National Fair Housing Alliance, Inc. et al v. Hunt Investments, L.L.C. et al, No. 3:2014cv00716 - Document 60 (E.D. Va. 2015)
Court Description: MEMORANDUM OPINION. Signed by District Judge James R. Spencer on 04/10/2015. (tjoh, )
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National Fair Housing Alliance, Inc. et al v. Hunt Investments, L.L.C. et al Doc. 60 EASTERN DISTRICT OF VIRGINIA RICHMOND DIVISION NATIONAL FAIR HOUSING ALLIANCE, INC., et al., Plaintiffs, Civil Action No. 3:14-CV-716 v. HUNT INVESTMENTS, LLC, et al., Defendants. MEMORAN D U M OPIN ION THIS MATTER is before the Court on Defendant MGT Construction Managem ent, Inc.’s Motion to Dism iss (“MGT Motion”) (ECF No. 30 ), Defendant Walter Parks, Architect, PLLC Motion to Dism iss Plaintiffs’ First Am ended Com plaint (“Parks Motion”) (ECF No. 32), and Defendants Hunt Investm ents, LLC, Cedar Street Genesis, LLC and Genesis Hom es Manager, LLC’s Motion to Dism iss Am ended Com plaint (“Hunt & Genesis Motion”) (ECF No. 34). Plaintiffs filed a Consolidated Mem orandum in Opposition to Defendants’ Motions to Dism iss on Decem ber 23, 20 14 (“Opp’n Mem .”) (ECF No. 36), and the Defendants each filed their respective replies on Decem ber 29, 20 14 (ECF Nos. 39, 40 , 41). A hearing was held on Tuesday, April 7, 20 15. For the reasons set forth below, each of the above-listed Motions is hereby GRANTED. I. BACKGROU N D a. Fa ct u a l Ba ck g r o u n d This is a civil rights action brought by Plaintiffs National Fair Housing Alliance (“NFHA”) 1 and Housing Opportunities Made Equal of Virginia (“HOME”) 2 against the developers, builders, designers, and owners of the m ultifam ily apartm ent com plex “Shockoe 1 NFHA is a national, nonprofit, public service organization whose m ission includes advocating for the rights of people with disabilities to accessible housing. (Am . Com pl. ¶ 10 .) 2 HOME is a nonprofit corporation who works to ensure equal access to housing for all persons through counseling, education and advocacy. (Am . Com pl. ¶ 11.) 1 Dockets.Justia.com Valley View Apartm ents” (also known as “Cedar Street Apartm ents”) located in Richm ond, Virginia, arising from violations of the accessibility requirem ents of the Fair Housing Act, Title VII of the Civil Rights Act of 1968, as am ended by the Fair Housing Am endm ents Act of 1988 (“FHAA”), 42 U.S.C. §§ 360 1-3619.3 Specifically, the Defendants in this case are: Hunt Investm ents, L.L.C. (“Hunt”), Cedar Street Genesis, LLC (“Cedar Street”), Genesis Hom es Manager, LLC (“Genesis Hom es”)– all of whom are allegedly responsible for the design and/ or construction of the project; Walter Parks, Architect, PLLC (“Parks”)– who is the architect responsible for the design of the project; an d MGT Construction Managem ent, Inc. (“MGT”)– who is the general contractor on the project. The apartm ent com plex project has been divided into phases. Construction is ongoing in Phase 1 (“Tested Property” or “Shockoe”), located at 190 0 , 190 2, and 190 4 Cedar Street, Richm ond, Virginia 23223. Plaintiffs allege that construction will begin soon on Phase 2, located at 190 1, 190 3, and 190 5 Cedar Street, Richm ond, Virginia 23223. In J une 20 14, Plaintiffs allege that they becam e aware that the m ultifam ily housing com plex designed and/ or constructed by Defendants did not include the required elem ents of accessible and adaptable design. Plaintiffs therefore sent “testers”4 to Shockoe in J une 20 14. The testers were shown four possible rental units at Shockoe, two of which were available to rent im m ediately. The testers identified alleged FHAA violations in those units and com m on areas. The testers observed that one portion of Phase 1 was com pleted and being m arketed and rented, while the other portion of Phase 1 was still under construction. 3 The FHAA mandates that every m ultifam ily apartm ent building containing four or m ore units and built for first occupancy after March 13, 1991 be subject to certain design and construction requirem ents. All ground floor units m ust com ply with the following requirem ents, as m ust all units in a building served by an elevator: public and com m on use areas that are readily accessible to, and usable by, people with disabilities; doors into and within covered units that are sufficiently wide to allow passage by people in wheelchairs; an accessible route into and through the dwelling; light switches, electrical outlets, therm ostats, and other environm ental controls in accessible locations; reinforcem ents in bathroom walls that allow for the later installation of grab bars; and usable kitchens and bathroom s such that an individual in a wheelchair can m aneuver about the space. See 42 U.S.C. § 360 4(f)(3)(C). 