McCardell v. United States Department of Housing & Urban Development

Case: 14-40955 Document: 00513127196 Page: 1 Date Filed: 07/23/2015
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
July 23, 2015
No. 14-40955
Lyle W. Cayce
Clerk
TRYSHATEL MCCARDELL, also known as Trysha McCardell,
Plaintiff – Appellant,
v.
UNITED STATES DEPARTMENT OF HOUSING AND URBAN
DEVELOPMENT; JULIAN CASTRO, In His Official Capacity as Secretary of
United States Department of Housing and Urban Development; THE
GENERAL LAND OFFICE OF THE STATE OF TEXAS; GALVESTON
HOUSING AUTHORITY; THE CITY OF GALVESTON; TEXAS
DEPARTMENT OF HOUSING AND COMMUNITY AFFAIRS,
Defendants – Appellees
Appeal from the United States District Court
for the Southern District of Texas
Before HIGGINBOTHAM, DAVIS, and SOUTHWICK, Circuit Judges.
PATRICK E. HIGGINBOTHAM, Circuit Judge:
Hurricane Ike made landfall over Galveston Island in September 2008
and wrought widespread devastation on the region. Among the ruins were 569
public housing units comprising four sites located in impoverished areas of
Galveston County. This case centers on a plan to replace those units in part by
redeveloping on two of the sites destroyed by Ike. We address questions
concerning the scope of standing to sue under the Fair Housing Act of 1968,
whether Congress intended by that Act to abrogate States’ sovereign
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immunity, and whether Appellees can avail themselves of a safe harbor
provision contained in the United States Housing Act of 1937, as amended by
the Quality Housing and Work Responsibility Act of 1998. 1
I.
A. Regulatory Backdrop
The provision of public housing in the United States is authorized under
42 U.S.C. § 1437 and administered by the United States Department of
Housing and Urban Development (“HUD”). 2 HUD carries out this duty in part
by distributing funds to local public housing authorities (“PHAs”) that, in turn,
manage housing projects. 3 The relationship between HUD and a PHA is
governed by a standard written contract called an “annual contributions
contract” or “ACC.” 4 Under an ACC, HUD agrees to provide funds for housing
assistance payments and administrative fees and in exchange the PHA “agrees
to administer the program in accordance with HUD regulations and
requirements.” 5 A PHA may apply to HUD for authorization to demolish or
dispose of a public housing project under 42 U.S.C. § 1437p. “[I]n cases where
PHAs must demolish housing due to an emergency or natural disaster,”
however, it “has been HUD’s practice, as reflected in the [standard form] ACC,”
to allow demolition without prior authorization to ensure the health and safety
of residents. 6 “If the PHA rebuilds less than all of the demolished structures or
the project, the PHA shall submit a demolition application . . . within one year
1 42 U.S.C. § 1437 et seq.
2 See 24 C.F.R. § 970.1 et seq.
3 Id. at § 982.151(a)(1).
4 Id.
5 Id.
6 Public Housing Program: Demolition or Disposition of Public Housing Projects, and
Conversion of Public Housing to Tenant-Based Assistance, 79 Fed. Reg. 62,250, 62,254,
62,265 (October 16, 2014) (to be codified at 24 C.F.R. § 970.33), also available at
http://www.gpo.gov/fdsys/pkg/FR-2014-10-16/pdf/2014-24068.pdf.
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of such demolition to formalize and request official HUD approval for the action
under [section 1437p].” 7
B. The Demolition
The Galveston Housing Authority (“GHA”) is the PHA that manages and
administers public housing in Galveston County. In the wake of the storm, the
City of Galveston declared four public housing sites “unfit for human
occupancy” and it ordered GHA to demolish Oleander Homes, Palm Terrace,
Magnolia Homes, and Cedar Terrace. 8 Consistent with HUD’s practice in like
cases, GHA sent a letter to HUD announcing its intent to demolish Oleander
Homes and Palm Terrace without seeking prior authorization from HUD’s
Special Applications Center under section 1437p. 9 Lone Star Legal Aid, a
nonprofit legal organization, filed an administrative complaint with HUD
opposing GHA’s demolition plan on behalf of displaced public housing tenants.
GHA and LSLA reached a settlement of the complaint under which GHA
agreed to provide replacement housing on a one-for-one basis for all residential
units destroyed by Ike and to incorporate the terms of an agreed upon
replacement plan. 10
Having satisfied LSLA’s concerns, GHA moved forward and demolished
all four sites, including the housing units situated at the Magnolia Homes and
Cedar Terrace sites, on August 6, 2009. 11 It then submitted a formal demolition
application to HUD. 12 In a letter dated April 15, 2010, HUD approved GHA’s
application “as outlined in [an] enclosed memorandum from [HUD’s director of
7 Id. at 62,265.
8 R.3384-87.
9 R.3390, 4686-87; see 24 C.F.R. § 970.1 et seq.
10 R.3390-92.
11 R.4608.
12 See supra Note 6 and accompanying text (citing 79 Fed. Reg. 62,250, 62,265 (to be
codified at 24 C.F.R. § 970.33)).
