{\rtf1\ansi\deff0\deftab720{\fonttbl{\f0\fswiss MS Sans Serif;}{\f1\fdecor\fcharset2 Symbol;}} {\colortbl\red0\green0\blue0;} \deflang1033\pard\plain\f0\fs17 No. 94-1952 \par \par In The Supreme Court of The United States \par \par OCTOBER TERM, 1995 \par \par CITY OF HAYWARD, CALIFORNIA, PETITIONER \par \par v. \par \par UNITED STATES OF AMERICA \par \par ON PETITION FOR A WRIT OF CERTIORARI \par TO THE UNITED STATES COURT OF APPEALS \par FOR THE NINTH CIRCUIT \par \par BRIEF FOR THE UNITED STATES IN OPPOSITION \par \par DREW S. DAYS, III \par Solicitor General \par \par DEVAL L. PATRICK \par Assistant Attorney General \par \par DAVID K. FLYNN \par LISA J. STARK \par LESLIE A. SIMON \par Attorneys \par \par Department of Justice \par Washington, D.C. 20530 \par (202)514-2217 \par \par ---------------------------------------- Page Break ---------------------------------------- \par \par QUESTIONS PRESENTED \par \par 1. Whether, in a suit brought by the Attorney \par General to enforce the Fair Housing Act, a district \par court has discretion to deny an award of compen- \par satory damages to an aggrieved person who has \par suffered actual damages from a violation of the Act. \par 2. Whether standards that this Court has applied \par to the determination of municipal liability under 42 \par U.S.C. 1981 (1988 & Supp. V 1993) and 42 U.S.C. 1983 \par should also apply under the Fair Housing Act. \par \par (I) \par \par ---------------------------------------- Page Break ---------------------------------------- \par \par TABLE OF CONTENTS \par \par Page \par \par Opinions below . . . . 1 \par Jurisdiction . . . . 1 \par Statement . . . . 2 \par Argument . . . . 5 \par Conclusion . . . . 10 \par \par TABLE OF AUTHORITIES \par \par Cases: \par \par Adickes v. S. H. Kress & Co., 398 U. S. 144(1970) . . . . 8 \par Bonner v. Lewis, 857 F.2d 559(9th Cir. 1988) . . . . 8 \par City of Chicago v. Matchmaker Real Estate Sales Ctr., \par Inc., 982 F.2d1086(7th Cir. 1992), cert. denied, l13 \par S. Ct. 2961 (1993) . . . . 8 \par City of St. Louis v. Praprotnik, 485 U. S. 112 (1988) . . . . 8, 9 \par Grumble v. Blumthal, 549 F.2d 462(7th Cir. 1977) . . . . 5 \par Curtis v. Loether, 415 U.S. 189 (1974) . . . . 5, 6 \par Jett v. Dallas Indep. Sch. Dist., 491 U. S. 701 (1989 ) . . . . 7 \par Monell v. Department of Social Servs., 436 U.S. 658 \par (1978) . . . . 7, 9 \par Pembaur v. City of Cincinnati, 475 U. S. 469 (1986 ) . . . . 9 \par Smith v. Wade, 461 U. S. 30 (1983) . . . . 5 \par United States v. Balistrieri, 981 F.2d 916 (7th Cir. \par 1992), cert. denied, 114 S. Ct. 58 (1993 ) . . . . 5 \par United States v. City of Hayward, 805 F. Supp. 810 \par (N.D. Cal. 1992) . . . . 2, 3, 4 \par United States v. Rent-A-Homes Systems of Illinois, \par Inc., 602F.2d 795(7th Cir. 1979) . . . . 6, 7 \par Woods-Drake v. Lundy,667F.2d 1198(5th Cir. 1982) . . . . 5 \par \par Statutes and ordinance: \par \par Fair Housing Act, 42 U.S.C. 3601 et seq. . . . . 2 \par 42 U.S.C. 3602(k) . . . . 2 \par 42 U.S.C. 3604-3606 . . . . 2 \par 42 U.S.C. 3607(b) . . . . 2 \par 42U.S.C. 3610(g)(2)(C) . . . .3 \par 42 U.S.C. 3613(c) (l), . . . . 6 \par \par ---------------------------------------- Page Break ---------------------------------------- \par \par IV \par \par Statutes and ordinance - Continued: \par \par Page \par \par 42 U.S.C 3614 . . . . 6 \par 42 U.S.C. 3614(a) . . . . 3 \par 42 U.S.C. 3614(b)(1) . . . . 3 \par 42 U.S.C. 3614(d)(1)(B) . . . . 5 \par 42 U.S.C. 3617 . . . . 3 \par 42 U.S.C. 1981 (1988 & Supp. V 1993) . . . . 7 \par 42 U.S.C. 1983 . . . . 5, 7 \par Hayward, Cal., Ordinance 89-057, 5(e)(3) \par (Oct. 24, 1989) . . . .3 \par \par Miscellaneous: \par \par H.R. Rep. No 711, 100th Cong., 2d Sess. (1988) . . . . 