SCHOENSTEIN et al v. RICHARD E. CONSTABILE, III, COMMISSIONER
Filing
27
OPINION filed. Signed by Judge Joel A. Pisano on 11/26/2014. (mmh)
NOT FOR PUBLICATION
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY
MATTHEW SCHOENSTEIN, et al.,
Plaintiffs,
v.
RICHARD E. CONSTABLE, III,
COMMISSIONER, in his official capacity as
Commissioner of the NEW JERSEY
DEPARTMENT OF COMMUNITY AFFAIRS,
an agency of the State of New Jersey,
Defendant.
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Civil Action No. 13-6803 (JAP)
OPINION
PISANO, District Judge.
The Plaintiffs in this matter are a not for profit corporation and its subsidiary, which
operate a group home for men in recovery from alcohol and substance abuse, as well as a current
and prior resident of the group home, and the guarantor of the mortgage of the property where
the group home stands. They seek an injunction from this Court preventing the New Jersey
Department of Community Affairs (―DCA‖) from interfering with their use of the group home,
which is located in Somers Point, New Jersey. Plaintiffs filed this complaint after the owner of
the group home, Hansen House, LLC, and the operator of the group home, the Hansen
Foundation, Inc. (―Hansen Foundation‖), were fined by the DCA for illegally operating an
unlicensed boarding house (together, the ―Hansen Entities‖). The Hansen Entities were advised
to obtain a license or conform to the ―Oxford House‖ model, but Plaintiffs instead requested that
the DCA issue a waiver from that requirement. After an Office of Administrative Law hearing,
but before an initial decision was issued, Plaintiffs brought this suit, alleging that the DCA‘s
1
enforcement action violates federal and state law. Before the Court is a motion to dismiss
brought by the State Defendant Richard E. Constable, III, named only in his official capacity as
Commissioner of the New Jersey Department of Community Affairs (―Defendant‖ or the
―DCA‖). Plaintiffs oppose this motion. The Court heard oral argument on this matter on
November 19, 2014. For the reasons set forth below, the Court denies in part and grants in part
Defendant‘s motion.
I.
Background
The following allegations are summarized from the Complaint, and must be taken as true
in deciding this Motion to Dismiss.1
The Hansen Foundation is a nonprofit organization, whose main purpose is to help
recovering alcoholics and substance abusers. The Hansen Foundation founded Hansen House,
LLC (the ―LLC‖), which owns two ―Hansen Houses,‖ which are state-licensed facilities that
provide substance abuse treatment. The Hansen Houses are inpatient residential treatment
facilities, and are often referred to as ―halfway houses.‖ Residents of the Hansen Houses are
referred from jail and other substance abuse treatment programs, and typically live at the facility
for a period of three to six months. The Hansen House helps its residents find jobs, and provides
transportation to and from work. Except for when they are at work, the residents are supervised
by the Hansen House. The Hansen House transports the residents to 12-step meetings, and there
is on-site substance abuse treatment with licensed substance abuse counselors and a clinical
director. Plaintiffs allege that when residents of the Hansen House facilities complete treatment,
they go on to live at Oxford House, or some other living arrangement, depending on individual
1
See Newman v. Beard, 617 F.3d 775, 779 (3d Cir. 2010) (―We accept all factual allegations as true, construe the
amended complaint in the light most favorable to [the plaintiff], and determine whether, under any reasonable
reading of the…complaint, he may be entitled to relief.‖).
2
circumstances. Some of the residents will go on to become residents of the Randy Scarborough
Serenity House (the ―Serenity House‖).
The Serenity House is owned by the LLC, and is located at 6 Braddock Road, Somers
Point, New Jersey. It first opened in October 2011. The Serenity House is in a duplex being
used as a single family dwelling. It has no live-in staff or counselors, but is supervised by two
employees of the LLC. Residents of the Serenity House are referred from substance abuse
treatment facilities, drug courts, jails, or anyone seeking a recovery residence. The Serenity
House does not accept payments from the referral sources to take residents, nor does it take
accept payment for rent on behalf of the residents. The residents of the Serenity House are drug
tested, and the results are reported to the New Jersey Department of Probation and Parole if it is
a condition of the resident‘s residency at Serenity House. Residents of the Serenity House are
required to be employed, engaged in community service, or enrolled in school. Many residents
have criminal histories that hamper their ability to find employment. Residents sign a contract at
the Serenity House, which requires the payment of rent and a security deposit. The contract also
requires that the resident remain clean and sober, undergo drug testing, follow a curfew, and puts
a limitation on the number of guest visits. The contract also requires residents to attend a weekly
house meeting and attend at least four meetings a week at 12-step programs. Individual rent is
paid by each resident on a weekly basis to the LLC. The LLC pays all the house utilities and
bills. Plaintiffs allege that the residents of the Serenity House live as a family because they eat
together, shop together, and provide certain emotional support to each other.
On February 14, 2012, the DCA began investigating a complaint alleging that the
Serenity House had been operating illegally since October 20011 as an unlicensed rooming or
boarding house. The DCA determined that the residence was a boarding house as defined by
3
N.J. Stat. Ann. § 55:13B-3(a),2 and was operating without a license in violation of N.J. Stat. Ann.
