Maryland Attorney General Brian Frosh yesterday filed a civil suit against Westminster Management, a company owned by Jared Kushner and other Kushner family members, along with 25 other companies that Westminster manages. The suit alleges that Kushner uses “unfair or deceptive” rental practices in charging his tenants, and that his apartments, located in Baltimore City and surrounding Baltimore County, are rat infested. According to the complaint, Kushner “has victimized consumers, many of whom are financially vulnerable, at all stages of offering and leasing” his apartments, by committing “hundreds of thousands of violations” of consumer protection laws. Yesterday, Attorney General Frosh told the Baltimore Sun:
What we are claiming in this lawsuit is that they were cheating tenants before, during and after their tenancy, and when I tell you there were hundreds of thousands of violations of the Consumer Protection Act, it just begins to convey the seriousness of the charges. They caused serious harm and suffering to the people who lived in their units.
The suit was filed after Kushner and his attorneys had rejected multiple settlement offers made by the state.
The suit claims that Kushner’s companies rented without proper licenses and charged tenants with illegal and sham fees while renting out “distressed, shoddily maintained” apartments under “conditions that can adversely impact consumers’ health and well being.” Many tenants
have had to endure living in units that are infested by rodents and vermin, plagued with water leaks that have caused mold and other issues, and, at times, lacking in basic utilities. [Some tenants] have experienced rodent infestations so severe that they have rodents living and dying in walls and kitchen appliances; damaging carpeting and screen doors; and leaving droppings on floors, counter tops and furniture.
In addition, Kushner’s tenants have endured sewage backups, appliances in disrepair, and a management that failed or refused to make repairs.
Kushner stepped down as CEO of Westminster in 2017 when he became “senior advisor” to his father-in-law, but refused to divest himself of ownership of Westminster. Kushner, through his attorneys, deny these allegations and claim they are politically motivated and reflect Brian Frosh’s dislike of his father-in-law. However, the Baltimore Sun article I linked to in the opening sentence of this diary contains photos that one tenant provided to the Sun of her apartment; these photos of holes in the ceiling and rodent droppings appear to confirm the State’s allegations.
Under the Maryland Consumer Protection Act, the charges are filed within the state’s attorney general’s office, with the Consumer Protection Division of the Attorney General. The suit will be assigned to an administrative law judge, who will make a finding of facts and law and refer his or her findings back to the Consumer Protection Division. The case will then be assigned to Consumer Protection personnel walled off from the initial investigation, who will adjudicate the findings and assess damages, if any. The Consumer Protection Division’s decision could then be appealed to state court. Mr. Frosh told the Baltimore Sun that the damages could reach many millions of dollars, given the vast harm done to so many tenants. Most of these damages, if collected, will be used to reimburse the tenants for the harm they have suffered and the illegal charges they were forced to pay to escape eviction.