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SAC] to the HUD Houston Program Center.” 13 In the enclosed memorandum,
the SAC director stated, “[b]ased upon our review, and finding that the
requirements of 24 [C.F.R.] Part 970 and Section 18 of the [United States
Housing Act] have been met, the proposed demolition . . . is hereby approved.” 14
The memorandum also included a general description of GHA’s intended
future use of the property. 15 On June 17, 2010, HUD issued a letter of
amendment and clarification, restating its approval of GHA’s demolition
application and acknowledging that “a public housing authority . . . may
demolish public housing property without prior approval from [HUD] if the
property suffers abrupt damage from an act of God,” that the Magnolia Homes
and Cedar Terrace sites fell into this category, and that after demolishing them
GHA had submitted a formal application “to evidence that the demolition was
in compliance with Section 18 of the [United States Housing Act] and 24
[C.F.R.] Part 970.” 16
C. The Planned Redevelopment
GHA’s master plan for redevelopment—pending approval from HUD—
seeks to replace each of the 569 public housing units lost during Ike in
accordance with the terms of the LSLA settlement. As part of the master plan,
GHA proposes to redevelop the former Magnolia Homes and Cedar Terrace
13 R.4605-07.
14 R.4615.
15 R.4611-16.
16 R.4608-09.
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sites with 282 multi-family, mixed-income housing units, 144 of which would
count toward replacement public housing units. 17
D. Procedural History
GHA’s effort to redevelop the Magnolia Homes and Cedar Terrace sites
met controversy. Individuals and the Galveston Open Government Project filed
this lawsuit, seeking to enjoin the plan and arguing that by proposing
redevelopment on former public housing sites the plan would actively
concentrate poverty in already impoverished and racially segregated areas. 18
The original complaint named as defendants: the City of Galveston and GHA;
GLO and the Texas Department of Housing and Community Affairs
(collectively the “State Defendants”); and HUD and its secretary. 19
The second amended complaint added as an additional plaintiff
Tryshatel McCardell, an African-American resident of Galveston who lives
nine blocks from the Cedar Terrace site. She claims injury from the
construction of “public housing in [her] current neighborhood—a neighborhood
that is already segregated—[because it] will further add to the segregation of
the neighborhood—depriving her of interracial associations.” 20
17 Before Ike, Magnolia Homes and Cedar Terrace comprised 133 units and 136 units,
respectively—all 269 units were low-income public housing. The Magnolia Homes
redevelopment would include 160 total units: 78 market rate unrestricted units; 18 project-
based section 8 voucher units; and 64 public housing units. The Cedar Terrace redevelopment
would include 121 total units: 59 market rate unrestricted units; 13 project-based section 8
voucher units; and 49 public housing units. R.4687; see R.2779-80. To achieve one-for-one
replacement of the 569 units lost, in complement to redeveloping the Magnolia Homes and
Cedar Terrace sites the master plan provides for the Texas General Land Office (“GLO”) to
develop 385 public housing units at scattered sites, 50 of which may be developed outside
Galveston city limits on the mainland of Galveston County. “GHA Reconstruction Plan,”
GALVESTON HOUSING AUTHORITY, available at
http://www.ghatx.org/dev_reconstruction.html (last visited April 1, 2015).
18 R.22.
19 Shaun Donovan was Secretary of HUD when this case was originally filed; Julian
Castro later replaced Donovan at that post and was substituted for Donovan as a named
defendant.
20 R.2725-26.
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Motions and orders ensued. In a thorough memorandum and order, the
district court dismissed for lack of standing all plaintiffs except for
McCardell. 21 McCardell then filed a third amended complaint, elaborating
allegations in support of her “neighborhood standing” to challenge the plan 22
and requesting declaratory and injunctive relief on claims under the
constitution, Title VIII of the Civil Rights Act of 1968, and the Administrative
Procedure Act. 23 The district court dismissed the State Defendants on
sovereign immunity grounds, 24 dismissed the APA claim, 25 granted
McCardell’s motion to nonsuit the constitutional claim, 26 granted the
remaining defendants’ joint motion for summary judgment on the Fair
Housing Act claim, 27 and entered final judgment on August 13, 2014. 28
Only McCardell appeals. 29
II.
McCardell first challenges the district court’s dismissal of the Individual
Plaintiffs and GOGP for lack of standing. As an initial matter, we hold that we
lack jurisdiction to entertain these dismissals, for they did not appeal.
The Federal Rules of Appellate Procedure mandate that a notice of
appeal must “specify the party or parties taking the appeal by naming each
one in the caption or body of the notice . . . [and] designate the judgment, order,
or part thereof being appealed . . . .” 30 Failure to name a party in a notice of
appeal constitutes a fatal defect in that it fails to confer upon our court
21 R.3728-63.
22 R.3846-47.
23 R.3857-60.
24 R.3872-74.
25 R.4460-63.
26 R.4514.
27 R.4685-97.
28 R.4698-99.
29 R.4700-02.
30 Fed. R. App. P. 3(c)(1).
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jurisdiction over that party. “It constitutes a failure of that party to appeal.” 31
The Individual Plaintiffs and GOGP are not parties to this appeal because none
filed notice of appeal. 32
McCardell urges that it is irrelevant whether the Individual Plaintiffs or
GOGP are parties because she has a personal stake in advancing an appeal of
their dismissal. Even assuming, without deciding, that McCardell would have
standing to bring such an appeal, we still would lack jurisdiction to review it.
The notice of appeal filed by McCardell names only McCardell as plaintiff in
its caption and states the following in body text: “Notice is hereby given that
Tryshatel McCardell, Plaintiff in the above-named case, hereby appeals to the
United States Court of Appeals for the Fifth Circuit the Final Judgment (D.E.
