Exclusive: lawsuit paints disturbing picture of company that targeted Latinos, low-income tenants and those with mental disabilities in illegal eviction scheme

This article is more than 3 years old

This article is more than 3 years old

The Latino families all got the same threat posted on their doors: if their children played in the apartment’s hallways, they would be evicted. When the Spanish-speaking parents asked the Los Angeles property managers for help reading the notices, they were told: “Learn English.”

According to a federal discrimination lawsuit filed Thursday against a major California real estate investment firm, when four mothers inquired about the notices, management threatened to “call immigration, social services and the police”.

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“I was in shock,” said Carmen Castro, one of the mothers. “That really created a fear in us.”

The complaint against Optimus Properties paints a disturbing picture of a company that has targeted and harassed Latino residents, low-income tenants and renters with mental disabilities as part of an illegal eviction scheme to replace them with wealthier, younger people.

Civil rights advocates said the suit, filed on behalf of 15 tenants and advocacy group Strategic Alliance for a Just Economy, provides a window into the tactics of profit-driven real estate investors who are aggressively purchasing and “flipping” older buildings, accelerating gentrification, displacement and income inequality in cities across the US.

Facebook Twitter Pinterest Hilda Deras, 76, has received baseless eviction notices and faced harassment from her landlords, according to the federal lawsuit. Photograph: Joshua Busch

The allegations come at a time of increased anxiety for Latino families and immigrants tied to the surprise victory of Donald Trump. The president-elect has called Mexicans rapists, has threatened to deport millions and in the 1970s was accused of discriminating against African Americans at his real estate properties.

The lawsuit, filed by the not-for-profit groups Public Counsel and Public Advocates, covers five buildings with a total of 150 units in Koreatown, a gentrifying neighborhood that has historically been affordable to working-class people, with a high concentration of Asian American and Latino families.

The complaint alleged that Jerome Mickelson, Optimus’ director of construction and multifamily asset manager, along with a number of his affiliated real estate companies, have systematically targeted tenants protected by rent control.

For this population, new landlords are barred from raising rents beyond small annual increases and cannot evict them if they continue to pay rent, but the laws haven’t stopped Mickelson, according to the complaint.

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In an email to the Guardian, Mickelson strongly denied the allegations. “We take these allegations very seriously and categorically deny each and every such allegation,” he said. He added that the lawsuit was filed “without proper analysis and investigation” and that the companies “look forward to working with the Plaintiff to educate them about the real facts and if need be, to exonerate ourselves at trial”.

Residents “are treated with respect at all stages of their tenancy”, he added.

However, according to the complaint, property managers in the buildings allegedly filed a series of illegal eviction notices and have created “a hostile and threatening environment” for tenants.

The landlords in one building allegedly told tenants that the new managers “don’t want to rent to people with mental disabilities, that they should move, and that they belong in group homes”, the suit said.

Landlords have additionally “told Latino tenants that their food smells ‘disgusting’ and ‘foul’ and that the tenants need to learn to read English since they are in America”, according to court records.

Facebook Twitter Pinterest Tenants targeted for eviction have struggled to get management to address infestations of rodents, roaches and bedbugs, broken heaters and bathtubs, plumbing problems, leaks, peeling drywall, mold and other maintenance problems, according to the complaint. Photograph: Joshua Busch

Utilizing a practice that activists say is common for real estate investors who flip buildings, Optimus has also allegedly allowed for “uninhabitable living conditions” in the apartments with rent control while “providing freshly renovated units in good and sanitary condition to new tenants who are English-speaking”.

Tenants targeted for eviction have struggled to get management to address infestations of rodents, roaches and bedbugs, broken heaters and bathtubs, plumbing problems, leaks, peeling drywall, mold and other maintenance problems, according to the complaint.

Optimus has advertised a “Koreatown strategy” in its marketing materials, explicitly stating that it is focused on “value creation” by investing in old buildings and renovating units “as they become vacant”.



Deepika Sharma, attorney with Public Counsel, said these kinds of campaigns against tenants are not unique.

“It is wide-scale,” she said, adding that tenants’ fears of racial discrimination have escalated since Trump’s victory. “Even before this election, our clients experienced this racism that threatened their ability to live in their homes.”

Facebook Twitter Pinterest Arthur Rivera, a 67-year-old tenant with a disability, has received numerous unlawful eviction notices, the lawsuit alleged. Photograph: Joshua Busch

Demetrius Allen, a 45-year-old African American tenant who has a mental disability, was chronically homeless before he moved in to the Koreatown building in 2012. He has received more than a dozen eviction notices since Optimus purchased the property – all of which were illegal, according to the complaint.

“I’m completely overwhelmed,” he said. “Every day of the week … it’s always something.”

An on-site manager allegedly told Allen that the landlords “planned to rid the building of persons with mental disabilities”, the suit said.

When he first moved in, he said, “It was a sanctuary.” But he said the nonstop threats from management and the fear that he may be homeless again have taken a severe toll on his mental health.

“It’s really destroyed my peace of mind. You’re always angry or paranoid. You never know what’s going to happen next.”

Castro, 31, whose sons are ages five and 11, said that she doesn’t know how her family could find another affordable place if her landlord successfully pushes her out. “We would end up homeless, out on the streets.”