Gilead Community Services, Inc. et al v. Cromwell et al
Filing
98
ORDER granting 57 Motion to Amend/Correct. Signed by Judge Victor A. Bolden on 02/26/19. (Ryan, Sarah)
UNITED STATES DISTRICT COURT
DISTRICT OF CONNECTICUT
GILEAD COMMUNITY SERVICES, INC.,
et al.,
Plaintiffs,
No. 3:17-cv-627 (VAB)
v.
TOWN OF CROMWELL, et al.,
Defendants.
RULING AND ORDER ON MOTION TO AMEND THE COMPLAINT
On April 17, 2017, Gilead Community Services, Inc. (“Gilead”), Rainbow Housing Corp.
(“Rainbow”), and the Connecticut Fair Housing Center, Inc. (“Fair Housing” and in conjunction
with Gilead and Rainbow, “Plaintiffs”) sued the Town of Cromwell (“Cromwell”), as well as
Enzo Faienza, Anthony Salvatore, and Jillian Massey, individually and in their official capacities
as Cromwell’s mayor, town manager, and zoning enforcement officer, respectively. Compl.,
ECF No. 1.
Plaintiffs allege that Cromwell and the named officials (collectively “Defendants”)
violated the Fair Housing Act, 42 U.S.C. § 3601 et seq. (“FHA”) and implementing regulations
at 24 C.F.R. § Part 100; the Americans with Disabilities Act, 42 U.S.C. § 12131 et seq. (“ADA”)
and implementing regulations at 28 C.F.R. § Part 35; and the Rehabilitation Act of 1973, 29
U.S.C. § 794 (“Section 504”) and implementing regulations at 24 C.F.R. § Part 8, “by denying
housing to Gilead’s clients, who are people with disabilities.” Id. ¶ 1.
On June 22, 2018, Plaintiffs moved to amend their Complaint to add retaliation claims
under 42 USC §§ 3617 and 3604(f)(2). Mem. of Law in Supp. of Pls. Mot. for Leave to File Am.
Compl. (Pls. Mem. of Law), ECF No. 57 at 5. Plaintiffs allege that Defendants denied the
property tax exemption on Gilead’s other Cromwell property in retaliation for the fair housing
rights claims pursued in this Court, and that Defendants’ retaliation occurred after the Complaint
was filed and the deadline for amendment of the pleadings had passed. Id. at 1–3.
Defendants oppose the motion as untimely, substantially prejudicial, and improper due to
Plaintiffs’ present appeal to the Connecticut Superior Court. Obj. to Pls. Mot. for Leave to File
Am. Compl. (“Defs. Obj”.), ECF No. 60.
For the reasons set forth below, the Court now GRANTS Plaintiffs’ motion to amend the
Complaint, ECF No. 57.
I. FACTUAL AND PROCEDURAL BACKGROUND
A. Factual Background
Gilead, allegedly a tax-exempt organization, seeks to provide housing and communitybased services to individuals with mental illnesses. Compl. ¶ 22. Rainbow Housing Corporation
allegedly is a separate entity affiliated with and controlled by Gilead. Id.
Since 1968, Gilead allegedly has provided housing to mentally ill individuals in
Middlesex County, Connecticut. Id. Around 2015, Gilead allegedly sought to operate a
“community residence for six men with mental health diagnoses in an existing single family
residence at 5 Reiman Drive in Cromwell” (“Reiman Drive residence”). Id. ¶ 2.
Plaintiffs allege that Defendants not only opposed the operation of the Reiman Drive
residence but also “took a leading role in fanning the flames of community opposition, providing
community forums for amplifying the opposition’s voice, and knowingly and intentionally
invoking the full weight of municipal authority to prevent Gilead from operating the house on
Reiman Drive.” Id. ¶ 4.
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Specifically, Plaintiffs allege that Defendants: (1) “called a special Town forum and
encouraged Town residents to attend and oppose Gilead’s operation of the house”, (2) “issued an
official Town press release requesting that Gilead relocate the house”, (3) “petitioned the
Connecticut Department of Public Health (“DPH”) to deny Gilead the ability to operate the
house on Reiman Drive”, (4) “issued a ‘Cease & Desist Order,’ wrongly alleging that Gilead was
operating the house ‘without first obtaining proper zoning permits,’ in violation of Town zoning
regulations”, and (5) “denied Gilead a property tax exemption for which it was clearly eligible.”
