Freedom's Path at Dayton v. Dayton Metropolitan Housing Authority

Filing 17

REPORT AND RECOMMENDATIONS In light of the above discussion concerning Plaintiffs present, non-speculative injury in fact, supra, § III, particularly its financial injury, and given GDPMs opposition to Plaintiffs assertion of standing and the me rits of its claims, the amended complaint asserts sufficient allegations to make Plaintiffs FHA claim ripe and fit for adjudication.Deferring consideration of the parties dispute over Plaintiffs FHA claim will cause them hardship by leaving unresolve d the issue of whether Plaintiff is entitled to relief in the form of damages, declaration, or injunction. IT IS THEREFORE RECOMMENDED THAT: Defendant GDPMs Motion to Dismiss under 12(b)(1) and 12(b)(6) (Doc. # 7 ) be denied. Objections to R&R due by 9/5/2017. Signed by Magistrate Judge Sharon L. Ovington on 8/22/17. (kma)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF OHIO
WESTERN DIVISION AT DAYTON

DAYTON VETERANS RESIDENCES
LIMITED PARTNERSHIP, d/b/a
Freedom’s Path at Dayton,

:
:
:
:
Plaintiff,
:
:
vs.
:
:
DAYTON METROPOLITAN
HOUSING AUTHORITY, d/b/a Greater :
:
Dayton Premier Management,
:
:
Defendant.

Case No. 3:16-cv-00466
District Judge Walter H. Rice
Magistrate Judge Sharon L. Ovington

REPORT AND RECOMMENDATIONS1
I.

Introduction
Plaintiff Dayton Veterans Residences Limited Partnership, doing business as

Freedom’s Path at Dayton (Plaintiff), is a Florida limited partnership authorized to do
business in Ohio. It describes itself as, “A sole purpose entity formed specifically for the
purpose of developing and owning the 60 units of affordable housing in Dayton that will
serve United States Veterans ….” (Doc. #6, PageID #48, ¶5). Most of the veterans it
seeks to house in its development are “persons with disabilities.” Id. at ¶13.
Dayton Metropolitan Housing Authority, doing business as Greater Dayton
Premier Management (GDPM), is a federal public housing agency operating in

1

Attached is a NOTICE to the parties regarding objections to this Report and Recommendations.

Montgomery County, Ohio and the greater Dayton, Ohio region. Its mission is, in part, to
operate public housing for low-income individuals, seniors, and families.
Plaintiff alleges that Defendant GDPM blocked Plaintiff’s attempts to obtain
financing it needed to develop and own 60 units of low-income housing for veterans in
Dayton. Defendant GDPM did so, according to the amended complaint, with
discriminatory intent and with discriminatory effect in violation of the Fair Housing Act
of 1968, as amended, 42 U.S.C. § 3601, et seq., and the Americans with Disabilities Act
of 1990, as amended, 42 U.S.C. §12101, et seq.2
The case is presently before the Court upon Defendant GDPM’s Motion to
Dismiss under 12(b)(1) and 12(b)(6) (Doc. #7), Plaintiff’s Response in Opposition (Doc.
#9), Defendant GDPM’s Reply (Doc. #10), Plaintiff’s Surreply (Doc. #16), and the
record as a whole. The issues the parties raise broadly concern whether Plaintiff has
standing to pursue, whether its amended complaint states a plausible claim upon which
relief can be granted, and whether its claims are not ripe for review.
II.

