Bruce Ring v. First Interstate Mortgage, Inc. Federal National Mortgage AssociationBruce Ring v. First Interstate Mortgage, Inc. Federal National Mortgage Association
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- Before:
- Loken
The issue in this housing discrimination case is whether developer Bruce Ring’s complaint states a claim under the Fair Housing Act,
I.
In March 1990, Ring commenced this action in Missouri statе court, alleging that defendants First Interstate Mortgage, Inc. (“FIM”), and Federal National Mortgage Association (“Fannie Mae”) had violated the National Housing Act,
After removing, defendants moved to dismiss on the ground that there is no private right of action under the National Housing Act. With the district court’s permission, Ring then filed an amended Complaint for Damages that added claims under the Equаl Credit Opportunity Act (“ECOA”),
On March 29, 1991, the district court dismissed Ring’s claims under ECOA, Title VI, and the National Housing Act for failure to state a claim. The court denied defendants’ motion to dismiss Ring’s Fаir Housing Act claim but granted Fannie Mae’s alternative motion for a more definite statement and ordered Ring “to file a second amended complaint which clearly sets forth his alleged cause of action pursuant to the Fair Housing Act,
Ring then filed his Second Amended Complaint, FIM filed a motion to dismiss, and Fannie Mae filed a motion for summary judgment or to dismiss. On October 29, 1991, the district court granted defendants’ motions to dismiss, concluding that Ring “has not alleged the elements necessary to prove a prima facie ease” of racial discrimination under
II.
On appeal, the parties have vigorously debated whether we are reviewing the grant of a Rule 12(b)(6) motion to dismiss or a Rule 56 motion for summary judgment. The record on appeal contains voluminous factual materials in addition to the Second Amended Complaint, and Fannie Mae had moved in the alternative for summary judgment. However, the district court expressly stated it was granting defendants’ motions to dismiss, and its analysis never strayed from the four corners of Ring’s Second Amended Complaint. Therefore, we arе reviewing a dismissal under Rule 12(b), and we will not consider whether summary judgment would have been appropriate. See Martin v. Sargent, 780 F.2d 1334, 1336-37 (8th Cir.1985); see generally Garita Hotel Ltd. Partnership v. Ponce Fed. Bank, 958 F.2d 15, 18-19 (1st Cir.1992).
We review Rule 12(b)(6) dismissals de novo. Wells v. Walker, 852 F.2d 368, 369-70 (8th Cir.1988), cert. denied, 489 U.S. 1012, 109 S.Ct. 1121, 103 L.Ed.2d 184 (1989). Like the district court, we must view the complaint most favorably to Ring and may dismiss “only if it is clear that no relief could be granted under any set of facts that could be proved consistent with the allegations.” Hishon v. King & Spalding, 467 U.S. 69, 73, 104 S.Ct. 2229, 2232, 81 L.Ed.2d 59 (1984). Dismissal is appropriate “as a practical matter ... only in the unusual case in which a plaintiff includes allegations that show on the face of the complaint that there is some insuperable bar to relief.” Bramlet v. Wilson, 495 F.2d 714, 716 (8th Cir.1974). 1
III.
The district court analyzed the Second Amended Complaint in terms of whether Ring has alleged the elements of a prima facie case of discrimination.
See McDonnell Douglas Corp. v. Green,
411 U.S. 792, 93 S.Ct. 1817, 36 L.Ed.2d 668 (1973), and
Texas Dep’t of Community Affairs v. Burdine,
450 U.S. 248, 101 S.Ct. 1089, 67 L.Ed.2d 207 (1981). Adapting the Title VII prima facie case to an alleged violation of
must prove (1) that he was a member of a рrotected class; (2) that he applied for and qualified for a loan from Defendants; (3) that the loan was rejected despite his qualifications; and (4) that Defendants continued to approve loans for аpplicants with qualifications similar to those of Plaintiff.
See HUD v. Blackwell, 908 F.2d 864, 870 (11th Cir.1990); Selden Apts. v. HUD, 785 F.2d 152, 159 (6th Cir.1986).
We have no doubt that the three-stage
McDonnell Douglas/Burdine
analysis applies to Fair Housing Act cases.
2
However, the prima facie case under this analysis is an evidentiary standard—it defines the quantum of
proof
plaintiff must present to create a rebuttable presumption of discrimination that shifts the burden to defendant to articulate some legitimate, nondiscriminatory reason for its conduct. Under the Federal Rules of Civil Procedure, an evi-dentiary standard is not a proper measure of whether a complaint fails to state a claim.
