26 April 2024. In a significant victory for plaintiffs, Chief Judge James E. Boasberg of the District Court for the District of Columbia largely denied defendant Bozzuto Management Company’s motion to dismiss in a putative class action lawsuit alleging violations of D.C.’s consumer protection laws.
The case, brought by former tenant Laura Hettinger on behalf of herself and other DC tenants at properties managed by Bozzuto, claims that Bozzuto engaged in an unlawful “drip pricing” scheme by failing to disclose mandatory utility charges upfront in rental listings and applications for its DC apartment buildings. Hettinger alleges these practices violate D.C.’s Consumer Protection Procedures Act (CPPA).
In seeking dismissal, Bozzuto argued that its utility charges were proper and that the CPPA does not require disclosure of such fees. However, the court rejected these arguments, finding that Hettinger plausibly alleged the utility charges constitute “rent” under D.C. law since the leases stated that failure to pay them can result in eviction. As such, Bozzuto may be required to disclose these fees at the application stage.
The court also reasoned that a reasonable consumer may be misled by Bozzuto’s practice of revealing utility charges only after an applicant has spent hundreds of dollars on non-refundable fees and deposits.
While the court dismissed Hettinger’s claim that the gas and electric submetering practice used by Bozzuto was per se illegal, it allowed those claims to move forward on a theory that the practice is unfair. It also denied Bozzuto’s challenge to her claim that Bozzuto used an inflated rate in assessing tenants’ water and sewer bills. This decision marks an important step forward for the putative class, permitting them to pursue their claims that Bozzuto’s utility pricing practices violate D.C. consumer protection laws.
Ms. Hettinger is represented by TZ attorneys Kristen G. Simplicio, Peter Silva, Leora Friedman, and Shilpa Sadhasivam, supported by paralegal Emma Bass, as well as Jason Rathod of Migliaccio & Rathod LLP.
The case is Laura Hettinger v. Bozzuto Management Company, Case No.: 23-3687 in the United States District Court for the District of Columbia.