148) entered in this action on the 13th day of August, 2014.” 33 The referenced
final judgment names only McCardell as plaintiff and addresses only those
claims she alone brought in the third amended complaint. It does not mention
the Individual Plaintiffs or GOGP or any of the orders resulting in their
dismissal from the suit. Although we “treat notices of appeal relatively liberally
‘where the intent to appeal an unmentioned or mislabeled ruling is apparent
and there is no prejudice to the adverse party,’” 34 no such intent is apparent
here. By specifically designating only the district court’s final judgment in her
notice of appeal, McCardell exhibited no intent to appeal the district court’s
dismissal of the Individual Plaintiffs or GOGP. 35
31 Torres v. Oakland Scavenger Co., 487 U.S. 312, 314 (1988).
32 Residential Council of Allen Parkway Vill. v. U.S. Dep’t of Hous. & Urban Dev., 980
F.2d 1043, 1048-49 (5th Cir. 1993).
33 R.4700-02.
34 R.P. ex rel. R.P. v. Alamo Heights Ind. Sch. Dist., 703 F.3d 801, 808 (5th Cir. 2012)
(citation omitted).
35 See Warfield v. Fid. & Deposit Co., 904 F.2d 322, 325-25 (5th Cir. 1990).
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III.
We must first address the threshold question of whether we have
jurisdiction over McCardell’s claim. 36 The district court held that McCardell
alleged sufficient facts at the pleading stage to weather a motion to dismiss
and proceed on the basis of “neighborhood standing.” 37 We review that holding
de novo, cognizant of the of Supreme Court’s guidance that the standard used
to establish standing is not constant but becomes gradually stricter in its
demanded showing as the parties proceed through “the successive stages of [a]
litigation.” 38 “Although standing generally is a matter dealt with at the earliest
stages of litigation, usually on the pleadings, it sometimes remains to be seen
whether the factual allegations of the complaint necessary for standing will be
supported adequately by the evidence adduced at trial.” 39 McCardell bears the
burden of establishing that she has standing to bring this appeal. 40
A.
Article III of the Constitution limits our jurisdiction to certain justiciable
“Cases” and “Controversies.” 41 One element of the “case-or-controversy”
requirement, among others, is that a plaintiff must establish that she has
“standing” to sue 42—that she “is entitled to have the court decide the merits of
the dispute or of particular issues.” 43 To establish Article III standing, a
plaintiff must demonstrate an injury that is: (1) concrete, particularized, and
36 Mart. v. Halliburton, 618 F.3d 476, 481 (5th Cir. 2010).
37 R.3742-53.
38 Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61 (1992).
39 Gladstone Realtors v. Village of Bellwood, 441 U.S. 91, 115 n.31 (1979).
40 Martin, 618 F.3d at 481.
41 Clapper v. Amnesty Intern. USA, 133 S. Ct. 1138, 1146 (2013).
42 Id. (internal quotation marks and citation omitted).
43 Warth v. Seldin, 422 U.S. 490, 498 (1975).
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actual or imminent (so-called injury “in fact”); (2) fairly traceable to the
challenged action; and (3) redressable by a favorable ruling. 44
B.
After Congress passed the Fair Housing Act, the Supreme Court handed
down a trilogy of cases in which it recognized that deprivation of “the benefits
that result from living in an integrated community” is sufficient injury. 45 This
theory of standing—deemed “neighborhood standing”—stems from the Court’s
conclusion that the harm caused by a racially discriminatory housing practice
can, in some circumstances, extend beyond its immediate victim. 46 Rather than
a claim of direct discrimination against oneself, neighborhood standing finds
the requisite injury, albeit indirect and immediately visited upon a third-party,
in “an adverse impact on the neighborhood in which the plaintiff resides.” 47
The Court first identified neighborhood standing in Trafficante v.
Metropolitan Life Insurance Company, 48 where it found justiciable two
apartment tenants’ allegations that their landlord’s “racial steering” 49
practices had resulted in “the loss of important benefits from interracial
associations” in their apartment community. 50 The Court emphasized that the
person excluded on account of his race “is not the only victim of discriminatory
practices; it is . . . the whole community.” 51 In Trafficante the standing analysis
was relatively simple, as both plaintiffs resided in the “same housing unit that
44Monsanto Co. v. Geertson Seed Farms, 561 U.S. 139, 149 (2010).
45See Havens Realty Corp. v. Coleman, 455 U.S. 363, 375 (1982).
46 Id.
47 Id.
48 409 U.S. 205 (1972).
49 The Court has defined “racial steering” in this context as “directing prospective
home buyers interested in equivalent properties to different areas according to their race.”
Gladstone Realtors v. Village of Bellwood, 441 U.S. 91, 94 (1979).
50 Trafficante, 409 U.S. at 209-10 (internal quotation marks and citation omitted)
(emphasis added).
51 Id. at 211
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[was] charged with discrimination.” 52
Seven years later, in Gladstone Realtors v. Village of Bellwood, 53 the
Court took up the resulting challenge of scope—whether a “12- by 13-block
residential neighborhood” constituted a community from which residents
enjoyed standing to challenge illegal racial steering practices. 54 Answering
that question affirmatively, the Court held that the inquiry is the same
regardless whether a “community is defined in terms of city blocks [or]
apartment buildings”: standing depends on “[t]he presence of a genuine injury
ascertainable on the basis of discrete facts presented at trial.” 55 The Court held
that the plaintiffs had standing based on their allegations that racial steering
had negatively affected the racial composition of their “relatively compact
neighborhood.” 56
In Havens Realty Corporation v. Coleman, 57 the Court reaffirmed its
recognition of neighborhood standing “based on the effects of
discrimination . . . within a ‘relatively compact neighborhood.’” 58 There, two
residents of the Richmond, Virginia, metropolitan area alleged that a
landlord’s racial steering practices at an apartment complex in a Richmond
suburb had deprived them of “the important social, professional, business, and
economic, political, and aesthetic benefits of interracial associations that arise
from living in integrated communities . . . .” 59 The Court, noting that it was
implausible to conclude that discrimination within a single housing complex
52 Id. at 209. We note that the apartment complex in Trafficante housed “about 8,200
residents.” Id. at 206.
