RECENT ACCOMPLISHMENTS OF THE

HOUSING AND CIVIL ENFORCEMENT SECTION

(September 30, 2008)

The Housing and Civil Enforcement Section of the Civil Rights Division is responsible for the Department’s enforcement of the Fair Housing Act (FHA), along with the Equal Credit Opportunity Act, Title II of the Civil Rights Act of 1964, which prohibits discrimination in public accommodations, the land use provisions of the Religious Land Use and Institutionalized Persons Act (RLUIPA) and the Servicemembers Civil Protection Act (SCRA). During this administration, the Housing and Civil Enforcement Section has initiated 267 new lawsuits and obtained 257 consent decrees in the areas of fair housing, fair lending and public accommodations, including the first five Department of Justice lawsuits under RLUIPA.

Under its Operation Home Sweet Home initiative, the Department of Justice conducted a record high number of fair housing tests in Fiscal Year 2007. The Department conducts these tests in order to uncover housing providers who are discriminating against people trying to rent or buy homes. In Fiscal Year 2007, the Department filed four Fair Housing Act pattern or practice cases based on evidence developed through the testing program.

Several cases we have filed or resolved recently exemplify our efforts to ensure the availability of the housing opportunities guaranteed by the Fair Housing Act. ⁽¹⁾

Fair Lending

• On September 29, 2008, the Division filed a complaint and proposed consent order in United States v. First Lowndes Bank (M.D. Ala.). The complaint alleged that the bank engaged in a pattern or practice of discriminating against African-American customers by charging them higher interest rates on manufactured housing loans than similarly situated white customers, in violation of the Fair Housing Act (FHA) and the Equal Credit Opportunity Act (ECOA). Under the consent order, which is subject to court approval, First Lowndes Bank will pay up to $185,000, plus interest, to compensate African-American borrowers who were charged higher interest rates. The consent order also enjoins the bank from discriminating against customers on the basis of race in its home mortgage lending. In addition, the bank has agreed to implement new procedures to prevent discrimination in setting interest rates and will provide enhanced equal credit opportunity training to its officers and employees who set rates for housing loans.

• On September 29, 2008, the Division filed a complaint and proposed consent order in United States v. Nationwide Nevada (D. Nev.). The complaint alleged that the company and its general partner NAC Management, Inc., engaged in a pattern or practice of discrimination by refusing to finance car loans for consumers living on Indian reservations in Utah and Nevada, in violation of the Equal Credit Opportunity Act (ECOA). Under the consent order, which is subject to court approval, the company will pay $170,000 to compensate loan applicants who were denied loans by Nationwide Nevada due to their residence (or the residence of their co-applicant) on an Indian reservation. In addition, the company has agreed to implement a non-discrimination policy stating that consideration of residency on an Indian reservation is not a valid basis for declining to purchase automobile sales finance contracts and will provide enhanced equal credit opportunity training to its officers and employees who determine whether to finance car loans.

• On November 7, 2007, the Court entered the consent decree in United States v. First Nat'l Bank of Pontotoc (N.D. Miss.), resolving a lawsuit alleging that a former Bank vice president engaged in a pattern or practice of sexual harassment against female borrowers and applicants for credit, in violation of the Fair Housing Act and the Equal Credit Opportunity Act. The lawsuit also alleged that the Bank was liable for Anderson's actions. Under the consent decree, the defendants will pay $250,000 to 15 identified victims, up to $50,000 for any additional victims, and $50,000 to the United States as a civil penalty. In addition, Bank employees are required to receive training on the prohibition of sexual harassment under federal fair lending laws. The agreement also requires the Bank to implement both a sexual harassment policy and a procedure by which an individual may file a sexual harassment complaint against any employee or agent of the First National Bank of Pontotoc.

• On September 4, 2007, the court entered consent orders in United States v. Springfield Ford and United States v. Pacifico Ford (E.D. Pa.). The complaints, which were filed on August 21, 2007, alleged that these two Philadelphia-area car dealerships engaged in a pattern or practice of discriminating against African-American customers by charging them higher dealer markups on car loan interest rates than similarly situated white customers, in violation of Equal Credit Opportunity Act (ECOA). Under the consent orders, Pacifico Ford will pay up to $363,166, and Springfield Ford will pay up to $94,565, plus interest, to African-American customers who were charged higher interest rates. In addition, the dealerships will implement changes in the way they set markups, including guidelines to ensure that the dealerships follow the same procedures for setting markups for all customers, and that only good faith, competitive factors consistent with ECOA influence that process. Both dealerships will also provide enhanced equal credit opportunity training to officers and employees who set rates for automobile loans.

