Eligible individuals and families who owned property in the Mariposa master-planned community have settled their class-action lawsuit against its former developer, High Desert Investment, and Albuquerque Academy for $5 million.
Negotiated by lawyers on both sides of the case, the settlement was approved by District Court Judge James L. Sanchez following a hearing Wednesday in Valencia County. The settlement covers from 225 to 235 owners who purchased their property on or before June 20, 2012.
The court heard one objection to the settlement by a property owner who wanted to be part of the lawsuit but was originally barred due to a technical reason.
A key element of the settlement is that the property owners, as a class, give up their right to sue High Desert and Albuquerque Academy on their own.
“Prior to the final fairness hearing, we were contacted by over a third of the property owners,” said Christopher Bauman of the Bauman, Dow & Leon, one of two law firms representing the plaintiff.
“Some people who contacted us thought it wasn’t enough money — we’d settled too low — but the vast majority of the class seems to be happy with the settlement,” he said.
Payouts will range from roughly $4,000 to a high of about $60,000, Bauman said. The money will be allocated according to a formula. In simple terms, owners of less expensive vacant lots will receive lower payouts, while owners of pricey lots with high-end homes will receive the highest payouts.
The allocation plan will likely carry over into 2016.
Filed in 2012 and alleging breach of contract, negligence and other claims, the lawsuit basically sought compensation for property owners who suffered a financial loss when High Desert withdrew as Mariposa’s developer.
High Desert is the for-profit arm of Albuquerque Academy, a nonprofit private school that used a strategy of real estate development to build its financial endowment.
When the housing bubble burst and lot sales dried up, the Mariposa community in Rio Rancho became a money loser for High Desert. The active 800-acre portion of the community was repossessed by lenders and eventually sold.