R&E Prevents Class-Action Suit Against Landlord: Decision Incorporates New Holdings from Court of Appeals Regarding Housing Stability and Tenant Protection Act of 2019

New York State Supreme Court, Decided April 30, 2020
Featuring Neil C. Dwork and Devin P. Kosar

Rosenberg & Estis successfully represented a New York City property owner in New York State Supreme Court preventing certification of a class-action lawsuit that relied on elements of the Housing Stability and Tenant Protection Act of 2019. The decision incorporates new holdings from the Court of Appeals ruling on Regina Metropolitan Co. v. Division of Housing and Community Renewal and the HSTPA. The plaintiffs claimed alleged rent overcharges, or alternatively, sought an adjournment of the deadline to move for class certification in order to conduct additional pre-class discovery, in accordance with the increased lookback period from the HSTPA. The Supreme Court denied the motion in its entirety, ruling that the plaintiff failed to meet the requirements of class certification under CPLR 901(a) and CPLR 902, despite the argument that CPLR 901(a) and CPLR 902 should be liberally interpreted. R&E argued that the plaintiff made conclusory statements to meet the CPLR 901(a) and CPLR 902 requirements without submitting factual evidence or affidavits from tenants to support the claim. R&E also argued that plaintiffs could not rely on the allegations of the adjusted complaint, as it was only verified by two of the five named case plaintiffs. The Supreme Court agreed, holding that plaintiffs’ motion was not substantiated by affidavits from someone with personal knowledge and that “after years of pre-class discovery, all plaintiffs’ counsel can do is point to defendant’s ‘tax bills,’ which had not even been provided to the court, as so-called proof that a vast majority of the subject building’s apartments have been unlawfully deregulated during the J-51 period. This was insufficient to demonstrate numerosity. Relatedly, absent any facts, plaintiffs speculate that the named plaintiffs’ claims are typical to those of the class. Mere supposition cannot satisfy plaintiffs’ burden on a motion for class certification.” The Court also rejected Plaintiffs’ application of HSTPA to support their claim for numerosity, citing the Court of Appeals recent holding in Regina, that “retroactive application of that statute is unconstitutional.”