Fair Housing Council of Suburban Philadelphia v. Main Line Times Brief Amicus Curiae

    No. 97-1169

IN THE
UNITED STATES COURT OF APPEALS 

FOR THE THIRD CIRCUIT

FAIR HOUSING COUNCIL OF SUBURBAN PHILADELPHIA,

Plaintiff-Appellant,

v.

MAIN LINE TIMES, and ACME NEWSPAPERS, INC., 

Defendants-Appellees.

On Appeal from the 
United States District Court 

for the Eastern District of Pennsylvania

BRIEF AMICUS CURIAE OF
THE NAACP LEGAL DEFENSE & EDUCATIONAL FUND, INC.

Elaine R. Jones 
Director-Counsel

Norman J. Chachkin 
David T. Goldberg 
Paul K. Sonn
NAACP Legal Defense and 

Educational Fund, Inc.
99 Hudson Street 
Suite 1600
New York, New York 10013 
(212) 219-1900

Judith A. Browne 
Peter F. Rundlet 
NAACP Legal Defense and 

Educational Fund, Inc. 
1275 K Street, N.W.
Suite 301
Washington, D.C. 20005 
(202) 682-1300

Attorneys for Amicus Curiae



TABLE OF CONTENTS

Table of Authorities .......................................

Statement of Related Cases and Proceedings

Statement of Jurisdiction................................

Statement of Issues Presented for Review . .

Statutory Provision Relied u p o n ...................

Interest of Amicus C u r ia e ...............................

STATEMENT OF THE CASE ...................

iii-vi 

. vii 

viii 

ix-x 

. xi 

. . 1 

2-4
A. Nature of the C a s e ......................................................................... 2

B. Course of Proceedings Below............................................................. 2-3

C. Summary of Facts Relevant to Standing Issu e ..........................................  3.4

SUMMARY OF ARGUMENT

ARGUMENT 8-35
I.

II.

Congress Recognized that Numerous Obstacles Prevent Individual Housing 
Seekers from Effectively Enforcing the Fair Housing Act and Therefore 
Sanctioned a Special Enforcement Role for Fair Housing Organizations . . .  8

Obstacles to Fair Housing Enforcement 8-10

Fair Housing Councils Fill The Enforcement Gap ............................. 10-12

Congress and the Supreme Court Have Recognized this 
Special and Critical Role of Fair Housing Councils
in Enforcing the Fair Housing A c t .......................................................... 12-15

The District Court Erred as a Matter of Law in Holding that a Fair 
Housing Council Can Have Organizational Standing Only Where It Can 
Identify Bona Fide Housing Seekers Who Have Been Harmed 
by the Challenged Discriminatory Practices ................................................

A. A Bona Fide Complainant Requirement Is Irreconcilable with
Havens Realty Corp. v. C olem an ........................................................

B. A Bona Fide Complainant Requirement Is Irreconcilable with 
Congressional Policy Underlying the Fair Housing Act

C. A Bona Fide Complainant Requirement Is Irreconcilable with
an Unbroken Line of Precedent in Tester-Based Cases Brought 
by Fair Housing Groups ........................................................

15- 25

16- 17

17- 19

19-20

D. The District Court Erred in Relying on
HOPE, Inc. v. County of DuPage ............................................................ 20-23

The Absence of a Bona Fide Complainant Requirement Is All 
the More Clear in the Case of Advertising Discrimination . . 23-25



III. The Record Below Establishes that FHC Has Organizational
Standing in this Case .......................................................................................  25-3')

A. Discrimination that Impairs a Fair Housing Organization’s
Role of Facilitating Open Housing Constitutes Injury-in-Fact ..........26-28

B. The Trial Record Amply Demonstrates that FHC’s Efforts to
Facilitate Open Housing Were Frustrated by the Challenged 
Discriminatory Advertisements ............................................................... 28-32

4 IV. The District Court Erred as a Matter of Law in Holding that
Diversion of Resources for Purposes of Counteractive Activities
Such as Litigation Cannot Constitute Injury-in-Fact .......................................32-35

CONCLUSION ...........................................................................................................................

li



12
Holmgren v. Little Village Community Reporter,

342 F. Supp. 512 (N.D. 111. 1971) . . . .  10

Housing Opportunities Made Equal v. Cincinnati Enquirer 
943 F.2d 644 (6th Cir. 1991) . . .

Lightning Lube v. Witco Corp.,
4 F.3d 1153 (3d Cir. 1993)..........

Lujan v. Defenders of Wildlife,
504 U.S. 555 (1992) .................  K

Metro Fair Housing Servs., Inc. v. Morrowood Garden
Apartments, Ltd., 576 F. Supp. 1090 (N.D. Ga. 1983), 
rev’d in non-pertinent part, 758 F.2d 1482 (11th Cir 1985)

Mountain Side Mobile Estates Partnership v. HUD 
56 F.3d 1243 (10th Cir. 1995) . . .

N.A.A.C.P. v. Button,
371 U.S. 415 (1963) . .

Ragin v. Harry Macklowe Real Estate Co., 
6 F.3d 898 (2d Cir. 1993) ___

Raver v. Capitol Area Transit,
887 F. Supp. 96 (M.D. Pa. 1995) . .

Saunders v. General Servs. Corp.,
659 F. Supp. 1042 (E.D. Va. 1987) . .

Spann v. Colonial Village, Inc.,
899 F.2d 24 (D.C. Cir.), cert, denied, 498 
U.S. 980 (1990)

Trufficante v. Metropolitan Life Insurance Co., 
409 U.S. 205 (1972) .

. 20, 21, 27,28, 32, 34

Village of Bellwood v. Dwivedi
895 F.2d 1521 (7th Cir. 1990) . . .

Village of Bellwood v. Gorev & Assocs., 
664 F. Supp. 320 (N.D. 111. 1987)

Warth v. Seldin,
422 U.S. 490 (1975) . . .

Williams v. B & W Properties,
Civ. No. JFM-87-297, 1988 U.S. Dist. LEXIS 5623 (T>. 
Md. May 23, 1988) . . . .  v

IV



CONSTITUTIONAL AND STATUTORY 
PROCEDURE: PROVISIONS AND RULES OF

U.S. CONST., Article III ..........................................................

Housing and Community Development Act of 1987, Pub L 
No. 100-242 .................................................................... '

Cranston-Gonzalez National Affordable Housing Act, Pub 
L. No. 101-625, § 953 (1 9 9 0 ).........................................

Pages: 

7, 15, 16, 22, 34

13

13
Housing and Community Development Act of 1992, Pub. L 

No. 102-550, § 905(a)(9), 106 Stat. 3672, 3869 ..........

42 U.S.C. § 3604(c)......................................................................

42 U.S.C. § 3604(d) ....................................................................

42 U.S.C. § 3616(a) .................................................................

42 U.S.C. § 3616a note ............................................................

Fed. R. Civ. p . 50 ...............

............... 9, 13, 14

............  11, 23, 24

........................  24

........................  25

...................  9, 14

2, 3, 15, 25, 26, 32

OTHER AUTHORITIES Pages:

House Judiciary Committee, Fair housing Amendments of 
1988, H.R. Rep. No. 100-711 (1988), 
reprinted in 1988 U.S.C.C.A.N. 2173, 2177

Senate Banking, Housing, and U rban Affairs Comm., Report 
on the Housing and Community Development act of 
1992, S. Rep. No. 102-332 (1992) ..............................................

9 Moore’s Federal Practice

John P. Relman,
Housing D iscrimination Practice Manual (1996)

Robert G. Schwemm,
Housing D iscrimination: Law and Litigation (1996)

Alex S. Navarro, Note, Bona Fide Damages for Tester 
Plaintiffs: An Economic Approach to Private 
Enforcement o f the Antidiscrimination Statutes, 81 
GEO. L.J. 2727 (1993) .........................................

26, 32 

. 27

. . 27

8



James A. Kushner, The Fair Housing Amendments o f 1988:
The Second Generation o f Fair Housing, 42 Vand L 
Rev. 1049 (1989) ................................ ...............

Robert G. Schwemm, The Limits o f Litigation 
Under the Fair Housing Act o f 1968, in 
The Fair Housing Act After Twenty Years 
(Robert G. Schwemm ed., 1989) ...............................................................

u.S. Dep’t of Housing and U rban Devel.,
Office of Policy Devel. & Research, An Evaluation
of the FHIP Private Enforcement Testing Initiative (Apr. 1994)

u.S. Gen’l Accounting Office, Fair housing:
Funding and Activities Under the Fair Housing 
Initiatives Program (1997)...............



STATEMENT OF RELATED CASES AND PROCEEDINGS

This case is related to, involves the same plaintiff fair housing organization, and 

on appeal raises issues identical to the central issue raised in, Fair Housing Council of 

Suburban Philadelphia v. Montgomery Newspapers, Inc., Third Circuit Docket No. 97- 

1051. The appeal in that parallel proceeding is being briefed and awaits scheduling of 

oral argument before this Court. Although the two appeals have not been consolidated, 

amicus curiae respectfully suggests that in order to facilitate full and efficient 

adjudication of these appeals, both matters should be assigned to the same panel of this 

Court and scheduled for oral argument together.

‘That case is an appeal from Fair Housing Council 
Montgomery- Newspapers, No. 96-CV-1382, 1997 U.S. Dist
1997).

of Suburban Philadelphia v. 
LEXIS 27 (E.D. Pa. Jan. 7,

vii



STATEMENT OF JURISDICTION

The district court had subject matter jurisdiction over this case, a suit under the 

federal Fair Housing Act, pursuant to 28 U.S.C. § 1331, 28 U.S.C. § 1343, and 42 

U S.C. § 3613(a). This Court has jurisdiction pursuant to 28 U.S.C. § 1291 to hear this 

direct appeal, timely filed, from the district court’s decision of January 27, 1997, a final 

decision entering judgment for defendant-appellee on all counts.

i

viii



1. Whether the district court erred as a matter of law in holding that a fair housing 

organization can enjoy organizational standing to enforce the Fair Housing Act only 

where it can identify bona fide housing seekers who have been harmed by the 

challenged discriminatory practices

Standard o f Review: The issue presents a pure question of law and is therefore 

subject to plenary review by the Court of Appeals. Nickeo v. Virgin Islands Tel. Corp.,

42 F.3d 804, 806 (3d Cir. 1994).

2. Whether the district court erred as a matter of law in setting aside the jury 

verdict and granting defendant judgment as a matter of law on standing grounds, where 

the trial record established that plaintiff Fair Housing Council had standing because its 

tail housing educational, outreach, and counseling efforts were frustrated by the 

discriminatory advertisements at issue 

Standard of Review.

