The ruling was welcome news to seniors living at the Park Village Apartments building on Park Boulevard Way in the city's Glenview district.
The seniors had thought they would be forced to move after their landlord, Mortimer Howard, first gave notice last March that he no longer would participate in the federal Housing and Urban Development's subsidy program.
Because he no longer would participate in the program, Howard gave the seniors 30 days to either pay market rate for rent or find a new place to live. He amended the notice to 90 days in October.
For many, the market rate of $1,192 per month for a one-bedroom apartment was more than they earn.
The only problem for Howard, however, was a federal law that mandates landlords give residents a year's notice before ending participation in the subsidy program.
City officials and Bay Area Legal Aid rose to the seniors' defense and filed a lawsuit against Howard arguing that the landlord failed to follow federal law.
They also asked a judge to prevent Howard from either raising the rent or evicting tenants until the court proceedings are resolved.
Federal Judge Saundra Armstrong agreed earlier this month, saying the tenants can stay as long as they continue to pay their roughly $300-a-month subsidized rent.
"It gave our clients a peace of mind," said Lisa Greif, an attorney at Bay Area Legal Aid. "A lot of our clients have limited English skills, are disabled and have been there a long time. The prospect of moving someplace else was prettydaunting."
The troubles began when Howard decided not to renew an agreement with HUD that paid him to house low-income seniors. Under the deal, seniors would put 30 percent of their income toward rent. HUD then would pay the rest to ensure Howard gets market value for each of the 84 units in the building.
Howard had participated in the program since he built the complex about 20 years ago. However, last year he decided to opt out.
HUD offered to pay Howard up to $1,225 per unit in the building but he refused. Instead, Howard sent notices to tenants saying their rent would rise.
The first notice was made in March with a 90-day notice sent in October. To this day, Howard has yet to give the legal one-year notice to tenants.
City Attorney John Russo, along with Bay Area Legal Aid, filed suit. Russo argued that Howard failed to follow city rent control laws while Bay Area Legal Aid argued that the landlord failed to follow federal laws.
The city's case is pending in Alameda County Superior Court.
Greif said she hopes Howard would sell the building to a nonprofit organization that would continue to offer units to low-income seniors. As a condition of the building's construction, seniors must be the only tenants for at least 20 more years.
Neither Howard nor his attorney could be reached for comment Tuesday.