Judge boosts penalties to $2.7 million in final ruling on ruthless landlord

With final court decision, Anne Kihagi must immediately comply with a broad injunction that will transfer her property operations to a city-approved manager

SAN FRANCISCO (May 24, 2017) — City Attorney Dennis Herrera today praised the final ruling and injunction issued Tuesday in his lawsuit against notorious landlord Anne Kihagi and her accomplices for waging a ruthless war to illegally force tenants from their rent-controlled homes so she could charge more money.
 
The final ruling issued May 23 expands on aspects of the sweeping May 3 tentative ruling against the defendants and makes the decision permanent. In addition to the many provisions from the tentative ruling that will protect tenants, the final decision adds about $400,000 in additional penalties, increasing the total to $2.7 million. The final ruling also orders the defendants to abate all of their numerous code violations and use an independent manager to do so.
 
“I am grateful that the court recognized the severity of the situation and issued a tough and enforceable injunction,” Herrera said. “Ms. Kihagi is a ruthless landlord who violated court orders at will and lied repeatedly. With this ruling we can finally put a stop to her egregious behavior.”
 
Herrera filed a lawsuit against Kihagi and her associates in June 2015 for her widespread pattern of unlawful business practices that included waging “a war of harassment, intimidation, and retaliation” against her tenants. Once forced from their homes, Kihagi routinely ordered unpermitted construction work before re-renting the uninspected and potentially dangerous apartments to unsuspecting new tenants at vastly higher rents.
 
Kihagi started buying properties in June 2013 in Noe Valley, the Castro, the Mission and North Beach, amassing at least 10 buildings in San Francisco. This was after a similar campaign of illegal evictions and harassment against rent-controlled tenants in West Hollywood, California. Earlier this year, a Southern California judge found Kihagi in contempt of court and ordered her to spend five days in jail.
 
The 152-page decision from San Francisco Superior Court Judge Angela Bradstreet ruled in favor of the San Francisco on every count, voiding all evictions pending as of Jan. 12, 2017 and awarding $2.7 million in penalties.  Judge Bradstreet also ordered the defendants to pay the city’s investigative costs and attorneys fees that are expected to run into the millions.
 
Kihagi’s tactics included fraud; harassment; threats; intimidation; verbal abuse; interrupting gas, electric, water, and cable service; disrupting mail service; and failing to cash rent checks, only to later claim them as untimely rent payments. She and her agents also backdated correspondence and notices; violated tenants’ privacy by entering their apartments without required notice; refused to timely abate unsafe conditions; and even retaliated against tenants who cooperated with city inspectors by installing video surveillance cameras aimed at the residents’ front doors. Well-known among tenants for her harassing text messages and expletive-ridden personal interactions, Kihagi even made a veiled threat against a tenant’s cats, saying “it would be a shame if they got out.”
 
The ruling is also a validation of the city’s Department of Building Inspection, which documented scores of violations at Ms. Kihagi’s properties. The court found that the buildings were, collectively, noncompliant with state and municipal law for at least 4,470 days. About $1.1 million of the $2.7 million in penalties were for building code violations alone. The court found another 1,641 violations of the state’s unfair competition law.
 
In addition to the financial penalties, the court ordered a tough, enforceable, 5-year injunction against Kihagi and her accomplices — her sisters Julia Mwangi and Christine Mwangi and her closely held LLCs — with the following terms, effective immediately:

  • All pending owner move in evictions, relative move in evictions, “temporary” evictions for capital improvements, and Ellis Act notices are declared “invalid and without legal effect”
  • Defendants are forbidden from contacting tenants
  • Defendants cannot file litigation against tenants (including evictions) except with the approval and supervision of the independent manager
  • City has the right to make unannounced surprise inspections every quarter
  • Defendants have 60 days to hire an independent manager that meets city approval to take over all property management, construction or maintenance responsibilities
  • Defendants have 7 days to disable their surveillance cameras pointed at tenants’ residences, and 30 days to permanently remove the cameras
  • Defendants have 7 days to notify the City of all of their real estate holdings in San Francisco, including the members of their various LLCs and business entities, and their tenants and current rents.
  • Within 30 days of the independent manager being hired, manager will give a copy of the injunction to all tenants
  • Defendants have 90 days after hiring an independent manager to abate all code violations.
  • Court retains jurisdiction to make further orders to put the injunction into effect

The case is: City and County of San Francisco and People of the State of California v. Anne Kihagi et al., San Francisco Superior Court No. 15-546152, filed June 4, 2015. Additional information on the San Francisco City Attorney’s office is available at: https://www.sfcityattorney.org/.

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