Housing and Civil Enforcement Cases
United States v. Todisco Services, Inc. d/b/a Todisco Towing (D. Mass.)
On December 8, 2023, the court entered a consent order in United States v. Todisco Services, Inc. d/b/a Todisco Towing (D. Mass.). The complaint, which was filed by the United States Attorney’s Office on November 13, 2023, alleges that the defendant, a towing company based in Salem, Massachusetts, violated the Servicemembers Civil Relief Act (SCRA) by illegally auctioning off a vehicle belonging to a U.S. Air Force Staff Sergeant who was deployed to Qatar. The consent order requires the defendant to adopt new policies, implement new training requirements, pay $5,000 in compensation to the servicemember, and pay a $1,000 civil penalty to the U.S. Treasury.
United States v. City of Chattanooga (E.D. Tenn.)
On December 8, 2023, the Court entered a Consent Decree in United States v. City of Chattanooga (E.D. Tenn.). The Division filed a complaint in this case on November 6, 2023, alleging that the defendant discriminated on the basis of disability and violated the Fair Housing Act and the Americans with Disabilities Act by refusing to allow four people with disabilities to reside in a four-bedroom home together under the same terms and conditions as residents without disabilities. This case arose out of a HUD complaint filed by Quality Lifestyle Service, Inc., a non-profit corporation that supports independent housing for persons with mental disabilities in the City. The Consent Decree includes an injunction prohibiting future acts of discrimination; requires the City to pay $32,600 in monetary relief to Quality Lifestyle Service and a civil penalty of $5,000; and requires the City to implement revisions to its zoning code, conduct training, and provide compliance reports to the Division. The case was referred to the Division after the U.S. Department of Housing and Urban Development received Quality Lifestyle’s complaint and conducted an investigation.
United States v. Ameris Bank (M.D. Fla.)
On November 7, 2023, the court entered a consent order in United States v. Ameris Bank (M.D. Fla.). The complaint, which was filed on October 19, 2023, alleged that Ameris Bank violated the Equal Credit Opportunity Act (ECOA) and the Fair Housing Act (FHA) by engaging in unlawful redlining in the bank’s Jacksonville, Florida service area. The Department’s complaint alleges that, from 2016 through 2021, Ameris Bank avoided providing mortgage services to majority-Black and Hispanic neighborhoods in Jacksonville and discouraged people seeking credit in those communities from obtaining home loans. Ameris’ home mortgage lending was focused disproportionately on white areas of Jacksonville while other lenders generated applications in majority-Black and Hispanic neighborhoods at three times the rate of Ameris. Additionally, although Ameris operates 18 branches in Jacksonville, Ameris has never operated a branch in a majority-Black and Hispanic neighborhood in the city. The consent order requires Ameris to invest at least $7.5 million in a loan subsidy fund to increase access to home mortgage, home improvement, and home refinance for residents of majority-Black and Hispanic neighborhoods in Jacksonville. Additionally, in those same neighborhoods, Ameris will spend $900,000 for advertising, outreach, and consumer financial education; spend $600,000 to develop community partnerships to provide services that increase access to residential mortgage credit; open a new branch; ensure at least three mortgage loan officers are dedicated to serving those communities; and employ a Director of Community Lending who will oversee the continued development of lending in communities of color in Jacksonville. Ameris will also retain a consultant to assess the bank’s compliance management system as it pertains to redlining risk across all of its markets.
United States v. JAG Management Company LLC (D.N.J.)
On October 4, 2023, the court entered a consent order in United States v. JAG Management Company LLC (D.N.J.). The complaint, which was filed on September 29, 2023, alleges that the property management company for more than twenty large apartment properties in several states, including Maryland, the District of Columbia, Virginia, and Florida, violated the Servicemembers Civil Relief Act (SCRA), 50 U.S.C. § 3955, by demanding that at least nine servicemembers who were terminating their leases early following receipt of qualifying military orders repay rent concessions they had received when they signed their leases. The consent order requires the defendant to pay $41,581.95 in compensation to the servicemembers and a $20,000 civil penalty, to adopt new SCRA policies, and to obtain training on the SCRA.
Press Release - 10/2/2023
United States v. Hinesville Housing Authority, et al. (S.D. Ga.)