• On February 21, 2007, the court entered a consent order resolving United States v. Compass Bank (N.D. Ala.). The consent order resolves claims that Compass Bank violated the Equal Credit Opportunity Act by engaging in a pattern of discrimination on the basis of marital status in thousands of automobile loans that it made through hundreds of different car dealerships in the South and Southwest between May 2001 and May 2003. The complaint alleged that the bank charged non-spousal co-applicants higher interest rates than similarly-situated married co-applicants. This case resulted from a referral by the Federal Reserve Board. To remedy the alleged discrimination, the consent decree requires Compass Bank to pay up to $1.75 million to compensate several thousand non-spousal co-applicants whom the United States alleged were charged higher rates as a result of their marital status.

• On October 16, 2006, the court entered the consent order in United States v. Centier Bank (N.D. Ind.). The complaint in this case was filed on October 13, alleging violations of the Fair Housing Act and the Equal Credit Opportunity Act. Specifically, the complaint alleged that the Bank unlawfully failed to market and provide its lending products and services on an equal basis to predominantly African American and Hispanic neighborhoods in the cities of Gary, East Chicago and Hammond. Under the agreement, Centier will open new offices and expand existing operations in the previously excluded areas, invest $3.5 million in a special financing program, and spend at least $875,000 for consumer financial education, outreach to potential customers, and promotion of its products and services in these previously excluded areas.

Rental Discrimination:

• On June 4, 2008, the Division filed a complaint in United States v. Fountain View Apartments, Inc. (M.D. Fla.), a Fair Housing Act case referred by HUD, alleging that the owners and on-site manager of an apartment complex in Orange City, Florida discriminated against African Americans and families with children in the rental of apartments.

• On May 13, 2008, the court entered a consent decree in United States v. Henry (E.D. Va.), a Fair Housing Act case referred by HUD, alleging that Dr. James Crockett Henry and his company, who own and manage a 30-unit rental property in Virginia Beach, Virginia, evicted and threatened to evict black tenants, imposed different terms and conditions on black tenants, entered the units of black tenants without notice or reason, and used racial slurs and epithets. The complaint also alleged that the defendants prohibit more than two children per unit. The consent decree, requires the defendants to pay $84,000 to compensate three former tenants, $235,000 into a fund to compensate any additional victims subsequently identified by the United States, and a $42,000 civil penalty to the United States. Five other individual victims intervened in the lawsuit, and have reached a separate monetary settlement of their claims.

• On March 5, 2008, the court entered a consent decree in United States v. Luke (C.D. Cal.). The complaint, filed on November 16, 2006, alleged that the defendants discriminated against Hispanics in the rental of apartments in Garden Grove, California. The consent decree requires the defendants to pay $181,500 in damages to victims and $30,000 in civil penalties to the United States.

• On January 22, 2008, the court entered a consent decree resolving United States v. Pine Properties Inc. (D. Mass.), a case alleging discrimination on the basis of national origin. The complaint, filed on September 26, 2007, alleged that the owners and managers of multifamily housing in Lowell, Massachusetts, discriminated against Cambodian-Americans based on national origin by (1) telling Cambodian-American persons that their employment and/or credit had to be verified before they could see available dwellings while at the same time taking white persons to see available dwellings without first verifying their employment or credit; and/or (2) telling Cambodian-American persons that they had to have a separate appointment to see available dwellings while at the same time taking white persons to see available dwellings immediately, with no prior appointment. This case was developed based on evidence developed through the Civil Rights Division's Fair Housing Testing Program. Under the consent decree, the defendants will pay up to $114,000 to compensate victims, pay a $44,000 civil penalty to the U.S. government, establish and follow non-discriminatory tenancy procedures, undergo fair housing training and file reports with the government.