§ 55:13B-7a(1).3 Angelo Mureo, the DCA investigator, informed Jennifer Hansen, the Serenity
House President, that the Serenity House must either become licensed or comply with the
―Oxford House‖ model. The Oxford House model was created as an exception to the
rooming/boarding house licensing requirement, and generally consists of four criteria to
distinguish it from a rooming/boarding house: (1) the residents lease the entire premises from
the landlord and are jointly and severally liable for the rent and utilities; (2) all of the expenses,
including rent and utilities for the premises, are paid from a single checking account rather than
individually; (3) there are no personal or financial services to the residents by the owner or
Oxford House, Inc.; and (4) in the event one resident leaves the premises, it is the residents who
decide who will fill the vacancy. Sobriety houses with these same attributes do not require a
license because they are considered to be single-family households under the Rooming and
Boarding House Act (the ―Act‖), N. J. Stat. Ann. §§ 55:13B-1 et seq. The Serenity House did
not qualify as an Oxford House because it was owned by the LLC, which held individual
contracts with the residents and paid expenses, and because the residents paid rent to the LLC
from their personal bank accounts, were supervised by two LLC members, and do not select
house members.
Ms. Hansen then requested a waiver as a reasonable accommodation under the Fair
Housing Act (―FHA‖), 42 U.S.C. §§ 3601 eq seq., but was instead advised by the DCA that the
Serenity House must obtain a license or modify its program to fit the Oxford House model. On
2
A boarding house is any building which ―contains two or more units of dwelling space arranged or intended for
single room occupancy, . . . and wherein personal or financial services are provided to the residents, . . . but
excluding . . . any owner-occupied, one-family residential dwelling made available for occupancy by not more than
six guests, where the primary purpose of the occupancy is to provide charitable assistance to the guests and where
the owner derives no income from the occupancy.‖ N.J. Stat. Ann. § 55:13B-3(a).
3
―No person shall own or operate a rooming or boarding house . . . without a valid license to own or operate such a
facility . . . .‖ N.J. Stat. Ann. § 55:13B-7a(1).
4
March 9, 2012, the DCA issued separate violation notices to the LLC and the Hansen Foundation
for violating N.J. Stat. Ann. § 55:13B-7a(1). By letter dated March 26, 2012, counsel for the
Hansen Foundation requested that the DCA treat the Serenity House in the same manner as it
treats Oxford House, and waive the imposition of the requirements for rooming and boarding
houses in the same manner as it does for the Oxford House. Upon receipt of this letter, the DCA
transmitted the matter to the Office of Administrative Law (―OAL‖) as a contested matter. On
March 29, 2012, the LLC and the Hansen Foundation appealed the DCA‘s decision. In a letter
dated August 8, 2012, the DCA denied a July 25, 2012 request by the LLC and the Hansen
Foundation for a waiver to the licensing requirement of the Act.
An OAL hearing was held on August 22, 2012, December 5, 2012, March 13, 2012, and
April 17, 2013. On November 8, 2013, Plaintiffs initiated this matter by filing a three-count
Complaint. On December 20, 2013, the Administrative Law Judge (the ―ALJ‖) issued an initial
decision affirming the DCA‘s determination. The DCA‘s final agency decision is pending. On
January 21, 2014, the DCA filed a motion to dismiss. On February 10, 2014, Plaintiffs4 filed a
six-count Amended Complaint. Plaintiffs allege, inter alia, that the DCA is denying and
otherwise making housing unavailable to Plaintiffs because of their disability5 and that the DCA
is treating the residents of the Serenity House in a discriminatory fashion by imposing ―far more
stringent fire, zoning, building, property maintenance and land use requirements on this group of
unrelated disabled individuals living together than it imposes upon individuals living together
who are related by blood or marriage or other grounds of unrelated disabled persons.‖ Am.
Compl. ¶ 102, see also Am. Compl. ¶¶ 100–104, 111.
4
Ole Hansen & Sons, Inc., the mortgage guarantor for the property on which the Serenity House stands, was not a
party in the first Complaint.
5
Plaintiffs assert that the Plaintiff-residents are ―handicapped‖ within the meaning of the FHA and the ADA as
recovering alcoholics and substance abusers.
5
Currently, the Plaintiffs are current Serenity House resident Matthew Schoenstein; former
resident Russell Muldowney; the Foundation; the LLC; and Ole Hansen & Sons, Inc. (―Hansen
& Sons‖). As mentioned, the State Defendant, named in his official capacity only, is DCA
Commissioner Richard E. Constable III, who is vested with the authority to enforce the Act
under N.J. Stat. Ann. 55:13B-4(f). Plaintiffs are primarily seeking declaratory and injunctive
relief, and allege violations of the FHA, the Americans With Disabilities Act (―ADA‖), 42
U.S.C. §§ 701 et seq., the New Jersey Law Against Discrimination (―NJLAD‖), N.J. Stat. Ann.
10:6-1 et seq., and the New Jersey Administrative Procedures Act (―NJAPA‖), N.J. Stat. Ann.
52:14B-1 et seq.
II.