53 441 U.S. 91 (1979).
54 Id. at 112-14.
55 See id. at 114.
56 Id. at 110, 114.
57 455 U.S. 363 (1982).
58 Id. at 377 (quoting Bellwood, 441 U.S. at 114).
59 Id. at 376.
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could have palpable effects throughout an entire metropolitan area, remanded
for further factual development, because the “extreme generality” of the
residents’ complaint had “not identified the particular neighborhoods in which
they lived, nor established the proximity of their homes to the site of
petitioners' alleged steering practices.” 60
These cases demonstrate that a constitutionally cognizable injury can
arise from the deprivation of the social and economic benefits of living in an
integrated and relatively compact community. Serving this principle, we in
turn have held that denying “benefits of interracial associations” and “racial
balance and stability” can constitute cognizable injury. 61 In Broadmoor, we
held “that individual residents who live[d] inside the area targeted by real
estate brokers for racial steering” had standing to bring suit under the Fair
Housing Act. 62
C.
In reviewing standing at the summary judgment stage, any “specific
facts . . . set forth by affidavit or other evidence . . . will be taken to be true.” 63
The third amended complaint alleged that McCardell “is an impoverished
African American resident” of Galveston who “currently lives approximately
nine blocks from the proposed site of Magnolia Homes.” 64 It added the
following:
[McCardell’s] neighborhood is predominantly composed of racial
minorities, and the new tenants of the public housing units of [the
planned redevelopment] are estimated to be mostly racial
minorities. There is also a high rate of poverty and those needing
housing assistance in her neighborhood. Building new public
60 Id. at 377-78.
61 Broadmoor Improvement Ass’n, Inc. v. Stan Weber & Assocs., 597 F.2d 568, 570 (5th
Cir. 1979) (per curiam) (quoting Bellwood, 441 U.S. at 111)
62 Id.
63 Lujan v. Defenders of Wildlife, 504 U.S. 555, 561 (1992).
64 R.3846.
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housing in her neighborhood will have an economic and racially
segregative effect on her neighborhood . . . If Defendants [sic] plans
move forward [ ] McCardell will be deprived of the social and
professional benefits of living in an integrated society and the
racial balance and stability of the neighborhood will be
undermined. [ ] McCardell also presently suffers the stigmatic
harm of living in a community whose members are subjected to
segregation on the basis of prohibited classification by the
Defendant’s [sic] plan which is contrary to many laws . . . . 65
The record also contains several reports of experts that support McCardell’s
allegations regarding the anticipated socioeconomic effects of the planned
redevelopment on her neighborhood. 66
We are persuaded that McCardell sufficiently alleged that the
challenged action in this case would deny her the benefits of an integrated
community within her relatively compact neighborhood. Unlike mine-run
neighborhood standing cases, typically urging injury from past discriminatory
practices, McCardell alleges only future injury. Appellees respond that two
decisions of the Supreme Court since the Trafficante-Gladstone-Havens trilogy
preclude constitutional recognition of such injury. Specifically, that McCardell
has established neither “certainly impending” injury under Clapper v. Amnesty
International USA, 67 nor “‘likely,’ as opposed to merely ‘speculative,’”
redressability under Lujan v. Defenders of Wildlife. 68 We consider each
argument in turn.
65 Id.
66 See, e.g., R.739-804 (Kirk McClure, Analysis of Census Tracts of Galveston County,
Texas, September 24, 2013); R.688-738 (John A. Powell, A Preliminary Analysis of the
Galveston Public Housing Reconstruction Plan, May 7, 2013); R.3509-26 (Jason Reece, et al.,
Galveston After Ike: Moving Together Towards a Full Recovery, December 2011).
67 133 S. Ct. 1138, 1147 (2013).
68 504 U.S. 555, 561 (1992) (citation omitted).
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1.
Clapper held that “threatened injury must be certainly impending to
constitute injury in fact, and that allegations of possible future injury are not
sufficient.” 69 There, attorneys and human rights organizations brought action
seeking declaratory and injunctive relief from a provision of the Foreign
Intelligence Surveillance Act that allowed surveillance of non-“United States
persons” who were reasonably believed to be located outside the United
States. 70 The plaintiffs’ argument was premised on likely future harm caused
by the statute—“Respondents believe that some of the people with whom they
exchange foreign intelligence information are likely targets of surveillance
under [the statute].” 71 The Court held that the plaintiffs’ “theory of standing,
which relies on a highly attenuated chain of possibilities, does not satisfy the
requirement that threatened injury must be certainly impending.” 72 It
identified the “speculative chain of possibilities” 73 as follows:
(1) the Government will decide to target the communications of
non-U.S. persons with whom they communicate; (2) in doing so,
the Government will choose to invoke its authority under [the
statute] rather than utilizing another method of surveillance; (3)
