Greene v. Carson

Decision Date14 June 2017
Docket Number14 Civ. 3676 (AT) (GWG).
Parties Lonnette GREENE, Plaintiff, v. Ben CARSON, in his official capacity as Secretary of Housing and Urban Development, and Deshler Apts. Assocs. L.P., Defendants.
CourtU.S. District Court — Southern District of New York

Mary Purdy McCune, Daniel Allegretti Freeman, Rosalind Black, Cynthia C. Weaver, Manhattan Legal Services, Melissa Lauren Banks, The Port Authority of New York and New Jersey, New York, NY, for Plaintiff.

Elizabeth Tulis, Natasha Waglow Teleanu, United States Attorney's Office, Annica Paula Margareta Bianco, Nixon Peabody, New York, NY, Christopher James Porzio, Nixon Peabody, LLP, Jericho, NY, for Defendants.

OPINION AND ORDER

ANALISA TORRES, District Judge:

For most of her life, Plaintiff, Lonnette Greene, resided in an apartment complex owned by Defendant Deshler Apartment Associates, L.P. ("Deshler"). The building is a "project-based" Section 8 low-income housing development subsidized by the United States Department of Housing and Urban Development (with Defendant Ben Carson, Secretary of Housing and Urban Development, "HUD") pursuant to 42 U.S.C. § 1437f.1 In or prior to 2007, without Greene's knowledge, Greene's mother removed Greene from the household composition forms. Greene continued to live in the apartment. When Greene's mother moved out and Greene sought to take over the lease, Defendants denied Greene the continuation of the Section 8 subsidy because she was not a party to the lease. Greene brings suit to challenge that determination, alleging violations of the Due Process Clause and the Administrative Procedure Act ("APA"). HUD moves for judgment on the pleadings and summary judgment. For the reasons stated below, HUD's motions are GRANTED in part and DENIED in part.

BACKGROUND
I. Factual Background

Between 2007 and 2012, Deshler owned Deshler Apartments, located at 1871 Seventh Avenue, New York, New York 10026. See Joint Rule 56.1 Statement ("56.1") ¶¶ 12–13, ECF No. 81; Decl. of Natasha L. Waglow ("Waglow Decl.") Ex. A ("Colon Dep. 1"), at 15:20–23, ECF No. 61.2 Manhattan North Management Company, Inc. ("Manhattan North") served as managing agent. 56.1 ¶ 13. Richard Colon is Manhattan North's director of recertification and compliance. Colon Dep. 1 at 10:18–11:5. To administer the Section 8 program in New York, HUD employs the New York State Housing Trust Fund, which in turn subcontracts its work to CGI Federal ("CGI"). 56.1 ¶¶ 22, 23. Since 2005, CGI has been the HUD contract administrator for Deshler Apartments. 56.1 ¶ 24; Waglow Decl. Ex. E ("Van Loan Dep."), at 5:18–24, 28:4. CGI's responsibilities include processing subsidy payments and contract renewals and operating a call center to field tenant complaints. 56.123–25; Van Loan Dep. 6:8–18, 8:7–15. Until 2011, CGI was also responsible for conducting a "management and occupancy review" of Deshler, a process by which CGI monitored Deshler's compliance with Section 8 program requirements. See Van Loan Dep. 33:7–34:11.

From the mid–1980s onward, Greene resided in Deshler Apartments. Colon Dep. 1 at 15:20–16:6; Greene Dep. 13:23; 56.1 ¶ 12. Initially, Greene lived in apartment 4C, a two-bedroom unit, with her mother, father, sister, and brother. 56.1 ¶ 29. In 1998, Greene moved with her family to apartment 6B (the "Apartment"). 56.1 ¶¶ 30, 32. The lease for the Apartment was signed by Greene's mother, Dawn Lawless, and outlined the tenant's and the landlord's respective responsibilities as to reporting and verifying information necessary to calculate Lawless' rent and comply with the Section 8 requirements. See 56.1 ¶¶ 32, 37–38. Among other provisions, the lease obligated Lawless to report if a "household member moves out of the unit."

56.1 ¶ 38. On June 30, 2003, Lawless signed a new lease for the Apartment, which reflected a rent increase but otherwise contained the same provisions. See 56.1 ¶¶ 39–45.Greene was not a party to either the 1998 or 2003 lease. 56.1 ¶¶ 33, 40. However, the lease incorporates by reference the certification and recertification of tenant eligibility forms. See Waglow Decl. Ex. I, at 13. These forms include a section on household composition where Lawless was required to list the names of all individuals residing in the Apartment. See, e.g. , id. Ex. J.

Lawless oversaw the family's compliance with Section 8's reporting and recertification requirements. 56.1 ¶ 47; Greene Dep. 52:20–56:25. Although Greene was largely uninvolved, she twice joined Lawless in signing the Section 8 recertification form as co-head of household, and she recalls producing paystubs on a number of occasions for the purpose of reporting the family's income. 56.1 ¶¶ 46–48; Greene Dep. 48:12–56:18.