4 “Testers are individuals who, without an intent to rent or purchase a hom e or apartm ent, pose as renters or purchasers for the purpose of collecting evidence” of discrim inatory housing practices. Havens Realty Corp. v. Colem an, 455 U.S. 363, 373 (1982). 2 In Septem ber 20 14, Plaintiffs sent another tester to Shockoe, who was shown two units in Phase 1, both of which were available for rent in the near future. The tester again allegedly identified m ultiple FHAA violations in those units and com m on areas. Defendants’ agent also attem pted to show the tester the m odel unit, but the tester, who uses a m otorized wheelchair, could not enter the m odel unit because there were steps leading up to the only entrance. The tester observed a substantial portion of Phase 1 had been constructed and several units in Phase 1 were already occupied. Further, the blueprints for Shockoe that Defendants subm itted to the building departm ent for approval dem onstrate that the units that are still under construction at Phase 1 will contain m any of the sam e alleged FHAA design and construction violations identified in the units currently being rented. Those blueprints were approved by the building departm ent and tem porary certificates of occupancy have been issued. b . Pr o ce d u r a l Ba ck g r o u n d Plaintiffs filed their Com plaint in this Court on October 21, 20 14, requesting declaratory and injunctive relief as well as dam ages and attorneys’ fees. Defendants subsequently filed Motions to Dism iss. (See ECF No. 6, 9, 12). Those Motions to Dism iss were denied as m oot after Plaintiffs filed their Am ended Com plaint. (See ECF No. 43.) In the Am ended Com plaint, Plaintiffs allege violations of 42 U.S.C. § 360 4(f)(3)(C) at the Tested Property. 5 Plaintiffs further allege that their m issions to eradicate discrim ination in housing and in carrying out the program s and services they provide have been frustrated, and they have been forced to divert significant and scarce resources to identify, investigate and counteract Defendants’ discrim inatory practices. Defendants filed their present Motions to Dism iss the Am ended Com plaint on Decem ber 10 , 20 14. // 5 For a com plete list of the Defendants’ alleged violations of 42 U.S.C. § 360 4(f)(3)(C), see Am. Com pl. ¶¶ 24-28. 3 II. LEGAL STAN D ARD Federal Rule of Civil Procedure 12(b)(1) allows a defendant to m ove for dism issal of a claim when the court lacks subject m atter jurisdiction over the action. The Court m ust dism iss the action if it determ ines at any tim e that it lacks subject-m atter jurisdiction. Fed. R. Civ. P. 12(h)(3). Under Rule 12(b)(1), the plaintiff bears the burden of proving that jurisdiction exists in federal court. Richm ond, Fredericksburg & Potom ac R.R. Co. v. United States, 945 F.2d 765, 768 (4th Cir. 1991). The district court m ust then weigh the evidence to determ ine whether jurisdiction is proper. Adam s v. Bain, 697 F.2d 1213, 1219 (4th Cir. 1982). In its determ ination, a court should grant a Rule 12(b)(1) m otion to dism iss if the m aterial jurisdictional facts are known and the m oving party is entitled to prevail as a m atter of law. Richm ond, Fredericksburg & Potom ac R.R. Co., 945 F.2d at 768. III. D ISCU SSION a. Pa r t ie s ’ Ar g u m e n t s Each of the Defendants’ Motions raises the issue of ripeness.6 Specifically, the Defendants assert that because construction of the project is ongoing, Plaintiffs’ claim s are prem ature. Defendants further argue that “[t]he im position of FHA liability for a partiallycom plete construction project would be patently unfair, as plans routinely change during the course of a project.” (Parks Mem . in Supp. of Mot. at 4– 5); (see also MGT Mem . in Supp. of Mot. at 4) (“With construction still underway, any claim by Plaintiffs that the project, in its final form , will not com ply with the FHA necessarily depends upon future uncertainties and is not ripe for adjudication.”). 6 The Hunt & Genesis Motion also asserts that the Am ended Com plaint fails to allege factual allegations that any violations of the FHAA exists and therefore should be dism issed pursuant to Rule 12(b)(6). Specifically, the Motion alleges that the Am ended Com plaint “fail[s] to provide any allegations specific to the units and/ or areas for which tem porary certificates of occupancy have allegedly been granted and which are being m arketed to renters and which are currently available.” (Hunt & Genesis Br. in Supp. of Mot. at 6.) Because the Court disposes of the case on Rule 12(b)(1), Hunt & Genesis’s Rule 12(b)(6) argum ent will not be addressed. 