Proving that Pinnacle violated RICO will be the most difficult part of the case, because it will require plaintiffs to show that the company and Weiner engaged in a deliberate pattern of racketeering by violating over a 10 year period at least two of 35 crimes under the statute.
The other problem plaintiffs might face is convincing more tenants to participate, Powell says. From 2004 to 2006*, Pinnacle reportedly filed eviction proceedings against about 5,000 tenants. Since the plaintiffs filed suit, Powell contends, Pinnacle’s harassment and intimidation of tenants has worsened. “The massive fear that is being kicked out of your home,” says Powell. “What is perturbing to me even today, I have reason to believe, despite the signing of the settlement agreement they continued to conduct illegal practices.”
But if the plaintiffs succeed in obtaining an adverse judgment against Pinnacle, the company could lose millions of dollars.* The judge could order the company to reimburse up to three times the rent it overcharged. Additionally, the state’s Division of Housing and Community Renewal can penalize landlords $250 for deliberate violations of rent regulations and $2,500 when it finds them guilty of harassing tenants to vacate apartments.
“I think if the plaintiffs prevail in Pinnacle, the precedent will create a strong additional disincentive for landlords to engage in broad predatory practices," says Josephson. "In fact, just the fact that the Pinnacle case has progressed as far as it has, has probably given landlords some food for thought."
The case is not the first to allege that landlords violated RICO laws, nor is it the first filed since the City Council passed the tenant anti-harassment law in 2008. But Josephson believes it could be the first time in New York City history that tenants have won class action status in a case filed under RICO.
Attorneys for the plaintiffs have set up a hotline for tenants with complaints against Pinnacle, and the Manhattan Borough President’s Office is recruiting tenant advocates in the 194 Pinnacle buildings in Manhattan to get more tenants involved in the lawsuit.
Powell recalls that when tenants in her building, 706 Riverside Drive in West Harlem, first began to realize that their problems with Pinnacle were systemic, their only option was to file a complaint with DHCR.
Now the court will have the opportunity to consider the impact on every alleged Pinnacle victim, Powell says. “While I sat back there in 1997, while I saw what I saw, I wasn’t able to articulate it 'til 2005, other than to say I saw something that was potentially terribly wrong,” she says. “I just needed to get someone to listen. I think we have that now.”
*Portions of this article were corrected after initial publication.