Id. ¶ 5. Plaintiffs claim that “[a]s a consequence of the Defendants’ discriminatory actions . . .
Gilead had to limit occupancy at the house to just two residents for several months, and
eventually was forced to cease its operations on August 31, 2015.” Id. ¶ 6. Plaintiffs claim that
Defendants deprived Gilead of the “opportunity to fulfill its mission”, id. ¶ 7, and forced the
actual and proposed occupants of the Reiman Drive residence “to remain in settings more
restrictive and institutional than clinically indicated to be in their best interests”, id. ¶ 9.1
B. Procedural Background
On April 17, 2017, Plaintiffs filed their Complaint. Compl. That day, the Court issued a
Standing Order on Pretrial deadlines that set the deadline for the amendment of pleadings as June
16, 2017. Order, ECF No. 2.
On June 5, 2017, the parties filed a joint Rule 26(f) planning report. Form 26(f) Report of
Parties’ Planning Meeting, ECF No. 20.
On June 20, 2017, the Court issued a Scheduling Order that set a discovery deadline of
June 22, 2018. Scheduling Order, ECF No. 26.
Plaintiffs allege that “[e]ach client that Gilead proposed to move—or actually did move—into the house
on Reiman Drive was determined, by clinical professionals, to be capable of living in more integrated community
settings like those available in the house on Reiman Drive.” Compl. ¶ 8.
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On June 29, 2017, Defendants filed an Answer to the Complaint. Answer, ECF No. 27.
Cromwell largely denies Plaintiffs’ allegations. Answer, ECF No. 27. The town asserts four
defenses: (1) that the Complaint fails to state a claim upon which relief may be granted, (2) that
Plaintiffs’ claims against individual Defendants are barred by qualified immunity, (3) that
Plaintiffs have failed to exhaust administrative remedies, id. at 12, and (4) that Plaintiffs’ claims
are not ripe for adjudication under Williamson Cty. Reg’l Planning Comm’n v. Hamilton Bank,
473 U.S. 172 (1985), Am. Answer, ECF No. 44-1.
On August 24, 2017, the Court granted the parties’ consent motion for an extension of
time for Plaintiffs to respond to Defendants’ first set of interrogatories and requests for
production. Order, ECF No. 31. The Court then granted two requests by Defendants for
extensions of time to respond to Plaintiffs’ interrogatories and requests for production, Orders,
ECF Nos. 33, 39.
On December 26, 2017, after the deadline for amendment of pleadings had passed, Order,
ECF No. 2, Defendants moved to amend their Answer to add a fourth affirmative defense. Mot.
to Amend or Correct Answer to Compl., ECF No. 44.
Thereafter, the parties jointly moved to amend the Scheduling Order. Joint Motion to
Amend or Correct Scheduling Order, ECF No. 48.
On April 30, 2018, the Court granted the parties’ motion and set a new deadline for
discovery of September 14, 2018. Orders, ECF Nos. 51, 52.
On May 21, 2018, the Court granted Defendants’ unopposed motion to amend their
Answer. Order, ECF No. 54.
On June 22, 2018, Plaintiffs moved to amend their Complaint. Pls. Mem. of Law.
On July 11, 2018, Defendants objected to Plaintiffs’ motion. Defs. Obj.
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On July 20, 2018, Plaintiffs replied. Reply to Defs. Obj. to Pls. Mot. for Leave to Amend
(“Reply”), ECF No. 61.
II.
STANDARD OF REVIEW
Rule 16(b)(4) of the Federal Rules of Civil Procedure permits the modification of the pretrial schedule “only for good cause and with the judge’s consent.” FED. R. CIV. P. 16(b)(4).
Rule 15 of the Federal Rules of Civil Procedure provides that a party may either amend
once as a matter of course within 21 days of service or the earlier of 21 days after service of a
required responsive pleading or motion under Rule 12 (b), (e) or (f). FED. R. CIV. P. 15(a)(1).
Once that time has elapsed, a party may move for leave to file an amended pleading. FED. R. CIV.
