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April 9, 1996

MBI Faces a Third Housing Discrimination Lawsuit While Near Settlement in Another

by Edmund Tsang

The Mitchell Brothers, Inc. (MBI), which manages several apartment complexes in Mobile, is the subject of a third complaint related to charges of housing discrimination by a former employee, while it is close to settling a class- action lawsuit with individuals claiming they had been discriminated against when they sought rental properties from MBI.

The new complaint alleges that the plaintiff was fired from her job by MBI officials "because of her efforts to comply with the Fair Housing Act." Attorneys for MBI deny the allegations, contending that "the plaintiff's employment was voluntarily terminated as an employee of Mitchell Brothers, Inc., but specifically denies that the plaintiff's termination had anything to do with any of her efforts involving the Fair Housing Act and its mandate."

On April 2, 1996 attorneys for the plaintiff filed in the U.S. District Court of Mobile its "first request for production of documents" which, among others things, "support defendants' allegations that [plaintiff] either resigned or was voluntarily terminated her employment with MBI." The attorneys also filed with the court a "first set of interrogatories to defendants," including "[D]escribe in detail how you contend that [plaintiff's] employment was voluntarily terminated, including a statement of the facts or information upon which this contention is based."

This former property manager of Ashford Place, an MBI apartment complex, alleges that she became aware of numerous "policies and practices" that are in violation of the Fair Housing Act during her employment with MBI from February, 1993 to March, 1995. The plaintiff stated in court papers that she was placed under scrutiny after she informed a vice president of MBI that "she would not under any circumstances discriminate in violation of the Fair Housing Act and attempted to advise Defendant of the serious repercussions that could apply to acts which constituted discrimination under the Fair Housing Act and to provide educational training about the Act to other employees of MBI." The court papers also stated that "prior to this time Plaintiff had received nothing but excellent reviews by her supervisors at MBI and had never been counseled about any purported problems."

The plaintiff alleges that "subsequent to her discussion with [MBI officials] about the dangers of the practice of discrimination, and her efforts to provide education on the Fair Housing Act, Plaintiff was informed by other employees of MBI that she would be fired for 'rocking the boat.'

"On March 28, 1995 Plaintiff was terminated...without any notice or explanation as to the reasons for her termination. As a result of her attempts to comply with the Fair Housing Act, and further as a result of her specific refusal to violate the Fair Housing Act, Plaintiff was subjected to harsh treatment, unfair criticism, loss of her job and loss of her housing unit at Ashford Place Apartments."

Plaintiff's attorneys also asked for "documents pertaining to or concerning any administrative or judicial proceedings that involve any claimed violations of the Fair Housing Act of 1968, as amended, or any other federal, state, county or local law or ordinance concerning fair housing."

The Other Housing Discrimination Lawsuits

In August, 1995, a class-action lawsuit was filed by 19 persons in the U.S. District Court in Mobile against MBI alleging they had been denied the opportunity to rent apartments managed by MBI because of their race. The plaintiffs charged that in 1990 and 1991, when they applied for rental of property managed by the defendant, they were asked to fill out information cards, and that those cards were subsequently marked with a code to identify them as African-Americans for discrimination purposes.

The existence of the coded information cards was disclosed in affidavits associated with another lawsuit filed by a former MBI employee, which charges MBI officials with sexual harassment and housing discrimination, and in the complaints of housing discrimination filed by nine former MBI employees to the U.S. Department of Housing and Urban Development (HUD).

In an affidavit filed in November, 1994, Miriam L Steiner, a former MBI leasing agent, stated: "When a prospective renter would come in, a preliminary screening would be done by having the person fill out an index card asking for certain information, i.e., number of children. These index cards were kept in boxes, and if a vacancy came up, we would pull the card and call the person and ask if they were still interested in an apartment.

"Since the leasing agent cannot remember from many cards which applications were black and which were white, Debbie Brown (manager of Maison de Ville apartments) decided that an identifying mark was needed so that the blacks would not be inadvertently called. Debbie Brown decided that the leasing agent would put a mark on the top left-hand corner of the index card if the applicant was black. This meant not to call them.

"About two weeks before I was fired, Debbie Brown told me to pull the marked cards out of the file and to throw them away. I pulled the cards out and did put them in the garbage. I then decided to keep the cards. I have attached true and correct copies of these cards to this affidavit as Exhibit 1."

In this class-action lawsuit, attorneys for defendant MBI filed on March 14, 1996 a motion to stay all proceedings "for a period of thirty days."

"As grounds for this motion, defendant shows the Court that the parties hereto, as well as the United States Department of Justice, have reached an agreement in principle on the terms of settlement of this litigation and the related claims made by the United States, that the remaining terms of a comprehensive settlement are likely to be resolved by futher discussion ongoing at present, and that the parties should be in a position to inform the Court within thirty days of an agreement to settle the entire action subject to the Court's approval...As further grounds for this motion defendant shows the Court that plaintiffs' counsel have consented to its being granted," the court papers filed by MBI attorneys stated.

In August, 1995 an investigator from the U.S. Department of Justice visited Mobile to collect information concerning allegations of housing discrimination practices that several former MBI employees filed against company offices in 1994.

-- April 9, 1996

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