People ex rel. Madigan v. Wildermuth
2016 IL App (1st) 143592
Ill. App. Ct.2016Background
- Illinois appellate case addressing whether the AG may proceed under 3-102(B) for reverse redlining without alleging the defendants acted as mortgage lenders.
- The fourth-amended complaint alleged a pattern of discrimination in loan modification services under 3-102(B) related to real estate transactions.
- Defendants moved to dismiss arguing they did not engage in real estate transactions and that reverse redlining requires lending, not modification services.
- Trial court denied dismissal and certified a question under Rule 308 asking if reverse redlining applies where defendants weren’t mortgage lenders.
- Appellate court held that reverse redlining is viable under 3-102(B) because the statute covers broad real estate transaction conduct and “other financial assistance” connected to maintaining a dwelling.
- The case is remanded for further proceedings consistent with the holding.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether 3-102(B) supports reverse redlining without lender status | AG argues reverse redlining can apply to non-lenders | Defendants contend reverse redlining requires lending control | Affirmative: reverse redlining permissible even without lender status |
| Whether loan modification services constitute a real estate transaction | AG contends modifications fall within 3-101(B) definitions | Defendants claim not within real estate transaction scope | Affirmative: loan modification services fall within real estate transaction scope |
| Whether 'other financial assistance' satisfies 3-101(B)(1) and supports 3-102(B) | AG asserts modifications qualify as financial assistance | Defendants challenge scope of 'other financial assistance' | Affirmative: providing loan modification services fits 3-101(B)(1) |
Key Cases Cited
- Arlington Park Race Track Corp. v. Human Rights Comm'n, 199 Ill. App. 3d 698 (1990) (liberal construction of the Act; remedial statute)
- Szkoda v. Human Rights Comm’n, 302 Ill. App. 3d 532 (1998) (interpretation of 3-102(B) with FHA parallels)
- American Family Mutual Insurance Co. v. National Association for the Advancement of Colored People, 978 F.2d 287 (7th Cir. 1992) (financial assistance analogous to §3605 discussions)
- Estate of Davis v. Wells Fargo Bank, 633 F.3d 529 (7th Cir. 2011) (reverse redlining critique in lending context; applicability nuances)