Des Moines Civil & Human Rights Comm'n v. Knueven

• Docket Number: 21-1092
• Decision Date: 07 April 2023
• Citation: 988 N.W.2d 694
• Parties: DES MOINES CIVIL AND HUMAN RIGHTS COMMISSION, Appellee, v. Patrick KNUEVEN and Mary Knueven, Appellants.
• Court: Iowa Supreme Court

988 N.W.2d 694

DES MOINES CIVIL AND HUMAN RIGHTS COMMISSION, Appellee,

v.Patrick KNUEVEN and Mary Knueven, Appellants.

No. 21-1092

Supreme Court of Iowa.

Submitted February 21, 2023

Filed April 7, 2023

John F. Fatino (argued) and Nicholas J. Gral of Whitfield & Eddy, P.L.C., Des Moines, for appellants.

Luke DeSmet (argued) and Michelle Mackel-Wiederanders, Assistant City Attorneys, for appellee.

Christensen, C.J., delivered the opinion of the court, in which all justices joined.

CHRISTENSEN, Chief Justice.

The Des Moines Civil and Human Rights Commission alleged the defendants, a husband and wife who own rental properties together, discriminated against prospective tenants in violation of municipal law by steering prospective tenants of a protected religion or national origin away from their rental properties. A jury found only the husband liable and imposed a penalty against him for $50,000. He appealed and raises several issues, ranging from challenges to the district court's evidentiary rulings to the jury instructions on the elements of steering and the sufficiency of the evidence to submit the claim of steering to the jury. Both husband and wife challenge the district court attorney fee award to the Commission.

On our review, we reverse the district court judgment. The district court incorrectly instructed the jury that steering occurs merely by "discouraging" a member of a protected class from pursuing housing and "encouraging" a member not of the protected class. Such an instruction exposed the defendants to liability for conduct not prohibited by the Iowa Civil Rights Act or the relevant Des Moines ordinance. There is insufficient evidence against the defendants under the proper jury instruction. Accordingly, we reverse the district court judgment, vacate the award of attorney fees to the Commission, and remand for dismissal of the steering charge against Patrick and a determination of whether Patrick should be awarded attorney fees as the now prevailing party.

I. Background Facts and Proceedings.

Patrick and Mary Knueven are a married couple who own various rental properties in the Des Moines area that Patrick rents to tenants while operating as the landlord. They came to the attention of the Des Moines Civil and Human Rights Commission (Commission) when an individual filed a complaint alleging that Patrick had engaged in housing discrimination in 2015. Upon further review, the Commission chose to investigate the complaint through the use of housing testers to gauge whether Patrick was participating in some type of discriminatory housing practice.

Joshua Barr, the Commission's director, explained:

Housing testers are persons who go in and try to rent a property, et cetera, and they determine how they are treated and typically have two types: It's the control which is typically someone that's of European descent or white, as others may say, and then we have someone of another [protected] characteristic ... [such as] someone of a different skin color.

The Commission conducted this testing over the course of a few months in 2015 and 2016 and then again later in 2017.

A. 2015–16 Testing. On December 22, 2015, Chris Fultz, a white male acting as a control tester, called Patrick to schedule an in-person tour of the Knuevens’ Porter Avenue rental property. Fultz met with Patrick at the rental property the next day, which Fultz described as a "relatively uneventful" visit that involved Patrick walking him through the property. There is no recording of the phone call or visit in the record.

On December 28, Deeq Abdi, a protected tester, called Patrick to inquire about the same property in a recorded call. Abdi has an accent that indicates he is not a native English speaker. During the call, Abdi told Patrick his name and noted that he was calling to see if the rental property was available. Patrick responded, "It's rented. It's taken and they're living there." When Abdi asked who he was speaking to, Patrick said his name was "Joe." Abdi asked if any other units would be coming available, and Patrick answered, "Nope." Abdi thanked Patrick, and Patrick ended the call without a response. Overall, Abdi described Patrick as evasive, explaining that Patrick avoided his questions and gave him the impression "that he doesn't want to rent the apartment to me because [for] no reason [he] was trying to cut me off and you can see that."

Fultz called Patrick again on January 4, 2016, about the rental property at issue. After Patrick informed him that he rented the property to someone else, Fultz asked if Patrick had anything else available to rent. Patrick told him that he had a different property that would be available in a week. There is no recording of this call in the record.