the Article III judges who serve on the Foreign Intelligence
Surveillance Court will conclude that the Government's proposed
surveillance procedures satisfy [the statute’s] many safeguards
and are consistent with the Fourth Amendment; (4) the
Government will succeed in intercepting the communications of
respondents' contacts; and (5) respondents will be parties to the
particular communications that the Government intercepts. 74
Appellees assert that because the planned redevelopment is both
69 Clapper, 133 S. Ct. at 1147 (internal quotation marks and citation omitted).
70 Id. at 1142-43.
71 Id. at 1145.
72 Id. at 1148.
73 Id. at 1150.
74 Id. at 1148.
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inchoate and designed to be mixed income and to attract a variety of tenants,
McCardell can only speculate as to whether, if redevelopment proceeds, it will
deprive her of the social and economic benefits of diversity. Granted,
McCardell’s asserted injury is inescapably “speculative” in the sense that it is
not yet felt. But unlike in Clapper, where the alleged injury depended on a long
and tenuous chain of contingent events, the chain-of-events framework in this
case involves fewer steps and no “unfounded assumptions.” 75 McCardell’s
asserted injury would be concretely felt in the logical course of probable events
flowing from an unfavorable decision by this court: (1) HUD approves the
already-pending plan for redevelopment; 76 (2) redevelopment occurs according
to the approved plan; 77 (3) segregation and minority- and poverty-
concentration occur in McCardell’s neighborhood as specifically anticipated in
several expert reports contained in the record. 78
75 Cf. Clapper, 133 S. Ct. at 1148-49.
76 This after having formally approved the underlying demolition under 42 U.S.C. §
1437p, in part based on the details of the proposed redevelopment.
77 In an analogous redressability analysis the Supreme Court found a “substantial
probability of materialization” following the removal of regulatory barriers to a planned
development. See Village of Arlington Heights v. Metropolitan Hous. Dev. Corp., 429 U.S. 252,
264 (1977) (“If a court grants the relief [plaintiff] seeks, there is at least a ‘substantial
probability’ that the [proposed] project will materialize, affording [him] the housing
opportunity he desires . . . .”).
78 The following excerpt is representative of the extensive expert reports submitted by
McCardell:
The [planned redevelopment] will add public housing units to neighborhoods
that already suffer from high concentrations of poverty exacerbating the
problems that result from this social condition. These developments will
confront a significant challenge in marketing units to middle- and upper-
income households. If the developments fail to attract middle- and upper-
income tenants, then the developments will further concentrate the poor in
individual developments in poor neighborhoods. R.802 ((Kirk McClure, Ph.D,
Review and Conclusions on Public Housing Reconstruction on Targeted Census
Tracts in the City of Galveston, Texas, September 24, 2013). To develop mixed-
income housing on the sites of the former public housing projects means
locating these developments in tracts that are not enjoying strong demand for
housing by upper-income households. The census tracts where the
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Under Lujan, we take as true “specific facts . . . set forth by affidavit or
other evidence.” 79 McCardell asserts facts with more specificity and support
than those found wanting in Clapper. We conclude that she has adequately
alleged a threatened injury that is “certainly impending.” 80 Bolstering this
conclusion, as the district court below ably identified, numerous other courts
have found that individual neighbors have standing to challenge future
segregative effects of planned but yet unbuilt public housing projects. 81
2.
Appellees persist that even assuming injury-in-fact McCardell cannot
show that it is “‘likely,’ as opposed to merely ‘speculative,’ that the injury will
be ‘redressed by a favorable decision.’” 82 This misapprehends our inquiry. Their
argument appears to be that a favorable decision for McCardell “would have
developments are planned have high levels of poverty and are not racially or
ethnically integrated. The research suggests that these characteristics will
make mixed-income housing developments extremely difficult, perhaps even
impossible, to successfully market to upper-income households. R.791-94 (Kirk
McClure, Ph.D, Analysis of the Census Tracts of Galveston County, Texas,
September 24, 2013).
79 Lujan v. Defenders of Wildlife, 504 U.S. 555, 561 (1992).
80 Clapper, 133 S. Ct. at 1147.
81 See, e.g., Jackson v. Okaloosa Cnty., 21 F.3d 1531 (11th Cir. 1994) (holding plaintiffs
had standing to challenge siting process for new, unbuilt public housing project); Alschuler
v. Dep’t of Hous. & Urban Dev., 686 F.2d 472 (7th Cir. 1982) (affirming neighborhood standing
to challenge HUD’s decision approving a preliminary proposal for development project);
Shannon v. U.S. Dep’t of Hous. & Urban Dev., 436 F.2d 809, 817-18 (3d Cir. 1970) (affirming
standing to challenge site selection for apartment project “about to be constructed,” premised
on allegation that siting “will adversely affect” plaintiffs in the future) (cited favorably in
Trafficante, 409 U.S. at 111; and Gladstone, 441 U.S. at 114 n.28); Glendale Neighborhood
Ass’n v. Greensboro Hous. Auth., 901 F. Supp. 996, 1000 (M.D.N.C. 1995) (discussing Jackson
and Alschuler and affirming standing of plaintiffs that alleged “they will be injured by
development of the proposed public housing project”); King v. Harris, 464 F. Supp. 827, 832-
33 n.14 (E.D.N.Y. 1979), aff’d sub nom. King v. Faymor Dev. Co., 614 F.2d 1288 (2d Cir. 1979),
vacated, 446 U.S. 905 (1980), aff’d on remand, 636 F.2d 1202 (2d Cir. 1980) (holding that
plaintiffs, individuals living near a proposed housing project, had neighborhood standing to
sue).
82 Brief of Federal Appellees at 14 (quoting Lujan v. Defenders of Wildlife, 504 U.S.
555, 560-61 (1992)).