Background
To understand the factual context from which Plaintiff’s claims emerge requires

discussion of the federal housing program known as Veterans Affairs Supportive
Housing (VASH) and its connection to this case. Plaintiff’s amended complaint informs
the discussion. See Warth v. Seldin, 422 U.S. 490, 501 (1975) (“ For purposes of ruling
2

Because of the similarities between disability discrimination claims under the FHA and ADA, references
herein to the FHA speaks to the ADA as well (excluding Plaintiff’s ADA reasonable-accommodation
claim). See, e.g., Forziano v. Independent Group Home Living Program, Inc., 613 Fed. App’x 15, 18 (2nd
Cir. 2015)

2

on a motion to dismiss for want of standing, ... the ... [C]ourt must accept as true all
material allegations of the complaint, and [it] must construe the complaint in favor of the
complaining party.”); see also DLX, Inc. v. Kentucky, 381 F.3d 511, 516 (6th Cir. 2004).
VASH “is a federal program that is allocated to public housing authorities in two
forms”: a tenant-based form and a project-based form. (Doc. #6, PageID #49, ¶10).
“The VASH program combines rental assistance for homeless veterans with case
management and clinical services provided by the Department of Veterans Affairs.” Id.
at ¶17. Plaintiff’s goal is to use VASH project-based rental assistance to house veterans,
most of whom are disabled, in a development known as Freedom Path-Dayton VA on the
VA Medical Center’s campus in Dayton. Id. at ¶s 25, 28.
“On April 9, 2013, … under the leadership of Alphonzio Prude, GDPM’s Interim
Chief Executive Officer, GDPM extended its support for Plaintiff’s new development on
the campus of the VA Medical Center and committed thirty-three … project-based
vouchers.” Id. at ¶28. This support was extended through a Program the amended
complaint identifies as “Housing Choice Awards.” Id. at ¶s 23, 28. The amended
complaint describes Housing Choice Awards as “another kind of housing assistance ….”
Id. at ¶29.
Plaintiff alleges that Prude’s/GDPM’s affirmative commitment to provide 33
project-based through Housing Choice Awards supported Plaintiff’s goal of provide
housing assistance to disabled and other veterans on the VA Medical Center’s campus in
Dayton. (A copy of Prude’s commitment letter is attached to the amended complaint. Id.
at ¶29 (and Exhibit A)). The connection between Housing Choice Awards and VASH

3

project-based vouchers is that HUD administers the VASH program “in accordance with
most of the requirements that apply to Housing Choice Vouchers ….”3 Id. at ¶23. The
import of this emerges from Prude’s letter in which he states that GDPM’s Housing
Choice Voucher Program is extending their support for the new development on the
campus of the VA Medical Center.” (Doc. #6, PageID #62). Plaintiff understands this as
GDPM’s initial affirmative commitment to support Plaintiff’s efforts to obtain VASH
financing for its planned housing development. (Doc. #6, PageID #53, ¶29).
This leads to the heart of the amended complaint. Plaintiff alleges that since
Defendant GDPM’s initial affirmative commitment, GDPM “has balked at providing
continued support to Plaintiff.” Id. at ¶30. Plaintiff needs Defendant GDPM’s support
“because only [Public Housing Authorities] such as GDPM may apply for a VASH
allocation.” Id. at ¶27. In December 2015, Plaintiff asked GDPM to apply for projectspecific, project-based VASH vouchers on Plaintiff’s behalf. The application deadline
was in September 2016. GDPM declined to do so. “Notwithstanding its initial
commitment of thirty-three … project-based [Housing Choice Vouchers] in 2013, GDPM
has balked at providing continued support to Plaintiff.” Id. at ¶30. Plaintiff alleges:
Recently, under new leadership, and following meetings between
GDPM’s Executive Director Jennifer N. Heapy, Plaintiff’s principals,
and others, GDPM proposed applying for VASH Project-Based
Rental Assistance on behalf of itself….

3

Since Congress enacted the 2008 consolidated Appropriations Act, HUD may “waive or specify
alternative requirements for any provision of any statute or regulation affecting the [Housing Choice
Awards] program in order to effectively deliver and administer VASH housing assistance ….” Id. at ¶24.