A district court s grant of a FED. R. Civ. P. 50 motion for judgment as a matter 

of law is subject to plenary review by the Court of Appeals, which applies the same 

standard that the district court applied in the first instance. Under that standard, the 

Court may not weigh conflicting evidence, judge the credibility of trial witnesses, or 

substitute its determination for that of the jury. The Court must review the trial 

evidence in the light most favorable to the non-moving party. Lightning Lube v. Witco 

Corp., 4 F.3d 1153, 1166 (3d Cir. 1993); 9 MOORE’S FEDERAL PRACTICE § 50.08[1] (3d 

ed. 1997).

STATEMENT OF ISSUES PRESENTED FOR REVIEW

ix



3. Whether the district court erred as a matter of law in holding that where illegal 

discrimination compels a fair housing organization to divert some of its scarce resources 

to counter the effects of the discrimination, and the fair housing organization 

determines that legal enforcement, including litigation, is the most effective way of 

combatting the discrimination, such diversion of resources can never constitute injury-in­

fact for standing purposes

Standard o f Review. The issue presents a pure question of law and is therefore 

subject to plenary review by the Court of Appeals. Nickeo v. Virgin Islands Tel. Corp.,

42 F.3d 804, 806 (3d Cir. 1994).

3d ClR. Loc. R. 2\.\(?iM\} Designation

All three of the above issues were raised, and thereby preserved for review on 

appeal, in "Plaintiffs Response to Defendants’ Motion For the Judgment As A Matter 

of Law At the Close of Plaintiffs Case" (Dec. 11, 1996).

x



STATUTORY PROVISION RELIED UPON

42 U.S.C. § 3604

It shall be unlawful—

* * *

(c) To make, print, publish, cause to be made, printed, or published any notice, 

statement, or advertisement, with respect to the sale or rental of a dwelling that 

indicates any preference, limitation, or discrimination based on race, color, religion, sex, 

handicap, familial status, or national origin, or an intention to make any such 

preference, limitation, or discrimination.

4

XI



INTEREST OF AMICUS CURIAE

The NAACP Legal Defense & Educational Fund, Inc. (LDF) was incorporated 

in 1939 under the laws of New York State for the purpose, inter alia, of rendering legal 

aid free of charge to indigent "Negroes suffering injustices by reason of race or color." 

Its first Director-Counsel was Thurgood Marshall. See generally N.A.A.C.P. v. Button, 

371 U.S. 415, 422 (1963) (describing Legal Defense Fund as a "‘firm’ . . . which has a 

corporate reputation for expertness in presenting and arguing the difficult questions of 

law that frequently arise in civil rights litigation").

The Legal Defense Fund has participated as counsel of record or amicus curiae 

in numerous cases before the United States Supreme Court, as well as this and other 

Courts of Appeals, involving issues of standing to enforce fair housing rights, see Warth 

v. Seldin, 422 U.S. 490 (1975); Trafficante v. Metropolitan Life Insurance Co., 409 U.S.

205 (1972), and arising from housing discrimination based on race, see, e.g., Havens 

Realty Corp. v. Coleman, 455 U.S. 363 (1982); Ragin v. Harry Macklowe Real Estate Co.,

6 F.3d 898, 904 (2d Cir. 1993), as well as on family status, see Mountain Side Mobile 

Estates Partnership v. HUD, 56 F.3d 1243 (10th Cir. 1995). Information about the 

practical difficulties encountered by Legal Defense Fund and other civil rights attorneys 

in attempting to enforce the Fair Housing Act as originally written played an important 

in persuading Congress to enact the 1988 Fair Housing Act Amendments, which, inter

alia, for the first time provided statutory protection from discrimination against families 

with children.

1



STATEMENT OF THE CASE

A. Nature of the Case

This case brought against defendant-appellee the Main Line Times ("the newspaper") 

by plaintiff-appellant Fair Housing Council of Suburban Philadelphia ("FHC") under the 

federal Fair Housing Act, as amended, concerns the newspaper’s publication of real estate 

advertisements stating "no children" allowed or containing other language tending to 

indicate that families with children would not be welcome as tenants in the advertised 

apartments. Congress made such housing discrimination against families with children 

illegal under the Fair Housing Amendments of 1988. The Main Line Times had in the past 

published advertisements containing illegal discriminatory language, resulting in complaints 

and settlement agreements with FHC in 1991, over an earlier incident of family status 

discrimination, and in 1993, over an incident of religious discrimination. See Trial 

Transcript 12/2/96 at 15, 43-44.

B. Course of Proceedings Below

At trial before a jury, defendant actually conceded that some of the advertisements 

constituted per se violations of the Fair Housing Act, see Trial Transcript 12/3/96 at 175:16 

("I believe that it [— the "no children" advertisement —] violated the law.") (testimony of 

Deborah Shaw, Publisher, Main Line Times), and the jury returned a verdict for FHC. The 

jury had been repeatedly instructed that, in order to find that the advertisements violated 

the law, it first had to find that FHC’s "efforts to assist equal access to housing have been 

frustrated," Trial Transcript 12/4/96 at 125:20-21 (jury question no. 2), and that plaintiff had 

been "genuinely injured]," id. at 120:13, in order for FHC to meet the constitutional injury- 

in-fact requirement for standing to bring this suit. The jury found that three of the five 

advertisements violated the Fair Housing Act and, in the process, implicitly found that FHC 

had suffered injury-in-fact. Answering the questions contained in the jury instructions, the

2



jury quantified the monetary damages FHC had suffered by examining the quantum of 

resources that FHC had been forced to divert in order to address the discriminatory ads, 

and awarded FHC $25,000. Id. at 135-38.

During the course of the trial, the newspaper repeatedly moved pursuant to FED. 

R. Civ. P. 50 for entry of judgment as a matter of law on the ground that FHC had not 

demonstrated its standing. See, e.g., Trial Transcript 12/3/96 at 141; Trial Transcript 12/4/96 

at 47. The district court consistently refused to rule on the motions and, in fact, during 

trial prevented the Fair Housing Council from introducing more evidence detailing the ways 

in which its programs to help housing seekers and educate the public are impaired by the 

publication of discriminatory advertisements by newspapers. See Trial Transcript 12/2/96 

at 98:17-18, 99. However, following the jury verdict, the district court granted the 

newspaper’s renewed post-verdict Fed . R. Civ. P. 50 motion for judgment as a matter of 

law. Without even acknowledging much of the trial evidence detailing how FHC’s 

programs were injured by the advertisements, the district court set aside the jury verdict 

(including the implicit finding that the evidence presented demonstrated injury-in-fact) and 

entered judgment for the newspaper, evidently concluding that there was no "legally 

sufficient evidentiary basis for a reasonable jury to find" standing, FED. R. Civ. P. 50(a).

C. Summary of Facts Relevant to Standing Issue

During trial, FHC introduced substantial evidence demonstrating that its 

organizational mission and activities are dedicated to helping classes of persons protected 

under the Fair Housing Act — racial minorities, religious minorities, families with children 

-  find housing, particularly in non-segregated neighborhoods. FHC further demonstrated 

that it pursues this mission by means of extensive education, outreach, and counseling 

activities aimed at helping home seekers, the real estate industry, newspapers, and the 

public understand what sorts of housing discrimination are illegal under the Fair Housing 

Act. Such education is particularly important as regards discrimination against families

3



with children, since such discrimination was banned for the first time only in 1988, and 

sectors of the public may still not be aware of its illegality.

FHC introduced evidence tending to show that broad dissemination of discriminatory 

advertisements, such as those published by the Main Line Times, injure and impede FHC’s 

efforts to help protected classes of home seekers find housing, particularly in open 

communities. First, testimony showed that the direct effect of such ads is to communicate 

that the particular housing advertised is not available to certain classes of persons — in this 

case, families with children — thereby effectively excluding them from that portion of the 

housing market. Second, testimony showed that such ads have a substantial secondary 

effect on housing access, by confusing members of the public as to what sorts of 

discrimination are illegal under the Fair Housing Act.

FHC’s testimony indicated that when a prominent newspaper such as the Main Line 

Times publishes illegally discriminatory advertisements, that dissemination confuses the 

public — both housing seekers and landlords — as to whether such discrimination is really 

illegal. By showing that discriminatory ads discourage individual housing seekers from 

pursuing available housing and confuse the public about what sort of discrimination is 

illegal. FHC showed that the ads undermined the efficacy of FHC’s education, outreach, 

and counseling efforts and impeded the organization’s efforts to help protected classes of 

home-seekers live where they would like.

In addition, FHC introduced testimony indicating that, faced with this injury to its 

work to secure open housing, FHC responded by diverting resources away from its basic 

educational and counseling activities to activities aimed at identifying and stopping the 

newspaper’s discriminatory advertisements. Beyond the harm to FHC’s open housing 

activities done by the ads. this diversion of resources to counteract the ads diminished 

FHC’s remaining resources available for its basic educational and counseling activities, 

further injuring the organization.

4



SUMMARY OF ARGUMENT

Although the district court’s reasoning is at times difficult to follow, it appears that 

the court set aside the jury verdict and entered judgment for the newspaper on two 

grounds. First, the court concluded that a fair housing group plaintiff cannot show that 

illegal discrimination harms its operations unless it can identify particular bona fide housing 

seekers who were affected by and complained to it about the discrimination. Second, the 

court concluded that where, in response to illegal housing discrimination, a fair housing 

organization diverts some of its scarce resources to counter the effects of the discrimination 

and selects a strategy of legal enforcement, including litigation, that diversion of resources 

can never constitute injury-in-fact for standing purposes. Evidently concluding that those 

two rulings effectively rendered all of the trial evidence inadequate to establish that plaintiff 

FHC was injured in any way by the newspaper’s illegal advertisements, the court granted 

judgment as a matter of law on standing grounds, setting aside the jury verdict that had 

found the newspaper violated the Fair Housing Act.

Both of these legal conclusions were erroneous, and the trial record in this case 

amply demonstrates that plaintiff FHC suffered injury-in-fact as a consequence of the 

newspaper’s discriminatory advertisements. The district court’s conclusion that bona fide 

housing seeker complainants are needed before a fair housing organization may have 

standing to sue over illegal housing discrimination is utterly irreconcilable with 

congressional fair housing policy, Supreme Court precedent, and an overwhelming and 

unbroken body of case law from across the country. Recognizing the disturbing 

pervasiveness of housing discrimination; the fact that, due to lack of information and 

incentive, only an estimated 0.15% of victims of housing discrimination ever initiate any 

sort of complaint; and the inadequacy of government enforcement resources, Congress has 

strongly endorsed two alternative fair housing enforcement mechanisms. These are 

enforcement of the Fair Housing Act by private, non-profit fair housing groups, and the 

use of paired housing "testers" of different races (or other protected status) to detect and

5



combat discrimination. The power and potential of both of these enforcement tools lies 

in the fact that they make it possible to identify and combat pernicious and illegal 

discrimination in those numerous circumstances where, for many reasons, a bona fide 

housing seeker plaintiff does not come forward.