6 \par \par \par ---------------------------------------- Page Break ---------------------------------------- \par \par In the Supreme Court of the United States \par \par OCTOBER TERM, 1995 \par \par \par No. 94-1952 \par \par CITY OF HAYWARD, CALIFORNIA, PETITIONER \par \par v. \par \par UNITED STATES OF AMERICA \par \par ON PETITION FOR A WRIT OF CERTIORARI \par TO THE UNITED STATES COURT OF APPEALS \par FOR THE NINTH CIRCUIT \par \par BRIEF FOR THE UNITED STATES IN OPPOSITION \par \par \par OPINIONS BELOW \par \par The opinion of the court of appeals (Pet. App. 3a- \par 20a) is reported at 36 F.3d 832. The opinion of the \par district court is reported at 805 F. Supp. 810. \par \par JURISDICTION \par \par The judgment of the court of appeals was entered on \par September 19, 1994. A petition for rehearing was \par denied on January 24, 1995 (Pet. App. 1a-2a). The \par petition for a writ of certiorari was filed on April 24, \par 1995. The jurisdiction of this Court is invoked under \par 28 U.S.C. 1254(1). \par \par (1) \par \par ---------------------------------------- Page Break ---------------------------------------- \par \par 2 \par \par STATEMENT \par \par 1. S. G. Borello & Sons, Inc. (Borello) is the owner \par and operator of the Eden Roc Mobile Home Park \par in Hayward, California. Until 1989, Borello operated \par Eden Roc as an adults-only park and had a written \par policy requiring all park residents to be at least 18 \par years of age. The 1988 amendments to the Fair \par Housing Act, 42 U.S.C. 3601 et seq., prohibited dis- \par crimination against families wit h children under 18. \par See 42 U.S.C. 3602(k), 3604-3606. In order to comply \par with that enactment, Borello terminated the park's \par adults-only policy. Before eliminating that policy, \par Borello conducted a survey and determined that the \par park did not qualify for an exemption as a senior \par citizen community pursuant to 42 U.S.C. 3607(b). \par Pet. App. 7a-8a; United States v. City of Hayward, \par 805 F. Supp. 810,812 (N.D. Cal. 1992). \par Tenants of the park filed a petition with the City's \par Rent Review Office to obtain a reduction in rent. \par They asserted that the admission of families with \par children to the park constituted a reduction in \par housing services under a local rent control ordinance. \par The City accepted the tenants' petition and assigned \par it to an arbitrator employed by the City as a hearing \par officer under the ordinance. The arbitrator held a \par hearing on the matter, spoke to the City Attorney \par about the potential applicability of the Fair Housing \par Act, and ultimately granted the tenants' petition. She \par ordered a permanent reduction in their rents, \par concluding that "the change of status of the park from \par adult-only to a family park" constituted a reduction i n \par services. The arbitrator declined to address whether \par the park qualified for a senior housing exemption \par under the Fair Housing Act. Pet. App. 8a-9a; \par \par ---------------------------------------- Page Break ---------------------------------------- \par \par 3 \par \par Hayward, 805 F. Supp. at 812-813. Under the rent \par control ordinance, the arbitrator's decision was "final \par and binding upon the owner and all affected tenants." \par Hayward, Cal., Ordinance 89-057, 5(e)(3) (Oct. 24, \par 1989) (reproduced in C.A. Excerpts of Record 95). \par Borello sought review of the arbitrator's decision \par by filing a petition for a writ of mandamus in state \par court. The City Council voted to defend the arbi- \par trator's decision and therefore opposed Borello's \par petition. The City acknowledged that it had acted \par "through the hearing officer appointed by its Rent \par Review Office" and asserted that the hearing officer \par had not acted "without or in excess of her juris- \par diction." C.A. Excerpts of Record 168, 171. The state \par court denied the petition for a writ of mandamus. Pet. \par App. 9a; Hayward, 805 F. Supp. at 812. \par 2. The United States filed a complaint against the \par City alleging that application of the rent control \par ordinance to Borello violated the Fair Housing Act \par by interfering with Borello on account of its \par compliance with the Act.1 See 42 U.S.C. 3617. The \par district court awarded summary judgment to the \par United States. The court held that the City violated \par Section 3617 when the arbitrator, acting as the City's \par agent, required Borello to reduce its tenants' rents \par because Borello had complied with a federal anti- \par discrimination requirement. Hayward, 805 F. Supp. \par \par ___________________(footnotes) \par \par 1 Contrary to petitioner's statement (Pet. 1-2, 9-13), the \par United States brought this suit on referral of an individual \par complaint from the Secretary of Housing and Urban Develop- \par ment pursuant to 42 U.S.C. 3614(b)(l), and not as a "pattern or \par practice" case pursuant to 42 U.S.C. 3614(a). The Secretary \par referred Borello's complaint to the Attorney General because \par the matter involved "the legality of [a] State or local zoning or \par other land use law or ordinance." 