$400K settlement bonanza for Bernal tenant 'evicted by rent increase'

A tenant sued her landlord after the rent for this house at 355 Bocana Street in Bernal Heights was raised 315 percent. On Tuesday, the tenant, Deb Follingstad, won a $400,000 settlement. A tenant sued her landlord after the rent for this house at 355 Bocana Street in Bernal Heights was raised 315 percent. On Tuesday, the tenant, Deb Follingstad, won a $400,000 settlement. Photo: Google Photo: Google Image 1 of / 7 Caption Close $400K settlement bonanza for Bernal tenant 'evicted by rent increase' 1 / 7 Back to Gallery

A San Francisco woman who was forced out of her Bernal Heights apartment when her landlord increased her rent from $2,145 to $8,900 a month won a huge court settlement Tuesday, KQED reported.

In March 2015, Deb Follingstad posted the news of the shocking rent hike on Facebook and added that her landlord was also raising her security deposit from $1,500 to $12,500. The story, emblematic of the Bay Area's out-of-control real estate market, created a firestorm on social media.

Follingstad had lived in the rent-controlled, two-bedroom Bocana Street apartment for 11 years before her landlord, Nadia Lama, informed her by letter of the staggering rent hike. Lama obtained the property through inheritance.

"By raising the rent 400 percent and demanding a five-figure security deposit, the landlord is effectively evicting this tenant," Supervisor David Campos, who represents Bernal Heights, said at the time.

Follingstad sued Lama in August 2015. She and her laywer, Joe Tobener, accused Lama of trying to circumvent a city ordinance that requires reimbursement for tenants displaced in an "owner move-in" eviction.

Tobener announced Tuesday that Lama had settled for a whopping $400,000 — "the highest constructive-eviction-by-rent-increase case we've ever had." The attorney told KQED the high settlement amount reflected both what he called Lama's "egregious" behavior in raising the rent and the risk Lama ran in allowing the case to go to trial, where a jury could award triple damages for his client's emotional distress claims. The jury trial had been scheduled to begin next week.

Follingstad's story took a twist in 2015 when commenters on news sites revealed that she was renting a room in her apartment on Airbnb, and some accused her of exploiting the situation.

At the time, Denise Leadbetter, the attorney representing Lama, told SFGate in a statement that the rent hike actually provided an opportunity to Follingstad.

"The rent increase that has generated this controversy is actually an offer by the owner to rent a substantially larger home than was originally rented," Leadbetter said.

"In addition to the upper level (in which tenant currently resides), Ms. Follingstad will have access to at least 60% more space which can be used by the tenant to offset the rent increase through her existing Air BnB business."

But Tobener, a tenants rights attorney and managing partner at Tobener Law Center, said the evidence left no doubt that Lama wanted Follingstad out just so she could move in.

"Their defense was, hey, they took the lower rental unit off the market, they took out the kitchen, and therefore it became a single-family home, so they were allowed to increase the rent to whatever they wanted," Tobener told KQED. "Our argument was, 'Look, you can increase the rent to market rate, but you can't raise it way above market rate to force someone out to get around the owner-move-in eviction protections.'"

Follingstad, an acupuncturist who treats cancer patients, previously told SFGate that her her lease agreement didn't include prohibitions or restrictions on subletting. Most of the time, she said, she was offering her second bedroom to her patients who were dying from cancer and traveling from afar for her treatments.