Metropolitan St. Louis Equal Housing & Opportunity Council v. Jezewak et al

Filing 31

OPINION MEMORANDUM AND ORDER IT IS HEREBY ORDERED that Defendants Motion to Dismiss, [Doc.No. 25], is granted. IT IS FURTHER ORDERED that Plaintiff is given 14 days from the date of this Opinion, Memorandum and Order to file an amended complaint. 25 ( Response to Court due by 8/12/2014.) Signed by District Judge Henry Edward Autrey on 7/29/14. (CLA)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
EASTERN DIVISION
METROPOLITAN ST. LOUIS EQUAL
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HOUSING &OPPORTUNITY COUNCIL, )
)
Plaintiff,
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)
v.
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NORMAN L. JEZEWAK, and
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SIGNATURE PROPERTY, L.L.C.
)
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Defendants,
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Case No. 4:13CV481 HEA

OPINION, MEMORANDUM AND ORDER
This matter is before the Court on Defendants’ Motion to Dismiss. [Doc. No.
25]. For the reasons set forth below, the Motion is granted.
Facts and Background1
Plaintiff filed this action alleging the following facts:
Plaintiff periodically conducts investigations of housing providers in the
City of St. Louis to ensure that they are complying with the Fair Housing Act. As
part of these investigations, Plaintiff conducts matched pair tests using testers to
compare the treatment afforded by housing providers to different types of
prospective renters. Testers are persons who, without the intent to rent an
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The recitation of facts is taken from Plaintiff’s First Amended Complaint and is taken as true
for the purposes of this motion. Such recitation in no way relieves any party from the necessary
proof thereof in later proceedings.
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apartment or buy a house, gather information about housing for rent or sale in
order to help determine whether discriminatory practices are occurring. In matched
pair tests, two similarly-situated testers – one of whom is a member of a protected
class and the other of whom is not – test the same property.
Between June 6, 2011, and September 20, 2011, Plaintiff conducted three
matched pair tests of a property located at 5847 Sunshine Drive, St. Louis, MO
63109, owned by Defendant Signature Property, and managed by Defendant
Jezewak. Plaintiff conducted a matched pair test for familial status discrimination
on June 6-8, 2011, a second matched pair test for familial status discrimination on
September 20, 2011, and a matched pair test for race discrimination on July 7-12,
2011.
The two tests for familial status discrimination revealed evidence that
Defendant Jezewak engaged in discriminatory practices including, but not limited
to, the following:
a. Refusing to make one-bedroom units available for inspection by twoperson households with children while indicating a willingness to make the same
units available for inspection by two-person households without children;
b. Informing testers who indicated that they had children that he would not
rent to them because of his property insurance’s underwriting policy; and

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c. Informing testers who indicated that they had children that each resident
needed to have his or her own room because of his property insurance’s
underwriting policy.
The matched pair test for racial discrimination revealed evidence that
Defendant Jezewak engaged in discriminatory practices including, but not limited
to, the following:
a. Questioning the African-American tester extensively about his credit
score while not similarly questioning the white tester;
b. Questioning the African-American tester more extensively about his
current neighborhood than he did the white tester; and
c. Stating that less-desirable kinds of people tend to live in the AfricanAmerican tester’s current neighborhood.
The property insurance policy for the property located at 5847 Sunshine
Drive, St. Louis, MO 63109 was provided by State Farm at all times between June
6, 2011 and September 20, 2011. In an email dated February 24, 2012, Freund
(Jezewak’s insurance agent with State Farm and/or IPS) advised Jezewak that
children should have separate rooms from their parents under State Farm’s
underwriting policy. When Freund sent said email to Jezewak, Freund was acting
on behalf of State Farm and/or IPS in his capacity as an agent, within the scope of

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his employment, and in furtherance of the business interests of State Farm and/or
IPS.
Plaintiff claims that Defendants’ actions constitute housing discrimination in
violation of 42 U.S.C. § 3601, et seq.
Standard
A defendant may file a motion to dismiss for failure to state a claim upon
which relief can be granted. Fed.R.Civ.P. 12(b)(6). “To survive a motion to
dismiss, a complaint must contain sufficient factual matter, accepted as true, to
‘state a claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S.
662, 678 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570
(2007)). In other words, a plaintiff must plead facts from which the court can draw
a “reasonable inference” of liability. Iqbal, 556 U.S. at 678. The complaint need
not contain “detailed factual allegations” but must contain more than mere “labels
and conclusions, and a formulaic recitation of the elements” or “naked
assertion[s]” devoid of “further factual enhancement.” Twombly, 550 U.S. at 555,
557. An “unadorned, the-defendant-unlawfully-harmed-me accusation” will not
suffice. Iqbal, 556 U.S. at 678. “While legal conclusions can provide the
framework of a complaint, they must be supported by factual allegations,” id. at
679, which “raise a right to relief above the speculative level,” Twombly, 550 U.S.
at 555.