In Havens Realty Corp. v. Coleman, 455 U.S. 363 (1982), the Supreme Court 

sanctioned Congress’s grant of standing to fair housing groups and its endorsement of the 

use of testers. A bona fide complainant requirement is wholly irreconcilable with Havens 

and the numerous lower court decisions upholding fair housing group standing in cases not 

involving bona fide complainants. Such a requirement would radically reduce the 

effectiveness of fair housing groups and testers in promoting the congressional objective of 

truly open communities, and it flies in the face of Congress’s repeated, specific 

endorsement of these means of enforcement.

While the district court focused largely on the issue of whether diversion of 

resources for litigation can evidence a fair housing group’s injury-in-fact, the court ignored 

the ample record evidence supporting a separate basis for standing. Essentially unrebutted 

testimony demonstrated that plaintiff FHC’s purpose is to achieve open housing for 

populations protected by the Fair Housing Act, and that FHC pursues that goal by a wide 

range of educational, outreach, and counseling efforts aimed at making the public (both 

home seekers and the real estate industry) familiar with the law’s requirements. Testimony 

indicated that when a major newspaper publishes discriminatory advertisements, 

innumerable housing seekers are (wrongly) deterred from seeking housing, and the public 

(again, both housing seekers and the real estate industry) is confused. In the case of novel 

statutory prohibitions, such as the protections for families with children at issue in this case, 

the risk of confusion is particularly great, since many people are still not aware of this 

addition to the Fair Housing Act. While the record also established that FHC diverted 

resources to respond to the illegal advertisements, the above evidence that the ads 

frustrated FHC’s educational efforts constitutes injury-in-fact sufficient to provide an

6



independently adequate basis for FHC’s standing.

It is thus not necessary to reach the issue of whether diversion of resources for 

litigation, taken alone, can ever confer standing, since the issue is not squarely presented 

in this case and, indeed, will rarely be so posed in any fair housing case. However, should 

this Court reach the issue, it should reverse the district court’s holding, which finds no 

support in law or logic. A substantial body of case law from numerous circuits indicates 

that where illegal discrimination compels a fair housing organization to divert some of its 

scarce resources to counter the effects of the discrimination, and the fair housing 

organization determines that legal enforcement, including litigation, is the most effective 

mode of response, such diversion of resources constitutes injury-in-fact for standing 

purposes. Indeed, it defies logic to hold that discriminatory conduct which requires a 

housing organization to increase its expenditure of resources on public education efforts 

in an attempt to counteract (indirectly) the effects of that discrimination injures the 

organization for Article III purposes, but that there is no injury if the organization responds 

by expending its resources on more direct efforts -  including litigation -  to stop the 

discrimination at its source.

7



ARGUMENT

I. Congress Recognized that Numerous Obstacles Prevent Individual Housing Seekers 
from Effectively Enforcing the Fair Housing Act and Therefore Sanctioned a Special 
Enforcement Role for Fair Housing Organizations

A. Obstacles to Fair Housing Enforcement

For decades it has been well understood by Congress, the courts, and housing 

experts that individual housing seekers ("bona fide housing seekers") face formidable 

obstacles in enforcing their rights to open housing under the federal Fair Housing Act and 

that only a relative handful of bona fide housing seekers who are subject to discrimination 

in any given year will pursue complaints. The obstacles to enforcement by bona fide 

housing seekers arise from (1) inability to detect discrimination, (2) ignorance about rights 

and enforcement mechanisms, (3) inability to locate fair housing advocates and/or lawyers 

willing to assist with complaints, and (4) lack of incentive to do so, given the 

aforementioned impediments.

Bona fide renters are peculiarly unsuited to detect disparate treatment 
[discrimination by landlords or real estate agents]. Chronic market shortages, 
particularly of physically adequate housing in the low-priced rental sector, have 
conditioned piospective renters, black and white alike, to expect that nothing (or not 
much) is available. When a prospective renter is told that nothing is available, she 
has little reason to suspect that this information is false because the answer is what 
she expects to receive. Also, a prospective renter shown only properties in 
segregated neighborhoods may not detect that this is being done intentionally. 
Because she cannot tell that her statutorily-protected rights have been violated, she 
is unlikely to sue.

Even when a homeseeker suspects something is amiss, the costs of taking 
action may prevent her from challenging the discrimination. Information about 
available remedies may be hard to collect. The homeseeker may think a lawyer is 
necessary and dismiss the possibility of hiring one because of cost. Finally, the 
investment of time may be less than the benefit the disappointed applicant 
anticipates receiving.

Alex S. Navarro, Note, Bona Fide Damages for Tester Plaintiffs: An Economic Approach to 

Private Enforcement of the Antidiscrimination Statutes, 81 GEO. L.J. 2727, 2734 (1993) 

(footnotes omitted), see also Robert G. Schwemm, The Limits of Litigation Under the Fair

8



Housing Act o f 1968, in THE FAIR HOUSING ACT AFTER TWENTY YEARS 43, 45-46 (Robert 

G. Schwemm ed., 1989).

Partly as a consequence of these very serious structural obstacles, housing 

discrimination remains disturbingly pervasive, and only a tiny fraction of incidents of 

discrimination are ever challenged in administrative complaints or lawsuits. In 1989, the 

U.S. Department of Housing and Urban Development conducted its second Housing 

Discrimination Study (HDS) -  a nationwide investigation aimed at measuring the incidence 

of housing discrimination against minorities in the U.S. The HDS deployed hundreds of 

pairs of housing "testers" of different races to assess the behavior of 3,800 randomly 

selected landlords and real estate agents in 25 metropolitan areas across the country. 

These pairs of testers visited the same landlord or agent posing as homeseekers with 

comparable credentials, and recorded any differing treatment received. Among the HDS’s 

startling findings were that African Americans encounter some form of discriminatory 

treatment in from 23% to 44% of their housing searches, with the rate at times being even 

higher, depending on the range of discriminatory treatments examined and on the statistical 

methodology employed. See JOHN YlNGER, CLOSED DOORS, OPPORTUNITIES LOST: THE 

Continuing Costs of Housing Discrimination 19-62 (1995). So disturbing are these 

dramatic findings that Congress took the unusual step of statutorily acknowledging them 

in findings contained in the Community Development Act of 1992. See Pub. L. No. 102- 

550, § 905(a)(6), 106 Stat. 3672, 3869, codified at 42 U.S.C. § 3616a note ("The National 

Discrimination Survey (HDS), released by the Department of Housing and Urban 

Development in 1991, found that Hispanic and African-American homeseekers experience 

some form of discrimination in at least half of their encounters with sales and rental 

agents").

We know of no study calculating annual incidents of housing discrimination in the 

Philadelphia area and contrasting those figures with the number of complaints made to fair 

housing groups or state or federal authorities, and with the number of lawsuits ultimately

9



filed. However, Richard H. Sander, an economist and law professor at the University of 

California at Los Angeles (UCLA), has conducted such an analysis for the Los Angeles 

Metropolitan Area, under a contract with the County of Los Angeles. Professor Sander’s 

study provides dramatic documentation of how seldom housing discrimination is challenged. 

Professor Sander reports:

In our research for "the Fair Housing in Los Angeles County -  An Assessment of 
Progress and Challenges 1970-1995" report, we attempted to estimate the volume of 
housing discrimination in Los Angeles County. To do this, we used data from the 
1991 Housing Discrimination Study conducted by the Urban Institute and the 
Department of Housing and Urban Development. The study conducted roughly 300 
fair housing tests in Los Angeles County in 1989, using paired white/black and 
Anglo/Latino testers. The tests revealed differential treatment, to the disadvantage 
of the black or Latino tester, in approximately 40% of the tests. We then used 
census data to estimate the number of housing searches by blacks and Latinos in 
mostly-white neighborhoods within Los Angeles County during 1989. Even making 
conservative estimates, we concluded that black and Latino homeseekers 
encountered differential treatment approximately 200.000 times during 1989. More 
recent testing suggests that the volume is similar today.

Despite this enormous volume of discrimination, we estimate, from data on the 
housing complaints received by local and state fair housing agencies, that only two 
hundred to three hundred discrimination complaints (alleging racial discrimination) 
are made to these agencies each year, and, in a typical year, less than five fair 
housing lawsuits are filed against housing providers within the county. One of the 
reasons for this tremendous disparity between the harm suffered and the harm 
remedied is the fact that housing discrimination is very hard to recognize. For 
example, when a home seeker goes to look for an apartment and is not given an 
application or rejected, this lone home seeker may have no way of knowing if the 
basis of the rejections was their race, or familial status, or other protected 
characteristic. This is due to the fact that home seekers generally do not have any 
access or contact with each other to compare experiences.

Letter from Professor Richard H. Sander to Paul K. Sonn (June 2, 1997) (emphasis added) 

(reproduced infra in Appendix). There is no reason to believe that the corresponding 

figures for the Philadelphia area are not comparably stark.

B. Fair Housing Councils Fill The Enforcement Gap

In light of these structural obstacles to combatting housing discrimination, non-profit 

fair housing councils established across the country to promote open housing have come 

to play a central and critical role in beginning to bridge this enforcement gulf. Fair housing

10



councils, such as plaintiff FHC, educate the public -- including housing seekers and the real 

estate industry -- about the law, counseling and assisting protected classes of housing 

seekers in their efforts to find housing. When discrimination does occur, fair housing 

councils advise victims, serving as a clearinghouse for information, and screening and 

investigating complaints. Because, as explained, housing discrimination is often difficult to 

detect and then document, fair housing councils frequently will investigate reports of 

discrimination by using testersto apply for the housing in question, in an effort to confirm 

whether discrimination is in fact going on. As a consequence, evidence gathered by fair 

housing councils has come to play a central role in enforcement of the Fair Housing Act. 

Moreover, because of the extremely limited number of enforcement cases that 

governmental fair housing enforcers -  the U.S. Department of Housing and Urban 

Development, the U.S. Department of Justice, and state fair housing agencies, see 

Trafficante v. Metropolitan Life Insurance Co., 409 U.S. 205, 211 (1972) -  have resources 

to pursue, enforcement proceedings, including lawsuits, brought by fair housing councils 

themselves have come to play a central role in the battle against housing discrimination. 

As Professor James Kushner, one of the nation’s leading scholarly authorities on fair 

housing, has explained,

virtually all fair housing enforcement has relied upon information and evidence 
gathered by dedicated local fair housing councils and other volunteer nonprofit 
organizations and referred to lawyers and agencies. Most of the private fair housing 
litigation and most of the best publicly enforced fair housing proceedings arose from 
the referrals, testing, counseling, and publicity carried out by the fair housing 
councils.

