A federal appeals court ruled an insurer must defend a putative class action claiming an apartment management company systematically withholds security deposits after tenants move out and fails to provide a timely list of claimed damages as required by state law.

The complaint was filed in Decatur, Georgia, in 2017 against ECI Management, which oversees 26 apartment complexes in six Southern states. ECI has a “company-wide policy of withholding all or some of the security deposits of its departing tenants in violation of Georgia law,” the complaint said.

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