Standard of Review
Federal Rule of Civil Procedure 12(b)(6) provides that a court may dismiss a complaint
―for failure to state a claim upon which relief can be granted.‖ Fed. R. Civ. P. 12(b)(6). When
reviewing a motion to dismiss, courts must first separate the factual and legal elements of the
claims, and accept all of the well-pleaded facts as true. See Fowler v. UPMC Shadyside, 578
F.3d 203, 210–11 (3d Cir. 2009). All reasonable inferences must be made in the Plaintiff's favor.
See In re Ins. Brokerage Antitrust Litig., 618 F.3d 300, 314 (3d Cir. 2010).
In order to survive a motion to dismiss, the plaintiff must provide ―enough facts to state a
claim to relief that is plausible on its face.‖ Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570
(2007). This standard requires the plaintiff to show ―more than a sheer possibility that a
defendant has acted unlawfully.‖ Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). A ―plaintiff's
obligation to provide the grounds of his entitle[ment] to relief requires more than labels and
conclusions, and a formulaic recitation of the elements of a cause of action will not do.‖
Twombly, 550 U.S. at 555 (internal quotations and citations omitted). When assessing the
6
sufficiency of a civil complaint, a court must distinguish factual contentions and ―[t]hreadbare
recitals of the elements of a cause of action, supported by mere conclusory statements.‖ Iqbal,
556 U.S. at 678. Any legal conclusions are ―not entitled to the assumption of truth‖ by a
reviewing court. Id. at 679. Rather, ―[w]hile legal conclusions can provide the framework of a
complaint, they must be supported by factual allegations.‖ Id. See also Fowler, 578 F.3d at 210
(explaining that a proper complaint ―must do more than allege a plaintiff's entitlement to relief‖).
Generally, a district court may not consider matters extraneous to the complaint when
determining a Rule 12(b)(6) motion to dismiss. See In re Burlington Coat Factory Sec. Litig.,
114 F.3d 1410, 1426 (3d Cir. 1997). This means that the district court relies on ―the complaint,
attached exhibits, and matters of public record.‖ Sands v. McCormick, 502 F.3d 263, 268 (3d
Cir. 2007). A district court may, however, appropriately consider ―a document integral to or
explicitly relied upon in the complaint may be considered without converting the motion to
dismiss into one for summary judgment.‖ Angstadt v. Midd–West Sch. Dist., 377 F.3d 338, 342
(3d Cir. 2004).
III.
Discussion
A.
Abstention
In its motion to dismiss, the DCA argues that this Court should abstain from hearing this
matter under either the Burford or Younger abstention doctrine. The Court notes that abstention
―is the exception, not the rule.‖ Colorado River Water Conservation Dist. v. United States, 424
U.S. 800, 813 (1976). Abstention
is an extraordinary and narrow exception to the duty of a District Court to
adjudicate a controversy properly before it. Abdication of the obligation to decide
cases can be justified under this doctrine only in the exceptional circumstances
where the order to the parties to repair to the state court would clearly serve an
important countervailing interest.
7
Id. (quoting County of Allegheny v. Frank Mashuda Co., 360 U.S. 185, 188–89 (1959)).
Because abstention results in a district court declining to exercise or postponing the exercise of
its jurisdiction, the issue of abstention must be determined first.
1.
Abstention under Burford
The Supreme Court has characterized Burford abstention, an extension of Burford v. Sun
Oil Co., 319 U.S. 315 (1943), as appropriate where ―exercise of federal review of the question in
a case and in similar cases would be disruptive of state efforts to establish a coherent policy with
respect to a matter of substantial public concern.‖ Colorado River, 424 U.S. at 814.
Determining whether Burford abstention is appropriate requires a two-step analysis by the court.
See New Orleans Public Service, Inc. v. City of New Orleans (―NOPSI‖), 491 U.S. 350, 361
(1989). First, the court must determine ―whether timely and adequate state law review is
available.‖ Matusow v. Trans-County Title Agency, LLC, 545 F.3d 241, 247 (3d Cir. 2008). If
such adequate review exists, the court
must decline to interfere with the proceedings or orders of state administrative
agencies: (1) when there are ―difficult questions of state law bearing on policy
problems of substantial public import whose importance transcends the result in
the case then at bar‖; or (2) where the ―exercise of federal review of the question
in a case and in similar cases would be disruptive of state efforts to establish a
coherent policy with respect to a matter of substantial public concern.‖
NOPSI, 491 U.S. at 361 (quoting Colorado River, 424 U.S. at 814). While the doctrine has
evolved over the years, the Supreme Court has made clear in more recent decisions that a narrow
interpretation of Burford abstention is appropriate. For example, in Zablocki v. Redhail, the
Court declared that ―there is, of course, no doctrine requiring abstention merely because
resolution of a federal question may result in overturning a state policy.‖ 434 U.S. 374, 379 n.5
(1978) (citation omitted). Because both parties agree that ―timely and adequate state law
8
review‖ is available, the Court turns to the issue of whether it must decline to exercise
jurisdiction under either prong of Burford.
