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November 19, 1996

Trial or Settlement?

Another MBI Housing Discrimination Lawsuit Coming to the End of the Line

by Edmund Tsang

Rulings by a magistrate judge and a district judge in the last two weeks move the lawsuit Jamie Craft vs. Mitchell Brothers, Inc. et al one step closer to trial, with jury selection set for December 3 at 9 a.m., according to documents in the U.S. district court. Craft, a former manager for an apartment owned by Mitchell Brothers, Inc. (MBI), alleged that she was fired from her job after she told Jim Spafford, an MBI executive, that she would not follow the company's discriminatory rental policy against African-Americans. MBI officials contend that Craft was terminated because of poor work performance.

[MBI settled two other lawsuits recently involving allegations of housing discrimination. Last summer, MBI settled a class-action lawsuit, Lowman et al vs. MBI, in which the plaintiffs claimed that the information cards they filled out when they tried to apply for rental properties in Maison de Ville were coded to identify them for discrimination. Earlier in the year, MBI also settled a lawsuit filed by a former employee, Diane Hall, who charged MBI officials with sexual harassment and housing discrimination. One witness in the Hall lawsuit produced the coded information cards.]

November 12th Ruling

On November 12, U.S. District Judge for South Alabama Alex Howard ruled against two defendants' motions for summary judgment for dismissal of the lawsuit. One motion, filed on October 1 on behalf of all three defendants (MBI, Spafford, and Abraham Mitchell, a co-owner of MBI), was denied because plaintiff "provides substantial evidence that creates a genuine issue of material fact as to whether Defendants' reason for her termination are pretextual...As such, summary judgment in Defendants' favor is improper in this action."

The other defendants' motion, filed earlier on August 8 for Abraham Mitchell individually, was denied because "[T]he Court believes that Plaintiff's evidence creates a genuine issue of material fact as to this Defendant's culpability in the allegations made by Plaintiff sufficient to withstand Defendant's motion. The Court notes, however, that even if Mitchell is found to have not directly participated in terminating Plaintiff, he could be found liable under the FHA [Fair Housing Act]."

November 6th Ruling

On October 31, U.S. Magistrate Judge William E. Cassady held an evidentiary hearing on plaintiff's contention that discoverable information has been withheld. On November 6, Judge Cassady ruled that plaintiff's motion to compel and for sanction "be granted in part and denied in part."

On the issue of the coded information cards which several recent MBI employees said were used to identify African-Americans for discriminatory purposes, the judge wrote: "After considering the relevant testimony on whether the cards exist, and if they do, who has possession, it is determined that the cards have either been destroyed or lost. The evidence was inconclusive as to whether any defendant has purposely destroyed the cards or otherwise withheld them from disclosure. Accordingly, plaintiff's request that the Court issue an order compelling their production or otherwise sanction the defendants for failing to produce said cards is DENIED."

Judge Cassady also "DENIED" plaintiff's request to re-depose the defendants because plaintiff's counsel "failed to produce sufficient information that would convince the undersigned that a second round of deposition is necessary in order for them to prepare for trial," and also denied plaintiff's request that "the defendants be precluded at trial from claiming plaintiff was fired because of substandard job performance."

"The court does find, however, that certain specific reports, i.e., the Ashford Place Occupancy Reports...were clearly relevant to the issues raised in this action and cover a brief period of time," court paper shows, "the court finds that the response [of defendants' counsels] should have been more specific and more accommodation made for reviewing the data. Therefore, these reports shall be provided, as was directed during the evidentiary hearing, within 10 days of receipt of this order."

Pre-Trial Order

A Pre-Trial Order, signed by Judge Alex Howard of the U.S. District Court on October 29, listed 72 "Triable Issues." These were reduced to 25, according to the amended pre-trial ordered filed on November 5, and include: "If the Fair Housing Act contains a duty to supervise and train, does Alabama recognize it is [sic] a basis for tort recovery under Alabama tort theories," and "If Alabama recognizes the Fair Housing Act as a basis for tort law recovery, does the position a defendant holds with MBI render him liable as a director or officer."

Under the heading "Special Statements of Facts with respect to Paragraph 4(c) of the Pretrial Order," several former leasing agents for MBI stated that they were told tactics to detect applicants' race and instructed to code the cards of African-American applicants for discriminatory purposes.

One person, an "adverse" witness, is Debbie Brown, "but she will admit: (1) that at least three of her employees were, from time to time, placing racial identifying marks on visitors' information cards; (2) that she did nothing to prevent that or to determine whether discrimination was occurring at the complex; (3) that she had no training during the relevant time period other than receiving a manual and being required to sign an affidavit that she would follow the Fair Housing Act and that her apartment complex, to her knowledge, was never tested or surveyed to determine whether she and the others working there were following the Fair Housing Act. She will testify that about 1994, Mr. Jim Spafford inquired as to the practice of marking cards with racial identifiers and that he requested the originals of all visitors information cards. All original cards were given to him, including cards which were race marked. No one was reprimanded or punished for marking the cards."

In the pre-trial order, another witness -- an assistant manager of Maison de Ville Apartments, which is the rental property about which plaintiffs in the Lowman case made inquiries in 1990 and 1991 -- stated: "Mr. Spafford asked about the race-coded cards in 1993 or 1994. [She] and others turned in the original cards to Ms. Brown for transmittal to Mr. Spafford. Afterwards, Mr. Spafford said not to mark the cards. He did not criticize Ms. Ackers or anybody else for coding them. The coding of cards was just a process everybody knew to do.

"In 1992, in connection with the affidavits which MBI asked the managers and assistant managers to sign, [she] overhead Ms. Stein [the former MBI leasing agent who turned in the actual copies of the information cards, including the coded ones, in another lawsuit filed against MBI the previous year concerning housing discrimination] say to Ms. Brown, "We have this Fair Housing booklet, does that mean the policy has changed?" And Ms. Brown said, "No, this is just a little something Jim [Spafford] wants."

On October 29, Judge Alex Howard "ordered" both parties to "engage in mediation in good faith" and to "designate" a mediator. A mediator has been agreed upon by both plaintiff and defendants' attorneys, according to papers filed in early November with the district court.

-- November 19, 1996


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