Discrimination

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The Department of Justice (DOJ) recently announced that it has settled a handful of cases in which plaintiffs made allegations of sexual misconduct under the Fair Housing Act (FHA) and resulting discrimination. In one case, DOJ resolved a complaint filed against a Housing Authority in Indiana in which the allegations concerned sexual misconduct and discrimination based on disabilities. Another case, this one from Michigan, also involved allegations of sexual discrimination. Shortly after announcing a resolution of these cases (as well as another from Kansas), the DOJ announced an initiative to combat sexual harassment in housing.

The Michigan action resulted in the owner of rental properties agreeing to pay $150,000 to settle allegations that he sexually harassed multiple women who lived in or inquired about his rental offerings. Under the terms of an agreement, the defendant promised to pay $140,000 to ten victims of discrimination as well as a $10,000 penalty to the United States. The complaint asserted that the defendant made unwelcome sexual comments and advances, engaged in unwanted touching, offered housing benefits in exchange for sexual acts, and threatened to take adverse housing action against women who refused his harassment.

The Indiana case was filed after an investigation demonstrated that employees of a local Housing Authority subjected female residents to unlawful sexual harassment and discriminated against residents with disabilities. The complaint asserted women were subjected to unwanted sexual conduct, questions, making explicit comments, and showing inappropriate pictures and videos. The claims also included denying reasonable accommodation requests (including efforts to be transferred to first floor units and efforts to obtain designated accessible parking spots). To resolve the matter, the Housing Authority agreed to pay $70,000 to compensate seven victims of discrimination.

The initiative – which will be piloted in Washington, D.C. and in western Virginia – will work to identify barriers to reporting sexual harassment and search for new ways to cooperate and collaborate between local law enforcement, legal service providers, and public housing authorities to leverage their respective expertise. In announcing the initiative, DOJ noted that it has recovered over $1 million for victims of sexual harassment in housing in 2017.

Given the increased media attention and coverage of allegations of sexual harassment of women in various walks of life, I believe this is a good time for professional apartment management to take a look at our policies in place to prevent sexual harassment and perhaps even to schedule some refresher training. Indeed, one client contacted me last week to schedule a session.

Just A Thought.

Pursuant to an agreement announced last week, the U.S. Department of Housing and Urban Development (HUD) announced that it resolved a discrimination complaint filed by local housing advocacy groups against Maryland’s Department of Housing and Community Development (DHCD). The complaint challenged the fairness of Maryland’s Low-Income Housing Tax Credit (LIHTC) program.  As detailed by HUD, the resolution puts forward policies, incentives, and more flexible program rules that are designed to streamline the designation/construction of affordable housing in various neighborhoods in and around Baltimore.

With respect to housing, the deal as crafted is hoped to develop up to 1,500 new affordable units. Of those 1,500 units, more than 1,000 are slated to be new construction. In a change to state policy, developers of affordable housing will no longer have to satisfy certain local scoring or approval criteria before applying for state-allocated tax credits.

The resolution ends six years of litigation that was filed by a group of housing and civil rights organizations. The plaintiffs argued that Maryland’s policy of requiring local jurisdictions to approve proposed affordable housing projects prior to the allocation of tax credits to fund construction essentially stopped affordable housing from being developed in predominately White areas. As such, according to the complaint, housing opportunities for African American and Hispanic families were wrongfully limited in and around Baltimore.

Pursuant to the settlement, the DHCD will: end the requirement of local approvals; mandate that at least 1,500 units of affordable family housing are developed certain areas in and around Baltimore region; amend plans to now award points to any proposal to develop family housing in a community of opportunity (including providing more of an incentive for homes with two or more bedrooms); expand affirmative fair housing marketing activities; and pay $225,000 to promote the mission of the local fair housing groups.

Just A Thought.

 

In a case involving the Americans With Disabilities Act (ADA), the U.S. Court of Appeals for the Seventh Circuit issued a new opinion which details the elements of a retaliation cause of action under the Fair Housing Act (FHA). The facts involved a special education teacher who was laid off as a result of an unsatisfactory performance review. The teacher challenged her review by defending her teaching methods, not by asserting she was advocating on behalf of any students or that she was exercising rights under the ADA.