James A. Kushner, The Fair Housing Amendments of 1988: The Second Generation of Fair 

Housing, 42 Vand. L. Rev. 1049, 1100 (1989).

In the case of discrimination in real estate advertisements, see 42 U.S.C. § 3604(c), 

impediments to enforcement of the Act by individuals are substantial. First, individual 

housing seekers spotting an ad containing discriminatory language (e.g., "no children 

allowed") may well not realize that such preferences or restrictions are illegal, likely

11



believing that if a reputable newspaper prints it, it must be legitimate. This is particularly 

the case with respect to discrimination against families with children, which was banned for 

the first time in the Fair Housing Amendments of 1988, and which many people still may 

not know is illegal. Second, because discriminatory language in an advertisement is less 

personalized than discriminatory rejection of an application by a landlord, and because 

encountering an ad does not involve the same initial time, effort, and emotional investment 

that seeking and applying for housing in person does, fewer persons excluded by 

discriminatory ads are likely to go to the trouble of pursuing a complaint. Finally, there 

is a "free rider" problem. Since discriminatory ad language specifying "no children" or "no 

blacks" is disseminated to thousands of readers simultaneously, individuals encountering the 

ad are likely to assume that someone else will challenge the discrimination and that 

therefore they need not go to that trouble.

Our review of the reported case law confirms this description. After a 

comprehensive survey, we have identified only a single reported case in which an individual 

housing seeker pursued a lawsuit against an illegally discriminatory newspaper 

advertizement without the assistance of a fair housing council. See Holmgren v. Little 

Village Community Reporter, 342 F. Supp. 512 (N.D. 111. 1971). This record underscores the 

stark fact that, without the efforts of fair housing councils, very little ongoing housing 

discrimination, and virtually no advertising discrimination, would ever be challenged.

C. Congress and the Supreme Court Have Recognized this Special and Critical Role
of Fair Housing Councils in Enforcing the Fair Housing Act

For decades Congress and the Supreme Court have recognized the special and 

critical role that fair housing councils play in advancing the objectives of the Fair Housing 

Act. During the 1980’s, this appreciation moved from simple recognition to active support, 

with Congress’s decision to actively fund fair housing councils. After first funding nine fair 

housing groups under a pilot program, Congress established and has repeatedly 

reauthorized and expanded the HUD Fair Housing Initiatives Program (FHIP). See, e.g,

12



Housing and Community Development Act of 1987, Pub. L. No. 100-242; Cranston- 

Gonzalez National Affordable Housing Act, Pub. L. No. 101-625, § 953 (1990); Housing 

and Community Development Act of 1992, Pub. L. No. 102-550. Under FHIP, more than 

79 fair housing organizations have received HUD grants to engage in counseling, testing, 

and enforcement activities. See HUD OFFICE OF POLICY Devel. & Research, An 

Evaluation of the FHIP Private Enforcement Testing Initiative 2-2 through 2-7 

(Apr. 1994); U.S. GEN’L ACCOUNTING OFFICE, FAIR HOUSING: FUNDING AND ACTIVITIES 

Under the Fair Housing Initiatives Program (1997). As one Congressional 

committee explained in the legislative history to one of the FHIP reauthorizations,

Private fair housing organizations evolved in response to the need for increased 
enforcement of as well as education about rights under the nation’s fair housing 
laws. These organizations began to gradually achieve marked success in combatting 
housing discrimination and were primarily responsible for the development of a 
critical investigative tool — fair housing testing.

Despite the expanded capacity of both HUD and DOJ under the 1988 
amendments, it is private fair housing enforcement organizations which continue to 
remain on the "cutting edge" with respect to challenging housing discrimination 
(including discriminatory rental, sales, advertising, mortgage lending and appraisal 
practices).

*  *  *

This legislation] provides resources for enhanced private enforcement initiatives . . . 
and] systemic investigations, such as . . . [concerning] housing advertizing.

Senate Banking, Housing, and U rban Affairs Comm., Report on the Housing 

and Community Development Act of 1992, S. Rep. No. 102-332 (1992) (available 

without original pagination in the LEXIS "cmtrpt" file within the "genfed" library). Indeed, 

Congress has by statute expressly found that

the proven efficacy of private nonprofit fair housing enforcement organizations and 
community-based efforts makes support for these organizations a necessary 
component of the fair housing enforcement system.

Housing and Community Development Act of 1992, Pub. L. No. 102-550, § 905(a)(9), 106 

Stat. 3672, 3869, codified at 42 U.S.C. § 3616a note. So significant a role do fair housing 

organizations play in enforcing the open housing laws that Congress has at times voiced its

13



concern that, in effect, "[private persons and fair housing organizations are burdened with 

primary enforcement responsibility" for the Act. HOUSE JUDICIARY COMMITTEE, Fair 

Housing Amendments of 1988, H.R. Rep. No. 100-711, at 16 (1988), reprinted in 1988 

U.S.C.C.A.N. 2173, 2177.

Even before Congress began underwriting the operations of fair housing 

organizations, it had determined that maximizing private enforcement of the Fair Housing 

Act required abolition of all nonconstitutional limits to standing under the Act and 

"extending] to the full limits of Article III" the power of private parties, including fair 

housing organizations, to enforce the Act. Gladstone Realtors v. Village o f Bellwood, 441 

U.S. 91, 103 n.9 (1979). Similarly, Congress structured the Act in terms broad enough to 

permit private parties to document and combat housing discrimination using evidence 

generated by housing testers. See Havens Realty Corp. v. Coleman, 455 U.S. 363, 373 

(1982). These judgments by Congress, recognizing the validity and importance of fair 

housing councils and testing-based enforcement, evidence Congress’s desire to make 

available adequate tools for surmounting the formidable systemic obstacles to achievement 

of the goal of open communities that stands at the heart of the Fair Housing Act. And in 

a series of decisions, the Supreme Court has accepted Congress’s judgment that the 

purposes of the Act can only be accomplished by recognizing broad standing for both fair 

housing organizations and testers.

Finally, Congress recognized that discrimination against families with children is a 

particularly pervasive problem and so added familial status protection to the Fair Housing 

Act in 1988. While protecting families against discrimination was an important advance in 

its own right, the new protection is particularly important for minority families, since in the 

past, landlords often used the excuse of a policy of not renting to families with children as 

a pretext for racial discrimination. See also H.R. Rep. No. 100-711, at 16 (1988), reprinted

in 1988 U.S.C.C.AN. 2173, ___ (noting that restrictions on families with children

disproportionately burden minority families and increase racial segregation).

14



II. The District Court Erred as a Matter of Law in Holding that a Fair Housing 
Council Can Have Organizational Standing Only Where It Can Identify Bona Fide 
Housing Seekers Who Have Been Harmed by the Challenged Discriminatory 
Practices

Following the jury’s verdict for the Fair Housing Council finding that three of the 

five advertisements violated the Fair Housing Act, the district court granted judgment as 

a matter of law for the newspaper under FED. R. Civ. P. 50, finding that the evidence 

adduced at trial failed, as a matter of law, to establish the Fair Housing Council’s 

Article III standing to bring this suit. It appears that the court below held that without 

bona fide complainants — bona fide housing seekers with children who encountered the 

illegal ads, were deterred from inquiring about the housing, and then complained to the 

Fair Housing Council — the plaintiff cannot show that its programs have been "perceptibly 

impaired," slip op. at 8-9, 1997 U.S. Dist. LEXIS 596, at *12, and thus has not suffered the 

injury-in-fact required for Article III standing. Alternatively, the court found, for similar 

reasons, that even if the FHC had shown constitutionally adequate injury, absent such bona 

fide complainants, there was no causal link between the discriminatory ads and that injury. 

Id. at 9-11, 1997 U.S. Dist. LEXIS 596, at *12-*16. See Lujan v. Defenders o f Wildlife, 504 

U.S. 555, 560-61 (1992) ("injury must be traceable to challenged action"). Finding neither 

injury nor causation, the court granted judgment for the newspaper as a matter of law on 

standing grounds. Slip op. at 11-12, 1997 U.S. Dist. LEXIS 596, *16.

The district court’s holding that such bona fide home seekers complainants are 

indispensable to establishing injury and causation for purposes of fair housing group 

standing is irreconcilable with Havens Realty Corp. v. Coleman, 455 U.S. 363 (1982), with 

every circuit court decision addressing this issue, and with Congress’s purposes in promoting 

fair housing group and tester standing.

15



A. A Bona Fide Complainant Requirement Is Irreconcilable with Havens Realty Corp.
v. Coleman

As explained above, in an effort to maximize private enforcement, Congress defined 

standing under the Fair Housing Act "as broadly as is permitted by Article III of the 

Constitution." Trafficante, 409 U.S. at 209. Under this sweeping standard, any person who 

is "genuinely injured by conduct that violates someone’s [] rights [under the Fair Housing 

Act]" is "entitled to seek redress of that harm" under the statute. Gladstone Realtors v. 

Village of Bellwood, 441 U.S. 91, 103 n.9 (1979) (emphasis in original). Applying this 

standard to a fair housing organization plaintiff, the Supreme Court in Havens held that 

where a fair housing group can show that discriminatory activity made illegal under the Fair 

Housing Act has had the effect of "perceptibly impairing" the efficacy of the organization’s 

programs, the organization enjoys Article III standing and may bring suit over the 

discriminatory practice. Havens, 455 U.S. at 379.

Examination of the facts and the Court’s reasoning in Havens demonstrates that a 

bona fide complainant requirement is irreconcilable with the Supreme Court’s core teaching 

in that case. Havens involved a large suburban landlord who was refusing to rent to 

African Americans. The evidence of the landlord’s discrimination consisted of testimony 

of two testers, one black and one white, and one bona fide black rental applicant. When 

inquiries were made, the landlord told the black tester and the bona fide applicant that no 

apartments were available, but gave contrary information to the white tester. Havens, 455 

U.S. at 368. The fair housing group, along with other plaintiffs, sued the landlord under 

the Fair Housing Act.

The Supreme Court held that if, as alleged, the landlord’s practice of discriminating 

had "perceptibly impaired the [plaintiff fair housing group’s] ability to provide counseling 

and referral services for low- and moderate-income homeseekers, there can be no question 

that the organization suffered injury in fact." Havens, 455 U.S. at 379. Nowhere did the 

Court hint that the presence of the proof supplied by the bona fide housing seeker was 

necessary or even relevant to the standing of the tester or organizational plaintiffs. Nor did

16



the Court indicate that, without evidence from the bona fide seeker, the housing 

organization would be unable adequately to document the landlord’s policy of 

discrimination, which, as alleged, had impaired the organization’s ability to provide 

counseling and referral services to housing seekers. In Havens, the landlord’s 

discrimination, by effectively reducing the pool of open housing available to the fair housing 

group’s clients, made more difficult the fair housing organization’s work of counseling and 

referring minority and other low-income housing seekers to available housing.

