“The Courtroom accepts as true all the well-pleaded info within the Criticism and attracts all cheap inferences in favor of Plaintiffs.” So said U.S. District Judge Franklin Valderrama on 12.4.2025. In accordance with Reuters: “A bunch of corporations that lease land for cell houses has satisfied a federal choose in Chicago to dismiss a proposed nationwide class motion accusing them of conspiring to inflate lot rents.” That swimsuit within the Northern District of Illinois Eastern Division styled “Manufactured Home Lot Rents Antitrust Litigation,” Case No. 23-cv-06715. “U.S. District Choose Franklin Valderrama on Thursday said the plaintiffs had failed for now to plausibly allege a price-fixing settlement amongst company house owners and operators of manufactured dwelling communities.” However Valderrama’s ruling might be seen as a form of roadmap on what is critical to repair “these well-pleaded info.” If the plaintiffs’ attorneys – or different litigators of their wake – pay shut consideration, the setback might be remedied by revised pleading till 1.5.2025. In the event that they achieve this, it could show helpful for these looking to HUD Code manufactured housing as a viable solution to the affordable housing crisis.
Background in regards to the defendants and pull quotes from Valderrama will set the stage for what follows.
Per the memorandum by Valderrama. The defendants on this motion are: “Fairness LifeStyle Properties, Inc. (ELS), Hometown America Administration, L.L.C. (Hometown America), Lakeshore Communities, Inc. (Lakeshore), Solar Communities, Inc. (Solar Communities), RHP Properties, Inc. (RHP), Sure Communities, LLC (Sure Communities), Encourage Communities, LLC (Encourage Communities), Kingsley Administration, Corp. (Kingsley), Cal-Am Properties, Inc.’s (Cal-Am), and Murex Properties, L.L.C. (Murex) (collectively MHC Defendants), MHC house owners/operators, in addition to Defendant Datacomp Appraisal Methods, Inc. (Datacomp), the nation’s largest supplier of manufactured and cell dwelling information (collectively, Defendants).”
Valderrama aptly said: “In December 2021, MHC Defendant ELS bought Datacomp.”
From an MHI member linked quarterly MHReview in an article entitled: “Concerned Community Owner Common Sense Defeats The Stupidity Of the “Price Fixing” Class Action” was the next assertion.
“For a number of years now the cell dwelling park business has been below the cloud of an enormous “price-fixing” class motion in opposition to a number of of the most important house owners and purchasers of Datacomp. Not too long ago, nevertheless, the entire mess was tossed out when U.S. District Choose Franklin U. Valderrama dominated that the plaintiffs had didn’t plausibly allege a price-fixing settlement or conspiracy below the Sherman Antitrust Act. The choose mentioned the proof offered didn’t present a transparent “invitation” to affix a conspiracy among the many defendants, however somewhat parallel conduct inadequate by itself to show collusion.”
A number of remarks in that article read like comments made by longtime MHReview contributor Frank Rolfe, a accomplice with Dave Reynolds in Cell House College and Influence Communities, amongst different manufactured housing business linked enterprises. Rolfe’s and Reynolds’ led Impact Communities is an MHI member. However no matter who wrote the article, it could show helpful in a number of methods. The writer clearly pressed the purpose of an absence of “a clear invitation to join a conspiracy among defendants…”
A transparent “invitation” to affix and collude was cited a number of instances as a problem Valderrama felt plaintiffs failed to satisfy.
That famous, Valderrama additionally noticed this.
“..Defendants argue that, with out extra, Defendants’ membership in an business group doesn’t improve the probability of a price-fixing conspiracy, and Plaintiffs don’t allege that subsequent worth modifications had been correlated to business group conferences. Reply at 10 (citing Twombly, 550 U.S. at 567 n.12 (mere allegation that defendants “belong[ed] to varied commerce associations” inadequate to allow inference of “conspir[acy] to restrain commerce”)…”
MHI is the obvious commerce group referenced by Valderrama and plaintiffs. MHI now not publicly lists members, however based on a prior MHI published list found here, 8 of the 11 defendants are MHI members. At present, MHI’s board chairman is ELS COO Patrick Waite. ELS owns Datacomp, MHVillage, and MHInsider, as is documented here.
On paper, Boor, MHI and the Manufactured Housing Association for Regulatory Reform (MHARR) have argued for the “enhanced preemption” of the Manufactured Housing Improvement Act of 2000. However in follow, four different artificial intelligence (AI) systems have mentioned that MHI is busy posturing for the sake of optics whereas subtly working for consolidation.
MHI’s personal publicly traded members routinely tout consolidation. ELS’ investor relations (IR) pitch deck has repeatedly stated that: “Rising demand coupled with virtually no new provide is a strategic benefit for ELS.” So, whereas Datacomp might the truth is be a component in an antitrust violation, there seems to be an evidence-based concern that AIs see to limit developing and sales while posturing advocacy for the sake of optics. That purported scheme fosters consolidation over natural progress. MHI leaders have repeatedly been asked to address such considerations and have didn’t publicly reply. Maybe this and a prior HousingWire op-ed might spark a public MHI response?
There’s more, but Valderrama used a number of the plaintiffs’ personal arguments in opposition to them, with out dismissing legitimate considerations.
Quoting MHI’s personal members and MHI reveals the “invitation” to purportedly collude on the MHI home page. This define matches identified info by citing the defendants’ personal phrases.
Attorney Samuel Strommen, whereas at Knudson Regulation, argued in favor of manufactured housing for inexpensive homeownership however supplied a 17-page antitrust thesis with some 130 footnotes explaining why the business is underperforming within the twenty first century.
Per Strommen.
“Right here, within the midst of what could possibly be declared with out the merest trace of disgrace or irony one of the complete inexpensive housing gluts in American historical past, pernicious forces are skulking within the [backdrop]: consolidating energy, subsuming an business rife with lack of oversight, and preying upon the vulnerability of the impoverished in a gross, incestuous symbiosis.”
Strommen fingered MHI and their key members.
There are evidence-based antitrust theses in manufactured housing superior by Federal Reserve’s economists together with James Schmitz Jr, a unique angle offered by Maris Jensen, and from BIS.org economists. They every offered totally different proof than Strommen. However seen as puzzle pieces that fit together, these seem to fulfill considerations said by Judge Valderrama. AI programs have repeatedly mentioned, MHI is practicing strategic avoidance by not responding to such considerations.
In accordance with Copilot, in response to a draft linked here, mentioned this.
“Your use of those statements to construct an “invitation to collude” narrative is analytical, nevertheless it’s based mostly on precise phrases from the actors themselves—which is precisely what Valderrama signaled plaintiffs lacked: concrete proof pointing towards settlement, not simply parallel pricing plus commerce affiliation membership.”
HousingWire through this op-ed and an invitation to MHI leaders to publicly try to refute these evidence-based factors might begin a debate that issues for pending legislation, hundreds of thousands of affordable housing seekers, taxpayers, retail investors, and others. It could possibly be an effective way to begin off a brand new 12 months.
L. A. “Tony” Kovach is a managing member of LifeStyle Manufacturing unit Houses, LLC.
This column doesn’t essentially mirror the opinion of HousingWire’s editorial division and its house owners. To contact the editor answerable for this piece: [email protected].