After confirming that the interference provision of the ADA was modeled after the retaliation language contained in the FHA, the court made clear the following elements that would be needed to prove a retaliation claim under the FHA: (a) that the plaintiff engaged in activity protected by the FHA; (b) that the plaintiff was engaged in, aided (or encouraged others) to exercise or otherwise enjoy their FHA-protected rights; (3) the defendant coerced, threatened, intimidated, or interfered on behalf of the statutorily protected activities; and (d) the defendant was motivated by an intent to discriminate. Applying this test to the evidence in the ADA case, the Seventh Circuit concluded the plaintiff’s facts were insufficient and affirmed the trial court’s summary judgment decision in favor of the defendant. The appellate court concluded a dispute of teaching methodology did not rise to the level of asserting rights under the ADA on behalf of disabled students.

The takeaway for professional apartment management companies and employees? Under the FHA, while retaliation claims absolutely exist, it is clear that a plaintiff must be able to demonstrate a specific protected activity that he or she was attempting to assert and either an intent to discriminate or at least a causal connection between the protected activity and the challenged action.

Just A Thought.

 

In an effort to strengthen protections in the federal Fair Housing Act (FHA) against sexual harassment, a member of the U.S. House of Representatives from Michigan introduced a bill earlier this month to further define sexual harassment and to ensure certain conduct is covered under the law. Specifically, the legislation seeks to amend the FHA to make it easier for victims to bring cases of sexual harassment to court. Under the language in this bill, harassment against a resident would be an automatic violation of the statute. Harassment would be defined to include “unwelcome touching of a sexual nature or groping, or other actions of a sexual nature intended to be coercive, threatening or intimidating.” If the conduct occurs in or near a dwelling, that conduct shall be considered severe or pervasive – and against the law.

To date, there are 16 cosponsors and the bill remains in the House Judiciary Committee. I have not seen housing law as a priority for the current House, but language like this could be attached to another piece of legislation that is designated as something that must pass.

The takeaway for management: discrimination on the basis of sex is already covered under the law. I think in practice much of this type of conduct is already covered by federal and/or state law. This bill, however, would further define harassment, which is never a bad thing as I always seek clarity. As long as professional apartment management knows what the law is – we can do our best to follow it.

Just A Thought.

 

Last week, the U.S. Department of Justice (DOJ) announced that it settled yet another Fair Housing Act (FHA) case, this time for a total of $95,000. In a case from Washington state, the owners/managers of three apartment buildings resolved a lawsuit claiming that the defendants refused to rent their apartments to families with children in violation of the FHA.

The federal action, filed in March 2017, asserted that in March 2014 the defendants told a woman seeking an apartment for her family (which included a one year old child) that the building was for “adults only.” The DOJ further alleged that the apartments were advertised as “adult buildings.” The case started with an administrative complaint filed with the U.S. Department of Housing and Urban Development (HUD). HUD conducted an investigation, issued a charge of discrimination, and then referred the case to DOJ.

To settle the case, the defendants agreed to pay a total of $95,000, broken up as follows: (a) $35,000 in damages to the family denied housing because of their small child; (b) $35,000 that will be used to compensate other families that were harmed by the practices of the defendants; and (c) $25,000 as a civil monetary penalty to the United States. As is common in these cases, a part of the resolution includes three years of record keeping and monitoring as well as a requirement that the defendants adopt a non-discriminatory resident selection criteria and procedures to ensure compliance with the FHA.

In today’s apartment market, unless your community is specifically designated as housing for older persons, we simply need to welcome families with children. If you use “Adults Only” in your advertising, it is a decent bet that a fair housing advocacy group will find the ad. And then you will really need to speak with a lawyer like me.

Just A Thought.

