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United States v. Sterling

November 12, 2009

UNITED STATES OF AMERICA, PLAINTIFF,
v.
DONALD STERLING, INDIVIDUALLY, IN HIS CAPACITY AS TRUSTEE FOR THE STERLING FAMILY TRUST, AND DOING BUSINESS AS BEVERLY HILLS PROPERTIES; ROCHELLE STERLING, INDIVIDUALLY AND IN HER CAPACITY AS TRUSTEE FOR THE STERLING FAMILY TRUST; STERLING FAMILY TRUST; AND THE KOREAN LAND COMPANY, L.L.C., DEFENDANTS.
KEVIN TYRRELL; KAREN HARRIS-TYRRELL; A.H.T., MINOR, AND E.H.T., MINOR, EACH BY THEIR GUARDIAN AD LITEM KAREN HARRIS-TYRRELL, PLAINTIFFS,
v.
DONALD STERLING, INDIVIDUALLY, IN HIS CAPACITY AS TRUSTEE FOR THE STERLING FAMILY TRUST, AND DOING BUSINESS AS BEVERLY HILLS PROPERTIES; ROCHELLE STERLING, INDIVIDUALLY AND IN HER CAPACITY AS TRUSTEE FOR THE STERLING FAMILY TRUST; STERLING FAMILY TRUST; AND THE KOREAN LAND COMPANY, L.L.C., DEFENDANTS.
DARRELL RHODES; MARY RHODES; J.R., MINOR, M.R., MINOR, AND D.R., MINOR, EACH BY THEIR GUARDIAN AD LITEM DARRELL RHODES, PLAINTIFFS,
v.
DONALD STERLING, INDIVIDUALLY, IN HIS CAPACITY AS TRUSTEE FOR THE STERLING FAMILY TRUST, AND DOING BUSINESS AS BEVERLY HILLS PROPERTIES; ROCHELLE STERLING, INDIVIDUALLY AND IN HER CAPACITY AS TRUSTEE FOR THE STERLING FAMILY TRUST; STERLING FAMILY TRUST; AND THE KOREAN LAND COMPANY, L.L.C., AND DOES 1 THROUGH 10, DEFENDANTS.



The opinion of the court was delivered by: Judge Hon. Dale S. Fischer United States District Judge

CONSENT ORDER

I. INTRODUCTION

1. The United States filed its complaint against Defendants ("Defendants") on August 7, 2006, alleging violations of the Fair Housing Act ("FHA"), Title VIII of the Civil Rights Act of 1968, as amended by the Fair Housing Amendment Act of 1988, 42 U.S.C. §§ 3601 et seq. (the "U.S. Action").

2. Kevin Tyrrell, Karen Harris-Tyrrell, and A.H.T., minor, and E.H.T., minor, each by their guardian ad litem Karen Harris-Tyrrell (collectively, "Tyrrells"), filed their complaint on November 27, 2006, alleging violations of the Fair Housing Act ("FHA"), Title VIII of the Civil Rights Act of 1968, as amended by the Fair Housing Amendment Act of 1988, 42 U.S.C. §§ 3601 et seq., the Civil Rights Action of 1866, 42 U.S.C. § 1982, California Fair Employment and Housing Act, California Government Code § 12955, et seq., California Unruh Civil Rights Act, California Civil Code § 51, et seq., California Business and Professions Code § 17200, California Code of Civil Procedure §§ 1159 and 1160, Los Angeles Municipal Code §§ 151.04, 151.09, 151.10 and 161.1201, California Civil Code §§ 44-46, 789.3, 827, 1499, 1512, 1927, 1940.2, 1941.1, 1942.4, 1924.5, 1942.6, 1947.11, 1927, and 1954, California Health and Safety Code § 17900, et seq., and California Constitution, art. I, §2(a) (the "Tyrrell Action").

3. Darrell Rhodes, Mary Rhodes, and J.R., minor, M.R., minor, and D.R., minor, each by their guardian ad litem Darrell Rhodes (collectively, "Rhodes"), filed their complaint on November 2, 2007, alleging violations of the Fair Housing Act ("FHA"), Title VIII of the Civil Rights Act of 1968, as amended by the Fair Housing Amendment Act of 1988, 42 U.S.C. §§ 3601 et seq., the Civil Rights Action of 1866, 42 U.S.C. § 1982, California Fair Employment and Housing Act, California Government Code § 12955, et seq., California Unruh Civil Rights Act, California Civil Code § 51, et seq., California Business and Professions Code § 17200, California Code of Civil Procedure §§ 1159 and 1160, Los Angeles Municipal Code §§ 151.04, 151.09, 151.10 and 161.1201, California Civil Code §§ 44-46, 789.3, 827, 1499, 1512, 1927, 1940.2, 1941.1, 1942.4, 1924.5, 1942.6, 1947.11, 1927, and 1954, California Health and Safety Code § 17900, et seq., California Penal Code § 484(a), and California Constitution, art. I, §§ 1 and 2(a) (the "Rhodes Action").