4

By applying for VASH [assistance] … on its own behalf rather
than on behalf of Freedom’s Path, as GDPM had originally promised,
and by not applying in a timely manner for Plaintiff’s specific,
project-based VASH vouchers, GDPM jeopardized HUD’s award of
25 points that would give Plaintiff enough points for its project to be
selected, which in turn would provide necessary treatment to veterans
who would otherwise go without adequate treatment and housing.
Id. at ¶s 31-32.
In response to Plaintiff’s inquiries, Defendant GDPM provided “various
inconsistent, mistaken, or shifting rationales for its indecision….” Id. at ¶33. Plaintiff
alleges, for example, GDPM explained, in part, that Prude’s letter was inconsistent with
federal law, and GDPM “has already exceeded its overall allocation of vouchers (this in
incorrect—a HUD VASH voucher waiver to the cap is available)[.]” Id.
On September 2, 2016, Plaintiff’s counsel sent a detailed letter to GDPM asking it
to apply to HUD on Plaintiff’s behalf for 60 VASH vouchers. Id. at ¶34 and Exhibit B,
PageID #64. Plaintiff emphasized in its letter that “[t]ime is of the essence” given the
September 9, 2016 deadline for applications to HUD for VASH vouchers. Id. Plaintiff’s
letter also stated, “Please treat this as a request for reasonable accommodation under the
Fair Housing Amendments Act of 1988 and the Americans with Disabilities Act, and take
whatever steps necessary to accommodate our request to apply to H.U.D. for the sixty
(60) HUD-VASH vouchers....” Id. Plaintiff asserts in its amended complaint that GDPM
denied the requested accommodation. (Doc. #6, PageID #54, ¶34).
Plaintiff claims that GDPM’s discriminatory conduct violated the FHA by
effectively making “housing unavailable to Plaintiff’s prospective residents. [GDPM’s]
acts were undertaken with the intent to discriminate against, and had the effect of

5

discriminating against, disabled veterans and those who provide services to them, namely
Plaintiff and its prospective residents.” Id. at ¶64. Plaintiff also claims that GDPM’s
stalling and denial of a reasonable accommodation violated the ADA and “were taken
with the intent to discriminate against, and had the effect of discriminating against,
disabled veterans and those who provide services to them, namely Plaintiff and its
prospective residents.” Id. at ¶60.
As to Plaintiff’s alleged harm, it maintains that as a result of GDPM’s
discriminatory response to Plaintiff’s proposed housing and proposed financing, “[it] has
expended time and financial resources and has lost opportunity to conduct its business
and provide a much-needed service.” Id. at 61. And, Plaintiff asserts that it has suffered
damages in the form of frustration of mission, diversion of resources, lost financing, and
lost funding in the form of credits. Id. at ¶s 40, 41.
Plaintiff seeks (1) declaratory relief concluding that GDPM violated the FHA and
ADA; (2) an Order mandating GDPM to apply to HUD on Plaintiff’s behalf for VASH
project-based rental assistance or, alternatively, to grant Plaintiff a reasonable
accommodation; (3) preliminary and permanent injunctions prohibiting GDPM from
violating the ADA and FHA; and damages “for the harm it experienced as a result of
GDPM’s discriminatory and dilatory practices.” Id. at ¶60.
III.

Standing
“Under Article III of the United States Constitution, a court has no jurisdiction

over a case when the plaintiff does not have standing.” DeBolt v. Espyh, 45 F.3d 777,
779 (6th Cir. 1995). “To bring suit, Plaintiffs must have ‘alleged such a personal stake in

