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Interfaith Housing Center of the Northern Suburbs v. Barry Bernsen; Barbara Bernsen; and Bernsen Management

July 13, 2011

INTERFAITH HOUSING CENTER OF THE NORTHERN SUBURBS, PLAINTIFF,
v.
BARRY BERNSEN; BARBARA BERNSEN; AND BERNSEN MANAGEMENT, INC., DEFENDANTS.



The opinion of the court was delivered by: Judge Sharon Johnson Coleman

Magistrate Judge Morton Denlow

MEMORANDUM OPINION AND ORDER

This matter is before the Court on motion by Defendants Barry Bernsen, Barbara Bernsen, and Bernsen Management, Inc. (collectively, "Defendants") to dismiss the complaint filed by Plaintiff Interfaith Housing Center of the Northern Suburbs ("Plaintiff"). The Defendants argue, inter alia, that dismissal is proper pursuant to Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6). For the reasons that follow, the Court grants the motion to dismiss Barbara Bernsen in her individual capacity. The Court denies Defendants' motion in all other respects.

BACKGROUND

The following facts are taken to be true for the purpose of this motion. Plaintiff, a notfor-profit fair housing corporation, filed the this action on February 18, 2011 asserting three claims against Defendants based upon violations of the Federal Fair Housing Act, 42 U.S.C. § 3601, et seq. (West 2011) ("Fair Housing Act" or "the Act") (Dkt. No. 1.) Plaintiff alleges that on or about March, 2010, it received a complaint from a resident of an apartment building in Evanston, Illinois owned and managed by Defendants. (Id. at ¶ 5.) The resident stated that Defendants refused to rent apartments to individuals who were not students at Northwestern University. (Id.) Plaintiff conducted an investigation into Defendants' housing practices in order to determine whether Defendants discriminated against potential renters on the basis of student status or familial status. (Id. at ¶ 6.) Plaintiff alleges that Defendants violated the Fair Housing Act, 42 U.S.C. §3604, by discriminating on the basis of familial status and by expressing a preference based on familial status during the course of renting apartments. (Id. at ¶¶ 14, 16.)

Plaintiff caused three separate "testers" to make rental inquiries about apartments in Defendants' building. (Id. at ¶¶ 7-9.) Tester #1 represented that she was a Northwestern student interested in a three-bedroom apartment for herself and two roommates. (Id. at ¶ 7.) She was shown two available apartments by Defendant Barbara Bernsen on January 8, 2011. (Id.) Barbara Bernsen told Tester #1 that the building was usually "pretty quiet." (Id.) Tester #2 called Bernsen Management, Inc. on or about January 9th, 2011 and spoke with a person who identified himself as Defendant Barry Bernsen. (Id. at ¶ 8.) Barry Bernsen asked the tester whether she was a Northwestern student. (Id.) When the tester informed him that her husband was starting at Northwestern in the fall, Mr. Bernsen stated that the building was not suitable for families and that if she had a family she would be unhappy there. (Id.) Tester #3 contacted Defendants on January 11, 2011 and spoke with Barry Bernsen. (Id. at ¶ 9.) The tester represented that he was the spouse of the second tester, would be attending Northwestern in the fall, and was interested in renting a three-bedroom apartment in Evanston. (Id.) Mr. Bernsen inquired into the tester's familial situation and the tester stated that he had a five-year old daughter. (Id.) Mr. Bernsen then told Tester #3 that he didn't think he would be happy with the apartment, which was designed for students, not for families. (Id.)

Plaintiff claims that its investigation into Defendants' housing practices and subsequent legal efforts directed against this conduct have deflected considerable time and money away from Plaintiff's activities unrelated to fair housing discrimination. (Id. at ¶ 12.) Plaintiff also alleges that its clients and potential clients have been deprived of the opportunity to rent housing in Defendants' Evanston building as a result of their familial status. (Id.) Plaintiff claims that Defendants' actions were performed willfully, maliciously and/or with reckless disregard for the rights of Plaintiff. (Id. at ¶ 13.)

LEGAL STANDARD

A. Motions to Dismiss Pursuant to Rule 12(b)(1)

Rule 12(b)(1) of the Federal Rules of Civil Procedure requires dismissal of any claim over which the federal court lacks subject matter jurisdiction. FED. R. CIV. P. 12(b)(6). In reviewing a motion to dismiss pursuant to Rule 12(b)(1), a district court accepts as true all well-pleaded factual allegations and draws all reasonable inferences in favor of the plaintiff. Long v. Shorebank Dev. Corp., 182 F.3d 548, 554 (7th Cir. 1999). Article III of the Constitution limits the federal courts to adjudicating actual "cases" or "controversies." U.S. CONST. art. III, § 2. This requires that a party must have standing for each cause of action asserted. Parvati Corp. v. City of Oak Forest, 630 F.3d 512, 516 (7th Cir. 2010). To establish Article III standing, a plaintiff must allege: (1) an injury in-fact; (2) fairly traceable to the defendant's actions; and (3) capable of being redressed by a favorable decision from the court. (Id.)

B. Motions to Dismiss Pursuant to Rule 12(b)(6)

In order to withstand a motion to dismiss pursuant to Rule 12(b)(6), a complaint must include "a short and plain statement of the claim showing that the pleader is entitled to relief." Smith v. Medical Benefit Administrators, Inc. 639 F.3d 277, 281 (7th Cir. 2011); FED. R. CIV. P. 8(a). This statement "must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)). When considering a motion to dismiss, courts must accept the truth of all well-pleaded allegations and must construe the complaint in the light most favorable to the non-moving party. Pisciotta v. Old Nat'l Bancorp, 499 F.3d 629, 633 (7th Cir. 2007). The plausibility standard requires plaintiffs to allege enough facts to "nudge[] their claims across the line from conceivable to plausible." Twombly, 550 U.S. at 570.

DISCUSSION

Defendants seek dismissal of the complaint, arguing that it fails to state sufficient facts for a claim under the Fair Housing Act. (Dkt. No. 14 p. 3.) The Court disagrees. The Fair Housing ...


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