4. The U.S. Action, the Tyrrell Action, and the Rhodes Action shall hereinafter be referred collectively as "the Actions". The Actions were consolidated for discovery by this Court. The Court hereby consolidates the Actions for the purpose of entering and enforcing this Consent Order.

5. Defendants, and each of them, deny violating the FHA or engaging in any wrongful conduct of any type or nature as alleged in the Actions. Defendants, and each of them, further deny discriminating against any tenant or prospective tenant on the basis of race, color, national origin or familial status. This Consent Order is a compromise of disputed claims, and is not to be construed as an admission of liability on the part of Defendants, by whom liability is expressly denied.

6. At all times relevant to this case, the Defendants owned and/or managed multi-family residential rental properties located in Los Angeles County, California.

7. The Parties desire to fully and finally settle the Actions to avoid costly and protracted litigation and agree that the claims against Defendants should be settled as set forth in this Consent Order without incurring the time and expense of further litigation. Therefore, without any admission of any liability or any wrongdoing, the Parties have agreed to the entry of this Consent Order.

THEREFORE, IT IS HEREBY ORDERED:

II. JURISDICTION AND SCOPE

8. The Court has subject matter jurisdiction over the claims in the Actions pursuant to 28 U.S.C. §§ 1331, 1345 and 42 U.S.C. § 3614(a).

9. The provisions of this Consent Order shall be binding on Defendants, their heirs, successors and assigns, and their agents and employees (including, but not limited to, all employees or agents of Beverly Hills Properties) with respect to the Los Angeles County Residential Rental Properties. For purposes of this Consent Order, the "Los Angeles County Residential Rental Properties" shall refer to the 119 buildings comprising approximately 5,706 dwelling units that Defendants currently own or manage, and any additional properties that Defendants otherwise acquire or manage, in Los Angeles County during the term of this Consent Order. The provisions of this Consent Order shall cease to apply to any Los Angeles County Residential Rental Property if Defendants sell or otherwise transfer a majority interest to a third party unaffiliated with any of the Defendants and Defendants cease to have management responsibilities in such property. Defendants shall provide to the United States, by facsimile and first class mail, written notice of its sale or transfer and the identity of the buyer or transferee.

III. GENERAL INJUNCTION

10. Defendants, with respect to the Los Angeles County Residential Rental Properties, are hereby enjoined from:

a. Refusing to rent a dwelling, refusing or failing to provide or offer information about a dwelling, or otherwise making unavailable or denying a dwelling to persons because of race, color, national origin or familial status;

b. Discriminating against any person in the terms, conditions, or privileges of rental of a dwelling or in the provision of services or facilities in connection therewith, including engaging in any harassment or intimidation, because of race, color, national origin or familial status;

c. Making, printing, publishing, or causing to be made, printed or published, any notice, statement, or advertisement with respect to the rental of a dwelling that indicates any preference, limitation, or discrimination on the basis of race, color, national origin or familial status;

d. Misrepresenting the availability of units based on race, color, national origin or familial status; and

e. Coercing, intimidating, threatening or interfering with any person in the exercise or enjoyment of, or on account of his having exercised or enjoyed, or on account of his having aided or encouraged any other person in the exercise or enjoyment of any right protected by the FHA.

IV. AFFIRMATIVE RELIEF

11. Application and Tenancy Procedures: Defendants shall comply with the procedures contained in this Consent Order with respect to the rental of dwellings at the Los Angeles County Residential Rental Properties to ensure compliance with the FHA and to ensure that these dwellings are made available for rent on an equal basis and on the same terms and conditions for all persons, irrespective of race, color, national origin or familial status.

12. Nondiscrimination Policy: Within thirty (30) days of the entry of this Consent Order, Defendants shall submit their existing written Nondiscrimination Policy for approval to the United States*fn1. Within fourteen (14) days of the United States' approval of the Nondiscrimination Policy, the Defendants shall distribute any modified Nondiscrimination Policy. During the term of this Consent Order, if Defendants wish to modify or alter the Nondiscrimination Policy, they shall submit the proposed changes to counsel for the United States for review and approval.