6

the outcome of the controversy as to assure that concrete adverseness which sharpens the
presentation of issues’ before the court.” Crawford v. U.S. Dep’t of Treasury, No. 163539, __F.3d__, 2017 WL 3568494, at *8 (6th Cir. 2017) (quoting, in part, Baker v.
Carr, 369 U.S. 186, 204 (1962)).
An organization—like Plaintiff—has two potential forms of Article III standing:
It may seek relief either on its own behalf for its own injuries, Haven Realty Corp. v.
Coleman, 455 U.S. 363, 378-79 (1982), or on behalf of its members, see Hunt v.
Washington State Apple Advertising Comm'n, 432 U.S. 333, 342 (1977). Defendant
GDPM contends that Plaintiff lacks both forms of standing.
To determine whether Plaintiff itself has standing under the Fair Housing Act, the
analysis involves “the same inquiry applied to individuals: Has the plaintiff alleged such
a personal stake in the outcome of the controversy as to warrant his invocation of federalcourt jurisdiction?” Haven Realty, 455 U.S. at 378-79 (internal punctuation omitted)
(quoting, in part, Arlington Heights v. Metropolitan Housing Dev. Corp., 429 U.S. 252,
261 (1977)). To answer this question affirmatively, and thus establish standing on its
own behalf, Plaintiff “must allege: (1) an injury in fact; (2) a causal connection between
the injury and the challenged conduct that is fairly traceable to the defendant’s actions;
and (3) that the requested relief will redress the injury.” Miami Valley Fair Housing
Center, Inc. v. Connor Group, 725 F.3d 571, 576 (6th Cir. 2013) (citing Lujan v.
Defenders of Wildlife, 504 U.S. 555, 560–61 (1992)). An injury in fact is “an invasion of
a legally protected interest which is (a) concrete and particularized, and (b) actual or

7

imminent, not ‘conjectural’ or ‘hypothetical.’” Crawford, __F.3d__, 2017 WL 3568494,
at *8 (quoting, in part, Lujan, 504 U.S. at 560) (punctuation and other citations omitted).
Plaintiff alleges that its injuries include the expenditure of time and financial
resources; lost opportunity to conduct its business (developing and building Freedom’s
Path on the VA Medical Center’s campus in Dayton) and provide much-needed services
(housing) to disabled veterans; frustration of its mission; diversion of its resources; lost
financing (VASH vouchers); and lost funding in the form of tax credits. (Doc. #6, ¶s 2526, 40-41, 61). Such injuries are real and therefore concrete, particularized to Plaintiff,
and actual rather than hypothetical. See Miami Valley Fair Housing Center, 725 F.3d at
576 (“a drain on an organization’s resources … constitutes concrete and demonstrable
injury for standing purposes.”); cf. Haven Realty, 455 U.S. at 378-79 (“If, as broadly
alleged, petitioners’ steering practices have perceptively impaired HOME’s ability to
provide counseling and service for low-and moderate-income homeseekers, there can be
no question that the organization has suffered an injury in fact.”).
Plaintiff also alleges sufficient facts to reveal, if proved, that a causal connection
exists between its injuries and conduct fairly traceable to GDPM’s actions—namely,
GDPM’s act of applying for specific project-based VASH vouchers for itself and refusing
to apply for them on Plaintiff’s behalf. Plaintiff needed GDPM’s support to obtain
VASH vouchers because only Public Housing Authorities, such as GDPM may apply for
VASH vouchers. (Doc. #6, PageID #53, ¶27). It is therefore reasonable to conclude that
Plaintiff could not and cannot secure an award of the VASH vouchers it sought without
GDPM’s help. Plaintiff maintains that GDPM’s promised support and later refusal to

8

apply for VASH vouchers on Plaintiff’s behalf, “jeopardized HUD’s award of 25 points
to Plaintiff that would have given Plaintiff enough points for its project to be selected ...,”
(Doc. #6, PageID #53, ¶32), and improperly and illegally stalled and effectively denied
Plaintiff’s financing, id., PageID #55, ¶38. See Lynn v. Village of Pomona, 373
F.Supp.2d 418, 426-27 (S.D.N.Y. 2005) (“‘the prohibition against making a residence
unavailable has been applied to situations where government agencies take actions that
prevent construction of housing when the circumstances indicate a discriminatory intent
or impact against anticipated future residents who are members of a class protected’
under the FHA.” (citations omitted)).
As to the redress requirement, Plaintiff’s requested relief, if granted, will redress
its injuries. Its redress would include damages for the financial harm it has allegedly
incurred due to lost business opportunities, and damages to redress the diversion and
expenditure of its finances and resources.
GDPM finds something missing. It argues that Plaintiff must, but cannot, show a
statutory basis—i.e., “an invasion of a legally protected interest,” Lujan, 504 U.S. at 560
(emphasis added; citations omitted)—that would grant it a right to relief.