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In evaluating a motion to dismiss, the court can “choose to begin by
identifying pleadings that, because they are no more than conclusions, are not
entitled to the assumption of truth.” Iqbal, 556 U.S. at 679. Turning to any “wellpleaded factual allegations,” the court should “assume their veracity and then
determine whether they plausibly give rise to an entitlement to relief.” Id. The
court may only consider the initial pleadings. Brooks v. Midwest Heart Grp., 655
F.3d 796, 799 (8th Cir.2011).
Discussion
Defendants move to dismiss for lack of standing. Defendants contend that
Plaintiff lacks Article III standing, which requires a plaintiff to have suffered an
injury-in-fact “that has a causal connection with the challenged [ ] action that likely
will be redressed by a favorable decision.” Missouri Coalition for Environment v.
F.E.R.., 544 F.3d 955, 957 (8th Cir. 2008), citing Lujan v. Defenders of Wildlife,
504 U.S. 555, 560-61 (1992).
The Complaint alleges that its “mission is to ensure equal access to housing
for all people through education, counseling, investigation, and enforcement,” that
it “periodically conducts investigations of housing providers in the City of St.
Louis to ensure that they are complying with the Fair Housing Act. As part of these
investigations, EHOC conducts matched pair tests using testers to compare the
treatment afforded by housing providers to different types of prospective renters,”

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that “between June 6, 2011, and September 20, 2011, EHOC conducted three
matched pair tests of a property located at 5847 Sunshine Drive, St. Louis, MO
63109, owned by Signature Property, and managed by Jezewak,” that “the two
tests for familial status discrimination revealed evidence that Jezewak engaged in
discriminatory practices….,” that “the matched pair test for racial discrimination
revealed evidence that Jezewak engaged in discriminatory practices,” that
Defendants have frustrated the purpose and diverted the resources of EHOC
through the discriminatory acts identified herein.
The Supreme Court has stated that “more than simply a setback to the
organization's abstract social interests” is required for establishing an injury-infact. Havens Realty Corp. v. Coleman, 455 U.S. 363, 379 (1982).
In Arkansas ACORN Fair Housing, Inc. v. Greystone Development, 160
F.3d 433, 434-35 (8th Cir. 1998), the Eighth Circuit acknowledged that the
deflection of a fair housing organization's monetary and human resources from
counseling or educational programs to legal efforts aimed at combating
discrimination, such as monitoring and investigation, can be sufficient to constitute
an actual injury where traceable to some act by the defendant. However, the tests
conducted in this case are alleged as a result of the periodic testing performed by
the EHOC. Plaintiff alleges in its Complaint that part of the EHOC’s mission is to
“periodically conduct[] investigations of housing providers.” Thus, the alleged

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discriminatory acts of Defendants were discovered as a result of the periodic
investigations of housing providers.
Defendants, however, acknowledge that Plaintiff has, in its opposition to the
motion, set out additional allegations which may satisfy the standing requirements
for this action, i.e., that Plaintiff diverted resources for additional testing which
would not have been diverted but for the alleged discrimination discovered by the
testers. The Court, therefore will allow Plaintiff to file an amended complaint.
Conclusion
Based on the foregoing, the Court grants Defendants' Motion to Dismiss
Plaintiff's Complaint. Plaintiff will be given leave to file an amended complaint.
Accordingly,
IT IS HEREBY ORDERED that Defendants’ Motion to Dismiss, [Doc.
No. 25], is granted.
IT IS FURTHER ORDERED that Plaintiff is given 14 days from the date
of this Opinion, Memorandum and Order to file an amended complaint.
Dated this 29th day of July, 2014.

_______________________________
HENRY EDWARD AUTREY
UNITED STATES DISTRICT JUDGE

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