Generally, the DCA argues that the Court should abstain because ―[f]ederal intervention
would disrupt State efforts to establish and maintain‖ the regulation of rooming and boarding
houses, and ―New Jersey courts are in the best position to consider the validity and
implementation of these regulations and policies.‖ Def.‘s Br. at 17. This argument, however,
misses the mark. The essence of Plaintiffs‘ argument is that the DCA‘s refusal to accommodate
Plaintiffs in their housing violates the FHA, as well as other federal and state antidiscrimination
statutes. Plaintiffs make clear that they are not contesting the validity or interpretation of the
Act, but rather the application of the Act as it pertains to them. See Pls.‘ Opp. Br. at 23; see also
Heritage Farms, Inc. v. Solebury Twp., 671 F.2d 743, 748 (3d Cir. 1982) (finding that Burford
abstention inapplicable because ―[t]he policies embodied in the Municipalities Planning Code are
not being attacked—it is rather the application of those policies by a single township that is at
issue‖); Oxford House-Evergreen v. City of Plainfield, 769 F. Supp. 1329 (D.N.J. 1991) (holding
that Burford abstention was not appropriate where the issue was whether a township‘s refusal to
modify the term ―family‖ as it applies to the plaintiffs violated the FHA). In other words, they
argue that the FHA requires that the DCA to create a reasonable accommodation to Plaintiffs by
expanding its interpretation of ―single-family‖ to include the Serenity House. Despite the DCA‘s
objections, a determination of whether the DCA was motivated by discriminatory considerations
would not disrupt the State‘s legitimate efforts in establishing its boarding and rooming house
regulations. See, e.g., Heritage Farms, 671 F.2d at 748 (explaining how Burford abstention did
not apply where plaintiffs claimed a violation of their constitutional rights under § 1983 because
9
the regulation ―simply does not address such behavior‖); see also Bryant Woods Inn, Inc. v.
Howard Cnty., Md., 124 F.3d 597, 602 (4th Cir. 1997).
In cases like this, where the heart of Plaintiffs‘ claims involves federal issues, the
justification for abstention is raised. See Colorado River, 424 U.S. at 814 n.21. While the DCA
argues that the regulations involved here are complex, the regulatory scheme here does not
approach the complexity of the one under scrutiny in Burford, which ―involved a complex
system of land and natural resources management designed to balance private property rights,
state revenues, market demand, the economically efficient extraction of oil and gas, and
environmental protection.‖ Disability Rights N.J., Inc. v. Velez, Civ. No. 10-3950, 2011 U.S.
Dist. LEXIS 79687, at *59–60 (D.N.J. July 20, 2011). The DCA also asserts that permitting the
waiver of the licensing requirements by the Court ―would have potentially far-reaching and
disruptive effects.‖ Def.‘s Br. at 16 (citing to Izzo, 843 F.2d at 769). The DCA claims that if the
Court allows this waiver, it would ―open the door‖ for any group of disabled person, no matter
how dissimilar to a single-family household, to circumvent the regulations. The Court finds this
concern both misplaced and overblown. First, Plaintiffs‘ request to be treated as a ―singlefamily‖ under the Act is similar, if not the same, request that was made by the Oxford House.
See e.g., Oxford House, 769 F. Supp. 1329. There has been no claim that allowing this recovery
facility to avoid regulation under the Act has resulted in any and every recovery house being
permitted to do the same. Second, and significantly, the Court does not believe that claims of
discrimination of handicapped individuals in violation of federal law are simply a matter of land
use policy relating to boarding houses. As the Oxford House Court pointed out, the FHA
provides that ―any law of a State, a political subdivision, or other such jurisdiction that purports
to require or permit any action that would be a discriminatory housing practice under this
10
subchapter shall to that extent be invalid.‖ 42 U.S.C. § 3615. Accordingly, the Court will not
decline to hear this case under Burford.
2.
Abstention under Younger
The DCA also argues that the Court should abstain under the Younger abstention
doctrine, a principle of abstention that emphasizes the importance of federal courts refraining
from enjoining or otherwise interfering with ongoing state proceedings. See Younger v. Harris,
401 U.S. 37, 43–45 (1971). Younger abstention ―espouse[s] a strong federal policy against
federal-court interference with pending state judicial proceedings absent extraordinary
circumstances.‖ Middlesex Cnty. Ethics Comm. v. Garden State Bar Ass’n, 457 U.S. 423, 431
(1982). When determining whether abstention is appropriate under Younger, district courts must
determine three requirements are satisfied: ―(1) there are ongoing state proceedings that are
judicial in nature; (2) the state proceedings implicate important state interests; and (3) the state
proceedings afford an adequate opportunity to raise the federal claims.‖ Addiction Specialists,
Inc. v. Twp. of Hampton, 411 F.3d 399, 408 (3d Cir. 2005) (citations and quotations omitted).
a.
Ongoing State Proceedings that are Judicial
First, the Court must determine that there are ―ongoing state proceedings that are judicial
in nature.‖ Plaintiffs do not dispute that there are ―ongoing state proceedings,‖ and have not
offered any evidence that the DCA has taken any final action on their request. Furthermore,
Plaintiffs have ―the right to appellate review by state courts if he wishes to challenge the final
decision of the [DCA.] Indisputably, these are judicial proceedings.‖ Zahl v. Harper, 282 F.3d
204, 209 (3d. Cir. 2009) (citing N.J. Ct. R. 2:2-3(a)(3)); see also Ex rel W.K. v. N.J. Div. of Dev.
Disabilities, 974 F. Supp. 791, 794–95 (D.N.J. 1997).
11
Plaintiffs, however, do dispute that the state proceedings fall within the scope of Younger.