The Commission conducted similar testing during that time period involving two females: one a white control tester and the other a Muslim protected tester. The control tester, Jodi Mashek, spoke with Patrick over the phone on January 27 about a different rental property and arranged an in-person visit. That visit occurred on January 29. She reported that Patrick gave her a tour of the property, answering any questions she had and pointing out new appliances and flooring. He also mentioned that "it was a really nice neighborhood, [and] that neighbors on both sides had been there for a very long time." There is no recording of this call or visit in the record.

The protected tester, Nadia Ingram, first interacted with Patrick over the phone on January 28 in a recorded call that does not reveal any of her protected characteristics. Patrick asked her a few questions about when she was looking to move in and arranged for Ingram to view the property with him the next day. Ingram arrived for the visit wearing a hijab, which she describes as a "head scarf" that "easily identifie[s]" her as Muslim, with her two young children in tow. She discreetly captured an audio recording of her visit.

Ingram testified that Patrick "didn't really say hi when I initially said hi." He immediately asked her if her husband was with them and "seemed a little disappointed" that she did not bring her husband. Ingram described Patrick as "tense," explaining,

[E]very time I walked into a room, [Patrick] walked out. It seems like he didn't want to be around me. I also noticed a lot of times when he would be leaving a room, he would be muttering expletives under his breath not loud enough that he wanted me to hear it but I could certainly hear what he was saying.

When she asked Patrick what the neighborhood was like, he claimed he didn't know about the neighborhood or what the neighbors were like.

Ingram summarized the differences in her experience with Patrick over the phone when he was unaware of her protected status compared to her subsequent in-person visit when she was identifiable as Muslim. She testified,

On the phone, like I said before, he was polite, he was asking lots of questions about our situation, when we were looking to move. He even said thank you at the end of the conversation when I hung up with him and thanked him. He generally seemed to be interested in us as potential tenants.

In person it was a very different situation. He wasn't overtly rude in that he didn't call me names. He wasn't saying anything that was unkind directly to me with the exception of obviously the expletive that he kept muttering under his breath but he certainly wasn't the same person as he was on the phone.

He gave me very short answers. At times he said he didn't know. He wasn't offering any different options. He seemed to be more forthcoming over the phone. In person he just didn't seem like he wanted to be around me at all.

On the phone I used my real name which is a very multi-cultural name. It doesn't expressly show what my ethnic or religious background is. In person as I said before about what I was wearing, very obviously Muslim or at least not a typical Caucasian Christian or whatever. I'm pretty easily identified as Muslim.

None of the testers mentioned applied to rent a property from Patrick.

B. 2017 Testing. The 2017 testing began when Carla Cox, the test coordinator at the Fair Housing Center of Nebraska and Iowa who was working with the Commission, called Patrick on August 4 to inquire about an advertisement on Craigslist for the Knuevens’ East Kenyon Avenue rental property that was posted on July 31. That posting listed the monthly rent as $650, but Patrick posted a new Craigslist advertisement on August 3 that raised the monthly rent to $800 after consulting with a residential property management company.

When Cox called Patrick, she asked if the East Kenyon Avenue property was still available to rent for $650 per month. Patrick confirmed the property was still available at that rate based on his assumption that Cox must have had the old printout of the advertisement before he had updated it to raise the monthly rent. Cox's voice does not demonstrate any obvious protected characteristics regarding religion or national origin, but there is no recording of this call in the record.

On August 7, tester Laurie Madison called Patrick about the same rental property in a recorded call that lasted less than two minutes. She started the call by identifying herself as a caseworker at the Omaha Refugee Resettlement Program, to which Patrick responded, "Alright, what do ya got?" Madison informed Patrick that she was seeking housing for a married Muslim couple from Pakistan and asked whether the property was still available to rent. Patrick answered, "Well, yes, it is."

Madison mentioned the Craigslist posting that stated the monthly rent was $650 per month, and Patrick interjected, "Oh, that's an old ad, it's $800." Madison asked follow-up questions about the availability of a garage and whether Patrick showed the property during certain hours. Patrick simply answered "No" to each question without offering any additional information. When Madison stated that she would follow up with him once she knew the...