More

specifically, GDPM argues, “Plaintiff failed to show that the ADA or FHA provide[s]
Plaintiff or a disabled individual a legally protected interest in Freedom’s Path’s request.
Therefore, Plaintiff fails to establish anyone suffered an injury in fact.” (Doc. #10,
PageID #112) (footnote omitted). This argument rests on the correct standing principle
but fails to reach the correct standing conclusion.

9

First the principle: “Although standing in no way depends on the merits of the
plaintiff’s contention that particular conduct is illegal, it often turns on the nature and
source of the claim asserted. The actual or threatened injury required by Art. III may
exist solely by virtue of ‘statutes creating legal rights, the invasion of which creates
standing….’” Warth, 422 U.S. at 500 (quoting, in part, Linda R.S. v. Richard D., 410
U.S. 614, 617 (1973) (other citation omitted). With this in mind, GDPM’s reasoning has
some allure on its face because Plaintiff is a housing developer— a rather large step away
from a disabled military veteran. But FHA coverage extends more broadly.
The FHA “makes it unlawful [t]o discriminate in the sale or rental, or to otherwise
make unavailable or deny, a dwelling to any buyer or renter because of a handicap[.]”
HDC, LLC v. City of Ann Arbor, 675 F.3d 608, 611 (6th Cir. 2012) (quoting, in part, 42
U.S.C. § 3604(f)(1)). The FHA authorizes any “aggrieved person” to bring a civil action
contesting discriminatory housing practices. See 42 U.S.C. § 3613(a)(1)(A). An
“aggrieved person” is broadly defined “to include any person who ‘claims to have been
injured by a discriminatory housing practice[.]’” Hollis v. Chestnut Bend Homeowners
Ass'n, 760 F.3d 531, 544 (6th Cir. 2014) (quoting 42 U.S.C. § 3602(i)(1)).
Recovery under the FHA is not limited to “persons who are
directly and immediately subjected to discrimination.” Hamad v.
Woodcrest Condo Ass’n, 328 F.3d 224, 231 (6th Cir. 2003). Congress
intended standing under the FHA to extend to the “full limits” of
Article III of the United States Constitution, and accordingly an FHA
plaintiff need only allege a “distinct and palpable injury” caused by
the defendant’s actions. Havens Realty Corp. v. Coleman, 455 U.S.
363, 372, 102 S.Ct. 1114, 71 L.Ed.2d 214 (1982) (internal quotation
marks omitted); see also Miami Valley Fair Hous. Ctr., Inc. v. Connor
Grp., 725 F.3d 571, 576 (6th Cir. 2013).

10

Hollis, 760 F.3d at 544.
Plaintiff alleges sufficient facts, if true, to show it is an “aggrieved person” under
the FHA. It alleges that GDPM intentionally discriminated against handicapped
veterans—and those providing services to them (namely, Plaintiff)—by blocking
Plaintiff’s only avenue to obtain financing (VASH project-based vouchers) for its
proposed development and construction of low-income housing for disabled veterans.
This blocking effectively deprived disabled veterans of low-income housing that was
sorely needed near the VA Medical Center in Dayton, and caused Plaintiff to incur
financial harm (diversion of money and resources; lost business) and incorporeal harm
(frustration of its mission), according to Plaintiff’s amended complaint. (Doc. #6,
PageID #55, ¶s 37-38, 64-65). These allegations, if true, are sufficient to show that
GDPM violated Plaintiff’s legal interest created by the FHA and suffered resulting
“‘distinct and palpable injury.’” Hollis, 760 F.3d at 544 (citation omitted); cf. Havens
Realty, 455 U.S. at 378-79 (HOME had standing in its own right through the FHA to
challenge racial steering practices due to its injury in fact); cf. also Anderson Group, LLC
v. City of Saratoga Springs, 805 F.3d 34, 45-46 (2nd Cir. 2015) (commercial developer
had standing in its own right through the FHA to contest city zoning board’s denial of
special-use permit it needed to construct its planned residential project after it spent
$81,000 on architects, consulting firms, land use studies, and application fees). Plaintiff,
moreover, falls within the standing ambit of the FHA in the circumstances the amended
complaint describes even though it was not the direct victim of disability discrimination.
As noted above, the FHA is not limited to “‘persons who are directly and immediately

