On October 19, 2026, Relman Colfax, on behalf of Mayor Brandon M. Scott and the City Council of Baltimore, sued the operators of a major property management platform and a Baltimore property manager who uses the platform. The lawsuit alleges that the defendants surprise vulnerable tenants with compulsory junk fees in violation of Baltimore’s Consumer Protection Ordinance.
The defendants are Yardi Systems, LLC and RentCafe, LLC, which jointly sell the RentCafe platform at issue in the lawsuit, and Pennrose Management Company, LLC, which owns and manages hundreds of rental units for low-income renters in Baltimore City. The complaint alleges that RentCafe and Pennrose use predatory practices to squeeze every last dollar out of economically vulnerable renters.
In recent years, consumers have increasingly been surprised by “service fees,” “administrative fees,” “processing fees,” and similar junk fees that are driving up their bills. Such fees are especially unwelcome when they are tacked on to essential goods and services, such that consumers have little choice but to cough up the additional money in order to obtain housing, transportation, or groceries. These junk fees are not only costly; they are also illegal. The Federal Trade Commission and the Maryland Attorney General have warned companies against charging such fees and taken action against companies that did not heed that warning.
Month after month, these fees add up. And they are especially harmful to seniors, people on fixed incomes, and people who live in affordable housing. Yet these are precisely the types of tenants who are being made to pay rent via RentCafe.
In Baltimore, the complaint alleges that hundreds of rental properties in the city use RentCafe to process rent payments, including nearly 50 income-restricted properties and buildings with affordable units. Most tenants who are encouraged or required to pay rent via RentCafe have to pay a nonrefundable “service fee” every month in order to pay rent. But the term “service fee” is a misnomer. Tenants do not receive any additional “service” for the payment of those fees. Rather, these are additional fees that tenants are required to pay for the privilege of paying rent - otherwise known as “pay-to-pay” fees - that allegedly drive revenue for RentCafe, who keep a portion for themselves and pass the remainder of the payment to the property manager.
The complaint alleges that RentCafe steers tenants toward fee-generating payment options by obfuscating the fees associated with each payment method behind multiple clicks, embedding fee information across several web pages in fine print, and failing to disclose the fee associated with a selected payment method until the last step of the payment flow.
At Pennrose, which operates nine multi-family housing developments in Baltimore City, the switch to RentCafe was presented as mandatory. For years, tenants at Pennrose buildings in Baltimore were able to pay rent by dropping off a certified check or money order with the property management office. In approximately 2024, however, Pennrose switched to processing rent payments via RentCafe. At one Pennrose building, the dropbox in which tenants had dropped their checks for years was ripped out of the wall. The leases signed by the residents do not state that they will be required to pay rent via RentCafe or that additional fees will apply to their rental payments. Tenants who have lived at its buildings for years, and signed their leases prior to Pennrose’s adoption of RentCafe, have not been given updated leases stating that they will be required to use RentCafe or to pay its fees, the complaint alleges.
The lawsuit alleges that every Pennrose property in the city was developed with Low-Income Housing Tax Credits (LIHTC), which means that a portion of units remain affordable to households earning at or below a set share of area median income. Many seniors, people with disabilities, students, and people with low or fixed income reside in Pennrose properties. These are the tenants who can least afford RentCafe’s fees, who now fear being charged late fees or evicted if they do not pay through the platform.
Month after month, these fees add up significantly. Last year, four of ten households renting in Baltimore spent 35% or more of their income on rent and utilities. And for Baltimoreans making $35,000 or less a year, more than half spent 50% or more of their income on rent and utilities.
“This exploitative behavior is costing tenants greatly. Hard earned money paid in fees to RentCafe means less money for groceries, transportation, or medical bills,” said Tara K. Ramchandani, Co-Managing Partner at Relman Colfax. “Seniors, people with disabilities, students, and people with low or fixed incomes cannot and should not carry the burden of ‘junk fees’ or be forced into paying to generate revenue for payment platforms through deception."
Relman Colfax, alongside the City of Baltimore, is taking action to ensure people’s hard earned money remains in their pockets. The complaint alleges that the conduct described above is rife with unfair, deceptive, and abusive acts and practices that violate the Baltimore Consumer Protection Ordinance. The complaint seeks civil penalties, injunctive relief, and restitution for harmed consumers.
The legal team in this matter is led by Tinuola Dada, Ellora Israni, Tara Ramchandani, and Yiyang Wu of Relman Colfax, with paralegal support from Autumn Zhou; and the Baltimore City Law Department’s Ebony M. Thompson, Tom Webb, Natalie Neill, and Zachary Babo.