$62,000 Settlement in Fair Housing Disability Discrimination Case Against Apartment Complex for Refusing to Allow Residents to Keep Service Dogs

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On May 29, 2008, the United States Department of Justice ("DOJ") settled a fair housing disability discrimination case for $62,000 that was brought against an apartment complex and the on-site manager for refusing to allow residents to keep service dogs. United States v. Stealth Investments LLC; BMT Investments LLC; and Steven Barry Woodhouse, No. 4:07-cv-500, filed in the United States District Court for the Idaho (consent order dated May 29, 2008).

On May 29, 2008, the federal court entered a consent decree that settled this fair housing disability discrimination case brought by the DOJ against an apartment complex and its on-site property manager. The complaint alleged that the defendants engaged in housing practices that discriminated on the basis of disability, including refusing to allow residents with disabilities to keep service dogs at Shadow Canyon Apartments, which was a 77-unit apartment complex located in Idaho Falls, Idaho.

The DOJ'’s lawsuit alleged the following facts. On August 9, 2006, in response to a complaint, a local fair housing agency conducted a telephone test for housing discrimination based on disability at Shadow Canyon Apartments. Testing is a simulation of a housing transaction that compares responses given by housing providers to different types of home-seekers in order to determine whether or not illegal discrimination is occurring.

The local fair housing agency tester called Shadow Canyon Apartments and spoke to Mr. Woodhouse, who was the on-site apartment manager. The tester, who posed as a social worker, informed Mr. Woodhouse that she was inquiring on behalf of a prospective renter who used a wheelchair, about whether there were any one or two bedroom apartments available. Mr. Woodhouse confirmed that both unit types were available and quoted rental rates.

The tester then told Mr. Woodhouse that the prospective renter had a “service dog” and asked about Shadow Canyon Apartment’s procedures. Mr. Woodhouse replied, “We absolutely do not allow dogs. They’re going to have to find somebody else. Even if it’s service, we won’t allow dogs.” When the tester mentioned that the prospective renter had a prescription for the service dog because of his disability, Mr. Woodhouse responded that the prospective renter “might as well just find a different place.”

Mr. Woodhouse then informed the tester that it was Shadow Canyon Apartments' policy to allow service cats but “absolutely no dogs,” adding, “We can regulate the type of pet, service pet allowed.”

The tester then explained that the service dog assisted the prospective renter by helping him move his wheelchair. In reply, Mr. Woodhouse again told the tester that the prospective renter should “find somewhere else to stay,” adding, “[t]here’s lots of other places that accept them.” The tester asked if it was possible for the prospective renter to pay extra money or do anything else to have a service dog, and Mr. Woodhouse responded, “No.” Mr. Woodhouse stated, “The owners are just absolutely downright strict about no dogs.”

On October 27, 2006, the local fair housing agency filed a complaint of discrimination HUD alleging that the defendants discriminated on the basis of disability in violation of the Fair Housing Act. The complainant elected to have the charge resolved in a federal civil action, so the DOJ filed a lawsuit.

Under the terms of the settlement, the defendants were required to pay $24,500 to compensate victims of discrimination at Shadow Canyon Apartments, establish a $12,500 victim fund, and pay a $25,000 civil penalty to the United States. Additionally, the defendants were required to establish and follow non-discriminatory procedures and undergo fair housing training.

This case is yet another example of a blatant violation of fair housing laws.  Every real estate professional needs to remember that a service animal is not a "pet."  Various fair housing laws require housing providers to modify their "no pets" policy to allow the use of a service animal by a person with a disability. This does not mean the housing provider must abandon its "no pets" policy altogether, but simply that it must make an exception to its general rule for service animals.


To learn more about Fair Housing issues in Michigan (and many other topics affecting Michigan real estate professionals), please visit us at www.123ConEd.com. 123 ConEd LLC (www.123ConEd.com) is a leading online provider of continuing education courses to real estate professionals in Michigan. Our online Michigan real estate con ed courses are fully approved and properly certified by the Michigan Department of Labor & Economic Growth. All of our courses are designed to offer our students the most information, as quickly and economically as possible.

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Robert L. Brown
www.mrbrownsellsgr.com - Grand Rapids, MI
Grand Rapids Real Estate Bellabay Realty, West Mic

I didn't know that. It's good to have the knowledge to pass along to others. There again when you lose money you tend to learn quickly.

Feb 27, 2009 02:25 AM #1
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