South-Suburban Housing Center v. Greater South Suburban Bd. of Realtors

• Decision Date: 05 September 1991
• Docket Number: 89-2218,SOUTH-SUBURBAN,89-2777,Nos. 89-2115,89-2123,89-2767,89-2122,89-2778 and 89-2846,s. 89-2115
• Citation: 935 F.2d 868
• Parties: HOUSING CENTER, Plaintiff-Appellee, Cross-Appellant, v. GREATER SOUTH SUBURBAN BOARD OF REALTORS and National Association of Realtors, Defendants, Counterplaintiffs-Appellants, Cross-Appellees, v. CITY OF BLUE ISLAND, et al., Counterdefendants-Appellees, Cross-Appellants.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 868

935 F.2d 868

60 USLW 2022

SOUTH-SUBURBAN HOUSING CENTER, Plaintiff-Appellee, Cross-Appellant, v. GREATER SOUTH SUBURBAN BOARD OF REALTORS and National

Association of Realtors, Defendants, Counterplaintiffs-Appellants, Cross-Appellees, v. CITY OF BLUE ISLAND, et al., Counterdefendants-Appellees,

Cross-Appellants.

Nos. 89-2115, 89-2122, 89-2123, 89-2218, 89-2767, 89-2777,

89-2778 and 89-2846.

United States Court of Appeals,

Seventh Circuit.

Argued Feb. 15, 1990.

Decided June 19, 1991.

Rehearing and Rehearing In Banc

Denied Sept. 5, 1991.

Robert C. Johnson, C. Mark Kingseed, Richard Chessen, Sonnenschein, Nath & Rosenthal, Alexander Polikoff, Robert L. Jones, Jr., John R. Hammell, Roger Baldwin Foundation, Chicago, Ill., for plaintiff-appellee, cross-appellant South-Suburban Housing Center.

Philip C. Stahl, Darrell J. Graham, David E. Schoenfeld, Grippo & Elden, Chicago, Ill., for defendants, counterplaintiffs-appellants, cross-appellees Greater South Suburban Bd. of Realtors and National Ass'n of Realtors.

Barbara E. Hermansen, Richard J. Hoskins, Joseph A. Cancila, Jr., Thomas B. Quinn, Schiff, Hardin & Waite, Chicago, Ill., James R. Schirott, John T. Elsner, Schirott & Associates, Itasca, Ill., for defendants-appellees City of Blue Island, Village of Calumet Park, City of Country Club Hills, Village of Glenwood, Village of Hazel Crest, Village of Matteson, Village of Park Forest, Village of Richton Park and Village of University Park.

Cary A. Horvath, Chicago, Ill., for defendant-appellee Village of Calumet Park.

Ronald L. Kammer, Hinshaw & Culbertson, Chicago, Ill., for defendant-appellee City of Country Club Hills.

Thomas S. Moore, Frank K. Neidhart, Jr., McCarthy, Duffy, Neidhart & Snakard, Chicago, Ill., for defendant-appellee Village of University Park.

Jonathon H. Margolies, Schiff, Hardin & Waite, Chicago, Ill., for defendant-appellee City of Blue Island.

Before WOOD, Jr., COFFEY and FLAUM, Circuit Judges.

COFFEY, Circuit Judge.

These consolidated appeals deal with a variety of constitutional and Fair Housing Act challenges to real estate marketing activities and municipal ordinances affecting the real estate market in a number of the southern suburbs of Chicago, Illinois. The municipalities involved are the Cities of Blue Island and Country Club Hills and the Villages of Calumet Park, Glenwood, Hazel Crest, Matteson, Park Forest, Richton Park and University Park. The court disposed of these issues following a bench trial consisting of approximately eight weeks of testimony presented intermittently between March 23, 1987, and September 1, 1987.

We affirm 1) the district court's finding that Greater South Suburban Board of Realtors and National Association of Realtors (the Realtors) did not violate the Fair Housing Act in excluding South Suburban Housing Center's (SSHC) Apache Street homes from the Multiple Listing Service or in commencing disciplinary action against SSHC's realtor, William Motluck; 2) the trial judge's determinations that the Realtors lacked standing to pursue their Equal Protection claim against SSHC and Park Forest and that the affirmative marketing plan applicable to the Apache Street homes was permissible under the Fair Housing Act; 3) the district court's determinations upholding against First Amendment challenge the municipal ordinances of Country Club Hills, Matteson, Park Forest and University Park concerning the size, placement and number of "for sale" signs; and 4) the trial court's conclusion that the municipal ordinances of the City of Country Club Hills and the Villages of Hazel Crest, Matteson, Glenwood and Park Forest limiting solicitation did not violate the Fair Housing Act. We reverse the district judge's finding that the anti-solicitation ordinances of the above-mentioned municipalities violated the First Amendment and were unconstitutional because of vagueness. We also reverse the district court's conclusion that the Country Club Hills permit fee for the erection of "for sale" signs was free from constitutional infirmity. And we remand for further consideration the Realtors' claim that the Village of Glenwood's ban of "for sale" signs violated the Fair Housing Act, despite the eleventh-hour repeal of the same.

