California Attorney General Rob Bonta today, in partnership with Shasta County District Attorney Stephanie Bridgett, announced a settlement with a Redding property management company, Property Upsurge, and its property-owning affiliates. The settlement resolves allegations that Property Upsurge, which manages approximately 1,300 rental units across Northern California, improperly issued eviction notices, imposed rent increases above what state law allows, and charged higher rents to tenants using Section 8 vouchers, among other egregious conduct in violation of California law. As part of the settlement, Property Upsurge must pay $550,000 to tenants and provide an additional $200,000 in debt relief, pay $50,000 in civil penalties, and take specific actions to ensure compliance with injunctive terms.
“Forcing families out of their homes, charging illegal rent, and targeting vulnerable tenants is not just unjust, it's unlawful,” said Attorney General Rob Bonta. “Every Californian, in every corner of our state, deserves housing that is safe, stable, and reliable. Today’s settlement and my office’s tenant protection work proves that if landlords or property managers, no matter how small or large, violate tenant protections laws, my office will come knocking. I thank the Shasta County District Attorney’s Office, Legal Services of Northern California, and City of Redding’s Code Enforcement Division for their assistance with this investigation.”
“This resolution reflects our strong partnership with state and local agencies and our commitment to protecting residents of Shasta County,” said Shasta County District Attorney Stephanie A. Bridgett. “We will continue working to address unlawful business practices and help ensure tenants are treated fairly under the law.”
In 2023, the California Department of Justice (DOJ) launched an investigation into Property Upsurge, in partnership with the Shasta County District Attorney’s Office. The investigation revealed that Property Upsurge, which is a major property owner and management company in Redding’s lower-to mid-cost rental market, had violated the California Tenant Protection Act, California’s Fair Employment and Housing Act, state tenant protection laws governing habitability and liquidated damages, and California’s Unfair Competition Law. Violations included issuing pretextual eviction notices, imposing rent increases above what state law allows, charging fees without engaging in the required liquidated-damages analysis, engaging in localized habitability violations, and charging higher rents to tenants using Section 8 vouchers, in violation of California's civil rights laws.
Under today’s settlement, which is subject to court approval, Property Upsurge is required to:
Pay $550,000 to tenant victims, provide an additional $200,000 in debt relief, and pay $50,000 in civil penalties, which will be split between the state and Shasta County and used for the enforcement of consumer protection laws.
Comply with the Tenant Protection Act’s substantial-remodel eviction process requirements.
Design and implement new policies and procedures for tracking and reviewing rent increases to ensure that they are in line with state law, and train employees on these changes.
Complete an annual compliance audit covering all rent increases for the next three years.
Cease charging three-day notice fees entirely, engage an expert to conduct an analysis to support any late fees charged by the company, and limit those fees to the actual costs resulting from late payments of rent.
Respond to all tenant complaints within a reasonable time, not to exceed three business days, and as immediately as possible for conditions affecting life, safety, health, and immediate well-being of residents.
Report code enforcement citations and information on tenant complaints to DOJ and the District Attorney.
Rent units at the same rate regardless of whether tenants pay with government vouchers.
Attorney General Bonta is committed to protecting the rights of tenants across California. Last year, Attorney General Bonta and nine other attorneys general, announced a $7 million settlement with Greystar Management Services LLC to prevent the use of software that uses sensitive information to align rent prices. He also secured a $495,000 settlement with Mission Rock Residential California, Inc. resolving allegations that the company had raised rent for 140 families in excess of the Tenant Protection Act’s rent cap.
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