A lawsuit by Westminster Management LLC renters alleging illegal practices ended Thursday after a Baltimore judge ordered judgment in the property management company’s favor.
Owned by the family of Jared Kushner — President Donald Trump’s son-in-law and a White House senior adviser — Westminster and its affiliated businesses own thousands of apartments and townhouses in Maryland. The plaintiffs claimed the defendants were violating Maryland law by charging and collecting impermissible fees and filing eviction proceedings even if the rent was current.
The Public Justice Center filed a potential class-action suit in Baltimore City Circuit Court on behalf of several renters in 2017. Though portions of the case survived a motion to dismiss in 2018, a judge declined to certify a class of plaintiffs last year.
Thursday’s order by Baltimore Circuit Judge Philip S. Jackson granting summary judgment for Westminster “effectively concludes Plaintiffs’ counsel’s efforts to improperly attempt to legislate through the judicial system,” according to a news release from Nelson Mullins Riley & Scarborough LLP, which represented the defendants.
“This is an enormous win, not only for our client, but for property managers as a whole,” attorney Michael Blumenfeld said in a statement. “It is good to see that the law and justice prevail over political motivations and personal agendas.”
The Public Justice Center attorney representing the plaintiffs was not immediately available for comment Friday.
In their motion for summary judgment, the defendants argued the plaintiffs were asking the court to “step into the shoes of the General Assembly to re-write Maryland landlord tenant law.” Jackson did not write an opinion explaining his reasoning but cited the reasons outlined in the defendants’ motion.
Blumenfeld said Friday that it would have been “very significant” if the plaintiffs’ reading of the law had been accepted by the court.
“They were basically trying to change the way landlords did business in the state of Maryland and it would have been very significant,” he said.
He added that the practices the plaintiffs complained of were not unique to Westminster.
“It’s not like my client does business differently,” he said. “These are industry standards.”
The plaintiffs alleged Westminster charges improper fees, including an agent fee and a court fee, that amount to penalties above the 5% fee for late rent allowed under Maryland law.
But according to the defendants, the statute cited by the plaintiffs applies only to written lease provisions, not to landlord conduct, and the plaintiffs’ accusations involved only conduct, including charging, attempting to charge and collecting certain fees. The additional fees that the plaintiffs alleged were charged are also separate from the 5% late fee, according to the motion, because they are part of the cost of filing a court action for past due rent.
The plaintiffs also alleged improper debt collection by the defendants, who they said threatened to enforce a right that did not exist; the defendants replied that, under Maryland law, Westminster is not a debt collector and had a right to seek to collect debts. The defendants also said the plaintiffs were attempting to challenge the validity of the debt, not the method of collection, in their complaint.
The plaintiffs also failed to prove unfair practices or deception at the time they entered their leases or any breach of contract by the defendants, according to the motion.
The Maryland Office of the Attorney General announced charges against Westminster and its related companies in October, alleging violations of Maryland rental laws. Defense attorneys say Jackson’s ruling in the civil suit should also bring an end to the attorney general’s investigation.
However, a spokeswoman for the Attorney General’s Office said Friday that the office’s case was ongoing and that the ruling has no impact.
Kushner was not a named defendant in the proposed class action. Westminster Management is a unit of the Kushner Cos., a family-run, New York-based business that owns, manages and develops properties nationwide.
The case is Tenae Smith et al. v. Westminster Management et al., 24C17004797.