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September 30, 1994



The opinion of the court was delivered by: GEORGE W. LINDBERG

Plaintiffs, Jan Guider (Guider) and Hope Fair Housing Center (Hope), allege that defendants, Steven Bauer and Judy Bauer (jointly referred to as the Bauers) and Sun Publications, Inc., d/b/a The Naperville Sun (The Sun), engaged in unlawful discrimination against Guider on the basis of familial status. Plaintiffs brought this action under the Fair Housing Act of 1968 as amended (the Act), 42 USC ยง 3601 et seq., seeking declaratory judgment, permanent injunctive relief and damages. Plaintiffs allege the Bauers violated section 3604(a) of the Act by refusing to rent an apartment to Guider because she has children. Plaintiffs also claim the defendant newspaper violated section 3604(c) of the Act by publishing a discriminatory real estate advertisement which indicates a preference for tenants based on familial status. The Bauers have moved for summary judgment on the basis that they are exempt from liability under section 3693(b)(2) of the Act. The Sun has also moved for summary judgment based on various First Amendment arguments.

 On April 26, 1991 the Bauers placed an advertisement in The Sun to rent an apartment in Naperville. The advertisement stated in part:

NAPERVILLE: Perfect for single or couple. 2 Bedroom Victorian Duplex, 2-story, smoke-free, washer/dryer.

 After reading the advertisement in the classified section, Guider called the phone number listed in the advertisement to inquire about the apartment. Judy Bauer answered the phone and confirmed that the two-bedroom duplex advertised in the paper was for rent. Bauer then asked Guider who would be living in the apartment with her. When Guider replied that her two sons would be living with her, Bauer informed her that the apartment was not suitable for children because the rooms were too small and then hung up the phone.

 On May 10, 1991, an employee of the Chicago Lawyers' Committee for Civil Rights Under Law called Ms. Bauer to inquire about the same apartment. Ms. Bauer suggested she come by and look at the apartment. When the employee then told Ms. Bauer she had children, Ms. Bauer told her the apartment was rented and hung up the phone.

 On April 26, 1991, Guider called The Sun and told a supervisor in the classified department that the advertisement was discriminatory and violated the Fair Housing Act. The supervisor subsequently informed her that the advertisement would be removed from the paper. However, the same advertisement ran approximately one week later in the classified section of The Sun.

 In early April of 1991, the Bauers allegedly entered into an agreement to sell their home to their daughter, Anne Bauer. On May 31, 1991, a written residential sales contract was executed between the parties and the sale was closed on July 31, 1991. The Bauers claim their daughter Anne asked them to act as her agent to locate and secure a tenant for the west unit of the home. The Bauers leased the west apartment to a new tenant on approximately June 21, 1991.

 Rule 56 of the Federal Rules of Civil Procedure provides that summary judgment "shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." FRCP 56(c). Rule 56 further provides that a party opposing a properly supported motion for summary judgment "may not rest upon mere allegation or denials of his pleading, but must set forth specific facts showing that there is a genuine issue for trial." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 256, 91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986).

 I. The Bauers' Motion for Summary Judgment

 The Bauers contend they are entitled to summary judgment because they are exempt from liability under section 3603(b)(2) of the Fair Housing Act. Section 3603(b)(2) provides that:

(b) Nothing in section 3604 of this title (other than subsection (c)) shall apply to--
. . .
(2) rooms or units in dwellings containing living quarters occupied or intended to be occupied by no more than four families living independently of each other, if the owner actually maintains and ...

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