An alleged violation of the Fair Housing Act must always be proven, and evidence 

from bona fide housing seekers is, of course, a permissible way of doing so. However, such 

proof through bona fides is not the only way. Rather, other sorts of proof such as evidence 

of discrimination elicited by housing testers can also suffice. (As discussed below, in the 

case of advertising discrimination, proof of publication of an illegal ad is all that is needed, 

since such publication is a per se violation of the Act. See infra Part II.E.) Similarly, while 

a plaintiff fair housing group must show that its program has been injured by the 

documented discrimination, proof of the existence of bona fide housing seekers affected 

by the discrimination is not required to establish that injury.

B. A Bona Fide Complainant Requirement Is Irreconcilable with Congressional Policy
Underlying the Fair Housing Act

Although the instant case does not involve testers, further refutation of the notion 

of a bona fide complainant requirement is found in the compelling policy concerns, 

endorsed by Congress and recognized by the courts, favoring fair housing group standing 

and use of housing testers to enforce the Fair Housing Act. As discussed earlier, bona fide 

housing seekers encountering discrimination often do no know they have been 

discriminated against because they may not know why they were denied housing or, when 

they are told housing is not available, whether that representation is true. Even when 

housing seekers do recognize discrimination, many do not know how to go about 

challenging it, or determine that doing so is not worth the significant trouble — particularly

17



given how hard it can be to locate a lawyer willing to take a housing discrimination case. 

Relying solely on complaints from bona fide housing seekers thus results in unacceptable 

underenforcement of the open housing laws. See Letter from Professor Richard H. Sander 

to Paul K. Sonn (June 2, 1997) (reproduced infra in Appendix) (in Los Angeles, from an 

estimated 200,000 incidents of housing discrimination during a one year period, fewer than 

five individual lawsuits were filed). Thus, it would not overstate matters to say that if bona 

fide home seekers were necessary parties to fair housing cases, the Act would be a virtual 

dead letter.

Recognizing the seriousness of these systemic problems, Congress has turned to 

alternative enforcement mechanisms aimed at partially filling this gap, underwriting testing 

programs and extending standing (including for testers and fair housing organizations) to 

the outer constitutional limits. These measures are intended to provide a mechanism for 

challenging discrimination in those many cases — likely the vast majority — where bona fide 

home seekers encountering discrimination never make their way to the offices of fair 

housing groups or civil rights attorneys. Use of testers provides a means of probing for 

and, where present, documenting discrimination in circumstances where bona fide 

applicants are not available, where bona fides are unwilling to bring a complaint for fear 

of retaliation, or where a bona fide cannot confirm that the housing denial was 

discriminatory. Similarly, fair housing group standing provides a means of challenging 

illegal discrimination in those many circumstances where it is simply not worth the trouble 

of any individual to do so. Indeed, advertising discrimination is perhaps the best example 

of this problem, since bona fide housing seekers have virtually no incentive to go to the 

great bother of suing to challenge a discriminatory advertisement they happen to come 

across. As recounted above (discussion supra Part I.C), both Congress and the Supreme 

Court have approved both fair housing group standing and the use of housing testers.

The bona fide complainant requirement announced by the district court would 

radically limit the power of testing. For example, under such a rule, fair housing

18



organizations finding clear and compelling evidence of a landlord’s discrimination 

developed by repeated use of paired testers would be denied standing to sue unless they 

happened to come into contact with one of the bona fide minority housing applicants 

refused housing by the landlord. As the Los Angeles data summarized above demonstrates, 

persons facing discrimination initiate complaints only 0.15% of the time (300 out of 200,000 

instances). Moreover, as the district court itself observed at an earlier point in the trial, 

this problem is particularly acute in the case of newly enacted protections, such as the right 

of families with children to be free from housing discrimination. Persons excluded by such 

discrimination may well not know their rights and so are especially unlikely to come 

forward and complain. See Trial Transcript 12/2/96 at 63:2-5 ("What about if the people 

are so unaware of their rights that they don’t even -  they aren’t offended or turned off 

when they read the ad? Don’t they [plaintiff FHC] have an obligation to go out and do 

something?") (query by district court to counsel to defendant newspaper); see also Trial 

Transcript 12/2/96 at 92 (individuals often do not complain about housing discrimination 

until it has "happened to them three or four times"). Thus, a bona fide complainant 

requirement would have the added perverse effect of reducing fair housing group action 

most in precisely those areas where the need for strengthened enforcement is greatest. 

Such constraints would radically restrict the power and efficacy of testing and fair housing 

organization-based enforcement of the open housing laws, and are thus utterly 

irreconcilable with congressional intent and an unbroken line of Supreme Court authority 

endorsing both testing and fair housing group standing.

C. A Bona Fide Complainant Requirement Is Irreconcilable with an Unbroken Line
of Precedent in Tester-Based Cases Brought by Fair Housing Groups

This conclusion is buttressed by the wide range of court of appeals and district court 

opinions where, in cases without any evidence provided by bona fide housing seekers, courts 

have nonetheless found fair housing group standing to challenge discrimination documented 

by means of other evidence. See. e.g., Spann v. Colonial Village, Inc., 899 F.2d 24, 27-31

19



(D.C. Cir. 1990), cert, denied, 498 U.S. 980 (1990) (R.B. Ginsburg, J.) (two fair housing 

group plaintiffs found to have standing in an advertising suit where the only individual 

complainant was not a bona fide housing seeker, see id. at 29 n.2); City of Chicago v. 

Matchmaker Real Estate Sales Ctr., 982 F.2d 1086, 1095 (7th Cir. 1992) (fair housing group 

found to have standing in suit based on evidence provided by testers, not bona fide home 

seekers); Village of Bellwood v. Dwivedi, 895 F.2d 1521, 1526 (7th Cir. 1990) (same); Heights 

Community Congress v. Hilltop Realty, Inc., 11A F.2d 135, 139 n.2, 144 (6th Cir. 1985), cert, 

denied, 475 U.S. 1019 (1986) (same); Williams v. B & W Properties, Civ. No. JFM-87-297, 

1988 U.S. Dist. LEXIS 5623 (D. Md. May 23, 1988) (same); Coel v. Rose Tree Manor Apts., 

Inc., Civ. A. No. 84-1251, 1987 U.S. Dist. LEXIS 9212 (E.D. Pa. Oct. 13, 1987) (same); 

Village of Bellwood v. Gorey & Assocs., 664 F.Supp. 320 (N.D. 111. 1987) (same); Metro Fair 

Housing Servs., Inc. v. Morrowood Garden Apartments, Ltd., 576 F. Supp. 1090 (N.D. Ga. 

1983), rev’d in non-pertinent part, 758 F.2d 1482 (11th Cir. 1985) (fair housing group’s 

allegations establish standing in suit based on evidence provided by testers, not bona fide 

home seekers); Saunders v. General Servs. Corp., 659 F.Supp. 1042, 1052 (E.D. Va. 1987) 

(fair housing group has standing in discriminatory advertising suit where the only testimony 

concerning the ads came from an individual who was the director of the organization’s fair 

housing program); Berry v. John Doe Managers, Civ. A. No. 91-2891, 1991 U.S. Dist. LEXIS 

10159 (E.D. Pa. July 22, 1991) (fair housing group found to have standing in suit based on 

evidence provided by testers, not bona fide home seekers). This large and stable body of 

case law conclusively refutes the district court’s novel theory that evidence provided by 

bona fides is a necessary element for a fair housing group suit.

D. The District Court Erred in Relying on HOPE, Inc. v. County o f DuPage

While unpersuaded by the more directly analogous Seventh Circuit precedent of

Village of Bellwood v. Dwivedi, 895 F.2d 1521, 1526 (7th Cir. 1990), the court below wrongly 

understood HOPE, Inc. v. County of DuPage, 738 F.2d 797 (7th Cir. 1984), to provide

20



strong support for its no-standing ruling. In HOPE, the Seventh Circuit, following Warth 

v. Seldin, 422 U.S. 490 (1975), held that low-income citizens had no standing to bring an 

Equal Protection Clause challenge to municipal policies they alleged prevented the 

construction of integrated, low-income housing. As had the Supreme Court in Warth, the 

Seventh Circuit based its no-standing decision largely on plaintiffs’ failure to identify any 

particular housing projects that would have been built but for the governmental policies 

plaintiffs sought to challenge. See 738 F.2d at 806-10 (citing Warth, 422 U.S. at 502); see 

also id. at 809 n.4 (contrasting "total lack of evidence" linking developers’ failure to propose 

low income projects to "County’s alleged animosity toward low and moderate income 

housing" with "record . . . evidence . . . that justifies the alternative explanation, that 

construction of low and moderate income housing is not and has not been profitable or 

economically feasible in DuPage County").

Even looking beyond its obvious factual differences from this case — and the strong 

federalism policies that are implicated when federal-court review of local legislation is 

sought, see Arizonians for Official English v. Arizona, 65 U.S.L.W. 4169 (March 3, 1997); 

Spann v. Colonial Village, Inc., 899 F.2d 24, 30 (D.C. Cir. 1990); cf HOPE, 738 F.2d at 810 

(noting availability of "normal democratic process" to citizens allegedly aggrieved by 

exclusionary governmental policies) (quoting Warth, 422 U.S. at 508 n.18) -  HOPE is of 

minimal assistance in determining whether the plaintiff fair housing organization in this 

case has standing to sue. First, the Seventh Circuit in HOPE explicitly distinguishes its 

ruling from the Supreme Court’s decision in Havens, where fair housing testers were held 

to have standing to challenge discriminatory steering, on the ground that Havens "involved 

specific and particular discriminatory activity," 738 F.2d at 815 (emphasis in original), whereas 

the HOPE plaintiffs had "fail[ed] to allege . . . acts such as denial of zoning variations and 

special-use permits for low and moderate income housing projects," id. Here, there is no 

suggestion of plaintiffs failure to allege "particular discriminatory acts": indeed, the 

newspaper all but conceded that at least one of their advertisements was discriminatory.

21



Second, HOPE, like Warth — and unlike Havens and this case -  involved allegations of a 

denial of housing, asserted to be in violation of the Fourteenth Amendment, rather than 

any congressionally-conferred right to truthful or nondiscriminatory "information about 

available housing," see Havens, 455 U.S. at 463 (emphasis added). The significance of the 

distinction between constitutional and statutory housing claims was stressed in Warth, see 

422 U.S. at 514 (explaining that the "critical distinction" between Trafficante and Warth is 

that "Congress may create a statutory right or entitlement the alleged deprivation of which 

can confer standing to sue even where the plaintiff would have suffered no judicially 

cognizable injury in the absence of statute"), and it is apparent in the HOPE opinion, as 

well. Compare 738 F.2d at 815 n.6 (refusing to ignore the "prudential limitation that 

generally a plaintiff ‘cannot rest his claim to relief on the legal rights and interests of third 

parties’") (citing Warth, 422 U.S. at 499) with Havens, 455 U.S. at 372 ("‘Congress intended 

standing under § 812 to extend to the full limits of Art. III[,]’ and . . . courts accordingly 

lack the authority to create prudential barriers to standing in suits brought under that 

section") (quoting Gladstone, 441 U.S. at 103, n.9, 109).