4 Plaintiffs argue to the contrary that an FHAA violation does not only occur when “the project at issue is com plete.” Rather, they assert that a violation occurs when a portion of a building that is intended for residency is designed and built without the features set forth in 42 U.S.C. § 360 4(f)(3)(C)(i)– (iii). Plaintiffs further allege that the FHAA establishes that entities can bring suit when discrim inatory housing practices are about to occur. (Opp’n Mem . at 8 ) (citing 42 U.S.C. § 360 2(i)(2)). Plaintiffs claim that entities like them selves are perm itted to bring suit at an early juncture, at least in part, to try to prevent injuries to protected persons. Finally, Plaintiffs contend that they will suffer hardship if the court withholds consideration of Plaintiffs’ claim s. (See Opp’n Mem . at 11– 12.) Specifically, Plaintiffs allege that they have already spent their “lim ited resources” on testers, plan reviews, site visits and investigating and testing the property, as well as identifying the violations and bringing the present action. Further, dism issal of this suit will increase noncom pliance with the accessibility requirem ents of the FHAA. In reply, Defendants suggest that the Court look to the statute of lim itations for FHAA design and construction cases in determ ining the ripeness issue presented in the present Motions. Citing Garcia v. Brockw ay , 526 F.3d 456, 461 (9th Cir. 20 0 8), the Defendants conclude that a discrim inatory housing practice as defined under the Act occurs at the conclusion of the construction, or when the final certificate of occupancy is issued. Here, Defendants contend and Plaintiffs do not dispute that construction of Phase 1 is ongoing and construction of Phase 2 has not even begun, and as such, there can be no finding of discrim ination. b . An a ly s is “The ‘ripeness’ requirem ent originates in the ‘case or controversy’ constraint of Article III, and presents a ‘threshold question [] of justiciability.” Scoggins v. Lee’s Crossing Hom eow ners Ass’n, 718 F.3d 262, 269 (4th Cir. 20 13) (quoting Lansdow ne on the Potom ac Hom eow ners Ass’n, Inc. v. OpenBand at Lansdow ne, LLC, 713 F.3d 187, 195 (4th Cir. 20 13)). 5 The doctrine is intended to prevent courts “from becom ing entangled in ‘abstract disagreem ents’” by requiring “courts to avoid taking prem ature judicial action.” Id. at 270 . “A claim is not ripe for adjudication if it rests upon contingent future events that m ay not occur as anticipated, or indeed m ay not occur at all.” Texas v. United States, 523 U.S. 296, 30 0 (1998). In determ ining ripeness, the Court m ust consider both “the fitness of the issues before the court, as well as the hardship that the parties will experience if the court withholds consideration of the dispute.” Scoggins, 718 F.3d at 270 (citations om itted). The FHAA, in relevant part, m akes it unlawful to discrim inate in the sale or rental, or to otherwise m ake unavailable or deny, a dwelling to any buyer or renter because of a handicap. 42 U.S.C. § 360 4(f)(1). Dwelling is defined as “any building, structure, or portion thereof which is occupied as, or designed or intended for occupancy as, a residence by one or m ore fam ilies . . . .” 42 U.S.C. § 360 2(b). Discrim ination includes . . . a failure to design and construct those dwellings in such a m anner that– (i) the public use and com m on use portions of such dwellings are readily accessible to and usable by handicapped persons; (ii) all the doors designed to allow passage into and within all prem ises within such dwellings are sufficiently wide to allow passage by handicapped persons in wheelchairs; and (iii) all prem ises within such dwellings contain the following features of adaptive design: (I) an accessible route into and through the dwelling; (II) light switches, electrical outlets, therm ostats, and other environm ental controls in accessible locations; (III) reinforcem ents in bathroom walls to allow later installation of grab bars; and (IV) usable kitchens and bathroom s such that an individual in a wheelchair can m aneuver about the space. 