Lawsuit Filed Against Apartment Complex for Racial Discrimination

Here is another example of a recent Fair Housing Act lawsuit brought by the United States Department of Justice (“DOJ”). I try to post case summaries in order to provide timely updates to real estate professionals about the "dos and don'ts" under the Fair Housing Act, since fair housing is such an important issue.

On Friday, July 19, 2010, the DOJ filed a lawsuit against the owner, management company and former manager of Summerhill Place Apartments (a 268-unit apartment complex located in Renton, Washington) for violating the Fair Housing Act by discriminating on the basis of race, color, national origin and familial status in the rental of apartments. Summerhill Place Apartments consists of five separate buildings. Buildings 1-4 each have approximately 55 apartments. Building 5 has approximately 48 apartments.

The lawsuit alleges that the defendants steered Indian tenants away from one of the five buildings at Summerhill Place Apartments, treated tenants from India less favorably than other tenants, and discouraged African-Americans, Hispanics and families with children from living at Summerhill.

According to the lawsuit, two Summerhill Place Apartments employees contacted the King County Office of Civil Rights (“KCOCR”) in 2007, and reported/complained of discriminatory housing practices at Summerhill Place Apartments. The KCOCR then contracted with the Fair Housing Council of Washington (“FHCW”) to conduct testing at Summerhill Place Apartments. On various occasions between April 2007 and June 2008, the FHCW performed testing at Summerhill Place Apartments and provided the results to the KCOCR. Those tests revealed evidence of discrimination on the basis of race, color, national origin and familial status including, but not limited to, quoting different rental rates to African-American, Hispanic and Caucasian testers, discouraging African-Americans, Hispanics and families with children from renting at Summerhill Place Apartments and making statements indicating discrimination against African-Americans.

After testing was conducted, the KCOCR referred the matter to HUD. After an investigation, the Secretary of HUD determined that there was reasonable cause to believe that discriminatory housing practices had occurred and issued a charge of discrimination. The defendants elected to have the matters asserted in the HUD charge heard in federal court.

The DOJ's lawsuit alleges that the defendants engaged in discriminatory housing practices against African-Americans, Hispanics, people from India, and families with children at Summerhill Place Apartments, including:

• Instructing staff to not show vacant apartments in Building 5 or newly renovated apartments to Indians, African-Americans and families with children.

• Failing to inform Indians, African-Americans and families with children of available apartments in Building 5 or available renovated apartments, while showing and informing white prospective tenants without children of such apartments.

• Steering Indian prospective tenants into Buildings 1 through 4 and away from Building 5.

• Discouraging Hispanic prospective tenants from renting apartments by asking Hispanic prospective tenants, but not other prospective tenants, about whether they are legal residents of the United States, whether they have a social security number and, on at least one occasion, instructing a prospective tenant and bilingual employee not to speak Spanish to each other.

• Discouraging African-American prospective tenants from renting apartments by telling African-American prospective tenants, but not others, that there are strict rules on tenant conduct and suggesting they will be evicted if they violate them, telling African-American prospective tenants, but not others, that they should not even bother applying unless they have “pristine credit” or “squeaky clean” credit and, on one occasion, telling an African-American prospective tenant to pull up his pants.

• Discouraging prospective tenants with children from renting by falsely telling them that their children would not be allowed to play anywhere on the complex.

• Discriminating against Indian tenants by not replacing their carpet or their broken appliances, while providing such services to other similarly situated tenants, telling one or more Indian tenants that their children cannot play outside and that they should take them to a park to play, telling Indian tenants to “go back to India” if they cannot learn how to work their appliances and making other derogatory comments to such persons about their national origin.

According to the lawsuit, the conduct set forth above constitutes:

• A refusal to rent, a refusal to negotiate for the rental of, and conduct otherwise making unavailable or denying dwellings to persons because of race, color, national origin and familial status, in violation of 42 U.S.C. § 3604(a);

• Discrimination in the terms, conditions, or privileges, of rental of dwellings on the basis of race, color, national origin and familial status, in violation of 42 U.S.C. § 3604(b);

• Statements of preference or limitation on the basis of race, color, national origin and familial status in connection with the rental of dwellings, in violation of 42 U.S.C. § 3604(c); and

• Misrepresentations regarding the availability of units on the basis of race, color, national origin and familial status, in violation of 42 U.S.C. § 3604(d).

The lawsuit seeks monetary damages for those harmed by the defendants’ actions, civil penalties and a court order barring future discrimination. The complaint is an allegation of unlawful conduct. The allegations must still be proven in court.

As every real estate professional should already know, the Fair Housing Act prohibits discrimination in housing based on race, sex, color, national origin, disability, religion and familial status.

Source: U.S. Department of Justice and legal complaint and lawsuit documents (portions of used with the express permission of the DOJ)

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