Tenants in 421-a Building Claiming Rent Concessions Caused Overcharges Can Pursue Class Action

Current and former tenants sued landlord for improper deregulation, seeking rent-stabilized leases and rent overcharge refunds. The building was subject to rent stabilization under the RPTL 421-a tax benefit program. Tenants claimed that landlord illegally calculated initial apartment rents because, while advertising apartments with a "net effective rent" that took certain rent concessions into account, the units were registered with the DHCR at higher, undiscounted rent figures. Tenants sought certification from the court as a class defined as all current and former tenants who occupied their apartments at any time after March 28, 2016. The also sought certification of a subclass consisting of all current tenants. The court ruled for tenants. Tenants demonstrated numerosity, common question of law or fact, claims that derived from the same practice or course of conduct, adequacy of representation, and superiority of a class action as the form to resolve the dispute.

Gilbert v. 24th St. LIC LLC: Index No. 152618/2022, 2022 NY Slip Op 34077(U)(Sup. Ct. NY; 12/3/22; Goetz, J)