The Supreme Court has clarified that abstention under Younger is only appropriate in three types
of proceedings: ―state criminal prosecutions,‖ ―civil enforcement proceedings,‖ and ―civil
proceedings involving certain orders uniquely in furtherance of the state courts‘ ability to
perform their judicial functions.‖ Sprint Commc’ns, Inc. v. Jacobs, 134 S. Ct. 584, 593 (2013)
(internal quotations and citations omitted). The Supreme Court explained that ―civil
enforcement proceedings‖ to which Younger applies typically involve state proceedings that are
―akin to a criminal prosecution in important respects.‖ Id. (quotation marks omitted). These
quasi-criminal actions are frequently ―initiated to sanction the federal plaintiff, i.e., the party
challenging the state action, for some wrongful act,‖ and ―a state actor is routinely a party to the
state proceeding and often initiates the action.‖ Id. (citations omitted). Finally, the Court found
that ―[i]nvestigations are commonly involved, often culminating in the filing of a formal
complaint or charges.‖ Id. (citations omitted). See also ACRA Turf Club, LLC v. Zanzuccki, 748
F.3d 127, 138 (3d Cir. 2014) (adopting the factors set out in Sprint as necessary to evaluate when
considering whether a state proceeding is ―quasi-criminal‖ in nature).
Here, the state proceedings at issue constitute a civil enforcement proceeding under
Sprint. The state proceeding was commenced by the DCA, a state agency. The DCA conducted
an investigation into whether the Hansen Foundation and the LLC, two of the federal Plaintiffs,
were wrongfully violating the Act after receiving a formal complaint. The investigation led to a
conclusion by the DCA that the Hansen Foundation and the LLC were operating an illegal
boarding house in violation of the Act. The DCA then issued violation notices and imposed
sanctions. Thereafter, a formal hearing was conducted in the Office of Administrative Law, at
which the parties introduced testimony and documentary evidence, and cross-examined
12
witnesses. After this hearing, the Administrative Law Judge issued an Initial Decision, which
the DCA will accept, reject, or modify consistent with the record. An automatic right to
appellate review of the final decision is available. See Zahl, 282 F.3d at 209 (citing N.J. Ct. R.
2:2-3(a)(2)). Accordingly, the Court finds that the state proceeding at issue here bears the
hallmarks of a ―quasi-criminal‖ action, and is satisfied that Younger‘s first prong is satisfied.
b.
The State Administrative Proceedings Must Implicate an Important
State Interest
Next, under the second prong of Younger abstention, the DCA argues that the state
proceedings implicate important state interests, as the proceedings deal with the DCA‘s
enforcement of the Act, which was enacted ―to provide for the health, safety and welfare of all
those who reside in rooming and boarding houses in this State.‖ See Def.‘s Br. at 24 (quoting
N.J. Stat. Ann. § 55:13B-2). The mere fact that the background of a case arose out of a dispute
with the DCA ―is not enough to say that the federal proceeding would interfere with state
proceedings that involve important state interests for Younger abstention purposes.‖ Addiction
Specialists, 411 F.3d at 409. As discussed above, these proceedings do not deal with the validity
of the Act; rather, Plaintiffs challenge the DCA‘s actions in making certain determinations under
the Act. The Third Circuit had explained that a determination of whether state interest are
implicated under Younger depends in large part on whether the proceeding challenges an
official‘s actions or a state‘s policies; where a federal plaintiff seeks to challenge an official‘s
actions that may infringe upon his federal rights likely does not implicate important state
interests. See Addiction Specialists, 411 F.3d at 409–10 (―[A] federal claim challenging the
discriminatory actions of township officials in making land use decisions—as opposed to a claim
challenging the validity of the state‘s land use policies and laws—did not implicate important
state interests for Younger abstention purposes.‖) (citing Gwynedd Props. v. Lower Gwynedd
13
Twp., 970 F.2d 1195, 1202–03 (3d Cir. 1992)). Considering that the Plaintiffs here are arguing
that the DCA‘s in enforcing the Act was motivated by discriminatory considerations in violation
of the FHA, the Court finds that important state interests are not implicated for Younger
abstention purposes. See Addiction Specialists, 411 F.3d at 409. Accordingly, because
Plaintiffs‘ claims alleging that the DCA, through its actions, violated certain federal statutory
rights do not implicate important state interests, abstention under Younger is not appropriate.
The Court therefore will exercise jurisdiction over these claims, and will turn to the merits of
Plaintiffs‘ Complaint.
B.
Eleventh Amendment Immunity
The DCA next argues that the Court lacks subject-matter jurisdiction over Plaintiffs‘ state
law claims pursuant to the Eleventh Amendment. It asserts that the Eleventh Amendment
prohibits suits against a state by citizens of other states, as well as suits against a state or state
agency by its own citizens. Pennhurst State Sch. v. Halderman, 465 U.S. 89, 100 (1984).