• On January 18, 2008, the Division filed a complaint in United States v. Regent Court Apartments, LLC (E.D. Mich.). The complaint, filed against the owners and manager of a 102-unit apartment complex in Roseville, Michigan, a suburb of Detroit, is based on evidence developed by the Civil Rights Division's Fair Housing Testing Program showing that white testers were offered apartments immediately while African-American testers were told that there would be a long wait for apartment availability.

• On October 1, 2007, the court entered a consent order in United States v. Adams (W.D. Ark.). The complaint, which was filed on September 28, 2007, alleged that the owners and management of Phoenix Village Apartments, located in Fort Smith, Arkansas, refused to rent to families with children. Under the consent order, the defendants will pay up to $165,000 to compensate victims and $20,000 in civil penalties to the United States. The consent order also calls for injunctive relief, including training, a nondiscrimination policy, record keeping and monitoring. This case was based on evidence developed through the Civil Rights Division's Fair Housing Testing Program.

• On August 29, 2007, the court entered a consent decree in United States v. General Properties Company, LLC (E.D. Mich.), a Fair Housing Act pattern or practice case alleging discrimination on the basis of race. The defendants must pay $330,000 in damages to 21 victims of race discrimination, $350,000 in damages and attorney’s fees to the Fair Housing Center of Metropolitan Detroit, and a $45,000 civil penalty to the United States. In addition, defendants must use an independent property management company to handle the rental and application process.

• On March 30, 2007, the court entered a judgment in United States v. Matusoff Rental Co (S.D. Ohio), finding that the defendants had engaged in a pattern or practice of discrimination based on race. The court had previously found that the defendants had discriminated against families with children under 18. The court found that 26 persons were victims of defendants' discrimination, and ordered the defendants to pay them a total of $535,000 in damages ($405,000 in compensatory damages and $130,000 in punitive damages).

•On August 7, 2006, the Division filed a complaint in United States v. Sterling (C.D. Cal.), a pattern or practice case alleging discrimination on the basis of race, national origin and familial status. The complaint alleges that the defendants refused to rent to non-Korean prospective tenants, misrepresented the availability of apartment units to non-Korean prospective tenants, and provided inferior treatment to non-Korean tenants in the Koreatown section of Los Angeles. The complaint also alleges that the defendants refused to rent to African-American prospective tenants and misrepresented the availability of apartment units to African-American prospective tenants in the Beverly Hills section of Los Angeles. In addition, the complaint alleges that the defendants refused to rent to families with children and misrepresented the availability of apartment units to families with children throughout the buildings that they own or manage in Los Angeles County. The complaint also alleges that the defendants made statements and published notices or advertisements in connection with the rental of apartment units that express a preference for Korean tenants in the Koreatown section of Los Angeles and express discrimination against African-Americans and families with children in Los Angeles County.

Sales Discrimination

• On May 20, 2008, the Division filed a complaint in United States v. Collier (W.D. La.), alleging that defendants violated the Fair Housing Act when they interfered with the sale of a home because of the perceived race of the buyers. This case was referred by HUD.

• On July 18, 2008, the Division filed a complaint in United States v. S & S Group, Ltd. d/b/a ReMax East-West (DeJohn) (N.D. Ill.), a Fair Housing Act case alleging that real estate brokers in Elmhurst, Illinois illegally steered testers posing as homebuyers on the basis of race and national origin. This case was referred by HUD.

• On July 14, 2008, the Division filed a complaint in United States v. Autumn Ridge Condominium Association, Inc. (N.D. Ind.), a Fair Housing Act case alleging that the Autumn Ridge Condominium Association and the members of its Board of Directors in Munster, Indiana prohibited families with minor children from living in the condominium complex and enforced the policy in a discriminatory fashion to exclude African-Americans from living in the complex. This case was referred by HUD.

Sexual Harassment:

On August 18, 2008, trial is scheduled in United States v. Mitchell (S.D. Ohio), a Fair Housing Act case alleging that the owner and operator of numerous rental properties in the Cincinnati metropolitan area subjected female tenants to unwanted verbal sexual advances and sexual touching, entered their apartments without permission or notice, granted and denied them tangible housing benefits based on sex, and took adverse action against them when they refused or objected to his sexual advances. The suit seeks monetary damages to compensate the victims, civil penalties, and a court order barring future discrimination. This matter was initially referred to the Division by Housing Opportunities Made Equal, a fair housing organization in Cincinnati.

