Baltimore, MD — Maryland’s Attorney General, Anthony G. Brown, has revealed a historic settlement of $11.2 million with the proprietors of Heather Hill Apartments in Temple Hills due to alleged breaches of landlord-tenant regulations.
This settlement, which is the largest of its kind in the state, follows the discovery that Heather Hill Property Company LLC and Heather Hill Operating Company LLC managed the 459-unit complex without the necessary rental license for more than two years. During this period, tenants endured unsafe living conditions while still being charged rent, leading to numerous eviction filings.
The agreement requires restitution through rent credits, debt forgiveness, and cash payments to both current and former tenants. Additionally, all ongoing eviction proceedings related to the unlicensed timeframe will be dismissed, and associated court records will be sealed.
“This settlement provides relief for hundreds of Maryland families who were forced to pay rent while some lived in unsafe conditions,” said AG Brown. “Landlords will be held accountable when they put profits over people’s safety.”
Background and Allegations
As stated by the Division, Heather Hill Property Company (the owner) and Heather Hill Operating Company (the operator), both based in Delaware, did not:
Acquire a multifamily dwelling license (MFDL) mandated by Prince George’s County law prior to leasing units at the Heather Hill Apartments for a duration of 28 months, from February 2022 to May 2024.
Keep a valid Collection Agency License while collecting rent and other debts from tenants. Adhere to consumer protection laws during debt collection, allegedly partaking in false, misleading, and unfair practices.
In November 2024, the Attorney General’s office initiated charges against the companies and their associated entities, including OneWall Communities, a property management firm located in New York, along with key executives Ron Kutas and Andy Wallace. A temporary restraining order and preliminary injunction were issued by the Prince George’s County Circuit Court in early 2025 to prevent further consumer harm.
After several legal proceedings and a revised statement of charges in March 2025, the involved parties reached a settlement before a contested hearing that was set for September.
Key Terms of the Final Order
Cease and Desist Obligations
The Order forbids the companies from:
- Making deceptive statements to tenants.
- Imposing excessive late fees (over 5% of unpaid rent).
- Leasing units without the necessary MFDL.
- Initiating eviction actions or collecting debts without the appropriate licensing.
- Attempting to collect any rent or fees from the unlicensed timeframe (Feb 2022 – Jan 2025).
- Reporting unpaid debts from the unlicensed timeframe to credit bureaus or future landlords.
Restitution and Debt Forgiveness
A total of $2.6 million will be allocated for restitution to tenants who incurred charges during the period of unlicensed operations.
Tenants are categorized into various classes (A, B, C, D) according to their payment history and tenancy status. Current tenants who qualify may receive monthly rent credits, while former tenants could be eligible for one-time lump sum payments. Additionally, at least $8.8 million in uncollectible debt from the unlicensed period will be forgiven.
The companies are also obligated to provide comprehensive reports to the Division over a span of three years to guarantee compliance and transparency in the restitution distribution process. A civil penalty of $7.25 million has been put on hold and will be dismissed as long as the companies adhere to the order. Furthermore, the companies are required to pay $150,000 in community restitution and $75,000 for investigative expenses over a period of five years.
