Cabrera v. Jakabovitz, s. 317

Citation24 F.3d 372
Decision Date05 May 1994
Docket NumberD,318 and 510,Nos. 317,s. 317
Parties64 Fair Empl.Prac.Cas. (BNA) 1239, 62 USLW 2772 Orlando CABRERA, Linda McCoggle, Jeannette Ramsey, on behalf of themselves, and all others similarly situated, Open Housing Center, Inc., Plaintiffs-Appellees, Cross-Appellants, v. Jeno JAKABOVITZ, Benjamin Breitman, Defendants-Appellants-Cross-Appellees, Emanuel Fischler, doing business as AM Realty Co., James Siegel, Carl Matos, also known as Carlos Matos, Defendants. ockets 93-7261(L), 93-7371 and 93-7409.
CourtUnited States Courts of Appeals. United States Court of Appeals (2nd Circuit)

Marvin H. Wolf, Dix Hills, NY (Alan F. Katz, Jeffrey M. Garber, on the brief), for defendant-appellant-cross-appellee Jakabovitz.

Howard B. Schoenfeld, New York City (Hiller & Frank, Milwaukee, WI; Leonard W. Wagman, Snow, Becker & Krauss, on the brief), for defendant-appellant-cross-appellee Breitman.

Lynn E. Judell, New York City (David M. Brodsky, Leslie A. Rubin, Sofia C. Hubscher, Schulte Roth & Zabel, on the brief), for plaintiffs-appellees, cross-appellants.

Before: NEWMAN, Chief Judge, FEINBERG, Circuit Judge, and POLLAK, * District Judge.

JON O. NEWMAN, Chief Judge:

This appeal presents important issues concerning the framing of jury instructions in all types of discrimination cases. The appeal also presents specific issues concerning the circumstances under which landlords may be found liable for discrimination undertaken either directly by them or by real estate brokers acting as their agents. The issues arise on an appeal from a judgment of the District Court for the Eastern District of New York (Arthur Spatt, Judge) entered after a jury verdict, awarding compensatory and punitive damages in a suit alleging racial discrimination in the rental of housing. We affirm, except for one aspect of the calculation of attorney's fees, as to which we remand for further consideration.

Background

In 1987, the Open Housing Center, a not-for-profit organization whose primary purpose is to promote equal opportunity in housing in New York, began an investigation of AM Realty, a real estate brokerage firm in Brooklyn, to see whether it was complying with a prior consent decree not to discriminate in providing housing services. On four occasions from February to July 1987, the Center sent a pair of "testers" 1 of different races to AM Realty's offices to inquire about renting apartments in certain Brooklyn neighborhoods. The two testers in each pair presented a similar rental "profile," each claiming to have a family composition and income similar to the person with whom he or she was paired. In each of the tests, the realty agency directed the White tester in each pair to look at apartments in predominantly White neighborhoods, but directed the African-American or Latino tester to look at apartments in predominantly minority neighborhoods, or, alternatively, informed the minority tester that no apartments were available at all.

With this evidence of "racial steering" 2 by the broker, the Center then turned to examine which landlords employed this particular broker. The Center discovered that Jeno Jakabovitz and Benjamin Breitman were among the landlords who listed their apartments with AM Realty. Jakabovitz owns fourteen buildings in Brooklyn; Breitman owns two. The Center then sent a pair of testers directly to Jakabovitz's offices to inquire about available apartments. Again, the White tester was offered an apartment, while the African-American tester was not.

In the first test, the Open Housing Center sent Orlando Cabrera, a Latino tester, to AM Realty on February 1, 1987. Cabrera asked AM Realty broker Carl Matos for a one-bedroom apartment in Sheepshead Bay or Kings Highway. After making some phone calls, Matos informed Cabrera that no apartments were available. Later that same day, Cindy Reiman, a White tester, arrived and requested a one-bedroom in Sheepshead Bay or Midwood. She spoke with a different broker, James Siegel, who offered her three apartments in Sheepshead Bay, and even drove her to one of the apartments in his car.

In the second test, Ronald Luckett, an African-American tester, inquired on March 6, 1987, at AM Realty about a one-bedroom or studio apartment in Sheepshead Bay or Midwood. Broker Carl Matos offered him an apartment in Flatbush, a predominantly African-American and Latino area. Susan Hamovitch, a White tester, arrived two hours later and met with broker James Siegel. She asked for a one-bedroom or "junior four" apartment 3 in Sheepshead Bay or Midwood. Siegel offered her a "junior four" in Sheepshead Bay and also a one-bedroom apartment in a building owned by Breitman in Kensington, a neighborhood she had not requested. Hamovitch was also offered a "junior four" apartment in Sheepshead Bay. Breitman says that the apartment in his building to which Hamovitch was referred was later rented to a Latino person.