On July 17, 2008, the Division filed a complaint in United States v. Gumbaytay (M.D. Ala.), alleging that Jamarlo K. Gumbaytay (aka Laurence E. Lamar) d/b/a Elite Enterprises Consultant Group subjected female tenants and applicants to severe, pervasive, and unwelcome sexual harassment. The complaint also names as defendants the owners of the subject properties that Defendant Gumbaytay managed. This case was referred by the Central Alabama Fair Housing Center.

•On April 30, 2008, the Court entered the consent decree in United States v. Calvert (W.D. Mo.). The complaint, filed on August 8, 2006, alleged that Harold Calvert, the president of Calvert Properties in Richmond, Missouri, subjected female tenants to unwanted verbal sexual advances, unwanted physical sexual advances, forcible physical contact with the sexual parts of his body, inappropriate statements, and threats of eviction when they refused or objected to his sexual advances. The consent decree requires Calvert Properties to pay $165,000 to six women whom the United States alleges were sexually harassed by Harold Calvert, and to two children of one of the women who witnessed their mother being harassed., and $60,000 into a victim fund. Calvert Properties must also pay a $25,000 civil penalty.

• On April 4, 20008, the Court entered the consent decree in United States v. James (W.D. Mo.), a case alleging sexual harassment by the maintenance person at several apartment complexes in Platte City and Smithville, Missouri. The consent decree requires the defendants to pay $75,000 to four victims and $20,000 to the United States as a civil penalty. In addition, defendants will be enjoined from further illegal discrimination and must establish a sexual harassment policy and provide training to employees.

Disability Discimination:

• On June 23, 2008, the court entered a consent decree in United States & Wilder v. Bouquet Builders, Inc. (D. Minn.), a Fair Housing Act election case referred by HUD. The complaint alleged that the defendants, the owners of townhomes in Rochester, Minnesota, violated the Fair Housing Act by refusing to rent a unit to a woman and her family because she had an emotional assistance animal. The consent decree requires the defendants to pay $82,500 in damages and attorney's fees, as well as to adopt an assistance animal policy, attend fair housing training and comply with reporting and record keeping requirements.

• On June 2, 2008, the court entered a consent decree resolving United States v. Hussein (D. Conn.). The lawsuit, which was referred by HUD, alleged that the defendant refused to grant a reasonable accommodation from his no-pets policy so that his tenant's minor daughter could work with an assistance dog to help with her cerebral palsy, seizure disorder, and depression. The lawsuit further alleged that the defendant retaliated against the mother and daughter after they attempted to exercise their rights under the Fair Housing Act by refusing to renew their annual lease and beginning eviction proceedings. The tenant and her daughter filed a separate lawsuit that also is resolved by the consent decree. Under the consent decree, the defendant will pay $115,000 in monetary relief, including $102,000 to compensate the tenant and her daughter and $13,000 in attorneys fees.

"Design and Construction" Cases: During this administration, we have filed 46 new cases and obtained 55 consent decrees involving violations of the Fair Housing Act’s accessibility requirements for new multi-family housing.

• On July 1, 2008, the court accepted for filing our amicus brief in Equal Rights Center v. AvalonBay Communities (D. Md.), a Fair Housing Act pattern or practice design and construction case. The defendant has moved to dismiss part of the Equal Rights Center's complaint, arguing that relief for properties completed more than two years before the complaint was filed is barred by the statute of limitations. Our amicus brief argues that the statute of limitations does not bar the Equal Rights Center from seeking relief for these properties.

• On January 22, 2008, the court entered a consent decree in United States v. Tanski (N.D.N.Y.), a case alleging that the various defendants failed to design and construct 362 ground-floor apartments and the public and common areas at the McGregor Village Apartments in Wilton, N.Y., and several other properties in accordance with the accessibility provisions of the Fair Housing Act. The consent decree requires the defendants to eliminate steps at ground-floor units and retrofit the apartments; to retrofit public and common use areas; and to pay $155,000 in damages to persons identified by the government as having been harmed by these inaccessible features and a $20,000 civil penalty to the government.