42 U.S.C. 3610(g)(2)(C). \par \par ---------------------------------------- Page Break ---------------------------------------- \par \par 4 \par \par at 813.2 The court declined, however, to award \par compensatory damages to Borello for the three years \par during which it had received reduced rents, finding \par that the City's actions "were neither frivolous, \par malicious nor oppressive" nor based on an "improper \par motive." Id. at 816. The court based that decision on \par its belief that the award of both compensatory and \par punitive damages was discretionary. Ibid. \par 3. The court of appeals affirmed in part and \par reversed in part, and it remanded for a determination \par of actual damages. The court ruled that the City was- \par responsible for, actions of the arbitrator that violated \par the Fair Housing Act. It held that the arbitrator was \par acting as the City's agent in an administrative pro- \par ceeding. Because the City delegated its "authority \par to interpret or enforce the City's rent control \par ordinance" to the arbitrator and compelled Borello to \par submit to arbitration, the City was liable for the \par arbitrator's decision. Pet. App. 16a-17a The court of \par appeals also ruled that the district court erred in \par refusing to award Borello actual damages. It con- \par cluded from the Fair Housing Act's language, its \par legislative history, and this Court's precedents that \par compensatory damages may not be denied when actual \par damages have been sustained under the Act. Id. at \par 18a-20a. \par \par ___________________(footnotes) \par \par 2 Petitioner incorrectly describes the district Court as \par holding that "senior housing" has no "extrinsic value" and \par cannot provide the basis for a rent adjustment (Pet, 7-8). To \par the contrary, the district court expressly declined to determine \par whether Eden Roc was a senior housing facility and indicated \par that "[n]othing in the record" supported such a claim. \par Hayward, 805 F. Supp. at 814. \par \par ---------------------------------------- Page Break ---------------------------------------- \par \par 5 \par \par ARGUMENT \par \par 1. Petitioner contends (Pet. 9-13) that the Fair \par Housing Act gives a district court discretion to deny \par compensatory damages to a plaintiff who has demon- \par strated actual damages resulting from a violation of \par the Act. Specifically, petitioner argues that because \par Section 3614(d)(1)(B) states that compensatory dam- \par ages "may" be awarded, 42 U.S.C. 3614(d)(1)(B), such \par an award is discretionary. The court of appeals cor- \par rectly rejected that argument, which is contrary to \par established precedent. \par This Court has held that compensatory damages \par are required when a plaintiff sustains actual damages \par resulting from a violation of the Fair Housing Act. \par See, e.g., Curtis v. Loether, 415 U.S. 189, 197 (1974) \par ("There is no * * * discretion * * *: if a plaintiff \par proves unlawful discrimination and actual damages, \par he is entitled to judgment for that amount."). The \par courts of appeals have consistently followed that \par principle. See Woods-Drake v. Lundy, 667 F.2d 1198, \par 1203 (5th Cir. 1982) (directing district court to "award \par plaintiffs an amount sufficient to compensate them for \par their actual losses"); Crumble v. Blumthal, 549 F.2d \par 462, 467 (7th Cir. 1977) (directing district court to \par award compensatory damages to which plaintiff was \par entitled); see also United States v. Balistrieri, 981 \par F.2d 916, 927-928 (7th Cir. 1992) (stating that the term \par "damages" in 42 U.S.C. 3614(d)(1)(B) has "commonly \par understood meaning" and noting that government's \par action pursuant to that Section is "essentially a tort \par action for damages"), cert. denied, 114 S. Ct. 58 (1993). \par Cf. Smith v. Wade, 461 U.S. 30, 52 (1983) (compensa- \par tory damage