Settlement Reached in Voucher-Holder Lawsuit

Photo © by Bernard Kleina

April 14, 2023


Today, the Fair Housing Justice Center (FHJC) announced that a settlement has been reached in a source of income discrimination lawsuit filed by the FHJC and Ms. B., a woman using a CityFHEPS voucher to pay her rent, against the property owner 63 West Realty Corp., realty firm Apt212 Inc., and real estate agents Jeanette Gong and Georgeann Chang.

According to the lawsuit, the defendants discriminated against prospective tenants who use housing vouchers by ignoring them, discouraging them, or requiring them to have a guarantor, despite the voucher payment being guaranteed.

After being denied an opportunity to apply for an apartment at the Lincoln Square Apartments because of her voucher, Ms. B. contacted the FHJC, and an investigation was launched. According to the complaint, FHJC testers posing as home-seekers were treated with respect and enthusiasm until they mentioned they would be using Section 8 or CityFHEPS vouchers to pay a portion of their rent, at which point the agents became resistant and less encouraging. The agents insisted that applicants who could not meet a minimum income requirement of 40x the gross monthly rent would need a guarantor, and also encouraged these testers to buy insurance from a “third-party guarantor” company, in violation of state and city laws. Eventually the agents “ghosted” these testers, the suit alleged, ignoring phone calls and texts altogether.

By contrast, an FHJC tester who claimed to earn income solely through employment was immediately offered an appointment to view the available apartments, despite earning less than the 40x requirement. Full coverage of the initial complaint filing can be read here.

While denying the allegations, the defendants agreed to collectively pay $450,000 in damages and will participate in extensive injunctive relief, including

  • Eliminating any policy requiring or imposing a guarantor or insurance policy on prospective or actual tenants who receive rental subsidies, and ensuring no such policies will be imposed in the future
  • Refraining from discrimination on the basis of lawful source of income
  • Applying neutral policies, procedures, and rules to all rental applicants
  • Adopting an equal housing opportunity policy for all employees, agents, building superintendents, contractors, brokers, and sales or rental associates
  • Publicly advertising available apartments on craigslist and other websites before directly informing any prospective applicants or real estate agents
  • Including on all advertisements the phrase “Equal Housing Opportunity” in a large font along with the sentence “Government vouchers such as Section 8 and CityFHEPS are accepted.”
  • Allowing application, broker, or other fees to be paid by or subsidized by government assistance
  • Modifying application documents and other rental criteria to indicate the acceptance of all rental vouchers and subsidies
  • Fair housing training for all employees, agents, and brokers who regularly deal with potential tenants

The full settlement can be read here.

The agreement was so-ordered by New York County Supreme Court Judge Hon. Leslie A Stroth. The FHJC was represented by Mariann Meier Wang, Eric Hecker, and Alice G. Reiter of the law firm Cuti Hecker Wang LLP. Ms. B. was represented by Bianca Cappellini and Chiansan Ma of Bronx Legal Services.

“We were pleased to obtain serious and long-lasting relief and are hopeful that families and individuals with vouchers or other government subsidies will now have more opportunities to obtain housing as a result,” stated Ms. Wang.

“CityFHEPS and other voucher programs are guaranteed rental income for landlords,” said FHJC Legal coordinator Madhulika Murali. “Imposing guarantor requirements and income minimums for renters with vouchers is a form of discrimination against people who are simply trying to secure a place to live for themselves and their families.”

FHJC Executive Director/General Counsel Elizabeth Grossman added, “We are pleased to have litigated this case with Ms. B. and that we were able to reach a resolution satisfactory to all parties. The FHJC receives complaints of rampant source of income discrimination throughout our service area, and we will continue to fight against it whenever it occurs.”

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 enforcement of fair housing laws in the New York City region.