Conn. Fair Hous. Ctr v. CoreLogic Rental Prop. Sols.
| Docket Number | 3:18-cv-705-VLB |
| Decision Date | 20 July 2023 |
| Parties | Connecticut Fair Housing Ctr, et al. Plaintiffs, v. CoreLogic Rental Property Solutions, LLC, Defendant. |
| Court | U.S. District Court — District of Connecticut |
Following a serious accident that left Mikhail Arroyo severely disabled and unable to care for himself, his mother, Carmen Arroyo became his court appointed conservator. Ms. Arroyo applied for Mr. Arroyo to move in with her in the apartment complex where she lived. Mr. Arroyo's application was denied because, a year before his accident, he was arrested in another state and charged with minor theft. The leasing staff did not tell Ms. Arroyo why Mr. Arroyo's application was denied. Rather, the leasing staff told Ms. Arroyo to obtain Mr. Arroyo's background report directly from the screening company. She tried, but her efforts fell short. Ms Arroyo sought help from a local non-profit housing advocacy group, Connecticut Fair Housing Center (“CFHC”). Together, they brought a complaint before the Commission on Human Rights and Opportunities (“CHRO”) against the housing provider who denied Mr. Arroyo's application. Thereafter, the housing provider changed its decision and accepted Mr. Arroyo's application.
Before the Court is the case brought by CFHC and Ms. Arroyo, both for herself and as conservator for Mr. Arroyo (the “Plaintiffs”), against CoreLogic Rental Property Solutions, LLC (“CoreLogic”), the background screening company that the housing provider used to check Mr. Arroyo's criminal history and creditworthiness. The Plaintiffs allege CoreLogic's use and advertisement of its criminal background screening product, CrimSAFE, (1) has a disproportionate adverse impact on Latinos and African Americans as compared to similarly situated whites; (2) has the intention of discriminating on the basis of national origin and race; and (3) intentionally encourages, facilitates, and assists housing providers' with unlawful discrimination, all in violation of the Fair Housing Act, 42 U.S.C. §§ 3601 et seq. (“FHA”) and the Connecticut Unfair Trade Practice Act, Conn. Gen. Stat. §§ 42-110a et seq. (“CUTPA”). The Plaintiffs also allege that CoreLogic violated the Fair Credit Reporting Act, 15 U.S.C. §§ 1681 et seq. (“FCRA”), in failing to disclose Mr. Arroyo's consumer report upon request, by failing to establish reasonable requirements for proper identification, and by placing unreasonable preconditions on the disclosure of a consumer report.
The Court conducted a ten-day bench trial. Having considered the evidence and arguments submitted at trial and in the parties' written submissions, the Court rules in favor of CoreLogic on the Plaintiffs' FHA and CUTPA claims and rules in favor of Mr. Arroyo on the FCRA claim.
Below are the Court's findings of fact and conclusions of law.[1]
1. Mikhail Arroyo, a plaintiff in this action, is a Latino male.[2] (SOF ¶ 13.) In July 2015, Mr. Arroyo was in a serious accident that caused a traumatic brain injury, left him completely unable to walk or talk, and rendered him in need of assistance with all activities of daily living and mobility. (SOF ¶ 16.) Mr. Arroyo was hospitalized following the accident until early 2016, when he was transferred to a nursing home where he could continue to recover. (SOF ¶ 19; Tr. 3/14/2022 6:3-4.) In April 2016, Mr. Arroyo was authorized to be discharged from the nursing home to live with his mother, who will be his primary caregiver. (SOF ¶ 20.)
2. Mr. Arroyo's mother is Carmen Arroyo, who is also a plaintiff in this action. Ms. Arroyo serves as one of Mr. Arroyo's court-appointed conservators. (SOF ¶ 18; Tr. 3/14/2022 4:14-16.)
3. The Connecticut Fair Housing Center is a housing advocacy non-profit organization. CFHC aids individuals it believes have been victimized by housing discrimination in asserting their rights by taking actions that include bringing lawsuits on their behalf. (Tr. 10/28/2022 747:3-21.) In addition, CFHC provides education programs for victims and housing providers, and is involved in public policy formation. (Tr. 10/28/2022 747:22-748:6.) In late November 2016, Ms. Arroyo reached out to CFHC for assistance in her efforts to move Mr. Arroyo into her apartment with her. (Tr. 3/14/2022 20:16-21:1; Tr. 10/25/2022 at 720:6-8.)
4. CoreLogic is a tenant screening company that offers multi-family housing providers a number of tenant screening products and services, including credit and criminal history screening. (SOF ¶¶ 1, 4.) CoreLogic provides these products and services to customers nationwide, including more than 20 customers in the State of Connecticut. (SOF ¶ 3.)