In the third test, Linda McCoggle, an African-American tester, went to AM Realty on May 2, 1987. Upon entering AM Realty's offices, she was informed by the receptionist that no one was available to see her. The receptionist gave her Carl Matos's business card. McCoggle called AM Realty that same day and spoke with Matos, who told her that no apartments were available, and asked her to call back later in the week. McCoggle did call Matos back, but was again told that there was nothing available. McCoggle called a third time and left a message, but no one returned her call. Rachel Schwartz, a White tester, also arrived at AM Realty's offices on May 2, 1987, a short time after McCoggle's visit. She met with Marianne Hascup who told her that both rental agents were out, but gave her Siegel's card and assured her that apartments were available. Siegel called Schwartz a few days later and gave her six apartment listings. He spoke with her the next day and added two new apartments. He subsequently called Schwartz two more times to ask whether Schwartz was interested in any of the apartments.

In the fourth test, Augustin Hinkson, an African-American tester, met with Siegel at AM Realty's offices on July 24, 1987. Siegel told Hinkson that there were no apartments available in Sheepshead Bay, Kings Highway, or Midwood. After returning home, Hinkson called AM Realty and left a message for Siegel, who never called back. Nancy Steifel, a White tester, arrived at AM Realty's offices later that same day. She also requested a one-bedroom in Kings Highway and Sheepshead Bay. Hascup offered her two listings for one-bedroom apartments in those areas.

In the final test, the Open Housing Center sent testers directly to Jakabovitz's offices. Phyllis Spiro, a White tester, went to Jakabovitz's offices on July 29, 1987, and asked for an apartment in Kings Highway or Sheepshead Bay. Jakabovitz told her that there was a one-bedroom apartment available in Kings Highway. Jakabovitz said that the apartment's current tenant had recommended for tenancy a young man who had given Jakabovitz a deposit, but that he "didn't care for that young man," and that if she acted quickly he would rent the apartment to her instead. Jakabovitz also asked Spiro if she was interested in an apartment in Bensonhurst, and she replied that she was not. After Spiro left Jakabovitz's office she went to a location about three blocks away where she had arranged to meet Jeannette Ramsey, an African-American tester. Ramsey then went to Jakabovitz's office and explained that she was looking for an apartment in Kings Highway or Borough Park. Jakabovitz told her that there was nothing available in the areas she requested, but asked if she would be interested in "Cypress." This was apparently a reference to Cypress Hills, a predominantly African-American neighborhood. Ramsey did not indicate any interest in this neighborhood but instead asked Jakabovitz to contact her if anything else became available. Ramsey testified that Jakabovitz never asked her about the size of the apartment she wanted, how much she was willing to pay, or if she was interested in an apartment in Bensonhurst, nor did he call her to follow up.

To recapitulate, the White apartment seekers who followed minority testers Cabrera, McCoggle, and Hinkson were informed of apartments available in buildings owned by Jakabovitz, and the White tester who followed minority tester Luckett was told that there was an apartment available in a building owned by Breitman. Meanwhile, none of the minority testers was informed of any apartments in any building owned by either Jakabovitz or Breitman. When Jakabovitz was tested directly, he informed White tester Spiro that an apartment was available in the area that she had requested, but told African-American tester Ramsey less than an hour later that no apartment was available in that same area. Jakabovitz admitted at trial that in 1987 he had no African-American tenants in any of the buildings he owned in the predominantly White areas at issue.

Based on the results of these tests, the Open Housing Center, along with minority testers Orlando Cabrera, Linda McCoggle, and Jeannette Ramsey, sued Jakabovitz and Breitman, AM Realty, and AM Realty's brokers, for violating Title VIII of the Civil Rights Act of 1968 ("Fair Housing Act" or "Title VIII"), 42 U.S.C. Secs. 3601-19; the Civil Rights Act of 1870 ("section 1981"), 42 U.S.C. Sec. 1981, involving the right to enter into a contract; and the Civil Rights Act of 1866 ("section 1982"), 42 U.S.C. Sec. 1982, involving the right to lease real property.

After a two-week trial, the jury rendered a verdict largely in plaintiffs' favor. It found that Matos discriminated against minority testers Cabrera and Luckett in violation of Title VIII, but determined that he did not discriminate against plaintiff McCoggle. The jury found that Siegel discriminated against minority tester Hinkson in violation of Title VIII, and that Jakabovitz discriminated against minority tester Ramsey in violation of ...

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