See Moore v. Clarke,
821 F.2d 518, 519 (8th Cir.1987) (the “whole spirit” of the Federal Rules “is to discourage the pleading of evidence”). “When a federal court reviews the sufficiency of a complаint ... [t]he issue is not whether a plaintiff will
There are two practical reasons why the prima facie ease is аn inappropriate pleading standard in a discrimination case. First, as we have noted, the McDonnell Douglas/Burdine analysis applies to cases in which a plaintiff has no direct evidence of discrimination; if direct evidencе of an intent to discriminate does exist, plaintiff may be able to prevail without proving all of the elements of a prima facie case of disparate treatment. See Elliott v. Montgomery Ward & Co., 967 F.2d 1258, 1262 n. 4 (8th Cir.1992); Williams v. Valentec Kisco, Inc., 964 F.2d 723, 726 (8th Cir.1992).
Second, as the Supreme Court has еmphasized, the prima facie case that a plaintiff must prove under the McDonnell Douglas/Burdine analysis varies depending upon the facts of the particular case— thus, there is no “inflexible formulation” that can be defined at thе pleading stage of the lawsuit. International Bhd. of Teamsters v. United States, 431 U.S. 324, 358, 97 S.Ct. 1843, 1866, 52 L.Ed.2d 396 (1977). The prima facie case requirement “was ‘never intended to be rigid, mechanized, or ritualistic.’ ” United States Postal Serv. Bd. v. Aikens, 460 U.S. 711, 715, 103 S.Ct. 1478, 1482, 75 L.Ed.2d 403 (1983) (citation omitted). Thus, to measure a plaintiffs complaint against a particular formulation of the prima facie case at the pleading stage is inappropriate.
IV.
Having rejected the prima facie case as a basis for Rule 12 analysis, we must turn to the statutory elements of a Fair Housing Act claim to determine whether Ring’s Second Amended Complaint survives defendants’ motions to dismiss. Congress has expressly provided a private right of action in this statute:
An aggrieved person may commence a сivil action in an appropriate United States district court or State court not later than 2 years after the occurrence or termination of an alleged discriminatory housing practice ... to obtain appropriate relief with respect to such discriminatory housing practice....
(a) In general
It shall be unlawful for any person or other entity whose business includes engaging in residential real estate-related transactions to discriminate against any person in making available such a transaction, or in the terms or conditions of such a transaction, because of race, col- or, religion, sex, handicaр, familial status, or national origin.
(b) Definition
As used in this section, the term “residential real estate-related transaction” means any of the following:
(1) The making or purchasing of loans
(A) for purchasing, constructing, improving, repairing, or maintaining a dwelling....
We concludе that the allegations of Ring’s Second Amended Complaint are sufficient to state a cause of action under these statutory provisions. Paragraphs 3 and 4 allege that FIM and Fannie Mae are “engaged in the business of making or purchasing” loans for real estate-related transactions, as defined in
Fannie Mae argues that, to survive a Rule 12(b)(6) motion, Ring’s Second Amended Complaint must allеge facts “which, if true, would establish that Fannie Mae discriminated against plaintiff.” However, whatever obligations a plaintiff may have in a fact-pleading State such as Missouri,
As their briefs make clear, defendants’ real objection to the Second Amended Complaint — indeed, to Ring’s entire case — is that, in their view, he cannot prove what he has so generally alleged. Defendants argue at length that Ring never filed a formal application for a specific lending program, that he had already rehabilitated the properties so that the requested loan was not a “real estate-related transaction,” and that the properties did not qualify under Fannie Mae loan programs. But these arguments go to whether Ring can prove his claim, not whether his Second Amended Complaint has adequately stated a claim under the Fair Housing Act. Such issues of proof arе not properly before us, and we do not address them.
Ring’s Second Amended Complaint has “give[n] the defendants] fair notice of what the plaintiff’s claim is and the grounds upon which it rests.”
Conley v. Gibson,
355 U.S. 41, 47, 78 S.Ct. 99, 103, 2 L.Ed.2d 80 (1957). We conclude that Ring has stated a bаsis for relief under
Notes
. In this case, the district court had specifically ordered Ring to file a second amended complaint properly stating a Fаir Housing Act claim. Ring’s Second Amended Complaint was untimely under that order, and it failed to cite
. HUD, the agency primarily responsible for enforcing the Fair Housing Act, has adopted this test to evaluate claims оf discrimination under the Act, and we have approved that standard. See United States v. Badgett, 976 F.2d 1176, 1178 (8th Cir.1992).
. Ring’s brief on appeal also challenges the district court’s earlier order dismissing the other counts in his first amended complaint. However, as defendants note, Ring did not designate that earlier order in his notice of appeal, and therefore we do not consider these issues.
See