5. Though not a party, WinnResidential plays a central role in this litigation. WinnResidential is a multi-family owner and manager of apartment buildings throughout the country, managing over 120,000 units nationwide. (Tr. 3/14/2022 126:3-8.) During relevant times, WinnResidential managed 16 properties in Connecticut, including ArtSpace Windham-an apartment complex in Windham, Connecticut. (SOF ¶¶ 10-11.) Artspace Windham is the apartment complex where Ms. Arroyo lived while Mr. Arroyo was in the nursing home recovering after his accident and where Ms. Arroyo applied for Mr. Arroyo to live when he was cleared to leave. (Tr. 3/14/2022 6:23-7:4.) WinnResidential has been a customer of CoreLogic since 2006 and used its tenant screening products from 2008 until 2020. (SOF ¶ 9.) In March 2010, CoreLogic's predecessor, First Advantage SafeRent, and WinnResidential entered into a Screening Service Agreement. (Ex. J.) The agreement provides that WinnResidential is solely and exclusively responsible for complying with all laws as they relate to use of consumer reports. (Id.) The agreement also provides that CoreLogic is not an agent of WinnResidential. (Id.)
6. CoreLogic offers a criminal history screening product called CrimSAFE. (SOF ¶ 4.)
7. CoreLogic's criminal history products, like CrimSAFE, are web-based software programs that match criminal records and generate reports of data from CoreLogic's large criminal records database. The database contains criminal records from over 800 jurisdictions throughout the nation with over half a billion criminal records collected and categorized pursuant to CoreLogic's record classification criteria. (Tr. 11/3/2022 17:5-16.)
8. CoreLogic's classifications for categorizing criminal records in its database largely mirror classification criteria used by the Federal Bureau of Investigation in its National Incident-Based Reporting System. (Tr. 11/3/2022 19:9-15; Tr. 11/7/2023 64:1-5; Ex. AW.) All records fall within three primary categories: (1) “Crimes Against Property,” (2) “Crimes Against Persons,” and (3) “Crimes Against Society.” (SOF ¶ 5.) Within these categories are more specific sub-categories totaling 36 sub-categories. (SOF ¶ 5.) The subcategories for “Crimes Against Persons,” for example, include: “assault related offenses,” “family related offenses, nonviolent,” “homicide related offenses,” “kidnapping/abduction related offenses,” “sex related offenses, forcible,” “sex related offenses, nonforcible,” and “all other person related offenses.” (Ex. 3.)
9. CoreLogic has a similar background screening product called CrimCHECK. CrimCHECK provides users with unfiltered access to any and all criminal records within CoreLogic's criminal records database that match the tenant applicant's identification information. (Tr. 11/3/2022 17:2-4; Tr. 11/7/2022 62:23-63:2, 87:16- 25.)
10. CrimSAFE, like CrimCHECK, matches records from the CoreLogic criminal records database to a tenant applicant. Unlike CrimCHECK, CrimSAFE filters out records that the housing provider deemed irrelevant for their housing decision. (Tr. 11/7/2022 62:1-64:11.) CrimSAFE filters out records based on three criteria (1) type of offense, (2) severity/disposition, and (3) age of offense.[3] (Id.)
11. In practice, CrimSAFE filters out a large number of criminal records from housing provider consideration. During the same period of time involving the same applicant pool, CrimCHECK reported 14% of applicants had a criminal record, where CrimSAFE reported only 6% of applicants with criminal records. (Tr. 11/3/2022 29:14-30:1)
12. By filtering out records a housing provider deems irrelevant to their housing decision, CrimSAFE increases the number of automatic acceptances for individuals that have older and minor criminal histories. This unburdens the housing provider's staff and provides faster processing of tenant applications. The filtering function is an added feature, which is why CrimSAFE is more expensive than CrimCHECK. (Tr. 11/7/2022 245:5-8.)
13. CoreLogic advertises its tenant screening products to housing providers. In one of CoreLogic's product briefs on CrimSAFE issued in or around 2016 (the “2016 Product Brief”) CoreLogic describes CrimSAFE as follows:
Registry CrimSAFE® automates the evaluation of criminal records. Registry CrimSAFE is designed for clients who want CoreLogic® SafeRent® to process criminal history records and notify the leasing staff when criminal records are found that do not meet the criteria established by your community. Registry CrimSAFE helps you implement consistent decisions, which improves Fair Housing compliance and frees your staff from interpreting criminal records.
(Ex. 11.)
14. The 2016 Product Brief lists the benefits of CrimSAFE as “Maintain[ing] a safer community for residents, guests and staff,” “Reduc[ing] potential liability from criminal acts,” “Improv[ing] Fair Housing compliance by helping you screen applicants consistently,” and “Sav[ing] time...
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