Finally, it is not clear -  even for cases closer on their facts to HOPE — that the 

hard-edged reading of Warth embraced in the Seventh Circuit’s 1984 opinion has survived 

more recent Supreme Court explication of the Article III "injury-in-fact" requirement. On 

the contrary, whereas Warth and HOPE indicated that low-income individuals lacked 

standing to challenge policies that "‘had the purpose and effect of excluding persons of low 

and moderate income,’" see 738 F.2d at 805 (quoting 422 U.S. at 501), absent evidence of 

"specific housing projects in which plaintiffs established that they personally intended to and 

were, in fact, eligible and financially able to reside," 738 F.2d at 806, the Supreme Court’s 

more recent teaching in Associated Gen’l Contractors v. City o f Jacksonville, 508 U.S. 656 

(1993), indicates that:

When the government erects a barrier that makes it more difficult for members of
one group to obtain a benefit than it is for members of another group, a member
of the former group seeking to challenge the barrier need not allege that he would

2 2



have obtained the benefit but for the barrier in order to establish standing. The 
"injury in fact" in an equal protection case of this variety is the denial of equal 
treatment resulting from the imposition of the barrier, not the ultimate inability to 
obtain the benefit.

Id. at 666. See also id. at 668 (explaining that in Warth, "an allegation that a ‘specific 

project’ was ‘precluded’ by the existence or administration of the zoning ordinance would 

certainly have been sufficient to establish standing, but there is no suggestion . . . that it

was necessary").

E. The Absence of a Bona Fide Complainant Requirement Is Ail the More Clear in the 
Case of Advertising Discrimination

The absence of a bona fide complainant requirement is all the more clear in the case 

of advertising discrimination, where it is clear from the text and the structure of the statute 

that Congress intended to vest all advertisement consumers with a legally protected interest 

in receiving accurate information, such that any person reading or hearing a discriminatory 

ad suffers an invasion of that interest.

The statute provides that

it shall be unlawful . . . [t]o make, print, publish, or cause to made, printed, or 
published any notice, statement, or advertisement, with respect to the sale or rental 
of a dwelling that indicates any preference, limitation, or discrimination based on 
race, color, religion, sex, handicap, familial status, or national origin . . . .

42 U.S.C. § 3604(c). Thus, a violation is complete upon publication. This provision vests 

all readers with a statutory right to receive nondiscriminatory advertising information 

concerning housing. Congress could easily have fashioned a far narrower prohibition — for 

example, by providing that "it shall be unlawful to deny an individual access to housing in 

any manner, including by advertising that indicates any preference, limitation, or

discrimination based on race, color......... " The fact that Congress chose to make the simple

publication of a discriminatory advertisement a statutory violation (without requiring 

further proof of its impact on any individual) reflects the legislature’s appreciation that the

23



effects of discriminatory advertisements are broad and pernicious -  literally infecting the 

information channels with a harmful contagion. Indeed, as has been noted above, those 

effects are particularly harmful in the case of violations directed at families with children. 

Because the prohibition of familial status discrimination is less than ten years old, many 

persons may still not appreciate its illegality, and so may be easily misled and confused by 

advertisements manifesting such discrimination, particular when appearing in an 

established, otherwise reputable publication.

The right to non-discriminatory advertising information conferred by 42 U.S.C. 

§ 3604(c) is strikingly similar to the right to receive accurate housing information that 

Congress conferred on all persons under 42 U.S.C. § 3604(d).2 As the Supreme Court 

explained in Havens, Congress intended that right to extend to all persons inquiring about 

housing — whether or not they are bona fide housing seekers. Havens, 455 U.S. at 374 

( "Whereas Congress, in prohibiting discriminatory refusals to sell or rent in § 804(a) of the 

Act, 42 U.S.C. § 3604(a), required that there be a ‘bona fide offer’ to rent or purchase, 

Congress plainly omitted any such requirement insofar as it banned discriminatory 

representations in § 804(d)") (footnote omitted). The similar structure and broad language 

of § 3604(c) indicates the same congressional intent. As the Second Circuit has held, 

reaching this same conclusion,

There is no significant difference between the statutorily recognized injury suffered 
by the tester [plaintiff] in Havens Realty and the injury suffered by [the instant 
plaintiffs], who were confronted by advertisements indicating a preference based on 
race. See Saunders v. General Servs. Corp., 659 F. Supp. 1042, 1053 (E.D. Va. 1987). 
Given the private attorney general provision in [42 U.S.C. § 3616(a)] [authorizing 
amy "aggrieved person" to sue] and the Supreme Court’s holding in Havens Realty, 
the district court was constrained to find that the individual plaintiffs had standing 
to bring this action in federal court.

Ragin v. Harry Macklowe Real Estate Co., 6 F.3d 898, 904 (2d Cir. 1993).

[lit shall be unlawful . . . [tjo represent to any person because of race, color, 
religion, sex, handicap, familial status, or national origin that any dwelling is not 
available for inspection, sale, or rental when such dwelling is in fact so available.

42 U.S.C. § 3604(d).

24



As the Second Circuit further explained in Ragin, the fact that the statute vests all 

persons with a right to receive non-discriminatory advertising information also provides an 

additional and independently adequate basis on which to rest constitutional standing for 

plaintiff FHC in this case. Havens made clear that "the injury[-in-fact] required by Art. Ill 

may exist solely by virtue of ‘statutes creating legal rights, the invasion of which creates 

standing . . . Havens, 455 U.S. at 373 (quoting Worth, 422 U.S. at 500). Consequently, 

receipt of inaccurate housing information constituted "injury to [the recipient’s] statutorily 

created right to truthful housing information," id. at 374, thereby establishing standing. 

Similarly, in this case, the fact that FHC’s employees and agents were confronted by 

discriminatory advertisements constituted an injury to their statutory right to non- 

discriminatory advertising. This injury to them which, by agency principles, was an injury 

to FHC, thereby vests the organization with Article III standing to pursue this action. 

While, as explained infra, the discriminatory advertising has caused FHC other injuries 

equally sufficient to confer standing, this injury to the statutory right constitutes an 

independently adequate alternative basis on which to rest FHC’s standing.

III. The Record Below Establishes that FHC Has Organizational Standing in this Case 

Not only were the district court’s imposition of a bona fide complainant requirement 

and reliance on the Seventh Circuit’s HOPE, Inc. v. County of DuPage demonstrably wrong 

under controlling Supreme Court precedent, but there existed no other justification for the 

court’s grant of judgment as a matter of law. Under FED. R. ClV. P. 50, the district court 

may not weigh conflicting evidence, judge the credibility of trial witnesses, or substitute its 

determination for that of the jury. The court must review the trial evidence in the light 

most favorable to the non-moving party. Lightning Lube v. Witco Corp., 4 F.3d 1153, 1166 

(3d Cir. 1993); 9 MOORE’S FEDERAL PRACTICE § 50.08[1] (3d ed. 1997). Only if the trial 

record so viewed provides "no legally sufficient evidentiary basis for a reasonable jury to 

find for the [non-movant]" may the court properly set aside a jury verdict and grant

25



judgment as a matter of law. FED. R. Civ. P. 50(a).

Much of the parties' disagreement over standing focused on whether the diversion 

of resources from FHC’s basic activities for the purposes of pursuing this lawsuit against 

the newspaper constituted evidence of an injury that was caused by the challenged 

advertisements. However, irrespective of this legal issue, the grant of judgment as a matter 

of law was improper, for there existed ample trial evidence demonstrating that plaintiff 

FHC’s basic educational and counseling activities were impaired by the newspaper’s 

publication of the discriminatory advertisements.

A. Discrimination that Impairs a Fair Housing Organization’s Role of Facilitating 
Open Housing Constitutes Injury-in-Fact

In Havens, the plaintiff fair housing organization alleged that the landlord’s practice 

of discriminating against African Americans had "frustrated . . .  its efforts to assist equal 

access to housing through counseling and other referral services . . . [requiring the 

organization] to devote significant resources to identify and counteract the defendant’s 

racially discriminatory . . . practices." Havens, 455 U.S. at 379. The Supreme Court 

unanimously held that if the organization could prove that the defendants’ discriminatory

practices have perceptibly impaired [the organization’s] ability to provide counseling 
and referral services to low-income and moderate-income home seekers, there can 
be no question that the organization has suffered injury in fact. Such concrete and 
demonstrable injury to the organization’s activities — with the consequent drain on 
the organization’s resources — constitutes far more than simply a setback to the 
organization’s abstract social interests.

Id. The Court continued,

Of course J th e  fair housing organization] will have to demonstrate at trial that it has 
indeed suffered impairment in its role of facilitating open housing before it will be 
entitled to judicial relief.

Id. at 379 n.20.

In applying the High Court’s teaching in Havens, the lower federal courts have found 

it helpful to analyze injury to fair housing groups and other similar direct service 

organizations in terms of two distinct but closely related categories (1) frustration of the

26



efforts of the organization by the challenged illegal action, and (2) diversion of the 

organization’s resources as a result of the challenged illegal action. See ROBERT G. 

Schwemm, Housing D iscrimination: Law and Litigation § I2.2(4)(b), at 12-16 

(1996) (gathering cases).3 Into the "frustration of efforts" category fall the direct effects 

of the challenged illegal action to undermine or impair the efficacy of the work performed 

by the organization. For example, in another Fair Housing Act advertising case, the D.C. 

Circuit explained that to prove injury, a fair housing organization could show that the 

challenged advertisements "decrease[] the effectiveness of the [fair housing organization’s] 

efforts to educate the real estate industry and the community," by "creating] a public 

impression that segregation in housing is legal, thus facilitating discrimination by defendants 

or other property owners." Spann v. Colonial Village, Inc., 899 F.2d 24, 28, 30 (D.C. Cir. 

1990) (R.B. Ginsburg, J.). In a closely analogous suit brought by an organization providing 

counseling and othe- services for the purpose of helping Central American refugees win 

asylum in this country, the Ninth Circuit held that where a challenged government policy 

creates obstacles to that goal, the organization suffers frustration of efforts and hence 

enjoys standing. El Rescate Legal Serv. v. Exec. Office of Immig. Rev., 959 F.2d 742, 748 

(9th Cir. 1991). Accord Haitian Refugee Center v. Nelson, 694 F. Supp. 864, 874-75 (S.D Fla. 

