Tenants of 421-a Building Can Pursue Rent Overcharge Claims in Class Action

Rent-stabilized tenants of a building receiving RPTL 421-a tax benefits sued landlord in 2021, claiming that landlord improperly utilized preferential rents as part of their initial 421-a registration. Tenants asked the court to certify a class defined as all tenants at the building who occupied apartments between June 14, 2015, and the conclusion of the litigation, with a sub-class defined as all tenants currently residing in the building.

Landlord objected, arguing that the proposed subclass with respect to injunctive relief wasn't necessary, that tenants hadn't shown the number of potential claimants to be so numerous as to render a class action to be the most efficient way to maintain a class, that the proposed six-year lookback period for the class was overbroad, and that each unit had a different rent history and progression of tenancies that was contrary to the commonality and typicality requirements for class certification.

The court ruled for tenants. There were at least 45 possible claimants among the tenants, so they met the numerosity requirement for a class action. And tenants' claims arose from the same conduct arising from wrongful use of a preferential rent. So they satisfied the commonality and typicality requirements. Tenants also showed that permitting a class action was superior to requiring individual lawsuits as a means to resolve the claims. 

Alexander v. 4469 Broadway LLC: Index No. 153828/2021, 2023 NY Slip Op 32857(U)(Sup. Ct. NY; 8/17/23; Rosado, J)