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the ironic result of blocking investment in the area . . . [because] McCardell
provides no basis for concluding that an empty lot will do more to improve
diversity in her neighborhood than would a new mixed-income development.” 83
A favorable ruling by this court, however, would redress the injury McCardell
asserts by forbidding redevelopment according to the proposed plan. One need
not speculate about empty lots or alternative plans or outcomes to conclude
that McCardell has demonstrated “likely” redressability under Lujan.
D.
We hold that McCardell has Article III standing to bring her claim that
the planned redevelopment will deprive her of the social and economic benefits
that result from living in an integrated community
IV.
McCardell avers that the district court erred in dismissing the State
Defendants as immune from suit under the Eleventh Amendment because
Congress intended by the Fair Housing Act to abrogate their immunity. We
disagree.
The Eleventh Amendment bars suits brought by private citizens against
a state in federal court without the state’s consent. 84 It is axiomatic that, as
sovereigns, states and “arms of the state” possess immunity from suits brought
under federal law. 85 Congress may abrogate a state’s sovereign immunity only
83 Id. at 17.
84 U.S. CONST. amend. XI (“The judicial power of the United States shall not be
construed to extend to any suit in law or equity, commenced or prosecuted against one of the
United States by Citizens of another State, or by Citizens or subjects of any Foreign State.”);
see generally Hans v. Louisiana, 134 U.S. 1 (1890).
85 Northern Ins. Co. of New York v. Chatham Cnty., Ga., 547 U.S. 189, 193-94 (2006)
(“[T]he phrase ‘Eleventh Amendment immunity’ . . . is convenient shorthand but something
of a misnomer, for the sovereign immunity of the States neither derives from, nor is limited
by, the terms of the Eleventh Amendment.”) (citing Alden v. Maine, 527 U.S. 706, 713 (1999);
Pennhurst State Sch. & Hosp. v. Halderman, 465 U.S. 89, 98-99 (1984) (“[T]he principle of
sovereign immunity is a constitutional limitation on the federal judicial power established in
[Article] III . . . .”).
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if it (1) makes “unmistakably clear” its intent to do so and (2) acts pursuant to
a constitutionally valid exercise of its power. 86
It is undisputed that State Defendants here are arms of the state of
Texas and Texas has not consented to suit brought under the Fair Housing
Act. The question remains whether Congress validly abrogated Texas’
sovereign immunity in enacting the Fair Housing Act. McCardell cannot clear
the first hurdle of this inquiry. The language of the Fair Housing Act does not
make “unmistakably clear” that Congress intended to abrogate. It contains no
provision evidencing such intent. McCardell offers none, opting instead to
devote the whole of her briefing on this issue to the second prong: whether
Congress passed the Fair Housing Act pursuant to a constitutionally valid
exercise of its power. But whether Congress did so bridges beyond, as the Act
lacks an explicit provision allowing its enforcement by private right of action
against a state.
Its want is made the more clear, by contrast, in remedial provisions tied
to other aspects of civil rights legislation. For example, with regard to Title VI
of the Civil Rights Act of 1964, which prevents discrimination by government
agencies that receive federal funds, Congress provided by statute that “[a] state
shall not be immune under the Eleventh Amendment of the Constitution of the
United States from Suit in Federal court for a violation of . . . title VI of the
Civil Rights Act of 1964 . . . .” 87 The Supreme Court has recognized that by this
language Congress “expressly abrogated States’ sovereign immunity against
suits brought . . . to enforce Title VI.” 88 No similar language exists in the
provisions of the Fair Housing Act.
86 Nevada Dep’t of Human Res. v. Hibbs, 538 U.S. 721, 726 (2003); see Seminole Tribe
of Florida v. Florida, 517 U.S. 44, 55 (1996).
87 42 U.S.C. § 2000d-7(a)(1).
88 See Alexander v. Sandoval, 532 U.S. 275, 280 (2001); see also Bd. of Trustees of Univ.
of Alabama v. Garrett, 531 U.S. 356, 363-64 (2001) (holding that Congress indisputably
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We hold that Congress did not make clear an intent to abrogate States’
Eleventh Amendment sovereign immunity from suits brought under the Fair
Housing Act, a conclusion reached by other courts considering the issue. 89
V.
The district court granted summary judgment to the remaining
defendants on McCardell’s Fair Housing Act claim. 90 It concluded that
McCardell’s claim was precluded by a safe harbor provision found at
42 U.S.C. § 1437p(d), which provides:
Notwithstanding any other provision of law, replacement public
housing units for public housing units demolished in accordance
with this section may be built on the original public housing
location or in the same neighborhood as the original public housing
location if the number of the replacement public housing units is
significantly fewer than the number of units demolished.
The district court held that the “[n]otwithstanding any other provision of law”
language contained in section 1437p(d) applied in this case to bar a Fair
Housing Act claim against the rebuilding of units on former public housing
sites because the demolition met the conditions requisite to invoke the safe
harbor provision.
abrogated States’ immunity from suits brought under the Americans with Disabilities Act by
providing in 42 U.S.C. § 12202 that “[a] State shall not be immune under the eleventh
amendment to the Constitution of the United States from an action in [a court] for a violation
of this chapter”).
89 See Morris v. Dehaan, 1991 WL 177995, at *3 (6th Cir. Sept. 12 1991); Brooks v.
Oakland Univ., 2013 WL 6191051, at *2 (E.D. Mich. Nov. 26, 2013); Sims v. Tex. Dep’t of
Hous. & Cmty. Affairs, 2008 WL 4552784, at *1 (S.D. Tex. Oct. 7, 2008) (“[T]he states were
not made ‘persons’ potentially liable for FHA violations.” (citing 42 U.S.C. § 3602(d)); Gregory
v. S. Carolina Dep’t of Transp., 289 F. Supp. 2d 721, 724-25 (D.S.C. 2003); Project Life, Inc. v.
