McDermott Secures Settlement for Chicago Public Housing Residents in Minimum Rent Lawsuit
International law firm McDermott Will & Emery, along with Legal Action Chicago and the National Housing Law Project, has settled a federal lawsuit challenging the Chicago Housing Authority’s (CHA’s) policy of charging and collecting minimum rents from its lowest-income residents. The Firm and its partners represented public housing residents in this class action matter.
“This CHA policy was impacting some of the most marginalized people of Chicago for far too long,” Daniel Campbell, partner in McDermott’s Litigation Group and co-lead on this matter, said. “This settlement was hard fought, and it’s a big win for some of the city’s poorest residents. We are satisfied and proud we were able to push for a positive and fair resolution that impacts thousands of residents. We are pleased the Court has provided preliminary signoff on the settlement in short order.”
Public housing residents typically pay a reduced rent equal to a percentage of their income, but when that percentage falls below a certain amount, federal law authorizes CHA to charge a minimum rent of $75 per month. CHA charges more than 1,400 public housing families the minimum rent. Families who cannot afford the minimum rent have the right to request a hardship exemption. The plaintiffs’ complaint alleged that CHA did not take steps to reasonably and sufficiently inform families of this right. CHA denied this allegation.
McDermott and its partners contacted CHA and worked together over the past year to seek a fair resolution. As part of the proposed resolution, CHA will provide residents with improved notice of the hardship exemption and provide additional training for property managers. Upon approval of the settlement, CHA will also erase from each resident’s ledger all unpaid minimum rent charges imposed since July 2016 and provide eligible residents with rent credits for minimum rent payments made since April 2020. U.S. District Judge Matthew Kennelly gave preliminary signoff on August 3, 2022 to the deal.
“We are pleased with this outcome and that we are able to help provide comfort to the residents who have given everything to keep a roof over their family,” Michael Weaver, the Firm’s pro bono litigation partner, said. “McDermott will continue to bring the full resources of its robust litigation team into work that directly aligns with our values and commitment to providing critical legal services to those most in need.”
The case is Oliver et al. v. Chicago Housing Authority in the US District Court for the Northern District of Illinois.
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