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When a new city law barring discrimination against housing aid recipients took effect on Aug. 1, one local attorney was ready.
In recent weeks, San Diego attorney Christian Curry has filed more than 50 lawsuits on behalf of two clients, alleging landlords across town advertised homes for rent with language like “No Section 8,” referring to federal subsidized housing funds available to low-income families, the elderly and disabled.
Their demands total roughly $360,000 combined so far, court records show, not including additional unspecified damages and attorney’s fees and costs.
“It’s always been illegal to discriminate based on source of income,” Curry told Voice of San Diego. But San Diego “put some teeth into the law,” and “it’s had the most dramatic effect,” he said.
Curry knew Sylvia Valencia and Lucila Luna, the two plaintiffs he’s representing, from previous work with his law firm, the Tenants Legal Center of San Diego. He said the number of advertisements barring Section 8 applicants on sites like Zillow, Trulia and Craigslist has plummeted in recent weeks.
“The law has been very effective in doing what it was designed to do,” he said.
But critics of the law – and Curry’s zeal in suing to enforce it – say it’s also been effective at extracting money on behalf of people who never even intended to rent from the offending landlord in the first place.
San Diego city leaders approved a new ordinance last year that brings steep penalties to landlords who discriminate against tenants based on their source of income, including housing assistance from government programs for low-income individuals such as Section 8 vouchers. More than 15,000 low-income households in San Diego receive Section 8 vouchers, according to city officials.
A 2018 Urban Institute study found “lower landlord denial rates correspond with places that have protections for voucher holders.”
San Diego’s new ordinance expanded the definition for source of income to include rental assistance from “any federal, state, local, or nonprofit-administered benefit or subsidy program, or any financial aid from any rental assistance program, homeless assistance program, security deposit assistance program, or housing subsidy program, whether paid directly to the program participant, landlord, or representative of either.”
City Council President Georgette Gómez championed the law.
“Protecting our families on Section 8 from discrimination is important for reducing undue barriers in an already tight rental market,” Gómez said after the ordinance was introduced in 2018.
The new law orders violators to pay three times the advertised monthly rent to eligible plaintiffs who saw the ad, plus punitive damages, as well as a plaintiff’s attorney fees and costs if a judge so orders. Even after the offending ad is taken down or changed, exposure to liability from anyone who saw the illegal ad lasts for a year.
Valencia and Luna both claim to receive Section 8 vouchers, though it is unclear how much they receive or whether they actually intended to apply to live at each home sued. Both declined interviews through Curry.
Under the city’s ordinance, just being a recipient of a housing subsidy and seeing the ad for a home in the city of San Diego is enough to have standing to sue.
“The law doesn’t require that you apply. The law simply requires that the tenant observed it,” Curry said.
“This person never attempted to rent from us as far as we can tell,” said Shelly Croft, vice president of operations for F&F Property Management Inc., a defendant in one of Valencia’s cases. “I’m sure the lawmakers thought they were doing a good thing, but there are flaws they didn’t anticipate. … From our end, I understand why they felt this law was important. We want everyone to find suitable housing, but the law didn’t allow for misuse to be prevented.”
Janet Hammer settled a lawsuit from Luna after re-posting an old ad with anti-Section 8 language. Hammer said Luna didn’t apply before she received the lawsuit notice.
Peerless Properties Inc. also settled with Luna, said owner David Allen Puffinburger. He said the company received Luna’s lawsuit Aug. 3, but that she never applied and he doesn’t believe she intended to.
“I’d get it if there were damages, but there weren’t. She didn’t want to move that many times,” he said.
That the law doesn’t require plaintiffs to actually apply to live in the space being advertised before suing is a problem, said Molly Kirkland, director of public affairs for the Southern California Rental Housing Association.
Kirkland likened the new Section 8 cases to “drive-by” lawsuits over violations of the Americans with Disabilities Act. Such cases have been frowned upon by several courts, sparked some reform legislation and the Riverside County district attorney even sued some plaintiffs and law firms who’ve filed numerous ADA cases, claiming they made fraudulent claims for financial gain. A judge dismissed the case in July, but the DA is appealing.
This is “the very thing I was worried about,” said Kirkland, of the Section 8 cases in San Diego. “They don’t really care about the outcome. They just want the settlement money and they move on. I think that’s what we are seeing here… I don’t think the law was intended to sue a bunch of owners who made a mistake or were unaware of the law.”
A few defendants reached by Voice of San Diego said they opted to settle, but declined to discuss their cases on the record.
Tammy Gagnon, owner and manager of 5th Avenue Property Management, said she settled a lawsuit from Luna for more than $5,000 over an ad for a space in a 55 and over community. She admits she made a mistake, but she questioned Luna’s motives.
“She had pulled up an ad that was the day after the law had changed… It was the only ad that had this language, and we missed it,” Gagnon said. “I think she is taking advantage of the system. … It was a mistake and I’m really sorry. Had this person contacted me, we would have corrected it. I don’t think at any time you make a mistake that you should be right away thrown into a lawsuit.”
Kirkland also expressed concern about the penalties the law created for landlords.
“That’s a lot of money for the owner, especially an independent owner,” Kirkland said. Getting the law changed “would be difficult,” but adding an opportunity to cure the violation – something like 30 days to remove the ads and change the rental criteria – would be a “better learning tool,” Kirkland argued.
Croft, whose company F&F manages about 30 buildings containing 600 units in San Diego County, said despite training employees about the new ordinance, a year-old ad was placed by a listing agent by mistake that had Section 8 prohibition language. The company received Valencia’s lawsuit notice in the mail.
“A simple mistake costs us thousands of dollars because of the way the law was written,” said Croft, adding they settled the case, “because you can’t fight it. The way the law is written, a judge has to award three times the rental rate,” which was almost $10,000.
“Owners need to be aware, because there are no oops. There are no take-backs,” she said.
“Wherever the moral high ground is, it is probably not with the person who discriminated,” Curry said. Curry declined to disclose his fee agreement with his clients, but said claims he is out for money alone are not true.
“The client and I share the same goal. We are trying to limit discrimination, so we have been very reasonable in settling these matters,” he said. “I hope this dissuades landlords from doing it. The ultimate goal is to never have to bring these suits.”
Section 8 voucher-holders and other housing subsidy recipients will soon see more protections statewide.
A new California law will take effect Jan. 1 that largely does what San Diego did, by broadening the definition of “source of income” to include Section 8 vouchers and other subsidies paid directly to landlords to further prevent tenant discrimination. The law was created at the suggestion of the California Department of Social Services’ Lifting Children and Families Out of Poverty Task Force.
Gómez tweeted Oct. 8, “SD was ahead of CA!”
Unlike San Diego, however, the state law will leave the penalties for violators up to the courts or administrative agencies that handle the complaints.
Gómez’s office did not respond to questions about the city ordinance.
As for Valencia, she has now settled into a new home in East County, Curry said. Luna is still looking for a home to rent, and there are a couple other Section 8 recipients who may file lawsuits with Curry’s help soon.