Significantly, the Supreme Court held in Pennhurst held that federal courts are barred by the
Eleventh Amendment from enjoining state officers from violating state law. See 465 U.S. at
101–02, 121 (―[A] claim that state officials violated state law in carrying out their official
responsibilities is a claim against the State that is protected by the Eleventh Amendment. . . .We
now hold that this principle applies as well to state-law claims brought into federal court under
pendent jurisdiction.‖) (citation omitted). Further, while federal courts may hear federal claims
against state officers, they may not hear supplemental state-law claims. See Pennhurst, 465 U.S.
at 118–21; see also Kentucky v. Graham, 473 U.S. 159, 169 n.18 (1985) (explaining that a state‘s
immunity can be overcome by naming state officials as defendants in an injunctive action
grounded in state law); Raygor v. Regents of Univ. of Minn., 534 U.S. 533, 540–42 (2002)
14
(holding that supplemental jurisdiction under 28 U.S.C. § 1367(a), like pendant jurisdiction
before it, does not extend to claims against nonconsenting state defendants).
Here, Plaintiffs attempt to bring several state law claims against the Commissioner of the
DCA in his official capacity. These state law claims are clearly barred under the Eleventh
Amendment, see Pennhurst, 465 U.S. at 121, and must be dismissed. Accordingly, Plaintiffs‘
state law claims found in Counts IV through VI of Plainiffs‘ Amended Complaint are dismissed
with prejudice, as well as any claims of state law violations that may exist in Counts I through
III.
C.
Plaintiffs’ Federal Claims
The DCA next argues that Plaintiffs‘ federal claims under the FHA, ADA, and RA must
be dismissed under Rule 12(b)(6) for failure to state a claim. Due to the similarity between the
FHA, ADA, and RA, ―courts have concluded that the FHA[] analysis can be applied to ADA and
[RA] claims as well in such cases where claims are brought under all three statutes.‖ In re Lapid
Ventures, LLC v. Twp. of Piscataway, Civ. No. 10-6219, 2011 U.S. Dist. LEXIS 63973, at *14
(D.N.J. June 13, 2011) (citing Reg'l Econ. Cmty. Action Program v. City of Middletown, 294
F.3d 35, 45–46 (2d Cir. 2002)). Therefore, the Court analyzes Plaintiffs‘ claims under the FHA
to determine if they have sufficiently stated a claim.
As an initial matter, the parties agree that the FHA‘s protections apply to recovering
alcoholics and addicts who are not currently using an illegal substance.6 See Easter Seals Soc.,
6
Under the FHA, ―handicap‖ is defined as:
(1) a physical or mental impairment which substantially limits one or more of such person's major life activities;
or
(2) a record of having such impairment; or
(3) being regarded as having such impairment, but such term does not include current, illegal use of or addiction
to a controlled substance. . . .
42 U.S.C. § 3602(h).
15
Inc. v. N. Bergen, 798 F. Supp. 228, 233 (D.N.J. 1992) (citing 42 U.S.C. §§ 3617, 3602(h)); see
also Sullivan, 811 F.2d at 182 (―Case law establishes that alcoholics are handicapped within the
meaning of [the RA].‖). Therefore, the consideration is whether Plaintiffs have sufficiently pled
facts to establish that the DCA has unlawfully discriminated against them, either by failing to
make reasonable accommodations for Plaintiffs, or by intentionally discriminating against
Plaintiffs or by retaliating against Plaintiffs for exercising their legal rights. See Pls.‘ Opp. Br. at
35–37.
1.
Reasonable Accommodation Claim
As defined under the FAA, discrimination includes ―a refusal to make reasonable
accommodations in rules, policies, practices, or services, when such accommodations may be
necessary to afford such person equal opportunity to use and enjoy a dwelling.‖ 42 U.S.C. §
3604(f)(3)(B). While the Third Circuit has yet to articulate a clear standard for reasonable
accommodation claims under the FHA, see Bedell v. Long Reef Condo. Homeowners Ass’n,
Civil No. 2011-051, 2013 U.S. Dist. LEXIS 17203, at *17 (D.V.I. Dec. 6, 2013), district courts
in this Circuit have held that a plaintiff must show the following elements in order to make out a
claim for a FHA violation based on failure to provide a reasonable accommodation:
i) that he is suffering from a disability as defined under 42 U.S.C. § 3602(h)(1); ii)
that the Defendants knew or reasonably should have been expected to know of the
disability; iii) that reasonable accommodation of [plaintiff‘s] disability might be
necessary to afford him an equal opportunity to use and enjoy his dwelling; and
iv) that the Defendants refused to make a reasonable accommodation.
United States v. Port Liberte Condo 1 Ass’n., Civ. No. 04-2783, 2006 U.S. Dist. LEXIS 70573,
at *13 (D.N.J. Sept. 20, 2006) (citing United States v. California Mobile Home Park Mgmt. Co.,
107 F.3d 1374, 1380 (9th Cir. 1997)). A reasonable accommodation inquiry ―is highly factspecific, requiring a case-by-case by case determination.‖ Hovsons, Inc. v Twp. of Brick, 89 F.3d
16
1096, 1104 (3d Cir. 1996) (quoting California Mobile Park, 29 F.3d at 1418). A reasonable
accommodation claim operates under a burden-shifting analysis, wherein ―a plaintiff must show
that the requested accommodation was necessary in order for handicapped persons to have an
equal opportunity to use and enjoy a dwelling‖ in order to establish a prima facie case. Dr.
