UPDATE (April 12, 2011): 
On December 16, 2010, the Court entered Judgment in this case in favor of Plaintiffs in the amount of $538,963.98.  This is three times the jury verdict, and reflects the provision in Measure EE which requires that a tenant recover treble damages for all harms caused by a landlord’s knowing or reckless violation of the Ordinance.  The jury specifically found that the defendant had wrongfully endeavored to recover each Plaintiff’s unit, and that he did so “in knowing violation of Ordinance.”

On February 18, 2011, the Court awarded to Plaintiffs an additional $1,052,402.00 for attorneys fees in connection with the case, under provisions in Measure EE which provide for attorney fees to prevailing litigants.  Additional motions requesting fees and costs are still pending, and Plaintiffs expect to recover about an additional $70,000 pursuant to those motions. 

The defendant has filed a notice of appeal.  

The jury in the Pierre v. Cox landlord- tenant trial in Oakland awarded damages to all thirteen tenants.

Plaintiff attorney Steve McDonald represented 13 tenants from the 30-unit Monte Cresta apartment building. Mr. McDonald said that at the time defendant Dennis Cox purchased the property 38 people were living in the building, and over 17 had been living there for more than ten years. 

In closing, Mr. McDonald told the jury, “The tenants…believe that the defendant had a business plan when he purchased this property, and this plan included forcing the tenants out so he could raise the rents and the value of the property. He pushed for a rent increase that wasn’t proper, he subjected the tenants to living in a construction without any relief, without any attempt to work things out for them. He mismanaged the property, and he pushed unfair policies that he knew he could not enforce…he basically did whatever he thought he could get away with, and he did so in order to make more money.”

“The most glaring evidence there is,” Mr. McDonald told the jury, “is the economic incentive. You heard the defendant, the defense brought their expert, Mark Cohen, and he said there was no economic incentive for the defendant to push people out, remodel the units, and raise the rents. How trustworthy is that testimony? The defendant is an experienced and successful property developer…and he does not buy these properties to lose money…he explained his business plan to a lot of people. He explained his business plan to the hard money lenders…from the very beginning: drive up the rents, perform some improvements, get higher rents, and then refinance. Take the money out, and let’s do it again.” According to Mr. McDonald, the jury heard the defendant’s lender, and even the defendant’s electrician testify to this plan. “The economic incentive is plain as day.”

For the defense, Lowball Lynch attorney Kurt Bridgman asked the jury, regardless of whether the tenants should have received a three-week look ahead on planned renovations, “Was it an intentional act, to not give a three-week look-ahead? Was it intended to get people to leave? Is he serious about that? There are notices all over the place in this case. Is he really serious that because he didn’t give a three-week look-ahead that he wanted people to leave? As I said in my opening statement…he didn’t want anybody to leave because if everybody leaves it’s $900,000 out of his pocket. When he sent that first rent notice, if everyone left, it’s $900,000.”

“I think you have to ask yourself,” Mr. Bridgman continued, “Do you want to penalize a landlord who improves a building primarily for the benefit of the tenants, who are sitting right there, four of them still live there, do you want to penalize him for that?…Because if you do, I would think, who’s going to do it in the future?…There’s disruption going on, there’s no question. But was it done in normal working hours? Of course it was.

“Do you see any citations from the city of Oakland for work being done at midnight? If you want to get rid of a tenant, I imagine that’s the way to do it. You start a power saw in the middle of the night above their unit. That’s an endeavor to recover possession. You cut off utilities day after day after day. Through the night. They can’t use their unit at night. That’s an endeavor, that’s wrongful. Here, the building department found the work acceptable and approved it. It’s fine. There’s no building citations. The rent board itself approves the work. Where’s the wrongfulness?”

The jury found that with respect to all of the tenants the defendant wrongfully and knowingly endeavored to recover possession of their units in violation of the Oakland Just Cause ordinance, Measure EE. For some of the tenants, but not others, the jury determined that the defendant’s violation was in fact the reason they surrendered possession.

The jury awarded non-economic damages to all of the plaintiffs of between $10.5K-$15K each. For two tenants, the jury found that they had also been forced out by the landlord’s actions and awarded economic damages of approximately $10K each.  The total damage award was $179,655.

CVN webcast the Pierre v. Cox landlord-tenant trial live.

Pierre v. Cox involves claims that an Oakland landlord, Dennis Cox, improperly attempted to raise the rents of 13 tenants at the Monte Cresta Apartments. CVN is webcasting the trial live.

According to plaintiff attorney Steve McDonald, “The defendant had a business plan when he purchased the apartment building where the tenants lived. And this plan included forcing the tenants out so he could raise rents and increase the property value. The plan was that he would push for this huge rent increase. He would subject the tenants to living in a construction zone. He would mismanage the property while doing so. And he would implement an unfair dog policy.”

According to McDonald, the landlord was an experienced real estate developer and investor who managed apartments himself. Cox allegedly purchased three apartment buildings at the same time. Two of the buildings were financed with low-interest 30-year loans. But for the third property, the Monte Cresta apartments, Cox allegedly obtained a two-year loan at 10.5% interest, which would allow him to raise the rents due to a debt service increase.

Said McDonald, “The plan was to use his 10.5% loan as a pretext to increase the tenants rents. A debt service increase would be far greater borrowing from a hard money lender than if he went to a traditional lender or hot a different loan with a lower interest rate. Defendant’s plan also included that he was going to refinance the short-term loan in two years — after he passed on the suddent, drastic rent increases to the tenants.”

Defense attorney Kurt Bridgman, of Low, Ball, and Lynch, said that “Mr. Cox was an extraordinary man. He followed the Oakland rent law as written. He followed all the Housing Codes. He fixed up a property that had suffered 40 years of deferred maintenance. And that really is the sin in the plaintiffs’ eyes — that he fixed a property that they all had complained about for years and years.”

Bridgman said that Cox had put over $1M into fixing up this property. The work was done by licensed contractors, and was permitted by the City of Oakland. The Oakland rent board approved that there was a need for the improvements and the amount spent.

Morever, said Bridgman, no one ever paid the proposed $381 rent increase. The only amount ever paid was the amount provided by the Oakland rent board. Nor was there any physical injury or emotional distress. Bridgman characterized some of the plaintiffs’ evidence as “weak, tepid, suspicious, and potentially manipulative.”

CVN is webcasting the Pierre v. Cox landlord-tenant trial live from Oakland, gavel-to-gavel.