In U.S. v. Starrett City Associates, the United States Attorney General (hereinafter Government) filed suit against Starrett City, which owned and operated an apartment housing complex in New York City. At issue was whether Starrett City's rental policies violated Title VIII, Sections 3601-3631 of the Fair Housing Act (FHA).
Prior to the Government becoming involved in this case, a group of black applicants brought a lawsuit against Starrett City alleging that Starrett's tenanting procedures violated federal and state law by discriminating against them on the basis of race. A settlement was reached and a consent decree was entered which required that Starrett would make an additional 35 units available each year for a five-year period to black and minority applicants.
After the consent decree was entered, the Government intervened and challenged the legality of Starrett's policy and practice of limiting the number of apartments available to minorities in order to maintain a prescribed degree of racial balance. The Government maintained that Starrett violated the FHA by making apartments unavailable to blacks solely because of race; by forcing black applicants to wait longer for apartments than whites solely because of race; by enforcing a policy that prefers white applicants while representing in an acknowledgment letter that no apartments are available. The Government moved for summary judgment.
Starrett asserted that the tenanting procedures were adopted at the behest of the state, that they were aimed to achieve and maintain integration, and were not motivated by racial animus. The district court rejected Starrett's claim that the duty imposed upon it by the government to achieve housing integration justified its actions. The court accepted the Government's contention that Starrett's practices of making apartments unavailable for blacks, while reserving them for whites, and conditioning rental to minorities based on a "tipping formula," derived only from race or national origin, were clear violations of the FHA.
The district court found that Starrett's tipping argument was undercut by: (1) the wide elasticity of that standard, and (2) the lack of difficulty they had in increasing their black quota from 21% to 35% when it became necessary to avoid litigation in the first lawsuit. The court further found that Starrett violated the FHA by making untrue representations of apartment unavailability to qualified minority applicants in order to reserve units for whites.
Starrett appealed the lower court's ruling. However, the Second Circuit affirmed the district court's decision.
U.S. v. Starrett City Associates, 840 F.2d 1096 (2d Cir. 1988).