Glendening, 139 F. Supp. 2d 703, 711 (D. Md. 2001); Welch v. Century 21 Chimes Real Estate,
1991 WL 29950, at *1-*2 (E.D.N.Y. Feb. 27, 1991); see also Boyd v. Browner, 897 F. Supp. 590,
594-95 (D.D.C. 1995) (“[T]he Fair Housing Act does not ‘unambiguously waive’ the
government’s sovereign immunity defense . . . .”).
90 R.4690-97.
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A.
We review de novo, applying the same standard as the district court. 91
Summary judgment is proper “if the movant shows that there is no genuine
dispute as to any material fact and the movant is entitled to judgment as a
matter of law.” 92 “An issue is material if its resolution could affect the outcome
of the action.” 93 We consider all facts and evidence in the light most favorable
to the nonmoving party. 94
B.
As an initial matter, the district court’s interpretation and application of
section 1437p comports with our plain-language reading of the statute. The
section 1437p(d) safe harbor applies to the redevelopment of public housing on
a demolished site if (1) the demolition was carried out “in accordance with”
section 1437p and (2) “the number of replacement public housing units is
significantly fewer than the number of units demolished.” 95 If these conditions
are met, the safe harbor applies to preclude a Fair Housing Act claim.
McCardell does not contest on appeal that the number of replacement public
housing units in the planned redevelopment would be “significantly fewer”
than the number of units demolished as that standard is defined in relevant
regulations. 96 Our inquiry is thus focused on the “in accordance with” prong.
Relevant to this inquiry, the implementing regulations for section 1437p are
codified at 24 C.F.R. § 970.1 et seq. 97 Among the implementing regulations, the
91 Haverda v. Hays Cnty., 723 F.3d 586, 591 (5th Cir. 2013).
92 Fed. R. Civ. P. 56(a).
93 Boudreaux v. Swift Transp. Co. Inc., 402 F.3d 536, 540 (5th Cir. 2005) (citation
omitted).
94 Haverda, 723 F.3d at 591.
95 42 U.S.C. § 1437p(d).
96 See 24 C.F.R. § 905.602(d)(5).
97 See generally Demolition or Disposition of Public Housing Projects, 71 Fed. Reg.
62,354 (Oct. 24, 2006).
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list of requirements for HUD approval of a PHA demolition application under
section 1437p is located at 24 C.F.R. § 970.7. And relevant to this appeal, 24
C.F.R. § 970.31 provides that the development of “replacement public housing
units . . . on the original public housing location . . . must [also] comply with
[the provisions of] 24 [C.F.R. §] 905 . . . .”
The provisions of 24 C.F.R. § 905, in turn, contain general requirements
related “to the development of public housing units to be included under an
ACC and which will receive funding from public housing funds.” 98 Part
905.602(d) provides that “[e]ach proposed site . . . for construction or
rehabilitation of public housing must be reviewed and approved by the [HUD]
field office as meeting [several] standards, as applicable.” 99 This language
indicates that a reviewing court’s inquiry is limited to considering whether
HUD reviewed and approved a proposed site as meeting each standard. It does
not require or permit a reviewing court to second-guess HUD’s determinations.
Part 905.602(d) lists eleven standards that HUD must consider with
regard to a proposed site for construction. 100 The fifth listed standard tracks
the language of the section 1437p(d) safe harbor and provides that
“[n]otwithstanding the foregoing [four standards], after demolition of public
housing units a PHA may construct public housing units on the original public
housing site or in the same neighborhood if the number of replacement public
housing units is significantly fewer than the number of public housing units
demolished.” 101 Because McCardell concedes that the planned redevelopment
98 24 C.F.R. § 905.600(a); see id. at § 905.602(d).
99 Id. at § 905.602(d) (emphasis added).
100 Id. at § 905.602(d)(1)-(11).
101 Id. at § 905.602(d)(5). Subpart (d)(5) provides, in full:
(5) Notwithstanding the foregoing, after demolition of public housing
units a PHA may construct public housing units on the original public
housing site or in the same neighborhood if the number of replacement
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meets the “significantly fewer” standard contained in subpart (d)(5), the
express terms of that subsection provide that subparts (d)(1) through (d)(4) do
not apply in this case. The remaining question for our purposes is whether
HUD reviewed the proposed site for the planned redevelopment and approved
it as meeting the standards listed at subparts (d)(6) through (d)(11). 102 The
district court, in holding that the section 1437p(d) safe harbor applied as a
matter of law, necessarily concluded that HUD did so and thus answered this
question affirmatively.
C.
McCardell challenges the district court’s holding on two fronts. She first
argues that a material fact issue remains as to whether the planned
redevelopment complies with subpart (d)(6), 103 which requires HUD to affirm
public housing units is significantly fewer than the number of public
housing units demolished. One of the following criteria must be
satisfied:
(i) The number of public housing units being constructed
is not more than 50 percent of the number of public
housing units in the original development; or
(ii) In the case of replacing an occupied development, the
number of public housing units being constructed is the
number needed to house current residents who want to
remain at the site, so long as the number of public
housing units being constructed is significantly fewer
than the number being demolished; or
(iii) The public housing units being constructed
constitute no more than 25 units.
102 Because McCardell does not appeal the dismissal of her APA claim challenging
HUD’s determination that the standards listed at subparts (d)(6) through (d)(11) were
satisfied, we have no occasion to consider whether those standards were satisfied in actuality.
