Owners Pay City Record $2.25M to Settle Claims of Illegal Evictions and Short-Term Rentals
Mayor Eric Adams and New York Attorney General Letitia James recently announced a settlement against the owners of a building in Crown Heights, Brooklyn, for illegally evicting tenants in 2020 and running an unlawful short-term rental operation for four years across nine Brooklyn buildings. The $2.25 million settlement is the largest monetary award the city has ever received from a case against an illegal short-term rental operator, and the case represents the city’s first-ever enforcement of the “Unlawful Eviction Law.”
The settlement requires the owners to transfer the Crown Heights building, valued at more than $2 million, to an owner designated by the city for use as low-income housing. They also must pay $250,000 in fines to the city and state and agree not to conduct future illegal short-term rental activity anywhere in the city. The city has also provided former tenants with significant recovery funds for the damages and trauma they suffered due to their landlords [City of New York v. Brooks-Church, February 2022].
The illegal renting activity began in January 2016 and lasted until at least the summer of 2020. The operations are estimated to have generated $1.4 million in revenue for two owners. The two placed 83 different listings on Airbnb and had 5,600 guests, preventing 14 units across nine buildings in Brooklyn from housing permanent tenants. In July 2020, the owners used threats and force to push out at least four tenants. In doing so, they violated a law that barred property owners from engaging in self-help evictions while subsequently violating the state moratorium on evictions instated during the pandemic. They removed their tenants’ possessions and changed the locks without providing keys to the tenants.
The city first began investigating the case that same month and sent a cease-and-desist letter to them. In November of 2020, the City Law Department’s Tenant Protection Unit in coordination with the Mayor's Office to Protect Tenants and the Office of the Attorney General brought its first lawsuit against them. The following month, the Mayor's Office of Special Enforcement filed a lawsuit targeting the illegal short-term rentals, which didn’t include the Crown Heights building. Additionally, the Office of the Attorney General began an investigation of possible state law violations.