The tenants of a Mount Vernon Triangle apartment building facing the prospect of eviction and demolition if they can’t come up with a huge sum to buy the building filed a lawsuit today against the property owner, alleging a violation of D.C. landlord-tenant law.

Residents of the Museum Square Apartments at 401 K St. NW learned in June that their 302-unit building would be demolished unless they paid $250 million to purchase the property. Under the Tenant Opportunity to Purchase Act, before selling or razing a building, the owner must give tenants a chance to buy it. Typically, the price is set by the market, at whatever a third party is willing to pay. But in the case of demolition, the definition of the “bona fide offer of sale” required by law is murky—-and the owner, the Bush Companies of Williamsburg, Va., gave tenants a pricetag that seemed arbitrarily high for an aging property full of low-income tenants.

All 302 units at Museum Square are under the federal Section 8 program, meaning the tenants qualify for heavy government subsidies of their rent. In addition, most of the tenants are Chinese, meaning that demolition would threaten to displace about half of the remaining Chinese population in the Chinatown area.

The D.C. Council passed an emergency measure last month to limit the price developers can charge tenants in these situations. But Museum Square’s tenant association decided to pursue the litigation route as well to ensure they wouldn’t be forced out. The lawsuit, filed with the D.C. Superior court, alleges that Bush violated the TOPA law by not making a “bona fide” offer.

“We felt that the offer of sale from the owner is way above what the market can justify, and it cannot constitute a bona fide offer under the TOPA law,” says Zenobia Lai, an attorney with the Asian Pacific American Legal Resource Center, which along with the Legal Aid Society and Arnold & Porter is representing the tenants.

“If we can’t save Museum Square, we will be displaced from this neighborhood since we won’t be able to afford any of the apartments in this area,” Vera Watson, vice president of the Museum Square Tenants Association, says in a statement. “We have lived here when Museum Square was surrounded by parking lots, when there were no amenities.  Now the area is improved and they tell us this land is too precious for us?”

The suit gives the courts their first chance to weigh in on this complicated area of tenant law. Until now, the D.C. government and the property owners have been forced to cite a marginally related case involving an art gallery as the legal precedent.

Museum Square tenants appeared to get a reprieve from displacement this summer when Bush rescinded its earlier notice stating its intention to opt out of its Section 8 contract. But on Sept. 29, Bush notified tenants that it would be seeking to end its contract effective October 2015, adding new urgency to the case that will now be before the courts.

Photo by Darrow Montgomery