• On December 12, 2007, the court approved the distribution of $700,000 to 37 persons with disabilities pursuant to the September 2005 settlement of United States v. Edward Rose & Sons (E.D. Mich.). The remaining $250,000 in the settlement fund will go toward increasing housing opportunities for disabled persons in communities where Edward Rose & Sons operates, in a manner to be determined later by the court. In this case, the Division alleged that a major housing developer and several architectural firms engaged in a pattern or practice of discrimination against persons with disabilities by failing to include accessibility features required the Fair Housing Act and the Americans with Disabilities Act in apartment complexes in Michigan, Indiana, Illinois, Ohio, Wisconsin, Virginia and Nebraska. Under the agreement, the developer and architectural firms agreed to retrofit 49 apartment complexes and pay $1,060,000 in damages and civil penalties.

• Between July and September 2007, we filed design and construction complaints in United States v. Sheils (S.D. Ill.); United States v. Palazzolo and Lombardo (E.D. Mich.) (consent decree entered in August 2007); United States v. Sayville Development Group (E.D.N.Y.); United States v. Douglass (E.D. Wash.); United States v. DKCD d/b/a Renaissance Developments (W.D. Ky.); and United States v. Genesis Designer Homes, LLC (S.D. Ga.).

• On August 22, 2007, the court approved the distribution of over $1 million in monetary damages among 756 individuals who were identified through a claims process pursuant to the 2004 consent decree in United States v. Housing Authority of Baltimore City (D. Md.). This is the Department's first case to enforce Section 504 of the Rehabilitation Act and HUD's implementing regulations. In addition to the victim fund, the consent decree requires extensive program and policy changes and nearly 2,000 new housing opportunities for individuals with disabilities.

Discriminatory Land Use and Zoning Practices

• On May 7, 2008, the Division filed a complaint in United States v. City of Satsuma (S.D. Ala.), a Fair Housing Act case that was referred by HUD. The complaint alleges that defendants refused to allow three adult residents living in a single-family home with supportive services provided by professional care-givers to reside together in a group home.

• On March 14, 2008, the court in United States v. District of Columbia (D.D.C.) issued an opinion and order declaring that the District violated the Fair Housing Act by twice failing to grant requests by Father Flanagan's Boys & Girls Homes ("Boys Town") for reasonable accommodations regarding building permits for four group homes, based on the disabilities of the prospective residents. The court enjoined the District from further violations of the reasonable accommodation provisions of the Act. Both sides have filed notices of appeal.

• On March 13, 2008, the court in United States v. City of Boca Raton (S.D. Fla.) issued an order enjoining the city from enforcing part of an ordinance that targeted substance abuse treatment facilities ("SATFs") for more restrictive treatment than comparable housing for non-disabled persons. The United States contended that the ordinance placed restrictions on a particular type of housing for persons in recovery from alcohol or drug dependency without a legally sufficient justification. Under the court's ruling, the city cannot prevent licensed SATFs with separate housing and treatment components from operating their residential components in residential multifamily and other zoning districts. As a result, one such facility currently operating in Boca Raton will be able to continue to operate its residential component in a multifamily district and will not have to obtain a different license from the state that the city deemed more acceptable.

• On October 29, 2007, the court granted the parties’ Joint Motion to Approve and Enter Settlement Agreements as Court Orders in United States v. Sarasota County (M.D. Fla.), which is consolidated with Tracey P. v. Sarasota County (M.D. Fla.). The two settlement agreements, one between the United States and the County and one between the private plaintiffs and the County, require the County to pay $750,000 to the private plaintiffs and $10,000 to the United States. The private plaintiffs’ settlement provides for the continued operation of the group homes. The government’s settlement requires County employees to undergo fair housing training, adopt a reasonable accommodation policy, and comply with various reporting requirements. This is a Fair Housing Act case that was referred by HUD, in which the complaint alleged that the County violated the Act by engaging in discrimination on the basis of disability.