1988), quoted in McNary v. Haitian Refugee Center, 498 U.S. 479, 488 n.8 (1991). Similarly, 

in a challenge by an organization that counsels senior citizens concerning their eligibility 

for benefits and other legal rights to a policy eliminating access to government information 

useful to seniors in these efforts, then-Judge Ginsburg, writing for the D.C. Circuit, again 

explained that where the policy has an "adverse impact on [the organization’s] activities,"

’While frustration of efforts and diversion of resources can be viewed simply as two 
sides of the same coin and thus often blend together when analyzing injury for standing 
purposes, the categories take on clearer definition in the remedy phase of litigation, where 
they are often used as guideposts in quantifying damages to the fair housing organization. 
See JOHN P. RELMAN, HOUSING DISCRIMINATION PRACTICE MANUAL § 6.1 (1 )(b)(ii), at 
6-13 through 6-17 (1996) (surveying case law). The issue of the appropriate quantum of 
damages to be awarded in this case is not raised in this appeal. In the event that this Court 
reverses and remands, as amicus curiae respectfully suggests is warranted, the issue of the 
jury’s damage award would be considered in the first instance by the district court.

27



"inhibiting] [the organization’s] daily operations, [the challenged policy constitutes] an 

injury both concrete and specific to the work in which they are engaged." Action Alliance 

of Senior Citizens v. Heckler, 789 F.2d 931, 938 (D.C. Cir. 1986), vacated on other grounds, 

494 U.S. 1001 (1990), reaffirmed on remand, 930 F.2d 77, cert, denied, 502 U.S. 938 (1991).

Closely related to the direct frustration of efforts caused by a challenged policy is 

the corresponding and compounding injury caused where it becomes necessary for the 

organization to divert some of its scarce human or capital resources from other activities 

in order to respond to harmful illegal action (see discussion infra Part IV). Because of the 

symbiotic relationship of the frustration-of-efforts injury, and the diversion-of-resources 

response, in many cases both injuries will be present. See, e.g., Housing Opportunities Made 

Equal V. Cincinnati Enquirer, 943 F.2d 644, 646 (6th Cir. 1991); Ragin v. Harry Macklowe 

Real Estate Co., 6 F.3d at 905; Spann, 899 F.2d at 28-29 (fair housing cases); El Rescate 

Legal Serv., 959 F.2d at 748; Haitian Refugee Center, 694 F. Supp. at 874-75; Action Alliance 

of Senior Citizens, 789 F.2d at 938 (non-housing cases). However, the Supreme Court has 

never suggested that diversion of resources must be demonstrated in order to show injury. 

Rather, so long as a fair housing organization shows that discrimination tends to "impair[] 

[it] in its role of facilitating open housing," Havens, 455 U.S. at 379 n.20, standing is 

established.4

B. The Trial Record Amply Demonstrates that FHC’s Efforts to Facilitate Open
Housing Were Frustrated by the Challenged Discriminatory Advertisements

While the district court was misled by the newspaper’s erroneous suggestion that

The fact that the plaintiff may not at present have the budgetary luxury of being able 
to divert resources for the purpose of commencing the needed counteractive activities, such 
as an expanded public education campaign, in no way evidences a lack of injury. Whether 
plaintiff is free at this time to divert resources to such a program depends on the fiscal 
health, flexibility, and the prior commitments of the organization, and has no bearing on 
whether a defendant’s discrimination has, in fact, injured plaintiff by frustrating its current 
efforts. The need for such educational work is, however, still relevant to standing, for it 
constitutes further evidence demonstrating the frustration of the fair housing organization’s 
efforts, thus supports standing on that basis.

28



bona fide housing seekers are required in all cases enforcing the Fair Housing Act, the 

court below also overlooked the very substantial evidence in the trial record demonstrating 

how FHC’s efforts to facilitate open housing were frustrated by the challenged 

discriminatory advertisements, thereby vesting FHC with standing to maintain this action.

First, during trial, FHC introduced substantial evidence demonstrating that its 

organizational mission and activities are all dedicated to helping classes of persons 

protected under the Fair Housing Act — racial minorities, religious minorities, families with 

children — find housing, particularly in non-segregated neighborhoods. See, e.g., Trial 

Transcript 12/2/96 at 98, 114-15.

Second, FHC demonstrated that it pursues this mission by means of extensive 

educational and counseling activities. These include educational outreach to members of 

protected classes (minorities, families with children) to inform them about their rights to 

open housing, what behavior might violate those rights, and about how to oppose 

discriminatory conduct should they encounter it. See, e.g., Trial Transcript 12/2/96 at 100, 

102, 104-05, 112-13. FHC conducts educational training for housing counselors -  persons 

who directly assist low-income and disadvantaged persons in their search for housing. Trial 

Transcript 12/3/96 at 90. FHC similarly engages in public education and conducts training 

for the real estate industry, Trial Transcript 12/2/96 at 102, 105, and the newspaper and 

advertising industries, id. at 102-03, in an effort to ensure that all key actors in housing 

markets understand what sorts of housing discrimination are made illegal under the Fair 

Housing Act. Such education is particularly important concerning discrimination against 

families with children, since such discrimination was banned for the first time in 1988, and 

sectors of the public may still not appreciate that it is illegal. Trial Transcript 12/3/96 at 

73.

FHC put on testimony explaining that, as a consequence of its education and 

outreach, the Council is frequently contacted by individuals who believe they have 

encountered housing discrimination. FHC detailed how it receives complaints, counsels

29



individuals about their rights and options, and conducts investigations, including testing, if 

appropriate. Trial Transcript 12/2/96 at 112-13. Where it appears that discrimination has 

occurred, FHC then endeavors to resolve the dispute through conciliation or similar means. 

Id. at 114. Where a serious complaint cannot be resolved in any other manner, however, 

FHC resorts to administrative or judicial enforcement action, in an effort to stop the 

behavior, and its damaging effects on the housing market. Id. at 114-15.

Third, FHC introduced evidence tending to show that broad dissemination of 

discriminatory advertisements, such as those published by the Main Line Times, injures and 

impedes FHC’s efforts to help protected classes of home seekers find housing, particularly 

in integrated neighborhoods. Testimony showed that the direct effect of such ads is to 

communicate that the paiticular housing advertised is not available to certain classes of 

persons — in this case, families with children — thereby effectively excluding them from that 

portion of the housing market. Trial Transcript 12/3/96 at 46-47. Indeed, even the 

newspaper’s own publisher acknowledged that such ads would likely have this deterrent 

effect. Id. at 187.

Testimony also showed that such ads have far broader secondary effects on housing 

access, by confusing members of the public — both home seekers and housing providers — 

as to what sorts of discrimination are illegal under the Fair Housing Act. Id. at 102; id. at 

46-47. These broad effects are that much greater when confusing and illegal advertisements 

appear repeatedly in a respected newspaper with a large circulation. See id. at 181-82 

(Main Line Times has a weekly circulation of 14,000 and a readership substantially larger 

than that).

Fourth and finally, FHC introduced testimony indicating that, faced with this injury 

to its work of securing open housing by educating and counseling the public about the Fair 

Housing Act, FHC was compelled to respond by diverting resources away from its basic 

educational, outreach, and counseling activities, devoting them instead to activities aimed 

at identifying and stopping discriminatory advertisements. These counteractive activities

30



included investigating the Main Line Times to determine how pervasive its practice of 

publishing discriminatory advertisements was and, when it proved impossible to reach a 

voluntary agreement ending the practice, the initiation and prosecution of this litigation. 

Id. at 107-15, 120-25, 70. In addition to the harm to FHC’s open housing activities done 

by the ads, this diversion of resources to counteract the ads further diminished FHC’s 

remaining resources available for its basic educational and counseling activities. FHC 

documented a range of new education and outreach opportunities it was forced to decline 

because of the need to commit time and resources to the Main Line Times matter, id. at 

49-50, including the development of new anti-discrimination initiatives in different areas, 

such as lending discrimination against African Americans. Id.

Virtually all of this record evidence went uncontroverted and unchallenged. By 

providing testimony that discriminatory ads discourage individual housing seekers from 

pursuing available housing, and that such ads — particularly in the new field of familial 

status protections — confuse the public about what sort of discrimination is illegal, FHC 

showed that the ads at issue undermined the efficacy of FHC’s educational efforts. 

Similarly, by misinforming the public and spreading the incidence of illegal discrimination 

against families with children, the ads increase the need for FHC’s counseling services, 

thereby placing greater demands on the organization. Because it is through its education, 

outreach, and counseling work that FHC pursues its larger goal of helping protected classes 

of home seekers gain access to decent housing in integrated communities, the ads 

additionally impeded FHC’s accomplishment of that mission.

Whether FHC’s evidence was sufficient to demonstrate frustration of efforts, thereby 

establishing standing, was a fact issue on which the jury was expressly instructed.5 Under

The jury was lepeatedly instructed that, in order to find that the advertisements 
violated the law, it would have to find that "the Main Line Times has impaired the Fair 
Housing Council’s purpose to promote the availability of open housing with a consequent 
drain on the organization’s resources," or that "the Fair Housing Council’s mission is to 
promote fair housing and that the actions of the Main Line Times interfered with that 
mission." Trial Testimony 12/4/96 at 119.

31



FED R. Civ. P. 50, the district court would be entitled to set aside the jury’s implicit finding 

of injury only if, "reviewing] the trial evidence in the light most favorable to [FHC]." 9 

MOORE’S F e d e r a l  P r a c t ic e  § 50.08[1] (3d ed. 1997), it could say that no reasonable 

juror could infer such frustration from the trial record. Particularly in light of the fact that 

most of FHC’s testimony on these issues was entirely uncontroverted, this high standard 

was not satisfied.

As explained above, see supra Part III. A, where housing discrimination causes a fair 

housing group to "suffer impairment in its role of facilitating open housing," Havens, 455 

U.S. at 379 n.20, standing is established. Like the discriminatory advertisements that 

"decrease[d] the effectiveness of the [fair housing organization’s] efforts to educate the real 

estate industry and the community" in Spann, 899 F.2d at 28, and the government policies 

that made more difficult and increased the need for the counseling and educational work 

provided by the social service groups in El Rescale Legal Serv., 959 F.2d at 748, Haitian 

Refugee Center, 694 F. Supp. at 874-75, and Action Alliance of Senior Citizens, 789 F.2d at 

938, the discriminatory ads in this case frustrated the educational efforts and increased the 

burden on the counseling activities of FHC, thereby injuring the organization. See also 

Raver v. Capitol Area Transit, 887 F. Supp. 96 (M.D. Pa. 1995) (group that counsels and 

advocates on behalf of disabled persons concerning transit issues has standing under Havens 

to challenge discriminatory access policies of transit authority).

