Fair housing verdict based on renters' income is affirmed.

This case went to trial on the plaintiff's claim that a private property management company was discriminating against renters based on disability and income. The Fair Housing Act prohibits discrimination on the basis of a renter's disability. The City Human Rights Law bars housing discrimination on the basis of income. The trial judge ruled in plaintiff's favor. The defendant appeals to the Second Circuit, which affirms. The plaintiffs emerge victorious.

The case is Fair Housing Justice Center v. Pelican Management, Inc., a summary order issued on January 21. 

FHJC asserted that in 2015 [Defendant] Goldfarb adopted a minimum income policy for prospective renters, requiring, among other things, that all prospective renters earn a gross annual income of at least 43 times their total monthly rent (the “2015 Policy”).  FHJC claimed that the 2015 Policy excluded virtually all renters who received certain rental subsidies, a large percentage of whom have disabilities.

The policy was amended in 2019. Under that revision,

with respect to applicants with no rental subsidy, the criteria under the 2019 Policy that prospective renters earn an annual income of at least 43 times their total monthly rent remained the same as before. Second, as to applicants with a full subsidy (i.e., 100 percent of the rent is paid by a government program), the 2019 Policy eliminated all income-related requirements.  Finally, with respect to applicants with a partial subsidy (i.e., a portion, but not all, of the rent is paid by a government program), the 2019 Policy, among other things, required that prospective renters earn 40 times their share of the monthly rent, rather than 43 times the full rent.

The NYCHRL prohibits housing discrimination “because of any lawful source of income.” A disparate impact claim can be brought under the NYCHRL when “a facially neutral policy or practice has a disparate impact on a protected group.”

The trial court ruled both policies were illegal. They had a disparate impact based on disability and source of income. Defendant appeals from the 2019 ruling, which held, based on the analysis from plaintiff's expert witness, that the rules had an unlawful disparate impact on applicants with partial subsidies on the basis of their source of income. The Court of Appeals (Carney, Bianco and Nardini) affirms. After holding that plaintiff's expert used a sound methodology in reaching his conclusions, the Second Circuit holds that the factual record supports the district court's ruling on the merits.