11

subjected to discrimination.’” Id. (citation omitted). Any lingering doubt (there is none)
about Plaintiff’s FHA-derived standing at this point in the case is extinguished by
Congress’ intent to broaden standing under the FHA to the “full limits” of Article III.
Havens Realty, 455 U.S. at 372.
GDPM points out that many of the cases on which Plaintiff relies dealt with a
plaintiff’s rights being denied by zoning restrictions, tax-credits denials, or buildingpermit refusals based upon racial considerations. 4 GDPM maintains that the instant case
differs from those standing cases based on the different circumstances Plaintiff alleges in
this case. (Doc. #10, PageID #111). Although the parties do not discuss one of the cases
cited above, Anderson Group, 805 F.3d at 45-46, GDPM’s argument extends naturally to
Anderson, where a zoning board denied a commercial developer a special-use permit it
needed.
The cases Plaintiff cites, along with Anderson Group, do not alter the above
analysis because the defendants in those cases allegedly engaged in blocking actions
similar to GDPM’s refusal to apply for VASH vouchers on Plaintiff’s behalf. The
similarity of those actions—zoning restrictions and denial of tax credits—with GDPM’s
4

Plaintiff cites Arlington Heights, 429 U.S. 252 (developer had standing); Oti Kaga, Inc. v. South Dakota
Housing Development Auth., 342 F.3d 871, 880 (8th Cir. 2003); (upholding developer’s standing to
challenge denial of funding application on racial grounds despite plaintiff’s own lack of racial identity);
Ave. 6E Invs., LLC v. City of Yuma, 818 F.3d 493, 503 (9th Cir. 2016) (addressing fair housing claims by
developer); Scott v. Greenville County, 716 F.2d 1409 (4th Cir. 1983); Baytree of Inverrary Realty
Partners v. City of Lauderhill, 873 F.2d 1407, 1409 (11th Cir. 1989) (citing cases); In re Malone, 592 F.
Supp. 1135, 1166 (E.D. Mo. 1984), judgment aff’d, 794 F.2d 680 (8th Cir. 1986) (plaintiff-developer of
affordable housing had standing under § 3617); U.S. General, Inc. v. City of Joliet, 432 F. Supp. 346, 352
(N.D. Ill. 1977) (holding, in case brought by developer of affordable housing, that Ҥ 3617 grants a right
of action to persons who have been interfered with as they aided others in their exercise of rights
protected by 3604.”).

12

alleged actions is that both completely forestalled a developer or housing advocate’s
attempt to provide housing for an FHA-protected class. Each blocking action alleged in
those cases stemmed from discriminatory intent and resulted in claimed constitutional or
statutorily forbidden discrimination, as GDPM’s alleged blocking actions did here.
Injury in fact and, therefore, existed in those cases as it does here.5
In its Reply memorandum, GDPM raises for the first time the contention that the
owner of property has no right to participate in the voucher program. GDPM relies on 24
C.F.R. § 982.306(e): “nothing in this rule is intended to give any owner any right to
participate in the program.” (Doc. #10, PageID #108). This contention misses the mark.
It fails to recognize that § 982.306(e)’s expression of the rule’s intent (not to give owners
property rights in the program) does not invalidate, indeed has no impact on, the FHA’s
anti-discrimination provisions.
Defendant GDPM further contends that Plaintiff lacks associational standing to
litigate its ADA and FHA claims because it fails to establish that it is an organization that
has members who may sue in their own right. However, because Plaintiff’s complaint
suffices to show its own standing, this Court has jurisdiction over the present case and
controversy without the need to further explore at present whether Plaintiff also has
associational standing.6

5

This conclusion might or might not hold up at later stages of this case. See Barry v. Lyon, 834 F.3d 706,
714 (6th Cir. 2016) (standing must continue throughout the litigation).