Gertrude A. Barber Center, Inc. v. Peters Tp., 273 F. Supp. 2d 643, 652 (W.D. Pa. 2003) (citing
Lapid-Laurel v. Zoning Bd. of Adjustment, 284 F.3d 442, 457 (3d Cir. 2002)). Thereafter, the
defendant bears the burden of showing that the requested accommodation was unreasonable. See
Lapid-Laurel, 284 F.3d at 459.
Here, the DCA disputes that Plaintiffs have alleged any facts that establish a causal nexus
necessary for a reasonable accommodation claim. In Lapid-Laurel, the Third Circuit emphasized
―that the plaintiff in an FHAA reasonable accommodations case must establish a nexus between
the accommodations that he or she is requesting, and their necessity for providing handicapped
individuals an ‗equal opportunity‘ to use and enjoy housing.‖ Id. at 459. In other words, under
Third Circuit law, a reasonable accommodation claim demands ―a causal nexus between the
requested accommodation and the requested accommodation‘s necessity for providing
handicapped individuals an equal opportunity to use and enjoy housing.‖ Bell v. Tower Mgmt.
Serv., L.P., Civil Action No. 07-CV-5305, 2008 U.S. Dist. LEXIS 53514, at *19 (D.N.J. July 15,
2008) (quoting Lapid-Laurel, 248 F.3d at 459, 460) (internal quotations and citations omitted).
In terms of what constitutes an ―equal opportunity‖ under the FHA, the Third Circuit has
approvingly cited the Sixth Circuit‘s finding that the FAA defines ―equal opportunity‖ as
providing ―handicapped individuals the right to choose to live in single-family neighborhoods,
for that right serves to end the exclusion of handicapped individuals from the American
mainstream.‖ Lapid-Laurel, 248 F.3d at 459–60 (quoting Smith & Lee Associates, Inc. v. City of
17
Taylor, 102 F.3d 781 (6th Cir. 1996)); see also McKivitz v. Twp. of Stowe, 769 F. Supp. 2d 803,
825–26 (W.D. Pa. 2010); Bryant Woods Inn, Inc. v. Howard County, 911 F. Supp. 918, 946 (D.
Md. 1996) (―The Act prohibits local governments from applying land use regulations in a
manner that will exclude people with disabilities entirely from zoning neighborhoods,
particularly residential neighborhoods, or that will give disabled people less opportunity to live
in certain neighborhoods than people without disabilities.‖), aff'd 124 F.3d 597 (4th Cir. 1997).
To be ―necessary,‖ a plaintiff must demonstrate a direct link between the requested
accommodation ―and the ‗equal opportunity‘ to be provided to the handicapped person. . . . And
if the proposed accommodation provides no direct amelioration of a disability‘s effect, it cannot
be said to be necessary.‖ Lapid-Laurel, 248 F.3d at 460 (quoting Bryant Woods Inn, Inc. v.
Howard County, 124 F.3d 597, 604 (4th Cir. 1997)).
Here, Plaintiffs‘ reasonable accommodation claim is based on their assertion that waiving
the licensing requirement under the Act was necessary to provide handicapped individuals with
an equal opportunity to live in the Serenity House and participate in its program. See e.g., Am.
Compl. ¶ 110. Plaintiffs have alleged that the conduct of the DCA has resulted in the denial of
disabled persons being unable to live in residential zoning districts within New Jersey. See id. at
¶ 101, 103. Plaintiffs have asserted that the Serenity House operates as sort of a ―step up‖ from
the Oxford House model, but a ―step down‖ from a halfway house. See Certification of Susan
Sharpe (―Sharpe Cert.‖) Ex. A at 4. Plaintiffs felt that some recovering alcoholics and drug
addicts were ―falling through the cracks‖ because they needed more support than the Oxford
House model provided. Id. The Serenity House serves these clients that require a higher level of
structure and assistance than they would otherwise receive at the Oxford House. See id. at 13.
In other words, Plaintiffs assert that there are features of the Serenity House that are necessary to
18
prevent certain recovering alcoholics and substance abusers from potentially failing at their
recovery. Accordingly, the Serenity House is the only way that certain handicapped individuals
may live in single-family neighborhoods, and the DCA is ―making single family housing
unavailable to persons recovering from drug and alcohol addiction.‖ Am. Compl. ¶ 103.
Assuming this is true, Plaintiffs have successfully alleged that their requested accommodation
―would serve a therapeutic purpose (and would therefore be necessary to ameliorate an effect of
the handicap),‖ and therefore have alleged a causal link between the disabilities addressed by the
facility and the accommodation. Lapid-Laurel, 284 F.3d at 461 (citations omitted).
Accordingly, at this stage of proceedings, Plaintiffs have appropriately alleged a claim for failure
to accommodate, and the motion to dismiss on that ground is denied.
2.
Intentional Discrimination Claim
A plaintiff can establish a prima facie claim of housing discrimination under FHA by
showing that the challenged actions were motivated by intentional discrimination or that the
actions had a discriminatory effect on a protected class, regardless of motivation. Cmty. Svcs.,
Inc. v. Wind Gap Mun. Auth., 421 F.3d 170, 176 (3d Cir. 2005); Doe v. City of Butler, Pa., 892
F.2d 315, 323 (3d Cir. 1989). Plaintiffs appear to seek a violation of the FHA under the
intentional discrimination prong of the FHA, rather than the discriminatory effect. A claim for
intentional discrimination under this prong of the FHA can be established ―by showing that
discriminatory intent against a protected group was a motivating factor for the challenged
action.‖ Eastampton Ctr. v. Twp. of Eastampton, 155 F. Supp. 2d 102, 111 (D.N.J. 2001).
