Tenants’ $4.75 Million Eviction Fee Settlement Gets Final Nod

North Carolina tenants secured a federal court’s final approval of a $4.75 million class settlement resolving allegations that several apartment investment and management companies unlawfully sent collection letters and charged eviction-related fees.

Their attorneys’ request for $1.3 million in fees also won approval Aug. 6 from the U.S. District Court for the Eastern District of North Carolina.

Randi Milroy and Dan Williams alleged Bell Partners Inc., LSREF3 Bravo (Raleigh) LLC, and Hudson Capital Weston LLC violated the North Carolina Residential Rental Agreements Act, North Carolina Debt Collection Act, and North Carolina Unfair and Deceptive Trade Practices Act.

Their lawsuit was dismissed in 2019, prompting an appeal to the U.S. Court of Appeals for the Fourth Circuit. The case settled while the appeal was pending.

The agreement covers residents who lived in properties owned or managed by the companies between Sept. 21, 2014, and June 25, 2018. Judge James C. Dever III certified separate settlement classes for those who received collection letters and those who paid fees.

Collection letter class members were eligible for $25 per letter sent to them, up to $75. Eviction fee class members were eligible to receive an estimated $416.

The tenants and the companies didn’t negotiate attorneys’ fees while they were negotiating the settlement’s other terms, and the agreement wasn’t the product of collusion or fraud, the court said.

Instead, the amount of attorneys’ fees to be paid by defendants was proposed after the other terms of the settlement had been agreed upon, the court said.

Class representatives will receive the requested $2,500 each as service awards, the court said.

Any remaining money will go to Legal Aid of North Carolina.

As of March 20, 2021, only one settlement class member had opted out of the deal and no class member had objected to the settlement, the proposed award of fees and expenses to class counsel, or the proposed service awards to the class representatives, the court said.

Maginnis Howard and Milberg Coleman Bryson Phillips Grossman PLLC represented Randi Milroy and Dan Williams.

Smith Anderson Blount Dorsett Mitchell & Jernigan LLP represented Bell Partners Inc. Hunton Andrews Kurth represented LSREF3 Bravo, which does business as Reserve at Lake Lynn. Kilpatrick Townsend & Stockton LLP and Nelson Mullins Riley & Scarborough LLP represented Hudson Capital Weston, which does business as Cary Reserve at Weston.

The case is Milroy v. Bell Partners Inc., 2021 BL 297393, E.D.N.C., No. 5:18-cv-516-D, 8/6/21.