6

Plaintiff’s Memorandum in Opposition also identifies an ADA reasonable-accommodation claim, as
does the amended complaint. There is no present need to address this claim, given Plaintiff’s standing.

13

IV.

Cognizable Claim
Defendant GDPM argues that Plaintiff’s amended complaint fails to state a

cognizable cause of action upon which relief can be granted. According to GDPM,
“Plaintiff argues that GDPM is denying availability of housing to disabled individuals in
violation of the [FHA]. Plaintiff is arguing that GDPM’s extremely attenuated, indirect
action is making housing unavailable and is a violation of the FHA.” (Doc. #10, PageID
#116). GDPM also alleges that disabled veterans will not be deprived of housing or
access to such housing because “GDPM was still seeking VASH vouchers that may be
used by disabled veterans….” (Doc. #7, PageID #80).
By minimizing its role as extremely attenuated and indirect, and by asserting that
disabled military veterans will not be deprived of housing, GDPM improperly rewrites
the amended complaint in its favor. Plaintiff’s amended complaint sufficiently alleges
that GDPM’s act of applying for VASH vouchers on its own behalf, rather than on
Plaintiff’s behalf, deprived disabled veterans of housing. (Doc. #6, ¶s 32, 37, 64). The
amended complaint likewise alleges sufficient facts, when taken as true, to show that
GDPM intended to discriminate against disabled military veterans, or had the effect of
discriminating against them, by denying them housing and services. (Doc. #6, PageID
#55, ¶37); cf. Nationwide Mut. Ins. Co. v. Cisneros, 52 F.3d 1351, 1362 (6th Cir.
1995)(no need to show discriminatory intent under FHA disparate-impact theory); cf.
also Swierkiewicz v. Sorema N. A., 534 U.S. 506, 513-15 (2002) (plaintiff is not required
to plead prima facie case of discrimination or plead a claim with heightened
particularity); Lindsay v. Yates, 498 F.3d 434, 439 (6th Cir. 2007) (extending

14

Swierkiewicz to housing-discrimination claims). The amended complaint further alleges
that GDPM’s intent to discriminate arises from “[t]he historical background of GDPM’s
actions, the sequence of events, and GDPM’s departures from the normal procedural
sequence or substantive criteria all reflect intent to discriminate against disabled people
who were veterans because Defendant maintains that administering VASH on a projectbased basis was administratively burdensome to GDPM even though administering
VASH on a project-based basis is less of an administrative burden than administering
them on a tenant-based basis.” (Doc. #6, PageID #54, ¶36). Plaintiff therefore raises
plausible claims that GDPM violated the FHA. Cf. Arlington Heights, 429 U.S. at 26567 (historical background and sequence of events pertinent to housing-discrimination
claims).
Relying on Growth Horizons, Inc. v. Delaware County, Pa., 983 F.2d 1277, 1279
(3rd Cir. 1993), Defendant contends that the ruling Plaintiff seeks is not the type of ruling
courts have found supportable under the FHA.
In Growth Horizons, the plaintiff provided living arrangements to developmentally
disabled individuals. The County of Delaware, Pennsylvania cancelled its contract with
the plaintiff. The plaintiff filed suit alleging that the city’s failure to assume the leases
was the result of political pressure emanating from bias against the disabled. “For this
reason, [the plaintiff] contends that the County’s failure to assume the leases was the
result of political pressure emanating from bias against the handicapped.” Id. at 1279.
This violated the FHA by constituting unlawful discrimination against handicapped
individuals, according to the plaintiff. The Third Circuit held otherwise. It had great