P. 15(a)(2). Courts “should freely give leave [to amend] when justice so requires.” Id.; see also
Friedl v. City of New York, 210 F.3d 79, 87 (2d Cir. 2000) (“[D]istrict courts should not deny
leave unless there is a substantial reason to do so[.]”). The Second Circuit “review[s] the district
court’s decision to grant a party leave to amend for abuse of discretion.” Monahan v. New York
City Dep’t of Corr., 214 F.3d 275, 283 (2d Cir. 2000).
Reasons for denying leave to amend include “undue delay, bad faith or dilatory motive
on the part of the movant, repeated failure to cure deficiencies by amendments previously
allowed, undue prejudice to the opposing party by virtue of allowance of the amendment, futility
of amendment, etc. [.]” Foman v. Davis, 371 U.S. 178, 182 (1962).
III.
DISCUSSION
Plaintiffs argue that (1) that they have shown good cause for the modification of the
scheduling order, (2) that justice requires the Court’s leave to amend, and (3) that the proposed
amendment is not futile.
The Court agrees.
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A. Modification of the Scheduling Order
Rule 16(b)(4) permits the modification of a pre-trial schedule “with the judge’s consent.”
FED. R. CIV. P. 16(b)(4). The movant must show good cause for the modification. Id. While “the
rule is designed to offer a measure of certainty in pretrial proceedings . . . . in certain cases the
court may determine that the deadline cannot reasonably be met despite the diligence of the party
seeking the extension. In such cases, where the moving party has demonstrated good cause, the
court may grant leave to amend the scheduling order to extend the deadline.” Parker v. Columbia
Pictures Indus., 204 F.3d 326, 339–40 (2d Cir. 2000) (internal quotation and citation omitted).
“‘Good cause’ means that the schedule cannot reasonably be met despite that party’s
diligence.” Julian v. Equifax Check Servs., Inc., 178 F.R.D. 10, 16 (D. Conn. 1998), citing
Fed.R.Civ.P. 16 Advisory Committee Notes, Subdivision (b) (1983 Amendment); Kassner v. 2nd
Ave. Delicatessen Inc., 496 F.3d 229, 244 (2d Cir. 2007) (“According to the principles we
discussed in Parker, 204 F.3d at 339–40, the primary consideration is whether the moving party
can demonstrate diligence. It is not, however, the only consideration. The district court, in the
exercise of its discretion under Rule 16(b), also may consider other relevant factors including, in
particular, whether allowing the amendment of the pleading at this stage of the litigation will
prejudice defendants.”).
Defendants argue that Cromwell denied Plaintiffs’ relevant tax exemption on March 24,
2018, Defs. Obj. at 5, and that Plaintiffs should have sought leave to amend their Complaint
three days later, in the parties’ March 27, 2018 joint motion to amend the schedule. Joint Motion
to Amend or Correct Scheduling Order. Defendants argue that since Plaintiffs did not move to
amend in late March of 2018, the Court should deny their motion for leave to amend the
scheduling order. Defs. Obj. at 5.
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Plaintiffs argue that they have been diligent and have shown good cause to amend the
scheduling order. Pls. Mem. of Law at 6–7.
The Court agrees.
The deadline for the amendment of pleadings was June 16, 2017. Order, ECF No. 2.
Cromwell allegedly denied the tax exemption on Plaintiffs’ second property in the spring of
2018. Pls. Mem. of Law at 7; Defs. Obj. at 5. Plaintiffs thus could not have pled their retaliation
claim by the 2017 amendment deadline. Julian, 178 F.R.D. at 16 (“‘Good cause’ means that the
schedule cannot reasonably be met despite that party’s diligence.”).
Plaintiffs must “demonstrate diligence” in adhering to deadlines. Kassner, 496 F.3d at
244 (“[T]he primary consideration is whether the moving party can demonstrate diligence.”).
Plaintiffs allege that they filed their motion “after the issuance of the Appeal Board’s decision”,
when “it became clear that Defendants would not reverse their denial of Gilead’s tax exemption
application.” Pls. Mem. of Law at 6. Plaintiffs’ motion was allegedly filed “[l]ess than ten weeks
. . . since Defendants’ [denial] and only five weeks since Gilead appealed [the denial].” Id. at 8.
Within weeks of this second denial, Plaintiffs drafted an Amended Complaint and moved to
modify the scheduling order. That timeline reflects a diligent effort to adhere to deadlines.
