United States v. Bob Lawrence Realty, Inc.

• Decision Date: 16 March 1973
• Docket Number: No. 72-1655.,72-1655.
• Citation: 474 F.2d 115
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. BOB LAWRENCE REALTY, INC., et al., Defendants-Appellants.
• Court: U.S. Court of Appeals — Fifth Circuit

474 F.2d 115 (1973)

UNITED STATES of America, Plaintiff-Appellee, v. BOB LAWRENCE REALTY, INC., et al., Defendants-Appellants.

No. 72-1655.

United States Court of Appeals, Fifth Circuit.

February 13, 1973.

Rehearing Denied March 16, 1973.

COPYRIGHT MATERIAL OMITTED

Glenville Haldi, Atlanta, Ga., for defendants-appellants.

John W. Stokes, Jr., U. S. Atty., David L. Norman, Asst. Atty. Gen., Martin Barenblat, John N. Mitchell, Atty. Gen., Carl W. Gabel, Civil Rights Div., U. S. Dept. of Justice, Washington, D. C., for plaintiff-appellee.

Charles L. Weltner, Atlanta, Ga., for Stanley.

Earle B. May, Jr., Atlanta, Ga., for D. L. Stokes.

Wesley R. Asinof, Atlanta, Ga., for Reeves & Reeves.

Noah J. Stone, Julian E. Gortatowsky, Atlanta, Ga., for Heimerich.

Before GOLDBERG, AINSWORTH and INGRAHAM, Circuit Judges.

GOLDBERG, Circuit Judge:

This case presents the first appellate challenge to the constitutionality of 42 U.S.C. § 3604(e), the "anti-blockbusting" provision of the Fair Housing Act of 1968, Title VIII of the Civil Rights Act of 1968, 42 U.S.C. § 3601 et seq. We find that § 3604(e) falls within the constitutional authority of Congress to enact legislation to enforce the Thirteenth Amendment and that § 3604(e) does not violate the First Amendment. The District Court enjoined appellant from violating § 3604(e). We affirm.

This action was brought by the Department of Justice pursuant to Title VIII of the Civil Rights Act of 1968, 42 U.S.C. § 3601 et seq., alleging that appellant, Bobby L. Lawrence, President of Bob Lawrence Realty, Inc., and four other Atlanta, Georgia real estate brokers had undertaken "blockbusting" activities prohibited by 42 U.S.C. § 3604(e).¹ The government's complaint seeking injunctive relief arose out of all the defendants' solicitation activities in racially transitional areas in southeast Atlanta. It alleged (1) that the defendants participated, individually and collectively, in a pattern or practice of resistance to the enjoyment of rights granted by the Act, and (2) that a group of persons had been denied rights secured by the Act, raising an issue of general public importance. See, 42 U.S.C. § 3613.²

The District Court denied several motions filed by appellant and various other defendants, including motions to dismiss, for a more definite statement, for a jury trial, and for a severance. United States v. Bob Lawrence Realty, Inc., N.D.Ga.1970, 313 F.Supp. 870 (Lawrence I).³ Following the denial of these motions, appellant and two other defendants filed separate motions for summary judgment, which the District Court denied. The District Court held, however, that the government's affidavits and documentary evidence were insufficient to make out an "individual pattern or practice" of violations by appellant, and granted summary judgment as to that issue. The District Court also held that triable issues of fact existed as to whether appellant had participated in a "group pattern or practice" of unlawful conduct and as to whether there had been a denial of rights secured by the Act to a group of persons raising an issue of general public importance. United States v. Bob Lawrence Realty, Inc., N.D.Ga.1971, 327 F.Supp. 487 (Lawrence II).

Shortly before the trial, consent decrees were entered against two of the five original defendants, and the action against a third was dismissed. The case as it pertained to appellant and the other remaining defendant then proceeded to trial. The District Court made the following findings of fact, which are more fully set out in its opinion. United States v. Mitchell, N.D.Ga.1971, 335 F.Supp. 1004.

Appellant is a real estate broker licensed by the State of Georgia to engage in the listing and selling of real estate,⁴ and employs twenty seven sales personnel who act as his agents.⁵ During the period with which this action is concerned, appellant did business in the Candler Road — McAfee area in southeast Atlanta. Appellant was aware that this area has been a racially transitional area since 1968, approximately two years before the action was filed. Prior to 1968 the racial composition of the area was all white, but as blacks began moving into the area in 1968, whites began moving out. Two of appellant\'s sales personnel made representations prohibited by 42 U.S.C. § 3604(e) to four different individuals. Although these representations did not constitute an "individual pattern or practice" of violating the Act, they were made as part of a "group pattern or practice" of violating the Act by all agents in the area.