15

difficulty interpreting the text of the statute to “literally encompass a situation in which a
public agency sponsor housing for the handicapped but because of neighborhood bias has
decided not to lease particular housing but rather to make an alternative choice.” Id. The
Court further found that it doubted that Congress would think that anyone is denied
housing when a public sponsor opts for one house over another. Id. The Court also
observed, “Subjecting to judicial review decisions of public agencies to invest in one
property rather than another would impose a financial burden on the limited resources
currently devoted to housing the handicapped.” Id. at 1283-84.
Growth Horizons is not controlling in the Sixth Circuit but it might have
persuasive value. Yet, upon careful reading, Growth Horizons did not involve
circumstances similar to those in the present case. Here, the factual circumstances
alleged in the amended complaint, when accepted as true, do not describe a political
choice by an agency to provide alternative housing. Plaintiff instead alleges that GDPM
wholly blocked Plaintiff from developing and building housing for disabled military
veterans. This had the effect of denying housing, meaningful access to housing, and
services for disabled veterans. (Doc. #6, PageID #55, ¶37). In this manner, Plaintiff’s
amended complaint goes beyond the allegations in Growth Horizons.
Accordingly, Plaintiff’s amended complaint states a cognizable claim under the
FHA.
V.

Ripeness
Defendant lastly argues that Plaintiff’s amended complaint is not ripe for

adjudication because Plaintiff raises a speculative argument. Defendant maintains that

16

the amended complaint contains no information that any qualified individual with a
disability will ever reside or want to reside in Plaintiff’s future development.
“A claim not amenable to ... the judicial process, when it is filed too early (making
it unripe) ….” Warshak v. United States, 532 F.3d 521, 525 (6th Cir.
2008) (internal punctuation and citations omitted).
The ripeness doctrine acknowledges the problem inherent in
adjudicating a dispute “anchored in future events that may not occur
as anticipated, or at all.” Determining whether a claim is ripe
involves evaluating “both the fitness of the issues for judicial decision
and the hardship to the parties of withholding court consideration.”
To be ripe for review, claims must satisfy both the fitness and the
hardship components of the inquiry.
Airline Professionals Ass’n of Intern. Broth. of Teamsters, Local Union No. 1224, AFLCIO v. Airborne, Inc., 332 F.3d 983, 987-88 (6th Cir. 2003) (internal and other citations
omitted).
In light of the above discussion concerning Plaintiff’s present, non-speculative
injury in fact, supra, § III, particularly its financial injury, and given GDPM’s opposition
to Plaintiff’s assertion of standing and the merits of its claims, the amended complaint
asserts sufficient allegations to make Plaintiff’s FHA claim ripe and fit for adjudication.
Deferring consideration of the parties’ dispute over Plaintiff’s FHA claim will cause them
hardship by leaving unresolved the issue of whether Plaintiff is entitled to relief in the
form of damages, declaration, or injunction.

17

IT IS THEREFORE RECOMMENDED THAT:
Defendant GDPM’s Motion to Dismiss under 12(b)(1) and 12(b)(6) (Doc. #7) be
denied.
August 22, 2017

s/Sharon L. Ovington
Sharon L. Ovington
United States Magistrate Judge

18

NOTICE REGARDING OBJECTIONS
Pursuant to Fed. R. Civ. P. 72(b), any party may serve and file specific, written
objections to the proposed findings and recommendations within FOURTEEN days after
being served with this Report and Recommendations. Such objections shall specify the
portions of the Report objected to and shall be accompanied by a memorandum of law in
support of the objections. If the Report and Recommendation is based in whole or in part
upon matters occurring of record at an oral hearing, the objecting party shall promptly
arrange for the transcription of the record, or such portions of it as all parties may agree
upon or the Magistrate Judge deems sufficient, unless the assigned District Judge
otherwise directs. A party may respond to another party’s objections within
FOURTEEN days after being served with a copy thereof.
Failure to make objections in accordance with this procedure may forfeit rights on
appeal. See Thomas v. Arn, 474 U.S. 140 (1985); United States v. Walters, 638 F.2d 947,
949-50 (6th Cir. 1981).

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