42 U.S.C. § 360 4(f)(3)(C)(i)– (iii). This section of the FHAA is often referred to as “design and construct” claim s. As an initial m atter, the Court first considers the plain language of the FHAA. See Robinson v. Shell Oil Co., 519 U.S. 337, 340 (1997); Ham ilton v. 1st Source Bank, 928 F.2d 86, 87 (4th Cir. 1990 ). Unless it specifies to the contrary, Congress intends the plain m eaning of the statutory term s to govern. See United States v. Hunter, 459 F.2d 20 5, 210 (4th Cir. 1972) (citing 6 Cam inetti v. United States, 242 U.S. 470 , 485– 486 (1917)). Plaintiffs em phasize the phrase “any building, structure, or portion thereof” in arguing that “the FHAA establishes that it is a violation to design and build a portion of a building that is intended for residency without the features set forth in § 360 4(f)(3)(C)(i)– (iii).” (Opp’n Mem . at 6.) While this language supports the general assertion that a plaintiff can bring an action for an FHAA violation if a portion of a building contains barriers to accessibility, this language does not control the ripeness issue presented here. In other words, the specific issue presented in the instant Motions is whether a plaintiff can sustain an action when only a portion of a building is constructed versus sustaining an action based on a portion of the building after construction is com plete? Defendants do not dispute the appropriateness of the latter scenario. (MGT Reply Mem . at 1.) But they do take issue with the form er. As evidenced by the parties’ briefs, scant case law exists addressing the specific ripeness issue presented in this case. The Eighth Circuit’s holding in Paraquad, Inc. v. St. Louis Housing Authority , 259 F.3d 956 (8th Cir. 20 0 1) appears to be m ost relevant. In that case, the St. Louis Housing Authority (“SLHA”) received a grant from the United States Departm ent of Housing and Urban Developm ent (“HUD”) for revitalization of a public housing com plex. 259 F.3d at 958. The revitalization plan called for the dem olition of m ore than 120 0 public housing dwelling units and the construction of m ore than 650 new m ixed incom e apartm ents and hom es. Id. Plaintiffs brought suit alleging that the SLHA refused to provide accessible replacem ent housing and supportive services to disabled fam ilies. Id. The district court granted sum m ary judgm ent to the SLHA, holding, inter alia, the plaintiffs’ challenge was not ripe. Id. The district court noted that plaintiffs needed to present “facts that m ore specifically show the likelihood of injury.” Id. at 959. “The district court stated the plaintiffs had not com e forward with evidence showing any disabled individuals have been relocated to an in accessible housing unit, denied relocation at all, or denied public housing as a result of the [revitalization] project.” Id. Further, the district court held that “plaintiffs presented no evidence that the actual, finished units will not be accessible 7 and in com pliance with applicable federal law.” Id. In affirm ing the district court’s decision, the Eighth Circuit agreed that injury to the disabled was not “certainly im pending.” Id. The Court noted that plaintiffs cannot identify any individuals who have been denied accessible housing under the plan, and plans for the design and construction of the new buildings were not yet com plete. Id. “[D]em olition has not yet started, drawings are still in the prelim inary phase, and no new construction has begun.” Id. Plaintiffs distinguish Paraquad from the instant case by arguing that here Defendants are m uch further along in the process of constructing dwellings. As alleged in the Am ended Com plaint, plans have received final approval by the building departm ent and tem porary certificates of occupancy have been issued (Am . Com pl. ¶ 22); units were being m arketed and rented (id. at ¶ 20 ); and several units were already occupied (id. at ¶ 21). Because Plaintiffs’ argum ent is persuasive but not determ inative, the Court will instead approach the issue from an alternative angle: when does the statute of lim itations begin to run on FHAA claim s? See Franks v. Ross, 313 F.3d 184, 194 (4th Cir. 20 0 2) (citation om itted) (“[A] cause of action accrues for purposes of the statute of lim itations ‘when it is sufficiently ripe that one can m aintain suit on it.’”). The FHAA’s statute of lim itations for private citizen suits, including design and construction claim s, provides: An aggrieved person m ay com m ence a civil action in an appropriate United States district court or State court not later than 2 years after the occurrence or the term ination of an alleged discrim inatory housing practice, or the breach of a conciliation agreem ent entered into under this subchapter, whichever occurs last, to obtain appropriate relief with respect to such discrim inatory housing practice or breach. 