Facts

In October 2016, plaintiffs Apartment Rental Assistance, Inc. and Oak Hills Housing LP (ARA) and defendants 80 Oak Hills, L.P., 80 Columbia Village Townhomes, L.P., and 60 Forest View Senior Housing, L.P., entered into three separate Purchase and Sale Agreements for three multi-family apartment complexes located in Sonora and Jamestown. The PSAs specified that the properties were being sold on an "AS IS" basis. The PSAs allowed plaintiffs 35 days to perform due diligence on the properties, during which time plaintiffs conducted multiple inspections of the properties, and obtained reports from third party inspectors, including appraisals and physical condition assessments. At the end of the 35-day due diligence period, plaintiffs expressly accepted the condition of the properties and the sales closed on December 22, 2016.

Notwithstanding the foregoing, soon after the sales closed, ARA filed this action for fraud and breach of contract. ARA sought a multi-million dollar damages award based on alleged misrepresentations made in the due diligence process that allegedly resulted in an artificially inflated valuation of the properties.

PLAINTIFF'S CONTENTIONS: Plaintiff claimed that the following principal claims that resulted in an allegedly artificially inflated valuation of the properties: Defendants provided incomplete and inaccurate due diligence materials; Defendants failed to pay certain vendors for services rendered prior to the sale; Defendants failed to make certain repairs and replacements at the Properties; Defendants failed to pay certain wages to former management company employees; and Defendants failed to grant Plaintiffs access to certain proprietary property management software called Yardi after the sales closed.

DEFENDANT'S CONTENTIONS: The PSAs expressly disclaimed any liability on the part of the defendants. Each of the fully-integrated PSAs contained all of the terms of each sale, including all representations, warranties, disclaimers, duties, obligations, and releases between the parties. The PSAs also clearly articulated that each sale would be on an "AS IS" basis. On nearly every page of the PSAs, Plaintiff ARA expressly agreed to rely solely upon its own due diligence, and acknowledged that Defendants were not making any representations about the Properties except as specifically provided in the PSAs.

Furthermore, the allegations that information was misrepresented or concealed are false. All the required information was properly and timely disclosed to the buyer.

Damages

Plaintiffs sought approximately $3.5 million in damages.

Result

The court granted defendants' motion for summary judgment in its entirety disposing of all of plaintiffs' claims against defendants.