Justice Department Settles Second Largest Apartment Rental Discrimination Case

Compliance with fair housing laws is serious business. And the rules are tough. Break them and you pay a stiff penalty. That is what happened to the manager, management company, and owners of an apartment complex in Kansas City, Kansas. The combined $2.13 million settlement represents the second largest monetary payment ever obtained by the department in a fair housing case alleging housing discrimination in the rental of apartments.

The department brought a lawsuit alleging that the community manager of Central Park Towers Apartments (CPT), her employer, NHP Management Co., as well as the Apartment Investment and Management Company (AIMCO) and the former owners of CPT, engaged in a pattern or practice of discrimination on the basis of race in violation of the Fair Housing Act (FHA). CPT is a Section 8 property with 195 units designated for persons with disabilities or who are elderly. The lawsuit also alleged that the defendants retaliated against an employee who cooperated with HUD investments. The settlement resolves claims on behalf of 40 current and former tenants of Central Park Towers, as well as the employee.

In its amended complaint, filed on September 18, 2008, the department alleged that for two-and-a-half years between 2003 to 2005, the community manager engaged in discriminatory rental practices on the basis of race, by openly displaying racially hostile materials at CPT, such as hangman’s nooses, frequently referring to African-Americans with racial epithets, and generally treating white residents more favorably than African-American residents. The government also alleged that the defendants improperly retaliated against an employee by firing her when she cooperated with HUD investigators and advised a resident to contact HUD.

The department settled its claim against the former owners, Central Park Towers II L.P., last summer for $145,000. That settlement, together with the recent agreement, which still must be approved by a district court judge, amounts to a total of $2.13 million. The most recent agreement would require the defendants to pay $95,500 in civil penalties to the U.S., and a total of approximately $1.89 million into a fund that would be used to compensate those who were harmed by the defendants’ discriminatory practices.

The FHA prohibits discrimination in housing on the basis of race, color, religion, national origin, sex, disability, and familial status.

For more information about the FHA compliance, see Fair Housing Coach or the Complete Guide to Fair Housing Training, published by Vendome.