Accordingly, the Court finds good cause to amend the scheduling order to permit
amendment of the pleadings.
B. Leave to Amend the Complaint
Rule 15 establishes a permissive standard for the amendment of pleadings. FED. R. CIV.
P. 15(a)(2). Courts will not deny leave absent a substantial reason to do so. Friedl, 210 F.3d at
87; see also Foman, 371 U.S. at 182. Courts, however, will deny leave on account of prejudice
or bad faith. Derisme v. Hunt Leibert Jacobson P.C., 880 F. Supp. 2d 339, 376 (D. Conn. 2012).
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An “[a]mendment may be prejudicial when, among other things, it would ‘require the opponent
to expend significant additional resources to conduct discovery and prepare for trial or
significantly delay the resolution of the dispute.’” AEP Energy Servs. Gas Holding Co. v. Bank
of Am., N.A., 626 F.3d 699, 725–26 (2d Cir. 2010) (internal quotation and citation omitted).
Defendants contend that Plaintiffs’ lengthy delay lessens Defendants’ burden to
demonstrate prejudice. Defs. Obj. at 4. Defendants argue that they would be prejudiced by
having to expend additional resources on discovery unrelated to the pending lawsuit. Id. at 2, 6.
Defendants also assert that Plaintiffs “should complete the appeals process in state court before
bringing these allegations to federal court.” Id. at 7.
Plaintiffs argue that they did not unreasonably delay in seeking to amend, that no
prejudice would result from the amendment, and that the “pending state tax appeal is irrelevant
to Plaintiffs’ claim of retaliation.” Reply at 1.
The Court agrees.
As explained above, Plaintiffs did not delay in filing the present motion. Rather, Plaintiffs
filed shortly after the denial of their appeal but before final resolution by the state’s courts. Defs.
Obj. at 7. In essence, Plaintiffs waited to see if Cromwell would reverse its position before filing
a retaliation claim. When Cromwell did not, Plaintiffs filed within weeks. Further, as both parties
acknowledge, Plaintiffs filed the present motion before the close of fact witness discovery, id. at
6, and three months before the close of all discovery. Pls. Mem. of Law at 9.
Plaintiffs plausibly allege that the retaliation claims implicate “the same Town players”
and “similar Town action.” Pls. Mem. of Law at 9. The proposed claims seem to arise from the
exercise of Defendants’ discretionary zoning and taxing authority, Pls. Mem. of Law at 3, similar
to Plaintiffs’ initial claims, id. at 2. As a result, any prejudice to Defendants is minimal.
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Courts do not deny Rule 15 amendments on account of some prejudice. Rather, an
“[a]mendment may be prejudicial when . . . it would ‘require the opponent to expend significant
additional resources . . . or significantly delay the resolution of the dispute.’” AEP Energy Servs.
Gas Holding Co. v. Bank of Am., N.A., 626 F.3d 699, 725–26 (2d Cir. 2010) (internal quotation
and citation omitted). At most, the parties may have to re-depose a few witnesses. Defendants
have not shown that such depositions would require “significant additional resources . . . or . . .
delay[.]” Id.
Moreover, if Plaintiffs pursued the retaliation claim in a separate suit, then Defendants
would have to defend Cromwell and the named Defendants against a second suit by the same
Plaintiffs related to allegedly interconnected zoning and taxation issues. Pls. Mem. of Law at 3
(“In the course of their dispute regarding the intended group home on Reiman Drive, Defendants
warned Gilead that if it continued to pursue legal recourse with respect to the Reiman property,
Defendants would deny the property tax exemption on Gilead’s other Cromwell property.”); see
also Hanlin v. Mitchelson, 794 F.2d 834, 841 (2d Cir. 1986) (Reversing the district court’s denial
of leave to amend where “the new claims are merely variations on the original theme of
malpractice, arising from the same set of operative facts as the original complaint. Moreover,
both the contract and negligence theories set forth in the proposed amended complaint were
forecast by the original malpractice allegations.”). A second suit thus would be improvident.
Finally, while Defendant is correct that section 12-117a of the Connecticut General
Statutes “set forth the appeal process regarding property tax decisions to superior court”, Defs.