While it is not necessary that the discriminatory purpose is ―malicious or invidious, nor need it
figure in ‗solely, primarily, or even predominantly‘ into the motivation behind the challenged
action,‖ a plaintiff must establish that ―the protected characteristic played a role in the
19
defendant‘s decision to treat her differently.‖ Cmty. Servs., 421 F.3d at 177 (quotations and
citations omitted). When considering if discriminatory intent has been established, courts
consider the following factors: ―(i) discriminatory impact of the challenged practice or policy;
(ii) the historical background of the challenged decision; (iii) the ‗sequence of events leading up
to the challenged decision;‘(iv) departures from ‗normal procedural sequences;‘ (v) departures
from normal substantive criteria; and (vi) legislative or administrative history of the challenged
decision.‖ Id. (citing Resident Advisory Bd. v. Rizzo, 564 F.2d 126, 142 n.22 (3d Cir 1977)).
In this case, Plaintiffs have alleged that the DCA‘s policy of refusing to exempt or
accommodate non- ―Oxford House-like‖ houses constitutes intentional discrimination.
Specifically, Plaintiffs have alleged that the DCA refused to consider a waiver or exception to
the requirements of the Act for the Serenity House, see Am. Compl. ¶¶ 50–85, and that the DCA
is ―imposing far more stringent fire, zoning, building, property maintenance and land use
requirements on this group of disabled individuals living together than it imposes upon
individuals living together who are related by blood or marriage or other groups of unrelated
disabled persons.‖ Id. at ¶ 102. See Bangerter v. Orem City Corp., 46 F.3d 1491, 1501 (10th
Cir. 1995) (affirming that a complaint set forth a claim of intentional discrimination where it
alleged that a protected group was subjected to explicitly different treatment). Accordingly, at
this stage of the proceedings, the Court finds that Plaintiffs have sufficiently alleged a plausible
claim for intentional discrimination, and denies the DCA‘s motion to dismiss.
3.
Retaliation Claim
Finally, Plaintiffs bring a claim for retaliation in violation of 42 U.S.C. § 3617. Section
3617 provides that:
It shall be unlawful to coerce, intimidate, threaten or interfere with any person in
the exercise or enjoyment of, or on account of his having exercised or enjoyed, or
20
on account of his having aided or encourage any other person in the exercise or
enjoyment of, any right granted or protected by section 3603, 3604, 3605 or 3606
of this title.
42 U.S.C. § 3617. Accordingly, to establish a claim for retaliation under the FHA, a plaintiff
must establish that the defendant ―interfered with‖ their rights under the FHA. Typically, ―the
language ‗interfere with‘ has been broadly applied,‖ Sporn v. Ocean Colony Condo. Ass'n, 173
F. Supp. 2d 244, 252 (D.N.J. 2001) (quoting Michigan Advocacy Serv. v. Babin, 18 F.3d 337,
347 (6th Cir. 1994)), and has been interpreted as having the same scope of Section 3604(f) of the
FHA. This means that retaliation claims can apply to ―those who used some sort of ‗potent force
or duress,‘ but extends to other actors who are in a position directly to disrupt the exercise or
enjoyment of a protected right and exercise their powers with a discriminatory animus.‖ Babin,
18 F.3d at 347.
The Court finds that Plaintiffs have put forward a plausible set of facts that the DCA
violated § 3617 by interfering with the exercise and enjoyment of the Plaintiffs‘ right to fair
housing. Section 3617 is broadly interpreted, and applies to ―less obvious, but equally illegal‖
acts done with discriminatory animus. Babin, 18 F.3d at 347. Here, Plaintiffs have alleged facts
showing that the DCA ―interfered with‖ their rights as handicapped individuals to live as a group
in any residential zoning district in New Jersey, see Am. Compl. ¶ 101, and that the DCA had an
apparent policy of refusing to exempt sobriety homes that did not fit the ―Oxford House‖ model
from licensing requirements under the Act. See id. at ¶¶ 50–84. At this stage of the proceedings,
such allegations are sufficient for a claim of retaliation under 42 U.S.C. § 3617. Accordingly,
Defendant‘s motion to dismiss is denied.
21
IV.
Conclusion
For the reasons stated above, Defendant DCA‘s Motion to Dismiss is denied in part and
granted in part.7 Plaintiffs‘ state law claims are dismissed with prejudice against the remaining
Plaintiffs because this Court lacks subject-matter jurisdiction over them pursuant to the Eleventh
Amendment. At this stage of the proceedings, Plaintiffs have sufficiently set forth a plausible set
of facts for their federal claims, and the DCA‘s motion to dismiss these claims is denied. An
appropriate Order accompanies this Opinion.
/s/ Joel A. Pisano
JOEL A. PISANO, U.S.D.J.
Dated: November 26, 2014
7
The DCA has also moved to dismiss Ole Hansen for lack of standing. After considering the parties‘ arguments,
the Court will deny, without prejudice, the DCA‘s motion at this stage of the proceedings.
22
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