Crain's Chicago Business reports:
As landlord-tenant disputes go, this one's a doozy. It started with the landlord allegedly coming up $1.40 short in interest on a security deposit. Then came the tweet that prompted a libel suit. Now, five years later, the story has taken a new twist, with the Chicago landlord in bankruptcy court after being hit with a legal judgment it can't pay.
Horizon Group Management, which manages about 25 apartment buildings, mainly on Chicago's North Side, filed for Chapter 11 protection last month after losing a class-action suit accusing it of violating the city's landlord- tenant ordinance.
Horizon became briefly infamous in 2009, when it filed a libel suit against a tenant, Amanda Bonnen, after she complained on Twitter about a “moldy apartment.” But Horizon is 0-and-2 against Bonnen, who not only prevailed in the libel suit but was lead plaintiff in the class-action suit that landed Horizon in bankruptcy.
There's more:
The Horizon story begins in June 2009, when Bonnen, who lived in an Uptown apartment building managed by Horizon, filed her class-action suit in Cook County Circuit Court. She alleged that the firm underpaid interest on her $250 security deposit by $1.40 and failed to provide disclosures about porch safety, both violations of the city's Residential Landlord and Tenant Ordinance.
About a month later, Horizon sued Bonnen, alleging that her tweet libeled the firm.
“Who said sleeping in a moldy apartment was bad for you? Horizon realty thinks its okay,” her Twitter post said.
News media ranging from the Wall Street Journal to the Belfast Telegraph reported on the suit, drawing unfavorable attention to an issue that company critics said could have been settled quietly. A judge threw out the libel suit in early 2010.
Bonnen's suit against Horizon continued for another three years, with the two sides finally agreeing to settle the case in November 2013. Under the settlement, Horizon has paid tenants in the class-action suit $45,000, including $5,000 to Bonnen, according to a filing in U.S. Bankruptcy Court in Chicago.
But for Horizon, the worst was yet to come. On Aug. 27, a judge ordered it to pay $833,455 in fees to Bonnen's Chicago-based law firms, Edward T. Joyce & Associates and the Law Offices of Jeffrey S. Sobek. Horizon, which only manages properties and doesn't own them, can't pay the money, claiming assets of $100,000 to $500,000, according to court filings.
The firm, which filed for Chapter 11 protection on Nov. 14, “must take immediate action to preserve its operations and value as a going concern, including the jobs of its 91 employees,” a court filing says.
The struggles of being a property owner in Chicago.