IV. The District Court Erred as a Matter of Law in Holding That Diversion of
Resources for Purposes of Counteractive Activities Such as Litigation Cannot
Constitute Injury-in-Fact

Although the district court’s reasoning is not easily followed, it appears that the 

court below also rested its finding that FHC lacked standing on a conclusion that diversion 

of resources for the purposes of direct counteractive activities such as litigation can never 

constitute injury in fact. See slip op. at 6-7, 1997 U.S. Dist. LEXIS 596, *9.

This conclusion is wrong as a matter of law. However, this Court need not reach this issue

32



because, as explained in the preceding section, irrespective of the diversion of resources -  

which is also fully supported by the record -  the record provides support for FHC’s 

standing on the separate although related ground that the advertisements injured FHC by 

frustrating its educational, counseling, and outreach efforts.

Moreover, the question of whether fair housing group standing can ever be 

predicated solely on the injury caused by diversion of resources from basic activities to 

litigation aimed at counteracting discrimination is truly an academic question. In virtually 

all circumstances (including this one) where a legitimate, established fair housing 

organization encounters housing discrimination, the organization will be able clearly to 

show frustration-of-efforts injury, because housing discrimination undermines the efficacy 

of the work fair housing groups do to educate the public (both the real estate industry and 

housing seekers) about the requirements of the open housing laws. Thus, the real 

importance of the diversion of resources for litigation comes at the remedy phase, when the 

court must determine whether such diversion constitutes compensable injury to the fair 

housing organization. Indeed, the record in this case shows that it was chiefly this damages 

issue that concerned the district court in this case. However, such damages are not at issue 

in this appeal in which neither party has raised an objection to the vacated jury verdict. 

See supra note 3.

While it is therefore neither necessary nor appropriate for this Court to reach the 

issue of diversion of resources for litigation, if this Court should reach the issue, it must 

reverse the district court’s holding, which finds no support in law or logic. As explained 

above. Havens and a substantial body of case law make clear that where housing 

discrimination compels a fair housing organization to divert resources from its basic 

activities in order to counter the effects of the discrimination — which frustrate the group’s 

educational, outreach, and counseling efforts — that diversion constitutes an injury sufficient 

to confer standing. As numerous courts have noted, these responses may include efforts 

to counteract the indirect effects of the discrimination -  for example, by "increased

33



educational efforts to counteract the influence of defendant’s discriminatory ads," Spann, 

899 F.2d at 28, or efforts "to reach out to potential home buyers or renters who are steered 

away from housing opportunities by discriminatory advertising," id. at 29. However, in 

many cases the fair housing organization may, in its considered judgment, determine that 

the most effective means of counteracting injury to its programs caused by discriminatory 

actions may be a preemptive enforcement campaign, including investigation, attempted 

mediation, and, if necessary, administrative enforcement or litigation, aimed at eradicating 

the discrimination itself. See, e.g., Village of Bellwood v. Dwivedi, 895 F.2d 1521, 1526 (7th 

Cir. 1990) ("deflection of the agency’s time and money from counseling to legal efforts 

directed against discrimination"); Ragin v. Harry Macklowe Real Estate Co., 6 F.3d at 905 

(devoting "time to investigating and attempting to remedy defendants’ advertisements"); 

Housing Opportunities Made Equal v. Cincinnati Enquirer, 943 F.2d 644, 646 (6th Cir. 1991) 

("devot[ing] resources to investigate and negate the impact of th[e] [particular] 

advertisements" by taking steps to stop their publication); Saunders v. General Servs. Corp., 

659 F. Supp. 1042, 1052 (E.D. Va. 1987) ("[fair housing group’s] staff was forced to spend 

time investigating [the defendant’s] advertising practices and attempting to counteract the 

alleged discriminatory advertising they found").

It defies logic that diversion of resources to relatively amorphous educational efforts 

attempting indirectly to counter the effects of discrimination would constitute Article III 

injury, while diversion of resources to more effective counteractive or preemptive measures, 

including administrative enforcement or litigation, would not. In many circumstances 

(including this case), fair housing groups, which unfortunately are constrained by modest 

budgets, will not have the resources available with which to mount a broad educational 

campaign of the sort needed to counter the effects of particularly pervasive discrimination, 

such as that in advertising. In such cases, the only feasible, cost-effective response will 

often be litigation aimed at stemming the problem at its source. The language and 

reasoning of Havens contemplate no exception for such circumstances, and the Dwivedi,

34



Ragin, Housing Opportunities Made Equal, and Saunders courts were all correct in holding 

that where discrimination compels diversion of resources to pursue counteractive 

enforcement activities, the constitutional injury to the fair housing group is in no way 

diminished.

The district court was misled by the D.C. Circuit’s decision in Fair Employment 

Council v. BMC Marketing Corp., 28 F.3d 1268, 1277 (D.C. Cir. 1994). In BMC, a D.C. 

Circuit panel suggested that resources diverted to efforts directly countering discrimination, 

including litigation, can never constitute evidence of injury. 28 F.3d at 1276. As an initial 

matter, this conclusion was wholly dictum, since the court had previously held that the 

plaintiff fair employment organization’s allegations that the challenged discrimination had 

"made the Council’s overall task more difficult" would, if proven, constitute fully adequate 

constitutional injury. Id. Moreover, that dictum stands in tension with the BMC court’s 

own analysis. BMC properly recognized that efforts to "‘counteract’ . . . illegal practices," 

BMC, 28 F.3d at 1277 (quoting Havens, 455 U.S. at 379), including "educational and 

counseling efforts" BMC, 28 F.3d at 1277 (citing Spann, 899 F.2d at 27-79), can constitute 

an injury to the organization’s activities. Since in many cases, litigation will be the most 

effective means of stemming such discrimination and thus counteracting its harms, the BMC 

dictum is at war with BMC’s own holding, and hence does not persuade.

CONCLUSION

For the foregoing reasons, amicus curiae respectfully urges that this Court reverse 

the district court’s grant of Judgment as a Matter of Law for defendant-appellee on 

standing grounds in this case, and remand the case for remedy proceedings in the district 

court.

35



Respectfully submitted,

Norman J. Chachkin 
David T. Goldberg 
Paul K. Sonn
NAACP Legal Defense and Educational 

Fund, Inc.
99 Hudson Street 
Suite 1600
New York, New York 10013 
(212) 219-1900

Judith A. Browne 
Peter F. Rundlet
NAACP Legal Defense and Educational 

Fund, Inc.
1275 K Street, N.W.
Suite 301
Washington, D.C. 20005 
(202) 682-1300

Attorneys for Amicus Curiae

New York, New York 
June 11, 1997

36



APPENDIX



06-06-97 09:37AM FROM UCLA LAW 3100256023 P02

UNIVERSITY OF CALIFORNIA, LOS ANGELES

BXAULXY • CAWT» • m v im  .  LOS AN OS LSI .  W V I M I D I  • JAN DISCO • SAN rnANCnco

UCLA

SANTA BASSAKA -  SANTA C SL Z

RICHARD H. SANDER 
PROFESSOR OF LAW
PHONE: (310) 106-7300 
FAX: (310) 206-7010

SCHOOL OF LAW 
403 HHjOAXD AVENUE 

LOS ANOKLBS, CA 90095-1476

June 2, 1997

Paul K. Sonn, Esq., Assistant Counsel 
NAACP Legal Defense and Educational Fund, Inc.
99 Hudson Street, 16th Floor 
New York, NY 10013-2897

Dear Paul:

I am writing in response to your questions about the current incidence of housing 
discrimination in Los Angeles County and avenues for determining when it exists.

In our research for the "Fair Housing in Los Angeles County -- An Assessment of Progress 
and Challenges 1970 - 1995" report, we attempted to estimate the volume of housing 
discrimination in Los Angeles County. To do this, we used data from the 1991 Housing 
Discrimination Study conducted by the Urban Institute and the Department of Housing and 
Urban Development. The study conducted roughly 300 fair housing tests in Los Angeles 
County in 1989, using paired white/black and Anglo/Latino testers. The tests revealed 
differentia] treatment, to the disadvantage of the black or Latino tester, in approximately 40% 
of the tests. We then used census data to estimate the number of housing searches by blacks 
and Latinos in mostly-white neighborhoods within Los Angeles County during 1989. Even 
making conservative estimates, we concluded that black and Latino homeseekers encountered 
differential treatment approximately 200,000 times during 1989. More recent testing suggests 
that the volume is similar today.

Despite this enormous volume of discrimination, we estimate, from data on the housing 
complaints received by local and state fair housing agencies, that only two hundred to three 
hundred discrimination complaints (alleging racial discrimination) are made to these agencies 
each year, and, in a typical year, less than five fair housing lawsuits are filed against housing 
providers within the county. One of the reasons for this tremendous disparity between the 
harm suffered and the harm remedied is the fact that housing discrimination is very hard to 
recognize. For example, when a home seeker goes to look for an apartment and is not given 
an application, or is rejected, this lone home seeker may have no way of knowing if the basis 
of the rejection was their race, or familial status, or other protected characteristic. This is due 
to the fact that home seekers generally do not have any access to or contact with each other to 
compare experiences.

Due to the difficulties in recognizing housing discrimination, it is essential that fair housing 
organizations conduct independent enforcement activities, such as “testing" and other 
investigations of fair housing complaints. Without such activities, it would be difficult, if not

JUN 06 ’97 13=34 310 825 6023 PAGE.02



06-06-97 09:37AM FROM UCLA LAW 310B256023 P03

Mr. Paul Sonn 
page two

impossible, to recognize and provide remedies for victims of illegal housing discrimination. 
These investigations also allow fair housing organizations to uncover situations where illegal 
discrimination does not exist, for example, when an applicant was rejected due to poor credit 
or low income. Therefore, fair housing organizations’ independent investigatory activities 
such as testing and tenant interviews are essential for detecting and providing a remedy for 
illegal housing discrimination, as well as assessing whether the conduct was prohibited or not

Sincerely yours,

Richard H. Sander

JUN 06 ’97 13:34 310 825 6023 PAGE.03



CERTIFICATE OF BAR MEMBERSHIP

I hereby certify that I am a member in good standing of the bar of the United States 

Court of Appeals for the Third Circuit.

June 11, 1997



CERTIFICATE OF SERVICE

I hereby certify that two copies of the foregoing BRIEF OF PROPOSED AMICUS 

CURIAE; have been served by depositing same in the United States mail, first class postage 

prepaid, on this 11th of June, 1997, addressed to each of the following counsel for the 

parties to this appeal:

Gregory M. Harvey, Esq. 
Morgan, Lewis & Bockius 
2000 One Logan Square 
Philadelphia, PA 19103

Clifford A. Boardman, Esq. 
Two Penn Center, Suite 1920 
1500 JFK Boulevard 
Philadelphia, PA 19102