At some time in or before 2007, and unbeknownst to Greene, Lawless verbally notified an individual in the management office of the building that Greene was no longer residing in the Apartment. See Waglow Decl. Ex. G ("Lawless Dep.") 18:21–19:22; 56.1 ¶ 50; Greene Dep. 57:14–20. Lawless did not submit, and Deshler did not ask for, a written request for Greene's removal or proof substantiating her removal from the household. Lawless Dep. 58:2–12. Lawless does not recall when she removed Greene's name from the household composition, nor why, but admits that she had been a drag addict at the time and her memory of that period is a "total blur." See id. 18:21–19:15. Lawless had submitted notarized statements to Deshler reporting when two children and a grandchild moved out of the Apartment, but did not do so for Greene. 56.1 ¶ 50.

The recertification forms submitted by Lawless in 2007, 2008, 2009, 2010, and 2011 do not list Greene as a member of the household composition, despite the fact that Greene continued to reside in the Apartment.3 See 56.1 ¶¶ 64, 65, 68, 71, 72, 76, 77, 80, 81, 85, 86. In each of those years, Greene was employed and her income should have been reported to properly calculate the Section 8 subsidy paid by HUD. 56.1 ¶¶ 65, 72, 77, 81, 86.

Lawless testified that, after she removed Greene from the household composition, she attempted for three consecutive years to re-add Greene during the recertification process, but Deshler refused. 56.1 ¶ 131; Lawless Dep. 20:1–21:21, 56:22–57:11. According to Lawless, Deshler informed her that family members removed from the composition could not be added later. Lawless Dep. 21:11–13. Lawless complained to property management but was unaware that she could or should contact CGI or HUD.4 Id. 51:23–52:4, 56:22–57:11; 56.1 ¶ 88. Greene was never added back to the household composition. See 56.1 ¶¶ 64, 68, 71, 76, 80, 85.

In or about 2010, Lawless moved out of the Apartment. 56.1 ¶ 82; Lawless Dep. 26:19–27:5. Despite this, Lawless signed the annual recertification form in 2011. 56.1 ¶ 83. In 2012, Greene discovered that she had been removed from the household composition, Greene Dep. 58:3–5, and attempted to submit the annual Section 8 recertification paperwork to Deshler. 56.1 ¶ 87. Greene included a notarized letter from Lawless stating that Greene lived in the Apartment and "paid all of the bills," and requested that Deshler add Greene to, and remove Lawless from, the lease. Id. Deshler refused to accept Greene's recertification. 56.1 ¶ 89. According to Colon, Greene was unable to recertify because "she was never listed in the household." Colon Dep. 2 at 149:6–24.

After Greene attempted to submit the recertification paperwork, she received a notice to vacate the Apartment. 56.1 ¶ 89; Greene Dep. 90:6–24. Deshler commenced a licensee holdover proceeding against Greene, in which the Civil Court of the City of New York: Housing Part P found that Greene had resided in the Apartment since at least 2000 and that Greene successfully established a defense of succession under New York law. 56.1 ¶ 90; Waglow Decl. Ex. W; see also Deshler Apartment Assocs. L.P. v. Lonnette Greene , Index No. 82842/2012 (Civ. Ct. N.Y. Cty. Mar. 3, 2013). Deshler informed Greene that the court's decision did not entitle her to benefit of the Section 8 subsidy and that her rent would be raised to the market rate. 56.1 ¶ 92. Greene then sought assistance at HUD's office, where the employee identified as tasked with overseeing Deshler was "busy" and two other employees instructed Greene to return to the judge who had presided over the holdover proceeding to "clarify" his decision. 56.1 ¶ 93; Greene Dep. 91:9–96:7. Greene did so, whereupon the judge told her that he did not have jurisdiction to award Greene a Section 8 subsidy. 56.1 ¶ 94; Greene Dep. 94:16–22. Around the same time, Colon discussed Greene's case with Christine El Shahat at HUD, who expressed HUD's position that Greene's request for a Section 8 subsidy should be denied. Colon Dep. 2 at 131:14–132:17; cf. McCune Dep. 9:2–10:15.

Following the court proceeding, Greene retained Mary McCune of Manhattan Legal Services, Inc. as counsel. Greene Dep. 95:10; McCune Dep. 6:11–14, 8:5–9. In December 2013, McCune participated in a conference call with Deshler's attorney, Colon, and El Shahat to discuss whether Greene was qualified to receive a Section 8 subsidy.5 56.1 ¶¶ 96, 162; McCune Dep. 6:11–8:18, 12:20–14:21. When HUD insisted that Greene was not a qualified tenant, McCune requested a waiver of the HUD guidelines, discussed below, that prevented Greene from qualifying to receive her mother's subsidy as a remaining member of a tenant family. 56.1 ¶ 96; McCune Dep. 14:22–15:22, 21:11–19. McCune offered to provide supporting documentation, but El Shahat denied the waiver and provided no further information on how the waiver might be obtained. 56.1 ¶ 100, 171, 172; McCune Dep 25:13–28:5. McCune testified that no one on the December 2013 conference call stated that a waiver request needed to be submitted in writing or requested that McCune submit a written request, 56.1 ¶ 179, and, as a result, Greene did not submit a written waiver request, 56.1 ¶ 95. El Shahat testified that she has never seen a waiver request and was not...

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