defendant had wrongfully endeavored to recover each Plaintiff’s unit, and that he did so “in knowing violation of Ordinance.”

On February 18, 2011, the Court awarded to Plaintiffs an additional $1,052,402.00 for attorneys fees in connection with the case, under provisions in Measure EE which provide for attorney fees to prevailing litigants.  Additional motions requesting fees and costs are still pending, and Plaintiffs expect to recover about an additional $70,000 pursuant to those motions. 

The defendant has filed a notice of appeal.  

The jury in the Pierre v. Cox landlord- tenant trial in Oakland awarded damages to all thirteen tenants.

Plaintiff attorney Steve McDonald represented 13 tenants from the 30-unit Monte Cresta apartment building. Mr. McDonald said that at the time defendant Dennis Cox purchased the property 38 people were living in the building, and over 17 had been living there for more than ten years. 

In closing, Mr. McDonald told the jury, "The tenants...believe that the defendant had a business plan when he purchased this property, and this plan included forcing the tenants out so he could raise the rents and the value of the property. He pushed for a rent increase that wasn't proper, he subjected the tenants to living in a construction without any relief, without any attempt to work things out for them. He mismanaged the property, and he pushed unfair policies that he knew he could not enforce...he basically did whatever he thought he could get away with, and he did so in order to make more money."

"The most glaring evidence there is," Mr. McDonald told the jury, "is the economic incentive. You heard the defendant, the defense brought their expert, Mark Cohen, and he said there was no economic incentive for the defendant to push people out, remodel the units, and raise the rents. How trustworthy is that testimony? The defendant is an experienced and successful property developer...and he does not buy these properties to lose money...he explained his business plan to a lot of people. He explained his business plan to the hard money lenders...from the very beginning: drive up the rents, perform some improvements, get higher rents, and then refinance. Take the money out, and let's do it again." According to Mr. McDonald, the jury heard the defendant's lender, and even the defendant's electrician testify to this plan. "The economic incentive is plain as day."

For the defense, Lowball Lynch attorney Kurt Bridgman asked the jury, regardless of whether the tenants should have received a three-week look ahead on planned renovations, "Was it an intentional act, to not give a three-week look-ahead? Was it intended to get people to leave? Is he serious about that? There are notices all over the place in this case. Is he really serious that because he didn't give a three-week look-ahead that he wanted people to leave? As I said in my opening statement...he didn't want anybody to leave because if everybody leaves it's $900,000 out of his pocket. When he sent that first rent notice, if everyone left, it's $900,000."

"I think you have to ask yourself," Mr. Bridgman continued, "Do you want to penalize a landlord who improves a building primarily for the benefit of the tenants, who are sitting right there, four of them still live there, do you want to penalize him for that?...Because if you do, I would think, who's going to do it in the future?...There's disruption going on, there's no question. But was it done in normal working hours? Of course it was.

"Do you see any citations from the city of Oakland for work being done at midnight? If you want to get rid of a tenant, I imagine that's the way to do it. You start a power saw in the middle of the night above their unit. That's an endeavor to recover possession. You cut off utilities day after day after day. Through the night. They can't use their unit at night. That's an endeavor, that's wrongful. Here, the building department found the work acceptable and approved it. It's fine. There's no building citations. The rent board itself approves the work. Where's the wrongfulness?"

The jury found that with respect to all of the tenants the defendant wrongfully and knowingly endeavored to recover possession of their units in violation of the Oakland Just Cause ordinance, Measure EE. For some of the tenants, but not others, the jury determined that the defendant's violation was in fact the reason they surrendered possession.

The jury awarded non-economic damages to all of the plaintiffs of between $10.5K-$15K each. For two tenants, the jury found that they had also been forced out by the landlord's actions and awarded economic damages of approximately $10K each.  The total damage award was $179,655.

CVN webcast the Pierre v. Cox landlord-tenant trial live.

Topics: Real Estate, Pierre v. Cox