Housing New Zealand has dropped a $1 million legal bid to evict three women with Mongrel Mob connections from their Lower Hutt state homes.
Robyn Winther, Huia Tamaka and Billy Taylor were given 90 days to leave their Farmer Crescent houses in March 2009 after neighbours complained of intimidation, threats and burglary by gang members associated with the women.
Armed police later stormed the street, arresting 10 people.
The trio fought the eviction attempt for two-and-a-half years through the Tenancy Tribunal, the Human Rights Tribunal and several courts.
The battle, which cost HNZ about $1 million, ended this week when the state agency announced it was calling of its legal bid.
A statement said it had reconsidered its stance after a Human Rights Review tribunal decision last week, despite the tribunal ruling in HNZ had acted lawfully in evicting the women.
Housing minister Phil Heatley this morning defended the long-running legal action.
He told Radio New Zealand the cost of the action was not HNZ's fault as it had not initiated any proceedings.
"Housing New Zealand were compelled to go to the courts or tribunals five times, then won each time, and that's where it sat. It wasn't as if Housing New Zealand had instigated all the court costs."
"Housing New Zealand didn't pursue these women through the courts. Housing New Zealand defended their positions.
"The costs that came out of that weren't Housing New Zealand's fault."
A spokeswoman for Mr Heatley said two of the woman had been issued 90-day eviction notices anyway as HNZ made way for a significant state housing redevelopment programme in the Hutt Valley suburb of Pomare.
The third could still be issued an eviction notice amid the development, she said.
However the lawyer for the three women, Liz Hall, told Radio New Zealand HNZ told the women they would be helped into another state house.
She said the agency unlawfully discriminated against her clients
"They were the ones who made the decision to evict women and children who had done absolutely nothing wrong."
Ms Hall said there had been no further complaints about the women since they were issued the original eviction notices in 2009.