Following in the footsteps of the feds.
Texas Attorney General Ken Paxton sued the Houston-area developers of Colony Ridge on Thursday, accusing them of deceptive sales, marketing and lending practices that allowed their sprawling housing development to flourish.
Residents of Colony Ridge filed dozens of complaints for years about the development to state agencies, but Texas had little to show for addressing those concerns, according to a Texas Tribune and Houston Landing investigation. Paxton announced his office’s investigation last fall, after right-wing media conflated the development’s growth with high levels of illegal immigration at the Texas border.
At least 11 consumer complaints were sent to the Attorney General’s Office about Colony Ridge since 2019, long before Paxton told a conservative talk radio host his office would investigate. Paxton at the time also said it was “completely insane that they can set up these villages with illegal immigrants,” but claimed the Legislature had not given his office the “authority to do anything about it.”
Thursday’s lawsuit marks the most significant state action to date against the development. It echoes many of the claims in a U.S. Department of Justice lawsuit filed against Colony Ridge in December. In the state’s lawsuit, Paxton argues the developers target foreign-born, Latino consumers with a bait-and-switch sales scheme that leads to sky-high foreclosure rates.
“The development profited from targeting consumers with fraudulent claims and predatory lending practices” Paxton wrote in a statement. “Their deceptive practices have created unjust and outsized harms. Nearby communities have borne a tremendous cost for the scheme that made Colony Ridge’s developers a fortune.”
Colony Ridge developer John Harris said there was no merit to the allegations in either lawsuit, and that the legal action was prompted by the recent attention from Texas lawmakers and GOP leaders following right-wing media coverage.
“They’re following the same line as the Department of Justice, there’s no creativity in Paxton’s words and we’re ready to defend this suit,” Harris said in a statement.
[…]
While parts of Paxton’s lawsuit repeat similar findings brought by the federal government, it also alleges new details about Colony Ridge’s business practices.
The lawsuit claims the developers launched an aggressive marketing strategy that relied on deception to attract potential customers. It alleges employees of Colony Ridge were provided multiple cellphone SIM cards to make marketing calls from burner phone numbers and set up dozens of social media accounts to market the development.
One former employee told state investigators that the company required them to make more than 60 fake online listings every day on fake social media accounts, according to the lawsuit. That employee recounted witnessing another colleague get fired for not hitting the quota, according to the lawsuit.
Throughout the lawsuit, former Colony Ridge employees who spoke to state investigators are referred to by pseudonyms to “prevent harassment and/or retaliation.”
The lawsuit argues the developers told sales people to use misleading marketing tactics, such as misrepresenting themselves to potential buyers and falsely claiming the properties were home-ready.
See here and here for some background. I’m not inclined to give Ken Paxton any credit for this – as noted, there have been complaints for years, and his initial response to the words “Colony Ridge” was to echo the wingnut lies about crime at the site – but perhaps this will force some action before the federal lawsuit is able to. I’m sure the developers will raise the point about Paxton’s longstanding inaction prior to this as part of theie defense.
I also am not inclined to give Ken Paxton credit for the action in his lawsuit. It should have been filed a long time ago. As everything with Paxton, I wonder what is the real reason for the suit. I suppose it is a sad state of affairs that when every action taken by the State’s top law enforcement officer is viewed with a jaundiced eye.