Justice Department Obtains Record $2.725 Million Settlement of Housing Discrimination Lawsuit

WASHINGTON, Nov. 3 /PRNewswire-USNewswire/ -- The Justice Department announced today the largest monetary payment ever obtained by the department in the settlement of a case alleging housing discrimination in the rental of apartments. Los Angeles apartment owner Donald T. Sterling has agreed to pay $2.725 million to settle allegations that he discriminated against African-Americans, Hispanics and families with children at apartment buildings he controls in Los Angeles. The settlement must be approved by U.S. District Judge Dale S. Fischer.

"Housing is a basic human need, and yet decades after passage of the Fair Housing Act, far too many still encounter barriers like discrimination. Particularly in times of economic distress and rising foreclosures, we must remain vigilant to ensure all individuals have equal access to housing," said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. "The magnitude of this settlement should send a message to all landlords that we will vigorously pursue violations of the Fair Housing Act."

The lawsuit, filed by the Justice Department in August 2006, alleged that the defendants, Donald T. Sterling, his wife Rochelle Sterling and the Sterling Family Trust, engaged in discriminatory rental practices on the basis of race, national origin and familial status (having children under 18) at various apartment buildings that they own and manage in Los Angeles. Among other things, the suit alleged that the defendants discriminated against non-Korean tenants and prospective tenants at buildings the defendants owned in the Koreatown area of Los Angeles.

In court filings, for example, the United States presented evidence that the defendants' employees prepared internal reports that identified the race of tenants at properties the defendants purchased in Koreatown. Additionally, the defendants made statements to employees at Koreatown buildings indicating that African-Americans and Hispanics were not desirable tenants. The United States also presented expert analysis in court filings showing that the defendants rented to far fewer Hispanics and African-Americans in Koreatown which than would be expected based on income and other demographic characteristics.

The defendants, who manage their apartments under the name Beverly Hills Properties, own and manage approximately 119 apartment buildings comprising over 5,000 apartments in Los Angeles County. The settlement would also resolve two related lawsuits filed by former tenants at one of the properties. The two families, an African-American family and an interracial married couple with bi-racial children, alleged that the defendants demolished the private yards that had been part of their apartment and took other actions against them because of their race.

The settlement, which is memorialized in a proposed consent order that the parties have submitted to the court for approval, would require the defendants to pay a $100,000 civil penalty to the United States. Under the settlement, the defendants would also pay $2.625 million into a fund that would be used to pay monetary damages to persons who were harmed by the defendants' discriminatory practices, including the tenants in the two related lawsuits discussed above. Any money left over would go to further fair housing education or enforcement in Los Angeles. The terms of the distribution of the $2.625 million will be determined in a separate disbursement order that will be submitted by the United States for approval to the Court.

In addition to the payments in damages and civil penalties, the proposed consent order would require the defendants to take various steps to ensure non-discriminatory practices at their Los Angeles County rental properties. Among other things, the proposed consent order would:

* Enjoin the defendants from discriminating on the basis of race, national origin, and familial status;
* Require the defendants to implement a self-testing program over the next three years to monitor their employee's compliance with fair housing laws at their Los Angeles County properties. The testing would be conducted by an independent contractor that would report the results to the defendants and the United States;
* Require the defendants to maintain non-discriminatory practices and procedures; and
* Require the defendants to obtain fair housing training through an independent contractor for their employees who participate in renting, showing or managing apartments at the Los Angeles County properties.

The federal Fair Housing Act prohibits discrimination in housing based on race, color, religion, national origin, sex, disability and familial status. Individuals who believe that they may have been victims of housing discrimination should call the Housing Discrimination Tip Line (1-800-896-7743) or email the Justice Department at fairhousing@usdoj.gov. Such persons may also contact the U.S. Department of Housing and Urban Development at 1-800-669-9777.

Fair housing enforcement is a priority of the Civil Rights Division. More information about the Civil Rights Division and the laws it enforces is available at http://www.justice.gov/crt.