2024 Fair Housing Litigation - Cases of Significance - Single Incident Must Be Egregious to Constitute Hostile Environment Harassment
(First in a series of Six Articles)
Why do landlords need a briefing on fair housing cases? The answer to that question is based on four facts:
Fact 1: The federal Fair Housing Act (FHA) bans landlords and their agents from discriminating against rental applicants and tenants based on race, color, religion, sex, national origin, family status, or disability.
Fact 2: The FHA and its regulations also spell out things landlords must do to ensure fair and equal housing, such as make reasonable accommodations for persons with disabilities and refrain from discriminatory advertising.
Fact 3: Like most landlords in Oregon and America, you already know of all of this, and you train your leasing agents and staff to know it, too.
Fact 4: Despite all of this, individuals, organizations, and government agencies file thousands of fair housing lawsuits against landlords every year.
That housing discrimination remains a problem in America is a fact that few would deny. But the other disturbing takeaway from these facts is that even landlords who embrace and try diligently to comply with the principles of fair housing law end up as targets for litigation. Of course, many of these discrimination claims are simply unfounded. But there’s more to it than that.
The problem is that well-meaning landlords may commit discrimination without intending to. Inadvertent discrimination is typically the product of ambiguity and uncertainty in the law. Thus, for example, the FHA requires “reasonable accommodations” for persons with disabilities but doesn’t specifically define what constitutes “reasonable.” While guidelines from the Department of Housing and Urban Development (HUD) help fill in the details, every situation is different. That leaves it for courts and tribunals to decide the issue case-by-case. Result: The only way to know for sure whether a particular requested accommodation is reasonable is to go to court and let the judge or jury decide the issue.
Obviously, that’s not a very practical strategy. The idea of compliance and managing liability risk is to take proactive action to prevent fair housing claims in the first place. But case law can play a vital role in helping you achieve this objective. That’s because the cases illustrate how the general principles of fair housing law play out in actual, real-life situations. So, reviewing court cases involving other landlords can bolster your own compliance efforts.
HUD receives approximately 30,000 fair housing complaints each year. But there’s a big difference between a complaint and a reported court case. Most of the former get dropped, resolved, or dismissed out of hand. Only a few actually make it to court and get reported. These cases are where the rubber meets the road and, therefore, the focus of our Scorecard.
The vast majority of cases pose the threshold question of whether a discrimination complaint should even go to trial. More precisely, most Scorecard cases aren’t the results of a trial but a ruling on a landlord’s motion for summary judgment—basically a ruling in favor of the landlord on the law on the basis of the pleadings (or complaint), without a trial. The landlord’s argument: There’s no point in holding a trial because even if everything the complaint alleges is true, we still wouldn’t be guilty of an FHA violation.
TOP 10 REPORTED DOJ FHA SETTLEMENTS OF 2024
Although they don’t count in our Scorecard, it’s worth noting that the U.S. Department of Justice (DOJ) reported a number of significant FHA settlements in 2024.
Top 10 FHA Consent Order Settlements Reported by DOJ in 2024
Settlement
Amount
Case
Alleged FHA Violation(s)
1
$623,000
United States v. Donahue (W.D. Wis.)
Landlord sexually harassed female tenants by offering to reduce rent in exchange for sex, making unwelcome sexual comments and advances, and evicting or threatening to evict tenants who refused his sexual advances
2
$600,000
United States v. Shambayati, et al. (S.D. Ga.)
Landlord sexually harassed female tenants and prospects by making unwelcome sexual comments and advances, inappropriately touching their bodies, entering their homes without permission, requesting sex in exchange for rent or other benefits, and retaliating against tenants who rejected his advances or complained about harassment
3
$460,000
United States v. Chicopee Housing Authority and Monica Blazic (D. Mass.)
Landlord made discriminatory statements to and about Black and Hispanic tenants, demanded that Spanish-speaking tenants speak English, and dragged its feet on reasonable accommodations, such as transfers to first-floor or elevator-accessible units
4
$300,000
United States v. Butters (D. Colo.)
Property manager sexually harassed a husband and wife and their two minor children
5
$250,000
United States v. Rutherford Tenants Corp., et al. (S.D.N.Y.).
Co-op apartment building and president of its board of directors denied a disabled tenant’s request for a reasonable accommodation for an assistance animal and retaliated against her for exercising her FHA rights
6
$190,000
United States v. Hussein (E.D. Mich.)
Landlord sexually harassed actual and prospective female tenants
7
$170,000
United States v. Martin (S.D. Ohio)
Landlord sexually harassed actual and prospective female tenants
8
$137,500
United States et al. v. Teruel et al. (N.D. Cal.)
Landlord pressured a couple, who had two babies during their tenancy, to move out of their one-bedroom apartment
9
$112,500
United States v. Kailua Village Condominium Association, et al. (D. Haw.)
Homeowners’ association, board members, property managers, sellers, and selling agents refused to sell a condo unit to a man with paraplegia, subjected him to discriminatory terms and conditions, made discriminatory statements, refused to make reasonable accommodations, refused to permit reasonable modifications, and harassed him
10
$100,000
United States v. Joel Nolen et al. (E.D. Cal.)
Landlord sexually harassed multiple female tenants dating back to at least 2011
KEY LESSONS FROM 2024 FAIR HOUSING CASES (1st in a series of 6)
Lesson #1: Single Incident Must Be Egregious to Constitute Hostile Environment Harassment
In recent years, failure to make reasonable accommodations and family status discrimination have been the most commonly asserted FHA claims against landlords. This year, though, the most common allegation was landlord harassment and retaliation, figuring in over 10 percent of the Scorecard cases. In addition, six of the DOJ’s 10 biggest reported FHA settlements of 2024 involved allegations of harassment (see the table on p. above).
Most of the harassment cases accused the landlord of creating a hostile environment on the basis of a tenant’s race, disability, or other protected characteristic. To prove this allegation, a tenant must show that a landlord’s conduct was “severe or pervasive enough to unreasonably interfere” with the tenancy, such as by forcing the tenant to move out. Although possible, this is tough to prove when the alleged harassment involved a single incident. Thus, in 2024, two different landlords successfully defended against hostile environment harassment charges by demonstrating that the complained of conduct was just an isolated incident that wasn’t severe enough to meet the harassment threshold.
Landlord Wins: A fair housing organization accused an Oklahoma landlord of harassing a disabled tenant, citing a single incident in which the landlord took photographs of the tenant’s apartment while he was moving out. “While tense conversations and being photographed in public areas might not be preferable, they do not rise to the level of unlawful harassment,” the federal court reasoned. Besides, the incident took place after the tenant had already decided to move out and thus didn’t factor into that decision [Metropolitan Fair Hous. Council of Okla., Inc. v. Feiock, 2024 U.S. Dist. LEXIS 140180, 2024 WL 3696458].
Landlord Wins: A 74-year-old Black tenant sued her landlord for racial harassment discrimination after a building security guard falsely accused her of stealing a neighbor’s jewelry and called the police. While acknowledging that this was “a distressing event,” the New York court ruled that the incident wasn’t, by itself, “extraordinarily severe" enough to constitute an “intolerable alteration of the conditions of [the tenant’s] housing environment” [Dickerson v. BPP PCV Owners LLC, 2024 U.S. Dist. LEXIS 59765, 2024 WL 1348497].
Compliance Takeaway: In most cases, hostile environment harassment involves a course or pattern of conduct that occurs over time. A single incident of harassment may be enough to create a hostile environment. But it must be extremely egregious to cross the line.