Property firm drops lawsuit challenging MD AG’s power in civil rights probes

Listen to this article

A property management company agreed last week to drop a federal lawsuit against the Maryland attorney general’s Civil Rights Division, a relatively new unit that the business alleged had used its subpoena power to conduct an unchecked “fishing expedition” for wrongdoing.

Judge Ellen Lipton Hollander approved a joint stipulation filed last Wednesday by Bay Management Group and the civil rights unit, which stated that both agreed to the case being dismissed without prejudice. The constitutional challenge had been nearing a settlement for months, according to court records.

It was unclear if other terms were involved in the case’s resolution, though attorneys agreed in prior court filings that they were hopeful for “a global resolution of all disputes” between the parties.

The attorney general’s office declined to comment. Jeffrey Lichtstein, a partner at Rosenberg Martin Greenberg LLP who represented Bay Management, did not respond to requests for comment.

The lawsuit stemmed from Attorney General Anthony Brown’s civil rights office’s use of subpoenas to investigate fair housing violations. State legislators created the office in 2023, allowing Brown to launch a unit charged with enforcing civil rights laws as well as the power to subpoena witnesses and documents for such investigations.

Within a few months of the division’s first settlements with landlords over alleged housing discrimination, the Timonium-based Bay Management filed its legal challenge, saying the unit had “unlimited and unchecked investigatory powers” and was “maliciously” using them to force the company to change its policies.

The company filed the lawsuit last June in U.S. District Court after receiving a subpoena from Brown’s office that the firm alleged would require it to produce as many as 100,000 records related to its tenant application process. The subpoena sought three years’ worth of documents related to the firm’s use of criminal background checks, including rental applications, advertisements and internal policies.

The company, which manages thousands of properties in the mid-Atlantic, had sought for a judge to rule that the subpoena powers afforded to the Civil Rights Division are unconstitutional because they violate the firm’s rights to due process.

Within a month, the attorney general’s office had agreed to a stay from enforcing the subpoena until the litigation was resolved. The parties had “reached a partial resolution of the claims” by October, according to court filings, and were “cautiously optimistic” that an agreement would resolve all disputes between the firm and the division.

This story has been updated with the attorney general office’s decline to comment.