award for proven losses is "mandatory" \par pursuant to 42 U.S.C. 1983). \par \par ---------------------------------------- Page Break ---------------------------------------- \par \par 6 \par \par The relevant statutory language, which provides \par that a court "may award [in addition to injunctive \par relief] such other relief as the court deems appro- \par priate, including monetary damages to persons \par aggrieved," 42 U.S.C. 3614(d)(1)(B), does not dictate a \par contrary conclusion. In Curtis, this Court construed \par a similar provision of the Fair Housing Act then \par applicable to private suits and concluded that, despite \par the statute's use, of the language "may award," an \par award of actual damages was not discretionary. See \par 415 U.S. at 196-197.3 The court of appeals properly \par applied the reasoning of Curtis to this case and \par correctly concluded that, once the district court \par found that the City's application of its rent control \par ordinance violated the Fair Housing Act, it was \par obliged to award relief that would compensate Borello \par for the losses it had suffered. \par Contrary to petitioner's claim (Pet. 12), the leg- \par islative history of the Act does not suggest that the \par award of actual damages is discretionary. As the \par court of appeals noted (Pet. App. 19a-20a), when \par Congress amended the Fair Housing Act in 1988 and \par expanded the Attorney General's enforcement auth- \par ority under Section 3614, it stated that damages \par are available to the same extent under Section 3614 \par as they had previously been in a private action. See \par H.R. Rep. No. 711, 100th Cong., 2d Sess. 17,40 (1988)! \par \par ___________________(footnotes) \par \par 3 The current provision regulating private enforcement \par actions, 42 U.S.C. 3613(c)(1), continues to state that a court \par "may award to the plaintiff actual and punitive damages." \par 4 Prior to the 1988 amendments, the Act did not specifically \par provide that monetary damages were available in an action \par brought by the Attorney General, and at least one court had \par held that only equitable remedies were available. See United \par \par ---------------------------------------- Page Break ---------------------------------------- \par \par 7 \par \par Indeed, the denial of compensatory damages in an \par action filed by the Attorney General on behalf of an \par aggrieved individual would undermine Congress's \par stated goal of avoiding duplicative litigation. Id. at 40. \par See Pet. App. 19a-20a. \par Petitioner appears to suggest (Pet. 12) that Con- \par gress intended the courts to employ a different \par standard for awarding compensatory damages when \par the defendant is a governmental entity. That ar- \par gument is without merit. Congress has given no \par indication of such a distinction anywhere in the \par language or the legislative history of the statute, and \par petitioner provides no authority for drawing it. \par Petitioner did not argue for such a distinction in the \par courts below, but rather asserted that the award of \par compensatory damages was left to the district court's \par discretion in all cases brought under Section 3614. \par 2. Petitioner additionally contends (Pet. 12-17) \par that an award of compensatory damages in this case \par would be inconsistent with this Court's decisions \par holding that the doctrine of respondeat superior does \par not apply under two other civil rights statutes, 42 \par U.S.C. 1981 (1988 & Supp. V 1993), 42 U.S.C. 1983. \par See, e.g., Jett v. Dallas Indep. Sch. Dist., 491 U.S. 701, \par 735-736 (1989) (damages under Section 1981 are \par limited to those available under Section 1983); Monell \par v. Department of Social Servs., 436 U.S. 658, 691 \par (1978) (in Section 1983 action, municipality cannot be \par held liable under theory of respondeat superior solely \par for employing a tortfeasor). Petitioner's novel theory \par was neither raised by petitioner in the courts below \par nor considered by them in the proceedings below. It \par \par ___________________(footnotes) \par \par States v. Rent-A-Homes Systems of Illinois, Inc., 602 F.2d 795 \par (7th Cir. 1979). \par \par ---------------------------------------- Page Break ---------------------------------------- \par \par 8 \par \par therefore does not warrant this Court's review. See, \par e.g., Adickes v. S.H. Kress & Co., 398 U.S. 144, 147 n.2 \par (1970).5 \par Petitioner's argument is also without merit. This \par Court's holding that the doctrine of respondeat \par superior is unavailable in actions brought under \par Sections 1981 and 1983 was based on the specific \par language and history of those statutes. See City of \par St. Louis V. Praprotnik, 485 U.S. 112, 122 (1988) \par (opinion of O'Connor, J.). Courts, however, have \par "routinely applied" the doctrine of respondeat \par superior in Fair Housing Act cases. See City of \par Chicago v. Matchmaker Real Estate Sales Ctr., inc., \par 982 F.2d 1086,1096 (7th Cir. 1992), cert. denied, 113 S. \par Ct. 2961 (1993); see also Bonner v. Lewis, 857 F.2d \par 5.59, 566 (9th Cir. 1988) (respondeat superior applies \par under Rehabilitation Act, as it does under most civil \par rights statutes other than Section 1983). \par The issue of municipal liability based on the actions \par of a municipal employee has arisen infrequently in \par \par ___________________(footnotes) \par \par 5 Petitioner argued below with respect to liability that (1) \par the arbitrator's decision did not violate the Fair Housing Act, \par because senior housing has value, and because the decision did \par not constitute unlawful interference with Borello, see Pet. App. \par 10a-16a and (2) the City was not liable in any event for the \par arbitrator's decision, because the arbitrator was not the City's \par agent, but rather an independent, neutral adjudicator. and \par because the City was entitled to arbitral immunity for the \par arbitrator's acts. see id. at 16a-17a. In making the second \par argument, petitioner did not refer to municipal liability under \par Sections 1981 and 1983 or to any of this Court's decisions \par interpreting those statutes. Nor did petitioner challenge the \par applicability of the doctrine of respondeat superior to \par municipalities under the Fair Housing Act; rather, petitioner \par argued that in this case the person responsible for the \par discriminatory act was not acting as its agent. \par \par ---------------------------------------- Page Break ---------------------------------------- \par \par 9 \par \par Fair Housing Act cases. Indeed, to our knowledge, no \par court of appeals has considered the potential appli- \par cability of the Monell line of cases to suits brought \par under the Fair Housing Act.6 \par \par ___________________(footnotes) \par \par 6 Even if judged under the Monell line of eases, petitioner's \par argument would be incorrect, because the City's position in this \par case constituted an official policy. The City's rent control \par ordinance delegated final decisionmaking authority to the \par arbitrator. The City permitted no appeal from the arbitrator's \par decision, which thus "may fairly be said to represent" the final \par statement of City policy on this issue. Monell, 436 U.S. at 694; \par see also Praprotnik, 485 U.S. at 124 (whether official has final \par policymaking authority is question of state law); Pembaur v. \par City of Cincinnati, 475 U.S. 469, 481 (1986) (plurality opinion) \par (a single decision tailored to particular situation, if made by \par authorized decisionmaker, may constitute official policy under \par Monell). Moreover, although the City was aware of the \par decision and the Fair Housing Act issues involved, it did not \par intervene in the arbitration process, and indeed elected \par (through a vote of the City's governing body) to defend the \par decision as correct. See Praprotnik, 485 U.S. at 127 (where \par authorized policymakers approve subordinate's decision and its \par basis, municipality has ratified decision). \par \par ---------------------------------------- Page Break ---------------------------------------- \par \par 10 \par \par CONCLUSION \par \par The petition for a writ of certiori should be \par denied. \par \par Respectfully submitted. \par \par DREW S. DAYS, III \par Solicitor General \par \par DEVAL L. PATRICK \par Assistant Attorney General \par \par DAVID K. FLYNN \par LISA J. STARK \par LESLIE A SIMON \par Attorneys \par \par July 1995 \par \par }