13. Uniform and Nondiscriminatory Procedures: Within thirty (30) days of the entry of this Consent Order, Defendants shall submit for approval to the United States Uniform and Nondiscriminatory Procedures in connection with:

a. receiving, handling, processing, rejecting, and approving rental inquiries and applications made in-person, by telephone, by mail, or by other means;

b. assigning prospective tenants to new units; and c. transferring existing tenants to different units.

Within fourteen (14) days of the United States' approval of the Uniform and Nondiscriminatory Procedures, Defendants shall implement such Uniform and Nondiscriminatory Procedures. During the term of this Consent Order, if Defendants wish to modify or alter the Uniform and Nondiscriminatory Procedures, they shall submit the proposed changes to counsel for the United States for review and approval. The Uniform and Nondiscriminatory Procedures shall be consistent with the practices and procedures outlined in paragraphs 14-18.

14. Vacancy Reports: Defendants shall maintain current, accurate vacancy reports of all dwellings available or expected to be available for rental within the next thirty (30) days ("Vacancy Report"), which include for each dwelling:

a. The address, apartment number, and number of bedrooms;

b. Whether the apartment is vacant and, if not, the date that the apartment is scheduled to be vacant; and

c. Whether the apartment is available to be moved into and, if not, the date that it is expected to be available for move-in.

The Vacancy Report shall be updated at least weekly and shall bear the date it was issued or updated at the top.

15. Inquiry Logs: Within fifteen (15) days of the entry of this Consent Order, Defendants shall maintain Inquiry Logs and request all persons who visit to inquire about renting an apartment to sign the Inquiry Log, provide the date of their visit, their name, their address, their telephone numbers, and the date by when they wish to move. Defendants shall note on the Inquiry Log the dwelling units the person was shown, if any, whether the person was given an application, the name of the employee who attended to the individual inquiring about a dwelling unit, and whether the visitor was referred to any other properties owned or managed by Defendants.

16. Wait Lists: As of the date of entry of this Consent Order, Defendants shall offer to any person that applies for an apartment or inquires about available apartments that they may be added to a Wait List for the type(s) of apartment the applicant is seeking. Defendants shall maintain for a eight (8) week period Wait Lists at each apartment building containing the names of the individuals who wish to be included on the Wait List. The Wait List shall also request information regarding the applicant's current address, telephone number, and the size of the dwelling unit the individual seeks. Defendants shall also indicate, for each applicant, the time and date he or she was placed on the Wait List and the name of the employee who received the applicant's application.

17. Rental Applications: Defendants shall write legibly on each rental application filled out by a prospective tenant the month, day, year, and time that Defendants received the application. Defendants shall review the applications in the order in which they are received. To the extent Defendants reject any application for housing, Defendants shall provide, either on the application or on an attachment to the application, a written explanation why the applicant was not offered a tenancy, any supporting documentation, and the name of the employee who made the decision. Defendants shall attempt to notify such applicant of the rejection and the reason therefor. Defendants shall permit all persons who inquire about renting a dwelling unit the opportunity to apply for an apartment.

18. Information Provided to Prospective Applicants: Defendants shall advise all persons who inquire about renting a dwelling that they may receive an application to be filled out and, if an apartment of the type that the person requested is not available, they shall be informed of the opportunity to be placed on a Wait List.

The application shall inform all persons on each application that they will be treated equally, irrespective of race, color, national origin, or familial status.

V. EDUCATIONAL PROGRAM

19. Within one hundred and twenty (120) days of the entry of this Consent Order, all agents or employees of the Defendants who have responsibility for showing, renting, or managing dwellings at the Los Angeles County Residential Properties shall attend and complete a fair housing training program, approved by the United States, at the Defendants' expense. The training shall be conducted by a qualified third party, (including but not limited to the Housing Rights Center), unconnected to Defendants or their employees or officers, agents, or counsel. Defendants shall notify the United States of the name, address and professional background of the trainer that Defendants select at least thirty (30) days in advance of such training. The United States may reasonably object to the trainer within ten (10) days of receipt of the notice, in which case Defendants shall select an alternate trainer acceptable to the United States. If no objection is received by the Defendants, the trainer so selected shall stand approved.

20. The training shall include the following:

a. Informing each individual of his or her duties and obligations under this Consent Order as well as under the FHA;

b. Furnishing to each individual a copy of Defendants' Nondiscrimination Policy and Uniform and Nondiscriminatory Procedures ...


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