The City of Annapolis and plaintiffs in two federal lawsuits alleging racial discrimination and unsafe conditions in public housing are moving toward settlement negotiations, according to court filings Friday.

One suit is a class action of more than 1,500 people; the other covers the same arguments, but concerns a public housing resident who died. In filings Friday, U.S. District Court Judge Matthew Maddox acknowledged that both parties in the cases wanted to mediate and ordered them to schedule a settlement conference.

The lawsuits argue that the Housing Authority of the City of Annapolis, or HACA, discriminated against residents in the past because it did not inspect all units as it did other licensed rentals.

Melissa Maddox-Evans, HACA’s executive director and CEO, said in an email that the authority supports the move toward mediation and negotiation.

“It represents a much-needed shift from the prolonged uncertainty and inconsistent direction that came out of the prior city attorney’s office,” she wrote.

She said the number of unoccupied HACA units is “far lower” than the 100 or so reported earlier this year. She did not specify how many units are currently unoccupied, but said HACA always has some empty units, “usually tied to repairs or inspection scheduling.”

“Every dollar spent responding to legal actions that do not advance resolution is a dollar that cannot be used for repairs, maintenance, or improvements for the residents who rely on us,” she wrote. “These cases have already diverted limited resources away from the mission they are intended to support.”

The move toward mediation came just days after Mayor Jared Littmann announced the departure of D. Michael Lyles, the city attorney, with immediate effect after a six-year tenure.

Annapolis had been accused of inserting “hallucinated” quotes and legal arguments, generated by artificial intelligence, in one of the housing cases. Littmann said that dismissing Lyles was not about any one legal case.

Reached last week, Lyles said he did not know “anything” about the potential use of artificial intelligence in filings.

“We’re pleased that under a new mayor and new leadership the city finally is willing to sit down in good faith and try to reach a resolution for these more than 1,500 HACA resident class members,” said Peter Holland, an attorney for the plaintiffs.

During his campaign for mayor, Littmann, who once worked as a lawyer, said he’d prefer the housing suits move toward a mediated settlement. A city spokesperson said Monday they would not offer comment on pending litigation.

The move toward a negotiated settlement is just the latest in a years-long saga that has dominated city politics.

Five years ago, the city and the housing authority settled a lawsuit that claimed conditions in public housing units harmed 52 families. The city and HACA shared the $1.8 million payout.

The next year, a federal judge approved a consent decree that required Annapolis to continue inspecting public housing units (a practice that former Mayor Gavin Buckley discontinued, then resumed in 2019). Also in 2021, Holland and Joseph Donahue, another attorney, sued on behalf of two more public housing residents.

In 2023, that suit was granted class-action status, allowing people who lived in Annapolis public housing units to join the class.

Then, at the beginning of this year, the housing authority received a $3 million bailout from city, state and county partners to confront an ongoing financial crisis. The funds should be used to reconcile the agency’s deficit, address repairs and re-license empty units.

This article has been updated with comments from Melissa Maddox-Evans, HACA’s executive director and CEO.