42 U.S.C. § 3613(a)(1)(A). The statute thus begs the question, when does “the occurrence or the term ination of an alleged discrim inatory housing practice” transpire? The Fourth Circuit has not ruled on the question of statute of lim itations as applied to design and construction claim s. 8 Rather, the Defendants rely on Ninth Circuit opinion in Garcia v. Brockw ay , 526 F.3d 456 (9th Cir. 20 0 8) to support their argum ent. In Garcia, plaintiffs appealed the district court’s determ ination that their FHA claim was tim e-barred by the two year statute of lim itations. 526 F.3d at 459. The “discrim inatory housing practice” at issue was the failure to design an d construct a m ultifam ily dwelling according to FHA standards. Id. at 461. The Ninth Circuit found that “[t]he statute of lim itations is . . . triggered at the conclusion of the design-and-con struction phase, which occurs on the date the last certificate of occupancy is issued.” Id.; see also Moseke v. Miller and Sm ith, Inc., 20 2 F. Supp. 2d 492, 510 (E.D. Va. 20 0 2) (finding that the “com pletion of the construction triggered the FHA statute of lim itations for a design and construct claim ”). Further, the Court held that the “failure to design and construct” is “a discrete instance of discrim ination that term inates at the conclusion of the design-and-construction phase.” Id. at 462; see also Moseke, 20 2 F. Supp. 2d at 50 3 (“[T]he plain m eaning of the ‘the occurrence . . . of a discrim inatory housing practice’ is a discrete event or incident that encom passes a discrim inatory custom .”); Kuchm as v. Tow son Univ., No. RDB 0 6-3281, 20 0 7 WL 2694186, at *5 n.6 (D. Md. Sept. 10 , 20 0 7) (citing cases) (noting that other courts have held that the statute of lim itations begins running when a noncom pliant building is fully constructed). In other words, “failing to design and construct is a single instance of unlawful conduct.” 526 F.3d at 463. Adm ittedly, Garcia did not address the specific issue presented in this case. Garcia was instead concerned with whether plaintiffs could claim a continuing violation of the FHA or m erely a “continuing effect of a past violation,” id. at 462, for purposes of the statute of lim itations. But, im portantly, the m ajority rejected the dissent’s conclusion that the statute of lim itations begins to run “when a disabled person experiences discrim ination– either in attem pting to buy or rent a noncom pliant housing unit, in ‘testing’ such a unit or upon m oving in as a tenant.” Id. at 467. 9 Here, like Garcia, the discrim inatory housing practice alleged is a failure to design and construct the Tested Property in such a m anner that com plies with FHAA standards. In applying Garcia’s logic, this “failure to design and construct” is a discrete instance of discrim ination that will only occur at the com pletion of the construction. Because Phase 1 was and still is under construction, (see Am . Com pl. ¶¶ 2, 21), and only tem porary certificates of occupancy have been issued, (id. at ¶ 22), no discrim ination has yet occurred. Moreover, Defendants subm it that they “are willing to address and correct any accessibility concerns as they continue construction so that the com pleted project com plies with the FHAA.” (Hunt & Genesis Mot. at 3.) Thus, as the Suprem e Court heeded, this claim is not fit for adjudication as it rests on “contingent future events that m ay not occur as anticipated, or indeed m ay not occur at all.” Texas, 523 U.S. at 30 0 . In considering the latter half of the ripeness inquiry, that is hardship to the parties, the Court finds Plaintiffs’ argum ent unavailing. “The hardship prong is m easured by the im m ediacy of the threat and the burden im posed on the petitioner who would be com pelled to act under threat of enforcem ent of the challenged law.” Charter Fed. Sav. Bank v. Office of Thrift Supervision, 976 F.2d 20 3, 20 8 (4th Cir. 1992). Additionally, the Court m ay consider the cost to the parties of delaying judicial review. Miller v. Brow n, 462 F.3d 312, 319 (4th Cir. 20 0 6) (citing Fort Sum ter Tours, Inc. v. Andrus, 564 F.2d 1119, 1124 (4th Cir. 1977)). In this case, although there m ay be som e delay to Plaintiffs, their cause of action is certainly not foreclosed. Moreover, the dam ages which Plaintiffs allege, (Opp’n Mem . at 11), rem ain recoverable in a later cause of action. IV. CON CLU SION For the foregoing reasons, the MGT Motion, Parks Motion, and Hunt & Genesis Motion are hereby GRANTED. 10 Let the Clerk send a copy of this Mem orandum Opinion to all counsel of record. An appropriate Order will issue. ENTERED this _ 10 th _____________________/s/__________________ James R. Spencer Senior U. S. District Judge day of April 20 15. 11
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