Local Landlords Charged with Rent Gouging Placed on Criminal Diversion
September 27, 2022 8:58 AM
SANTA MONICA, Calif. – On September 26, 2022, a judge for the California Superior Court placed defendants 1433 Euclid Street, LLC., and WS Communities, LLC., landlords of the property located at 1433 Euclid Street in Santa Monica, on a 12-month diversion program in connection with misdemeanor criminal charges of rental housing price gouging in violation of state law. The state rental housing price gouging law, Penal Code Section 396(e), generally prohibits landlords from increasing a tenant’s rent by more than 10% during a declared state of emergency. California and Santa Monica remain in declared states of emergency due to the COVID-19 pandemic.
As part of the terms of diversion, the defendants are required to pay $20,000 to The People Concern, a local homeless services organization, and $15,000 to the City of Santa Monica for tenant protection enforcement and outreach. The defendants must also post a notice regarding rental price gouging protections at the 1433 Euclid property. Two representatives of the property manager must attend and complete a tenant’s rights training program. In its complaint, the People alleged the defendants engaged in illegal rental price gouging—raising the rent more than 10% during a declared state of emergency—three times. Defendants raised a tenant’s rent from $865 to $3,000 and charged the increased rent in February, March, and April of 2020.
If the defendants successfully comply with the terms of diversion, the Court will dismiss the charges against the defendants at the end of the diversion period. If the defendants fail to comply with the terms of the diversion, the court is authorized to terminate diversion and resume the criminal proceedings.
Any questions or complaints should be directed to the Consumer Protection Unit of the City Attorney’s Office at (310) 458-8336.
Communications & Public Information Manager