On June 6, 1997, the city filed suit against a group of companies associated with prominent real-estate investor Stanley Rochkind, charging them with violating city housing-code laws on 148 rundown, vacant properties that have marred Baltimore's residential landscape for nearly a decade (The Nose, 7/16 and 8/13/97). The ensuing months saw a blizzard of counterclaims, motions, settlement conferences, and skirmishes over evidence that swelled the case to occupy four sets of defense attorneys and delayed the trial. Transactions in which titles to and mortgages on the properties changed hands further complicated matters, turning what began as a straightforward code-violation case into an ownership puzzle that the city was prepared to hire outside attorneys to help untangle at trial.

But on May 20, less than three weeks before the case was finally slated to go before a jury, the parties reached a settlement that housing-court prosecutors are hailing a "victory" for the city. After a year's worth of legal haggling and lawyers' fees, the agreement gives the city exactly what it requested in its initial complaint--that 100 of the houses be rehabbed and 48 be razed within the next two years. And as a bonus which the city brokered during the settlement negotiations, defendants will also rehab, at their own cost, another 50 of the 600 vacant houses the city owns.

Rochkind, who spent the past year fighting to disassociate himself from the properties, has agreed to rehab 50 of the original 148 houses, at a cost city lawyers estimate to be $2 million. Ronald Washington, the principal of the companies that acquired the properties since the violation notices were served on them between 1989 and 1995, is responsible for the rest.

"It's a win-win for us," says Denise Duval, director of code enforcement for the Department of Housing and Community Development's legal section. "We started with 150 vacants and we're ending up with 150 rehabs and 50 tear-downs. You can't beat that. Now we just have to enforce it."

In addition to abating nearly decade-old violations and getting 150 vacant houses rehabbed and back on the city's tax rolls within two years, Duval says the settlement lays the groundwork for more aggressive housing-code enforcement. The city's case against Rochkind et al. was based on an obscure housing-code provision that had never been used, and which is part of a growing arsenal of civil tactics housing officials are deploying to gain greater code compliance.

The benefit of pursuing the case civilly, rather than through criminal prosecution of landlords as was done in the past, is that in a civil case a judge can order the property owner to fix code violations, Duval says. "We're solving problems for the neighborhood, not just punishing the owner. And if [we] take the hardest battle first and [we] win, hopefully other [property owners] will be more willing to work with us." She says her office is preparing to file three or four similar cases against other landlords.

The defendants' lawyers in the Rochkind case could not be reached for comment.

The case stemmed from state action last spring to bolster Baltimore's feeble housing-code-enforcement system. In 1997 the General Assembly passed legislation granting the city authority to invoke civil penalties that could cost negligent landlords considerably more than the $500 criminal fines the city housing court had meted out in the past. Before that, housing court had been strictly a criminal docket in the city's District Court.

Housing attorneys lost no time tapping those new powers. Last year they filed a civil suit against 40 companies they claimed own 148 properties that are vacant and abandoned, and therefore in violation of the city's housing code. They also sued a holding company they link to those 40 companies by way of an ownership interest. The suit asked the court to compel the owners to rehab 100 of the properties and raze 48, and place enough money to cover the cost of abating code violations into an escrow account.

Identifying all of the ownership interests and holding them responsible for the properties' decrepit condition became the city's greatest challenge. Several of the 41 companies shared Rochkind's business address, listed associates of his as corporate officers, or used a company name housing attorneys have linked to Rochkind in the past. But a series of transactions in the previous 18 months had transferred the titles to the properties, as well as the mortgages on them, several times, and Rochkind's name didn't figure on any of the paperwork. The most recent owner is a group of companies led by Ronald Washington.

But the city maintained Rochkind also had an interest in the 148 properties, citing his stake in two companies that obtained various forms of deeds of trust on them in April 1997. Referencing a clause in the city building code--that "a lender acquiring an interest in property by way of a deed of trust is liable as an owner for violation notices issued prior to such transaction"--the city, in court documents, charged the Rochkind companies with conducting "sham transactions" and "playing games with their various interests in the properties to avoid liability," and added them as defendants to the suit.

Rochkind and other defendants added to the case through their association with him vehemently fought the city's effort to link them to the abandoned properties, filing various motions to dismiss the case. In December they asked the judge to allow them to enter "all vacant houses owned by the plaintiff and its related agencies for the purpose of inspecting, measuring, surveying, testing, and/or sampling the houses"--a request the city called "annoying" and "oppressive" (the judge never ruled on the request). And at many of the early settlement discussions last fall, the defendants arrived without lawyers, rendering the meetings meaningless, Duval says.

Finally, there were battles over discovery, the process of pretrial evidence-gathering. Duval says that by the last pretrial conference on May 8, she had only 10 percent of the material she had requested from the defendants during the previous six months, and it had been faxed to her the previous night. (Duval estimates the city gave defense attorneys 95 percent of what they requested--including, according to court documents, a list of each city-owned and each privately owned vacant house in the city, and each housing-inspection file the housing department has on vacant buildings.)

But the efforts to stall the suit and disassociate Rochkind from it ultimately proved useless: When the settlement was being negotiated last month, whether Rochkind was liable wasn't at issue, Duval says. Rather, the question was how much liability he would take--sharing the load for all 148 properties or taking full responsibility for 50 of them.

At an April 1 pretrial meeting with District Court Judge Charlotte Cooksey, Duval complained she didn't have any of the discovery she'd requested, and Cooksey urged the parties to settle. Weeks of intense settlement negotiations followed, but they fell through when the city refused to yield to Rochkind's request that the city refrain from enforcing housing codes on his other properties--which number somewhere between 1,000 and 1,500, city officials say--while he was working to abate the violations on those involved in the lawsuit. On May 8 both parties spent four hours in Cooksey's chambers and hammered out the current settlement. On May 20 the judge and the various parties signed off on it.

According to the May 20 consent order outlining the settlement's terms, Rochkind must rehab 50 of the properties by June 1, 2000. Washington must rehab another 50 and raze 48 by the same date. But because Washington, who will do the work with the help of a financial backer from Virginia, will use the revenue from the rehabs to finance the demolitions, he requested an additional 50 city-owned properties to rehab in order to earn more money for the razings. The city gladly obliged.

If any property isn't rehabbed or razed on time, Washington or Rochkind must place money in escrow until the job is done. If either doesn't comply with the escrow order, they could face any sanction allowed under the court. Duval says this could includes fines, mandates to put money into escrow, or incarceration.