Obj. at 7, the state statute does not require administrative exhaustion prior to filing a federal Fair
Housing Act claim. CONN. GEN. STAT. 12-117a. Connecticut courts have required plaintiffs to
exhaust local appeals processes before appealing to the state’s Superior Courts. See Tirado v.
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City of Torrington, 179 Conn. App. 95, 104–05, 179 A.3d 258, 264 (2018) (“The plaintiff
claimed that the defendant acted without authority when it issued a certificate of change and
added her motor vehicle to its 2004 grand list beyond the three year statute of limitations that the
plaintiff alleged was applicable . . . . that claim was appealable to the defendant’s Board of
Assessment Appeals and then, if she was dissatisfied with the board’s decision, to the Superior
Court.”).
Connecticut’s courts have not required plaintiffs to obtain an unfavorable Superior Court
ruling before filing in federal court. Furthermore, the federal Fair Housing Act does not require
administrative exhaustion. Gladstone Realtors v. Vill. of Bellwood, 441 U.S. 91, 103, (1979)
(“Contrary to petitioners’ contention, § 810 is not structured to keep complaints brought under it
from reaching the federal courts, or even to assure that the administrative process runs its full
course.”). And, Defendants have cited no law to support their contention that the ruling of a
Connecticut Superior Court is dispositive of a federal retaliation claim. Defs. Obj. at 7. The
Court therefore finds no sound basis to deny Plaintiffs’ motion to amend.
C. Viability of the Retaliation Claim
Under section 3617 of the Fair Housing Act, it is “unlawful to coerce, intimidate,
threaten, or interfere with any person” pursuing his or her rights under sections 3603, 3604,
3605, or 3606 of the Fair Housing Act. 42 USC § 3617. Section 3604(f)(2) prohibits
discrimination “against any person in the terms, conditions, or privileges of sale or rental of a
dwelling, or in the provision of services or facilities in connection with such dwelling, because of
a handicap of . . . (A) that person; or (B) a person residing in or intending to reside in that
dwelling after it is so sold, rented, or made available; or (C) any person associated with that
person.” 42 USC § 3604(f)(2).
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To establish a prima facie retaliation case, a plaintiff must show “that it was engaged in
protected activity, that the defendant was aware of this activity, that the defendant took adverse
action against the plaintiff, and a causal connection exists between the protected activity and the
adverse action, i.e., that a retaliatory motive played a part in the adverse . . . action.” Reg’l Econ.
Cmty. Action Program, Inc. v. City of Middletown, 294 F.3d 35, 53–54 (2d Cir. 2002)
(alterations in original). (“Finally, RECAP alleges that the defendants retaliated against it for
threatening to complain and actually complaining about the denial of the permit by withdrawing
funds committed to it by [Middletown] for a different project. We conclude that this allegation
states a claim . . . .”).
While Defendants have not raised the issue of futility, in determining whether to grant
leave to amend the Complaint, the Court has reviewed the issue and does not find Plaintiffs’
proposed amendment futile. Plaintiffs have plausibly pled a retaliation claim by alleging that
Plaintiffs provide housing services to individuals covered by the Fair Housing Act, Compl. ¶22,
that Defendants were aware of Plaintiffs’ proposed operation of the Reiman Drive residence, id.
¶ 2, that Defendants denied Plaintiffs’ recent tax exemption request, Defs. Obj. at 5, and that
such a denial could constitute an adverse action causally connected to Plaintiffs’ allegedly
protected activity at the Reiman Drive residence, Pls. Mem. of Law at 3 (“[A]t the very next
opportunity the Town had to review those properties that had been granted tax exemptions,
Gilead’s application was denied.”).
IV.
CONCLUSION
For the reasons set forth above, the Court now GRANTS Plaintiffs’ motion to amend the
Complaint, ECF No. 57.
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As a result of this ruling, Plaintiffs’ First Amended Complaint, ECF No. 57-1, is now the
operative Complaint for this case. To the extent that the current scheduling order needs to
modified as a result of this ruling, the parties should so move, jointly, if possible, by March 22,
2019.
SO ORDERED at Bridgeport, Connecticut, this 26th day of February, 2019.
/s/ Victor A. Bolden
VICTOR A. BOLDEN
UNITED STATES DISTRICT JUDGE
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