L.C. & Fair Housing Justice Center, Inc. v. LeFrak Organization, Inc.
987 F. Supp. 2d 391
S.D.N.Y.2013Background
- Plaintiff L.C., an indigent New York City resident with symptomatic HIV/AIDS and plaintiff Fair Housing Justice Center (FHJC) allege LeFrak refused to process or show apartments to HASA clients unless they produced a HASA letter certifying a sum certain, though HASA does not issue such letters.
- L.C. was told by LeFrak staff she must provide a HASA confirmation letter before LeFrak would process her rental application; HASA staff confirmed they do not provide such letters.
- FHJC testers corroborated differential treatment: non-subsidy applicants were shown apartments without documentation, while testers reporting a HASA-assisted household were steered to a separate office, required to provide paperwork (including a HASA letter), and not shown apartments.
- Plaintiffs sued under the federal Fair Housing Act (FHA) sections 3604(d), 3604(f)(1), and 3604(f)(2) alleging disparate treatment and disparate impact disability claims; and under the New York City Human Rights Law (HRL) alleging disability and source-of-income discrimination.
- Defendants moved to dismiss, arguing plaintiffs failed to plead disparate treatment, failed to plead disparate impact (no proper comparator or causation), and that source-of-income HRL claim fails because LeFrak’s documentation policy is neutral and applied to all applicants.
- The Court denied the motion to dismiss, finding plaintiffs plausibly pleaded disparate treatment and disparate impact FHA claims and HRL claims for disability and source-of-income discrimination; FHJC has organizational standing; L.C. has Article III standing.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Article III standing for FHJC | FHJC diverted staff time/resources investigating LeFrak, constituting injury | No standing asserted | FHJC has organizational standing based on diverted resources (Havens theory) |
| Disparate treatment under FHA | LeFrak required HASA confirmation letter and imposed burdens only on HASA/subsidy applicants (disability-linked) | Actions were based on source of income (HASA process), not disability; lack of causation | Complaint plausibly pleads disparate treatment under §§3604(d) and 3604(f)(1); §3604(f)(2) not dismissed at this stage |
| Disparate impact under FHA | Neutral policy (requiring documentation before showing) disproportionately harms persons with HIV because high proportion are HASA clients | No statistical disparity shown; HASA policy (not LeFrak) is true cause | Pleading suffices to raise inference of disparate impact given allegations about NYC HIV/HASA population; causation and absent party (HASA) arguments do not require dismissal |
| HRL source-of-income and disability claims | Policy requiring letters before showing apartments effectively withholds housing from low-income/HASA clients; disability claim parallels FHA claims | Policy is legitimate, applies to all, and inspection-only denial not covered by §8-107(5)(a) | HRL disability claim sustained under one-way ratchet; source-of-income claim plausibly pleaded; inspection-limitation fits §8-107(5)(a) under liberal construction |
Key Cases Cited
- Raines v. Byrd, 521 U.S. 811 (U.S. 1997) (Article III standing framework)
- Lujan v. Defenders of Wildlife, 504 U.S. 555 (U.S. 1992) (injury-in-fact, causation, redressability elements)
- Ashcroft v. Iqbal, 556 U.S. 662 (U.S. 2009) (plausibility standard for Rule 12(b)(6))
- Swierkiewicz v. Sorema N.A., 534 U.S. 506 (U.S. 2002) (pleading standard for discrimination claims)
- Havens Realty Corp. v. Coleman, 455 U.S. 363 (U.S. 1982) (organizational standing where resources diverted to counter discrimination)
- Boykin v. KeyCorp, 521 F.3d 202 (2d Cir. 2008) (disparate treatment pleading under FHA sufficient without alleging animus at pleading stage)
- Tsombanidis v. West Haven Fire Dept., 352 F.3d 565 (2d Cir. 2003) (disparate impact prima facie elements and causation requirement)
- McDonnell Douglas Corp. v. Green, 411 U.S. 792 (U.S. 1973) (burden-shifting framework for disparate treatment)
- Corey v. U.S. Dep’t of Housing & Urban Dev., 719 F.3d 322 (4th Cir. 2013) (‘‘otherwise make unavailable’’ includes burdensome procedures that discourage applicants)
- Bragdon v. Abbott, 524 U.S. 624 (U.S. 1998) (equating FHA “handicap” with ADA/“disability")