Six community groups that had been battling companies connected to a Texas businessman and dozens of vacant properties in Baltimore said Thursday they had reached a settlement, in which the owners agreed to clean-up the properties and pay $85,000.
A Baltimore City Circuit Court judge ordered clean-up of the eyesores last year, but the nine limited liability companies involved filed for bankruptcy before a second part of the suit — which sought $8 million in damages from the companies and Scott Wizig, the man behind them — went to trial.
In January, some residents said they were worried clean-up would actually mean an unwanted tear-down in some cases. Attorneys for both parties said then they were negotiating how to resolve the clean-up.
Under the terms of the settlement, which was approved this week by a bankruptcy judge in U.S. District Court, the property-owners pledged to the demolish 34 properties by the end of September, offering the vacant lots to community groups, neighbors or nearby residents for $500 on a first-come, first-serve basis. They agreed to work with the city to demolish two others and perform work on five properties in preparation of sale. Six others have sold, while sales of 10 others are expected.
Robin Jacobs, an attorney with the Community Law Center, which worked on the case with Venable LLP, called the plans for the properties the most important part of the settlement.
"While we celebrate this agreement, we also are committed to continue our work with our clients to ensure the Defendants perform their obligations under the agreement," she said in a statement.
Lawrence J. Yumkas of Yumkas, Vidmar & Sweeney LLC, who represented the limited liability companies, said the negotiations led to a "good settlement for everyone."
"The debtors never thought that there was much risk of those damages ever being assessed or the plaintiffs being entitled to them, but it certainly did get the parties to focus," he said.
Yumkas said his clients are seeking dismissal of bankruptcy because their debts have been resolved through the bankruptcy negotiations.
The case was one of the first in which community groups used a change in state law to sue the owner of vacant properties in their neighborhoods.
The suit, filed in 2013, concerned 57 properties in neighborhoods covered by six community organizations: Coldstream-Homestead-Montebello Community Corporation, Alliance of Rosemont Community Organizations, Inc., Mount Clare Community Council, Inc., Carrollton Ridge Community Association, Inc., Operation ReachOut SouthWest, Inc., and Greater Greenmount Community Association, Inc.
The limited liability companies involved own a total of about 112 units of residential housing in Baltimore, according to a filing seeking to dismiss the bankruptcy suit. An attorney representing the debtors could not be reached for comment Thursday evening.