In addition to these and the many other cases that we bring to ensure fair housing opportunities, the Division also is involved in ongoing efforts to educate the public and various entities involved in the housing industry about their rights and responsibilities under the Fair Housing Act. On March 5, 2008, we issued a Joint Statement on Reasonable Modifications under the Fair Housing Act with the Department of Housing and Urban Development. The joint statement provides technical assistance, in a series of questions and answers, regarding the rights and obligations of persons with disabilities and housing providers relating to reasonable modifications, and is available online. In 2005, we launched our Multi-Family Housing Access Forum, intended to assist developers, architects and others understand the FHA’s accessibility requirements, and to promote a dialogue between the developers of multi-family housing and persons with disabilities and their advocates. We have held events in Chantilly, VA; Dallas, TX; Atlanta, GA; Phoenix, AZ; Minneapolis, MN and; Miami, FL; and Seattle, WA. The next event will take place in November 2008, at a location to be determined soon. For more information, see http://www.usdoj.gov/fairhousing/access_forum.htm. In 2004, we issued a Joint Statement on Reasonable Accommodations with HUD, providing technical assistance relating to reasonable accommodations under the Fair Housing Act. It is available online.

Public Accommodations (Title II)

• On March 10, 2008, the court entered a consent decree in United States v. Davis (E.D. Va.). The complaint, filed on September 20, 2007, alleged that the owners and managers of Kokoamos Island Bar & Grill discriminated against African-American patrons by implementing a discriminatory dress code targeting African Americans and by applying the dress code in a discriminatory manner. The consent decree requires the defendants to post and enforce a non-discriminatory dress code policy; to implement a system for receiving and investigating discrimination complaints; and to conduct monitoring to ensure that Kokoamos' employees are acting in a non-discriminatory manner consistent with federal law.

Religious Land Use and Institutionalized Persons Act (RLUIPA)

• On February 25, 2008, the court entered the consent decree in United States v. City of Waukegan (N.D. Ill.). The complaint alleges that the City imposed and implemented zoning code provisions that were more restrictive for houses of worship than for nonreligious assemblies and institutions in several City zoning districts. Under the consent order, the City must amend its zoning code so that the code does not treat religious assemblies and institutions differently from comparable non-religious assemblies or institutions. The consent order also requires the City to provide training for personnel on RLUIPA’s requirements and post notices about the consent order at various locations.

• On October 1, 2007, the court denied the defendant’s motion for summary judgment in Albanian Associated Fund, Inc. v. Township of Wayne (D. N.J.), a RLUIPA case brought by the Albanian Associated Fund, which is seeking to construct a mosque in the Township. The Township commenced eminent domain proceedings against the Albanian Association Fund's land while its application for a conditional use permit was pending before the Township's Planning Board. The Township argued on summary judgment that eminent domain proceedings are not covered by RLUIPA. The Division filed an amicus brief on July 20, 2007, arguing that the Township's commencement of eminent domain proceedings in this case constituted the implementation of a land use regulation covered by RLUIPA. The court ruled that RLUIPA’s protections apply to the eminent domain proceedings in this case.

• On September 26, 2006, the United States filed a complaint in United States v. Village of Suffern (S.D.N.Y.). The complaint alleges that the Village of Suffern unlawfully discriminated on the basis of religion, in violation of RLUIPA, when it refused to allow a private religious organization to operate a Shabbos House near Good Samaritan Hospital in Suffern, New York. Bikur Cholim's Shabbos House in Suffern provides meals and lodging to Orthodox Jews who take patients to and from Good Samaritan Hospital, visit patients at the hospital or are patients released from the hospital. The complaint alleges that Suffern's denial of Bikur Cholim's variance application substantially burdens the religious exercise of the Orthodox Jews who need to visit the sick in Suffern while observing the religious proscription against driving on the Sabbath and other holy days. Both parties have filed motion for summary judgement with the court.

• On July 7, 2006, the court approved the consent decree resolving U.S. v. City of Hollywood (S.D. Fla.), a lawsuit filed by the Department against the City of Hollywood, Florida, resolving allegations that the city violated RLUIPA by denying an application for a zoning exception by the Hollywood Community Synagogue based on its religious denomination, the Chabad Lubavitch movement of Orthodox Judaism. As part of the settlement agreement with the United States, the city agreed to allow the Hollywood Community Synagogue to operate permanently as a house of worship at its properties, and to expand if it should acquire additional properties within a block of its current location. The city also agreed that its leaders and managers and certain city employees will attend training on the requirements of RLUIPA. In addition, the city will adopt new complaint procedures, and will report periodically to the Justice Department. In a separate agreement filed with the court at the same time, the city also agreed to pay the Synagogue $2 million in damages and attorneys’ fees and costs.