GROUNDBREAKING FEDERAL COURT DECISION ORDERING LANDLORD TO PAY NEARLY $1 MILLION AND END DISCRIMINATORY POLICIES THAT EXCLUDE PEOPLE WITH RENTAL SUBSIDIES
Today, the Fair Housing Justice Center (FHJC) announced a federal court decision finding that a large New York City landlord has engaged in illegal disability and source of income housing discrimination. Judge Edgardo Ramos of the Southern District of New York held that Goldfarb Properties has been applying minimum income requirements to rental applications that violate both the federal Fair Housing Act (“FHA”) and the New York City Human Rights Law (“NYCHRL”).
Judge Ramos ordered the company, which manages approximately six thousand rental units in New York City and Westchester County, New York, to cease its illegal practices immediately. The decision was issued on September 29, 2023.
Originally filed in 2018 by the FHJC, the lawsuit arose from an FHJC investigation in response to a complaint filed by a disabled unhoused man who had been rejected by Goldfarb when he applied for an apartment using a State of New York Olmstead rental voucher. FHJC’s investigation found that Goldfarb employees repeatedly refused to consider prospective tenants with rental subsidies and vouchers because none could meet the company’s minimum annual income requirement of 43x the total monthly rent. According to the FHJC’s expert, MIT Professor Justin Steil, this policy categorically disqualified all recipients of disability-based rental subsidies, as well as more than 90% of renters with Section 8 housing vouchers. The FHJC investigation concluded that it would be impossible to have an income low enough to qualify for a subsidy but high enough to meet Goldfarb’s income requirement.
Notably, Goldfarb instituted the policy shortly after a previous source of income discrimination lawsuit against Goldfarb was settled. In that case, which also stemmed from a complaint investigated by the FHJC, the company agreed not to discriminate against voucher holders. Judge Ramos found that as part of this earlier settlement, Goldfarb provided training to its employees and then ignored the trainer’s advice not to use minimum income requirements based on the full rent.
Judge Ramos found for the FHJC on each of its claims under federal and local fair housing laws, stating, “Defendants have had ample opportunity and time to correct their policies, have failed to do so, and thereby have acted discriminatorily toward two of the most vulnerable populations in our society — people with disabilities and low-income renters,” Judge Ramos wrote. The full opinion can be read HERE.
The Court ordered Defendants Pelican Management, Inc., Fordham One Company, LLC, and Cedar Two Company, LLC. to pay $240,540 in compensatory damages and $750,000 in punitive damages to the FHJC, a total of $990,940. The Court ordered that, for five years, a portion of the FHJC’s compensatory damages be used to counteract the injury caused by Defendants by 1) monitoring Goldfarb’s rental advertisements, website, and rental records; 2) distributing information about fair housing rights to organizations and government agencies that assist renters with rental subsidies; and 3) conducting compliance testing of Goldfarb apartment buildings.
The Court also ordered Goldfarb Properties to cease their discriminatory policies and take the following actions to comply with fair housing laws by:
- Not applying minimum income requirements to applicants with rental subsidies or vouchers
- Not granting variances and waivers to rental criteria only to non-subsidy applicants
- Not requiring rejected applicants to wait a minimum period of time before reapplying for apartments
- Contracting with a third party to provide fair housing training to its employees
“Housing providers across New York city and state have long discriminated, and have knowingly continued to discriminate, against many thousands of voucher holders despite the clear illegality of this practice. This ruling should make it easier for countless individuals to live in the housing of their choice,” stated Elizabeth Grossman, the FHJC’s Executive Director. “The FHJC will continue its dedicated efforts to investigate source of income discrimination and to bring enforcement actions against those entities who shirk their responsibilities.”
FHJC co-founder and National Field Consultant Fred Freiberg, who served as Executive Director at the time the suit was filed, had praise for the investigative and legal team. He hailed the decision as “a remedy that can create change, not just for one individual or family, but for thousands of renters who are being denied their right to equal housing opportunity.” He added, “We need to continue to use the legal process to disrupt systemic housing discrimination and ensure that segregation and exclusion are no longer viable options for landlords.”
“This decision puts landlords on notice that if they use seemingly neutral rental policies to exclude renters with vouchers, many of whom are individuals with disabilities, they are violating fair housing laws and will be held accountable,” warned the FHJC’s attorney Diane L. Houk. The FHJC was represented by Ms. Houk and David Berman with the law firm Emery Celli Brinckerhoff Abady Ward & Maazel, LLP.
The FHJC’s investigation in this case was supported with funding from a Private Enforcement Initiative (PEI) grant received from the Fair Housing Initiatives Program (FHIP) administered by the U.S. Department of Housing and Urban Development (HUD).
The mission of the FHJC, a nonprofit civil rights organization, is to eliminate housing discrimination; promote policies and programs that foster open, accessible, and inclusive communities; and strengthen fair housing enforcement in the New York City region.