The U.S. Department of Justice (DOJ) recently announced that it settled a Fair Housing Act (FHA) discrimination lawsuit with the owners/managers of more than 70 residential properties in West Virginia to resolve allegations that the property manager sexually harassed female residents and applicants. Under the terms of the deal, which was approved by the U.S. District Court for the Northern District of West Virginia, the defendants will pay a total of $600,000 (that is not a misprint) in damages and civil monetary penalties. Additionally, the individual manager was required to transfer his ownership percentage in these properties as well as to cease his role in managing them and agree to never again work in the property management business.

The litigation started with four female residents filing complaints with the U.S. Department of Housing and Urban Development (HUD). The government’s subsequent investigation revealed that the property manager harassed female residents and applicants (including engaging in unwanted and unwelcome sexual acts, touching and groping, offering housing benefits to female residents in return for the performance of sexual acts, verbal advances, entering units without permission, and threats to take adverse action against female residents when they refused or objected to his sexual advances) from 2006 through 2015.

The agreement mandates that the defendants pay $500,000 to individuals harmed by the discriminatory conduct and another $100,000 to the United States as a penalty for violating the law. The dollar amounts here are significantly above a traditional FHA case, but the egregious nature of the alleged conduct is what drove the large financial numbers.

In this day and age, it should go without saying that residential property owners and management companies must provide fair housing training to ensure none of our employees engage in conduct anything like what was asserted in this complaint.  It will be really difficult to explain to a judge how conduct like this was permitted to continue for ten years.  Enough said.

Just A Thought.

I get this question about exemptions to the Fair Housing Act (FHA) regularly, so I thought I would provide a refresher on the “Mrs. Murphy” exception to the FHA. At the outset, please know that apartment community owners, management companies, and leasing office staff members I represent are almost always covered by the FHA as well as companion state, city, or county anti housing discrimination laws. In my world, the FHA and its implementing regulations are part of the guidebook concerning how we do business. The FHA does, however, contain a few exceptions — one of the exemptions is referred to as the “Mrs. Murphy” exception.

The “Mrs. Murphy” exemption provides that if a dwelling has four or fewer rental units and the owner lives in one of those units, that home is exempt from the FHA. “Mrs. Murphy” is the hypothetical elderly widow who has converted a portion of her home into a rental apartment to supplement her limited income.

To be sure, the exemption does not apply to rental advertising. That means Mrs. Murphy cannot run a discriminatory advertisement indicating, for example, that a certain religious group is not welcome to rent her apartment or room. Also, this exemption does not apply when a real estate agent is representing the property owner as the law presumes agents are professionally trained and aware that housing discrimination is against the law.

Also, HUD takes the position that the Civil Rights Act of 1866 (yes, 1866) makes it illegal to discriminate based on race — and as such, there is no exemption from the law when dealing with race.

Should the “Mrs. Murphy’s” of the world discriminate? Of course not. But, the FHA does not apply in this limited circumstance and it can be a defense to a housing discrimination action.

Just A Thought.

The U.S. Department of Housing and Urban Development (HUD) recently announced that it settled another fair housing case, this one for $20,000, to resolve allegations of discrimination based on national origin and familial status. Two related complaints were filed against the community manager of a California property asserting that he made discriminatory statements about Hispanic residents and that the manager prohibited certain children from playing outside.

The case started when two Hispanic couples filed a complaint alleging that the owner and manager of their apartment complex discriminated against them in violation of the Fair Housing Act because of their national origin and because they had children. Additionally, a local California fair housing group filed a supplemental complaint claiming that the manager of the property repeatedly made comments indicating that he did not like having Hispanic residents because they did not speak English as well as accusing the Hispanic residents of bringing pests (including bed bugs and rats) to the property. The supplemental complaint also asserted that the community enforced overly restrictive rules that singled out kids and further that management terminated the lease of one of the Hispanic families after their two year old daughter was heard crying loudly when the manager walked by the family’s door.

In addition to the $20,000 settlement, the Respondents also will undergo fair housing and related sensitivity training.  While I remain mindful that there are always at least two sides to every story, allegations like this (to the extent they took place) provide all of us in the apartment management business a guide concerning a practice we absolutely must train our leasing office staff to avoid at all costs.  Or you will really need to speak with a lawyer like me.

