State College

AG’s Office accuses 2 State College property management companies of deceptive practices

Pennsylvania Attorney General Josh Shapiro's office filed two lawsuits against Associated Realty Property Management and Legacy Realty and Property Management, accusing the agencies of deceptive security deposit practices.
Pennsylvania Attorney General Josh Shapiro's office filed two lawsuits against Associated Realty Property Management and Legacy Realty and Property Management, accusing the agencies of deceptive security deposit practices. Associated Press, file

Two lawsuits filed Monday by the state attorney general’s office accused two State College property management companies of deceptive security deposit practices.

Legacy Realty and Property Management and Associated Realty Property Management deducted charges associated with cleaning, painting, administrative fees and fines from tenants’ security deposits, despite tenants not damaging the unit or owing any unpaid rent, according to the lawsuits.

ARPM plans to “vigorously” defend themselves and their owners against the lawsuit, President Mark Bigatel said.

“We just can’t comprehend their thinking on this,” Bigatel said. “We think students have to be responsible for their actions.”

A representative from LRPM could not immediately be reached for comment.

LRPM required tenants to perform cleaning, replace light bulbs and professionally shampoo the carpets to remedy normal wear and tear, which was “effectively passing the defendant’s cost of business onto the tenants” since 2011, the lawsuit said.

The company charged tenants $250 to replace smoke detectors or batteries for the smoke detectors. The fines were “unnecessarily high in relation to the violation,” the lawsuit said.

ARPM, meanwhile, charged tenants for items they already cleaned professionally or to replace items that were not in the rental unit upon move-in, the lawsuit said.

“One consumer stated the defendant charged her for replacement of a fourth dresser when only three existed at the time of occupancy,” Deputy Attorney General Kyla Djannie wrote in the lawsuit.

The company also imposed a 10-15% administrative charge on top of all other security deposit deductions from 2012 to 2017, the lawsuit said. Bigatel disputed that claim, saying the company stopped charging administrative fees in 2015.

The state attorney general’s office requested both agencies be deemed to be in violation of the Consumer Protection Law, make full restitution to all previous tenants who incurred losses, pay civil penalties of $1,000 for each violation and $3,000 for each violation involving someone older than 60 and repay the office for its investigation.

The lawsuits represent at least the second and third time the state attorney general’s office has taken legal action against a State College-based property management company this year.

Continental Real Estate Management agreed to pay $40,000 after the office also reviewed its security deposit practices. The company deducted a 15% administrative fee from tenants’ security deposits upon termination of their leases for about seven years, according to a court document.

The company “didn’t do anything else wrong, either,” Bigatel said. Instead, he claimed the state attorney general’s office typically goes after smaller organizations that may not have the financial means to defend themselves.

While the lawsuits and settlements have been filed recently, Bigatel said conversations between property management companies in Centre County and the state attorney general’s office have been ongoing since 2014.

“This goes way back,” Bigatel said. “We haven’t broken any laws. They can’t show where we’ve ever broken any laws. It’s just something they’ve started in the community.”

Bret Pallotto primarily reports on courts and crime for the Centre Daily Times. He grew up in Lewistown and graduated from Lock Haven University.
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