I. FACTS

The municipal defendants are located in an area bordered on the north by the City of Chicago, on the west approximately by Harlem Avenue or Interstate 57, on the south roughly by Will County and on the east by the Indiana State line. The district court found that these formerly all-white suburbs have become integrated, but now face the threat of resegregation as a result of

"a complex mix of market forces. These market forces include racial prejudice: some whites and some blacks prefer to live in segregated communities; the belief that high concentrations of blacks result in a drop in home values; the expectation that an integrated community will eventually become segregated; and housing search practices that are reinforced by certain real estate practices."

South-Suburban Housing Center v. Greater South Suburban Board of Realtors, 713 F.Supp. 1068, 1074 (N.D.Ill.1988). In order to stem the tide of these market forces and promote integrated housing patterns, the plaintiff, SSHC, "attempted to influence the housing market by encouraging the sales and marketing of real estate in what it terms to be 'non-traditional' ways, i.e., encouraging whites to move to black or integrated areas and blacks to move to white or integrated areas." Id. at 1075. A controversy between South-Suburban Housing Center and the Realtors over the propriety of SSHC making special efforts to market houses in black neighborhoods to white home buyers spawned the initial complaint in this litigation, which has resulted in the eight appeals consolidated herein.

The plaintiff, SSHC, is an Illinois, non-profit corporation whose "purposes are to 'promote and encourage multiracial communities in the South Suburbs' of Chicago and 'promote open housing to all people regardless of race.' " Id. at 1073. SSHC engages in a program of "affirmative marketing" of real estate, which "consists of race conscious efforts to promote integration or prevent segregation through special marketing of real estate to attract persons of particular racial classifications who are not likely to either be aware of the availability or express an interest in the real estate without such special efforts." Id. at 1075.

The defendants/counterplaintiffs are two realtor trade associations, the Greater South Suburban Board of Realtors (GSSBR) and the National Association of Realtors (NAR). The GSSBR is an Illinois, non-profit corporation which is an organization of licensed real estate brokers and salesmen operating in the south suburbs of Chicago. One of GSSBR's activities is the operation of a multiple listing service (MLS) in the south suburbs. The district court described the MLS as follows:

"[the] multiple listing service ('MLS') [is] a facility by which a MLS member broker makes a blanket unilateral offer of subagency to all other MLS participants with respect to a home listed with that broker. The MLS computer data base contains information about homes listed for sale with its members. MLS members and their home-seeking prospects can review this data via computer terminals or by reviewing printed compilations distributed to members on a bi-weekly basis."

Id. at 1077. The NAR is also an Illinois non-profit corporation and an organization of licensed real estate brokers that "provides policy guidance and materials and services of various sorts to its local affiliates, including the GSSBR." Id. at 1073.

The other litigants in this case are nine south suburban municipalities, the Cities of Blue Island and Country Club Hills and the Villages of Calumet Park, Glenwood, Hazel Crest, Matteson, Park Forest, Richton Park and University Park. These municipal defendants are parties to the suit as a result of ordinances they enacted either regulating real estate broker in-home solicitations or regulating the exhibition of real estate "for sale" signs. The Village of Park Forest also faces a legal challenge because of its alleged involvement with SSHC's efforts to "affirmatively market" to white individuals three homes South-Suburban Housing Center purchased from Park Forest.

The facts of this case deal with the following: 1) concerns over affirmative marketing, 2) limitations on real estate broker solicitation and 3) restrictions on "for sale" signs.

A. Affirmative Marketing

This action originated as a result of the Realtors' reaction to South-Suburban Housing Center's attempts to promote a racial balance in the Village of Park Forest through making special efforts to interest white home buyers in property there. The current racial imbalance came about during the 1970s when many black families moved into an area in the northeast corner of the Village of Park Forest, Illinois known as the Eastgate subdivision. At the time of the 1980 census, the census block including the homes at issue here had become more than fifty-six percent black, more than double the black population of any other census block in the Eastgate subdivision. As a result of the area's reputation as "a black block," few white families were interested in buying property. The area became less attractive to home buyers as VA and FHA mortgage foreclosures led to abandoned homes and neighborhood blight. See South-Suburban Housing Center, 713 F.Supp. at 1076. In response to the problem of abandoned homes in the Eastgate subdivision, in 1982 the Village of Park Forest instituted a program of purchasing vacant or abandoned homes for rehabilitation and resale, including vacant homes at numbers 9, 15 and 26 Apache Street. SSHC submitted a proposal, which included affirmative marketing, to Park Forest for the acquisition, rehabilitation and resale of these three homes.

After the Park Forest Board of Trustees accepted the proposal and...