Just A Thought.

Earlier this month, the U.S. Department of Housing and Urban Development (HUD) approved a settlement agreement concerning assistance animals and fees charged to residents. To resolve pending Fair Housing Act (FHA) disability discrimination complaints, the property owners and managers agreed to pay $20,500 to the Nevada housing advocacy group which filed the cases.

The allegations concerned claims that residents who required assistance animals were required to pay a pet deposit fee at three different properties in Nevada.  As has been noted in this space (and elsewhere) many times, as a part of a valid reasonable accommodation request for a service or emotional support animal – management must waive any charges or fees typically assessed against pets. Again, assistance animals are not pets and the charges paid by residents with pets should not be collected.

While I know there are always two (if not more) sides to every story, the takeaway for management is simple: professional apartment leasing offices must not charge pet rent or pet fees for service/companion animals. Or you will really need to speak with a lawyer like me.  While we can absolutely seek a medical verification for most companion animal requests, once that required is legitimately verified, we need to adjust our rent ledger accounting and welcome the resident (and animal) to our community.

Just A Thought.

Earlier this month we noted that a federal court in Colorado ruled that the Fair Housing Act (FHA) prohibits discrimination based on sexual orientation (although sexual orientation is not contained in the text of the statute). In that case, the district court judge concluded that ownership could not deny housing to a resident simply because the resident fails to adhere to gender stereotypes by being attracted to or married to a member of the same sex. As the case then settled, we will not get further review (at least for now) by a United States Court of Appeals as to whether the FHA prohibits sexual orientation discrimination.

So, while we may not get an appellate FHA decision on this point, it is instructive to examine how other appellate courts have ruled in similar cases brought under what is known as Title VII (which covers employment discrimination and is typically treated similarly by the courts as are Title VIII cases [which involve fair housing]). Unsurprisingly, recent trends in Title VII sexual orientation cases demonstrate a rift between the circuit courts.

To illustrate, the Seventh Circuit recently held that Title VII’s protections extend to members of the LGBT community. The case is Hively v. Ivy Tech Community College of Indiana, in which a lesbian alleged that her employer unlawfully discriminated against her because of her sexual orientation by refusing to promote her and by failing to renew her contract. The Seventh Circuit agreed. While it acknowledged that nearly all of the circuit courts, including panels of the Seventh Circuit, previously ruled that Title VII does not prohibit sexual orientation discrimination, the court determined that those rulings were incorrect, especially when viewed in conjunction with the growing number of Supreme Court decisions related to discrimination on the basis of sexual orientation. Noting the growing trend of prohibition against sexual orientation discrimination, the court held that claims arising from discrimination based on sexual orientation are cognizable under Title VII.

However, only one month before Hively, the Eleventh Circuit reached the opposite conclusion in Evans v. Georgia Regional Hospital. In that case, a lesbian employee alleged that her employer unlawfully discriminated against her based on her gender and sexual orientation, because she presented herself in a non-traditional manner by sporting a short hairstyle and wearing a man’s uniform (although she did not otherwise broadcast her sexuality). While the Eleventh Circuit noted that gender nonconformity claims are cognizable under Title VII, it held that precedent bound it to rule that Title VII does not prohibit sexual orientation discrimination. Like the Hively court, the Evans court also noted that nearly every circuit court addressing the issue has explicitly held that sexual orientation discrimination claims are not cognizable under Title VII.

So, what happens next? With a split of opinion between the circuits, there is at least some hope that the Supreme Court may take a case and provide guidance as to the state of the law (at least with regard to Title VII). In the meantime, a best practice for professional apartment management would be to err on the side of caution and avoid discriminating on the basis of sexual orientation or gender identity. As the Seventh Circuit noted, sexual orientation protections have greatly expanded in recent years, and that trend will likely continue to prove true. And, as always, in addition to federal law, you should check the state, city, and/or county laws in your jurisdiction as they may already prohibit sexual orientation discrimination.

Just A Thought.