The District Court did not consider the evidence sufficient to raise an issue of general public importance as required by 42 U.S.C. § 3613 and made no finding as to whether a group of persons had been denied rights under the Act. The District Court also made no finding concerning appellant's counterclaim and cross-action to recover attorney's fees and for damages.

On December 27, 1971, the District Court issued its opinion and order enjoining appellant from further unlawful conduct, from which ruling only appellant appeals.⁶

On appeal to this Court, appellant launches a scatter gun attack on the District Court's order. As we perceive appellant's brief, he presents four arguments: (1) 42 U.S.C. § 3604(e) is unconstitutional; (2) the Attorney General lacks standing to maintain this action; (3) the injunctive relief is improper; and (4) appellant is entitled to recover reasonable attorney's fees.

I. CONSTITUTIONALITY OF SECTION 3604(e)

Blockbusting has been described as a process through which individuals stimulate and prey

". . . on racial bigotry and fear by initiating and encouraging rumors that negroes . . . are about to move into a given area, that all non-negroes . . . will leave, and that the market values of properties . . . will descend to `panic prices\' with residence in the area becoming undesirable and unsafe for non-negroes."

Contract Buyers League v. F & F Investment, N.D.Ill.1969, 300 F.Supp. 210, 214. See generally, Note, Blockbusting, 59 Geo.L.J. 170 (1970); Note, Blockbusting: A Novel Statutory Approach to an Increasingly Serious Problem, 7 Colum. J. of Law & Soc. Sci. 538 (1971). Blockbusting practices ". . . constitute a fundamental element in the perpetuation of segregated neighborhoods, racial ghettos and the concomitant evils which have been universally recognized to emanate therefrom." Brown v. State Realty Co., N.D.Ga.1969, 304 F.Supp. 1236, 1240. In order to attack this pernicious example of a capitalistic ethic gone astray, Congress enacted 42 U.S.C. § 3604(e), the antiblockbusting provision of the Fair Housing Act of 1968.⁷ Congress was aware that as laudable and necessary as the profit motive might be for our socio-economic system, it must on occasion yield to more humane and compassionate mores which are inherent in the system itself, and necessary for its survival.

Appellant argues that § 3604(e) is unconstitutional on two grounds: (A) Congress does not have authority to enact the statute. (B) The statute violates the First Amendment.

A. Congressional authority

In evaluating appellant's first contention that Congress has no authority to enact § 3604(e), we are given much guidance by the decision of the United States Supreme Court in Jones v. Mayer Co., 1968, 392 U.S. 409, 88 S.Ct. 2186, 20 L.Ed.2d 1189. In upholding the constitutionality of 42 U.S.C. § 1982, the Court stated:

"Our starting point is the Thirteenth Amendment, for it was pursuant to that constitutional provision that Congress originally enacted what is now § 1982. The Amendment consists of two parts. Section 1 states:

`Neither slavery nor involuntary servitude, except as a punishment for crime whereby the party shall have been duly convicted, shall exist within the United States, or any place subject to their jurisdiction.\' Section 2 provides:

`Congress shall have power to enforce this article by appropriate legislation.\'

"As its text reveals, the Thirteenth Amendment `is not a mere prohibition of State laws establishing or upholding slavery, but an absolute declaration that slavery or involuntary servitude shall not exist in any part of the United States.\' It has never been doubted, therefore, `that the power vested in Congress to enforce the article by appropriate legislation,\' ibid., includes the power to enact laws `direct and primary, operating upon the acts of individuals, whether sanctioned by state legislation or not.\'"

"Thus, the fact that § 1982 operates upon the unofficial acts of private individuals, whether or not sanctioned by state law, presents no constitutional problem. If Congress has power under the Thirteenth Amendment to eradicate conditions that prevent Negroes from buying and renting property because of their race or color, then no federal statute calculated to achieve that objective can be thought to exceed the constitutional power of Congress simply because it reaches beyond state action to regulate the conduct of private individuals. The constitutional question in this case, therefore, comes to this: Does the authority of Congress to enforce the Thirteenth Amendment `by appropriate legislation\' include the power to eliminate all racial barriers to the acquisition of real and personal property? We think the answer to that question is plainly yes."

"`By its own unaided force and effect,\' the Thirteenth Amendment `abolished slavery, and established universal freedom\'. Whether or not the Amendment itself did any more than that — a question not involved in this case — it is at least clear that the Enabling Clause of that Amendment empowered Congress to do much more. For that clause clothed `Congress with power to pass all laws necessary and proper for abolishing all badges and incidents of slavery in the United States\'. (Emphasis added.)"

392 U.S. at 437-439, 88 S.Ct. at 2202-2203, 20 L.Ed.2d at 1206-1207. (Citations and footnotes omitted.)

We think that the mandate of Jones is clear. This Court...