On September 29, 2023, the United States filed an “election” complaint in United States v. Hinesville Housing Authority, et al. (S.D. Ga.). The complaint alleges that the defendants violated the Fair Housing Act by evicting the complainant in retaliation for making fair housing complaints against the defendants. Hineshouse Property Management and Maintenance Service, Inc., Hinesville Leased Housing Corporation, and Melanie Thompson are also named as defendants in the case. The case was referred to the Division after the U.S. Department of Housing and Urban Development (HUD) received a complaint, conducted an investigation, and issued a charge of discrimination.
United States v. Washington Trust Company (D. R.I.)
On October 31, 2023, the court entered a consent order in United States v. Washington Trust Company (D.R.I.). The complaint, which was filed on September 27, 2023, alleged that Washington Trust violated the Equal Credit Opportunity Act and the Fair Housing Act by engaging in unlawful redlining in the State of Rhode Island. Specifically, the complaint alleged that despite expansion across the state of Rhode Island, Washington Trust has never opened a branch in a majority-Black and Hispanic neighborhood, relied on mortgage loan officers working out of only majority-white areas as the primary source for generating loan applications, and failed to train or incentivize its lending staff or conduct outreach, marketing and advertising of its mortgage services to compensate for its lack of branches and presence in majority-Black and Hispanic areas. The consent order requires the defendant(s) to invest at least $7 million in a loan subsidy fund to increase access to home mortgage, home improvement, home refinance and home equity loans and lines of credit for residents of majority-Black and Hispanic neighborhoods in Rhode Island; spend $1 million on community partnerships to provide services that increase residential mortgage credit access for residents of those neighborhoods; spend $1 million for advertising, outreach, consumer financial education and credit counseling focused on majority-Black and Hispanic neighborhoods; open two new branches in majority-Black and Hispanic neighborhoods in Rhode Island; and ensure at least two mortgage loan officers are dedicated to serving these neighborhoods; and employ a Director of Community Lending who will oversee the continued development of lending in communities of color. Washington Trust also agreed to complete a community credit needs assessment, to assess and report on its fair lending program; and to train staff on the bank’s obligations under the consent order.
Press Release - 9/27/2023
United States v. Joseph Pedaline, et al. (N.D. Ohio)
On June 18, 2024, the court entered a consent decree in United States v. Joseph Pedaline and YLP LLC (N.D. Ohio). The complaint, which was filed on September 6, 2023, alleged that Joseph Pedaline sexually harassed numerous female tenants since at least 2009 at properties he owned or managed in Youngstown, Ohio. The complaint also named as a defendant YLP LLC, which owned certain properties at the time of Pedaline’s harassment. The consent decree requires the defendants to establish a settlement fund of $189,000 to compensate aggrieved persons, pay a $10,000 civil penalty, and comply with injunctive relief provisions, including limits on future property management, completing fair housing training, and taking steps to repair tenants’ credit and eviction records.
United States v. Joseph Earl Lucas (S.D. Ohio)
On August 26, 2024, the Court denied United Ohio Insurance Company’s motion to intervene as a defendant in United States v. Joseph Earl Lucas, et al. (S.D. Ohio), holding that the insurance company was not entitled to intervention as of right or permissive intervention. This is a pattern or practice lawsuit in which the United States alleges that Joseph Earl Lucas discriminated on the basis of sex in violation of the Fair Housing Act by sexually harassing female tenants and applicants since at least 2003. The United States filed its original complaint on August 31, 2023, and an amended complaint on February 21, 2024. The lawsuit alleges that Mr. Lucas requested sex acts from female tenants and applicants, subjected female tenants to unwelcome sexual touching, made unwelcome sexual comments and advances to female tenants and their female guests, repeatedly drove by and entered female tenants’ homes without their permission, demanded that female tenants engage in sex acts with him in order not to lose housing, and offered to reduce rent or excuse late or unpaid rent in exchange for sex acts. The lawsuit also alleges that Mr. Lucas initiated evictions or threatened to evict female tenants who refused his sexual advances. The amended complaint names Jacob Bush, Joie Carr, and Jeremy Carr as defendants in addition to Joseph Earl Lucas. The amended complaint alleges that Jacob Bush, Joie Car, and Jeremy Carr engaged Joseph Earl Lucas to act as their agent to manage Subject Properties they owned or co-owned during relevant times. The lawsuit, which is the result of a joint investigative effort with the Department of Housing and Urban Development Office of Inspector General, seeks monetary damages to compensate persons harmed by the alleged harassment, a civil penalty to vindicate the public interest and a court order barring future discrimination.
United States v. American Bank of Oklahoma (N.D. Okla.)
