Court rules that Wasatch Property Management’s add-on charges for Section 8 tenants are unlawful

November 23, 2022

On November 23, 2022, GBDH and co-counsel, together with our courageous Plaintiff tenants, won a major victory for Section 8 tenants in the class action and False Claims Act suit United States ex rel. Terry et al v. Wasatch Advantage Group et al.  The case challenges Wasatch’s practice of requiring Section 8 tenants to pay various service charges, such as charges for media packages and parking spaces, in addition to the government-approved rent amount.  Wasatch’s accounting and collection policies make payment of those additional charges a condition of continuing to live at the property—tenants must either pay them or face threats of eviction.

In its important ruling, the Eastern District of California agreed with Plaintiffs that Wasatch’s policies made the charges, in effect, rent.  The Court wrote that “the definition of rent properly turns on a tenant’s right to ‘to live in and make use’ of a unit, and conditioning living in a unit on the payment of [additional] fees may convert those fees into unlawful rent.” Because the landlords participating in the Section 8 program cannot charge or collect more rent than the government has approved, the charges were unlawful.

The Court went on to rule that Plaintiffs have established liability on their breach of contract claims and Unfair Competition Law claims on behalf of the California class.  The case is on track for trial on the remaining claims later this year.

More information about United States ex rel. Terry et al v. Wasatch Advantage Group et al can be found here.