103 McCardell makes passing reference to subparts (d)(7) through (d)(11) in briefing,
but she offers no basis on which this court could conclude that summary judgment as to those
subparts was improper. Nor do we find any basis in the record. The record indicates that the
demolition and planned redevelopment complied with subparts (d)(7) through (d)(11).
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that “[t]he site shall promote greater choice of housing opportunities and avoid
undue concentration of assisted persons in areas containing a high proportion
of low-income persons.” We disagree. The record leaves no doubt that this
requirement was met. After demolishing the Magnolia Homes and Cedar
Terrace sites, GHA applied to HUD for formal approval of the demolition and
the planned redevelopment. In its letter of approval, HUD explicitly considered
the requirements set forth in the implementing regulations for section 1437p
and concluded that the relevant requirements had been met. 104 With regard to
subpart (d)(6), the provision at issue here, HUD later indicated that:
. . . the [planned] redevelopment of both the Cedar Terrace and
Magnolia Homes sites will affirmatively further fair housing
and . . . the [planned] redevelopment of both sites will reduce the
concentration of public housing units in operation on these two
sites and will also lower the concentration of poverty in these
neighborhoods.” 105
This record evidence indicates conclusively that HUD reviewed the proposed
site for the planned redevelopment and approved it as meeting the standard
listed at subpart (d)(6). McCardell offers no relevant contrary evidence.
Although she points to several expert reports reaching conclusions different
from that reached by HUD, such evidence goes not to whether HUD reviewed
and approved the proposed site in compliance with subpart (d), but instead
attacks the wisdom of HUD’s underlying determination. As discussed above,
104 R.4611-4616 (“Based upon our review, [we find] that the requirements of 24
[C.F.R. §] 970 and Section 18 of the [United States Housing Act].”). As the district court
correctly explained, Section 18 of the United States Housing Act of 1937, as amended by the
Quality Housing and Work Responsibility Act of 1998, is codified at 42 U.S.C. § 1437p. See
Veterans Affairs and HUD Appropriations Act, Pub. L. No. 105-276, 112 Stat. 2461, 2573
(1998) (“Section 18 of the United States Housing Act of 1937 (42 U.S.C. 1437p) . . . .”); see
also, e.g., 24 C.F.R. § 906.35 (“The provisions of section 18 of the 1937 Act (42 U.S.C. 1437p)
. . . .”).
105 R.3547 (emphasis added).
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the plain text of 24 C.F.R. § 905.602(d) does not permit us to second-guess
HUD’s conclusions in this context.
Arguing in the alternative, McCardell posits that even if record evidence
demonstrates conclusively that the demolition was approved under section
1437p, it might have been carried out pursuant to a different section
altogether. McCardell offers that the demolition might have been carried out
pursuant to section 1437v, which provides that demolition of public housing
undertaken in conjunction with a “main street revitalization or redevelopment
project” 106 is not subject to the provisions of section 1437p, 107 and thus not
entitled to the section 1437p(d) safe harbor. In support, McCardell points to a
fragment of GHA’s demolition application and asserts that GHA’s use of the
word “obsolete” in a general narrative heading, 108 without an express
invocation of section 1437p, makes ambiguous whether the application was
submitted pursuant to section 1437p or section 1437v, both of which refer to
the demolition of “obsolete” public housing projects. 109
106 The purpose of section 1437v(a) “is to provide [grant] assistance to public housing
agencies” to improve living environments, revitalize sites, provide low income housing, and
build sustainable communities. See 42 U.S.C. § 1437v; see generally “Main Street Grants
Notice of Funding Availability,” HUD.GOV, available at
(http://portal.hud.gov/hudportal/HUD?src=/program_offices/public_indian_housing/program
s/ph/hope6/grants/mainstreet (last visited April 3, 2015) (providing an overview of the Main
Street program). Section 1437v allows HUD to award grants to “carry out revitalization
programs for severely distressed public housing.” 42 U.S.C. § 1437v(d)(1).
107 Section 1437v(g) provides:
Any severely distressed public housing disposed of pursuant to a
revitalization plan and any public housing developed in lieu of such
severely distressed housing, shall be subject to the provisions of section
1437p of this title. Severely distressed public housing demolished
pursuant to a revitalization plan shall not be subject to the provisions
of section 1437p of this title. (emphasis added).
108 The heading reads: “Circumstances that resulted in the units becoming vacant and
relocation of residents: Hurricane Ike made units obsolete[.]” R.4528.
109 42 U.S.C. § 1437p(a)(1)(A)(i); id. at § 1437v(a)(1).
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This second argument is without merit. The record contains a written
declaration from the director of HUD’s Public and Indian Housing Office of
Urban Revitalization stating that “42 U.S.C. § 1437v does not apply to the
development proposals submitted . . . by GHA for Cedar Terrace and Magnolia
Homes.” 110 The record contains no contrary evidence; nor does McCardell offer
any. Finally, McCardell’s assertion that GHA’s use of the word “obsolete”
creates ambiguity in the record, while creative, is unavailing. 111 Summary
judgment was proper.
VI.
The judgment of the district court is AFFIRMED.
110 R.4618-21
111 See Boudreaux, 402 F.3d at 540 (“Once the moving party has demonstrated the
absence of a material fact issue, the non-moving party must go beyond the pleadings and
designate specific facts showing that there is a general issue for trial. This burden will not
be satisfied by some metaphysical doubt as to the material facts, by conclusory allegations,
by unsubstantiated assertions, or by only a scintilla of evidence.” (internal quotation marks
and citations omitted)).
24