On October 3, 2023, the court entered a consent order in United States v. American Bank of Oklahoma (N.D. Okla.). The complaint, which was filed on August 28, 2023, alleged that American Bank of Oklahoma violated the Equal Credit Opportunity Act (ECOA) and the Fair Housing Act (FHA) by engaging in unlawful redlining in the Tulsa, Oklahoma Metropolitan Statistical Area. Specifically, the complaint alleged that the defendant refrained from providing mortgage services to majority-Black and Hispanic neighborhoods and discouraged prospective applicants from those neighborhoods from applying for credit. The consent order requires American Bank of Oklahoma to invest at least $950,000 in a loan subsidy fund to increase access to credit in majority-Black and Hispanic neighborhoods; spend $100,000 on community partnerships to provide services that increase access to residential mortgage credit; and spend $100,000 on advertising, outreach, and consumer financial education in majority-Black and Hispanic communities. The consent order also requires American Bank of Oklahoma to open a loan production office in a Black and Hispanic census tract which will provide access to mortgage services and a community room available to the public; ensure at least two mortgage loan officers are dedicated to serving majority-Black and Hispanic neighborhoods in Tulsa; and conduct a research-based market study to help identify the needs for financial services in majority-Black and Hispanic neighborhoods in Tulsa.
Press Release - 8/28/2023
United States v. Salazar (E.D. Cal.)
On August 28, 2023, the United States filed an election complaint in United States v. Salazar et al. (E.D. Cal.). The complaint alleges that the defendants violated the Fair Housing Act by discriminating and retaliating against the tenant of a single-family home in Bakersfield, California. Specifically, the complaint alleges that the maintenance worker of the property repeatedly asked the tenant to engage in sexual acts with him, persistently commented on her appearance, touched her body without her consent and took digital photographs of framed print pictures in her home of her and her daughter. The tenant reported the harassing behavior to the property manager, who is also the maintenance worker’s father. After she reported the harassment and threatened to contact a lawyer or the police if it continued, the maintenance worker and manager refused to fix a leaking gas line in her dwelling, causing her to go without heat for one month and consequently forcing her to move out. The complaint also alleges that the property owner is vicariously liable for the maintenance worker’s and manager’s conduct. The case was referred to the Division after the U.S. Department of Housing and Urban Development (HUD) received a complaint, conducted an investigation, and issued a charge of discrimination.
United States v. Iraj Shambayati – (S.D. Ga.)
On April 29, 2024, the court entered a consent order in United States v. Iraj Shambayati, 1511 Rosewood LLC and IDHD Properties LLC (S.D. Ga.). Defendant Shambayati is a landlord who owns and manages over 45 residential properties in and around Savannah, Georgia. The complaint, which was filed on August 8, 2023, alleged that since at least 2008, Shambayati harassed female tenants and prospective tenants by making repeated and unwelcome sexual comments and advances, inappropriately touching their bodies without their permission, entering their homes without their permission, requesting sexual acts in exchange for rent or other housing-related benefits, and taking retaliatory actions against female tenants who rejected his sexual advances or complained about the harassment. The consent order requires Shambayati and two other defendants, 1511 Rosewood LLC and IDHD Properties LLC, to pay $590,000 in monetary damages to female tenants and prospective tenants harmed by Shambayati’s conduct, and a $10,000 civil penalty to the United States. The order requires defendants to vacate any retaliatory eviction judgments obtained against these tenants and to take steps to correct the tenants’ credit histories. The defendants are also prohibited from managing residential rental properties in the future. The consent order further requires defendants to retain an independent property manager for the properties, implement a sexual harassment policy and complaint procedure, and submit detailed reports regarding property management activities and compliance with the terms of the consent order.
United States v. Melinda Bautista Teruel (N.D. Cal.)
On July 17, 2023, the United States filed a Fair Housing Act “election” complaint in United States v. Teruel, et al. (N.D. Cal). The complaint alleges that the manager of a two-story, seven-unit apartment complex in Burlingame, California, discriminated on the basis of familial status in violation of 42 U.S.C. §§ 3604(a), (b), (c) and 3617 by pressuring a couple, who had two babies during their tenancy, to move out of their one-bedroom apartment and then falsely accusing the family of causing significant damage to the unit after the family moved out. The complaint names Melinda Bautista Teruel as a defendant both in her individual capacity and as trustee of the Melinda Bautista Teruel 1992 Revocable Trust, which owned the property during the family’s tenancy. The case was referred to the Division after the U.S. Department of Housing and Urban Development received a complaint, conducted an investigation, and issued a charge of discrimination.