Twin Creek Apartments SCRA Settlement: $76,516 for 65 Servicemembers

What happened

On September 11, 2018 the United States sued Twin Creek Apartments, LLC, which does business as Pavilion at Twin Creek, in the District of Nebraska, and both sides signed a settlement agreement that day. The complaint describes an Indiana company whose principal place of business is the Pavilion at Twin Creek apartment property in Bellevue, Nebraska, adjacent to Offutt Air Force Base (complaint paragraph 8).

The Department of Justice received a referral from a U.S. Air Force attorney on May 4, 2017 and told Twin Creek on June 13, 2017 that it was investigating its lease termination practices (paragraphs 9 and 10); DOJ's release says the referral came from a U.S. Air Force Community Legal Services office. Using records Twin Creek produced, the complaint says, the Department found that from January 1, 2012 through June 15, 2017 Twin Creek imposed early termination charges on 65 servicemembers who had given written notice and a copy of their orders (paragraphs 11, 15 and 17).

The complaint puts those charges between $78.00 and $1,498.00, while DOJ's release says $72 to $1,498. Some of the servicemembers were leaving to deploy overseas, including to Afghanistan in support of Operation Enduring Freedom. At least eight were charged between $520.00 and $640.00 for ending their leases just one month before they expired, and another was billed a $712.50 "military lease term[ination] fee" for leaving two months early to deploy to Afghanistan (complaint paragraphs 12 and 13).

The settlement agreement describes the same charges as repayments: the United States alleged that Twin Creek required the 65 servicemembers to pay back all "rent concession" amounts they had received over the course of the lease (agreement paragraph 3). Twin Creek denied violating the SCRA, and the agreement states that nothing in it is a finding of noncompliance (paragraph 7).

The law behind this: 50 U.S.C. § 3955

Termination of residential or motor vehicle leases: read the statute , or read § 3955 in plain English, with its enforcement record .

The SCRA prohibits landlords from charging members of our armed forces an extra fee when they move due to military orders,

This is a just resolution for the former tenants and demonstrates our continuing commitment to protecting our servicemembers,

Who was covered

The 65 instances since January 1, 2012 that the United States alleged, on a list it gave Twin Creek, in which a servicemember who properly terminated under the SCRA had to repay rent concessions (agreement paragraph 19). Co-lessees named on those leases shared in the refund portion. Every payee had to sign the release in Appendix B first, and the agreement allowed no one to obtain review of who was identified or how much was paid (paragraphs 20, 22 and 27).

What the settlement paid

• Twin Creek had 14 days from the effective date to put $76,516.00 into interest-bearing escrow (agreement paragraph 21). DOJ's release describes it as $76,516 in damages to the 65 identified servicemembers; DOJ's case page prints $75,615. This record follows the agreement and the release.
• Per instance: the early termination charge refunded in equal shares to the servicemember and any co-lessees, plus an additional payment of two times that refund, paid entirely to the servicemember who terminated (paragraph 20). Twin Creek owed each check within ten days after the United States reported a signed release, and recipients had six months to cash it (paragraphs 23 to 25). Escrow money not distributed within five years was to go to the Treasury (paragraph 26).
• A $20,000 civil penalty, payable to the Treasury on the same 14-day deadline (paragraph 29).
• Within 30 days, Twin Creek had to ask each credit bureau receiving its reports to remove negative entries that would not have existed without the termination charge (paragraph 28), and to develop written policies that, among other terms, could not require servicemembers to repay rent concessions or other discounts or incentives received at lease signing (paragraph 10(e)). The agreement lasted five years from its execution on September 11, 2018 (paragraph 44).

Why this case matters

Twin Creek had to accept a termination notice and orders delivered by hand, private carrier, U.S. Mail, e-mail or text message (agreement paragraph 10(b)). The statute did not list electronic delivery until Pub. L. 116-315 added it to § 3955(c)(2) on January 5, 2021, according to the U.S. Code's amendment notes. The figure to remember is small: by the complaint's count, at least eight servicemembers were charged $520 to $640 for leaving a single month early. When DOJ announced the United Communities settlement on September 27, 2018, it called that case and this one the first two SCRA cases the Department had brought involving lease incentives.