UNPUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

JONATHAN E. PUMPHREY; CLAY

KEITH; BALTIMORE NEIGHBORHOODS,

INCORPORATED,

Plaintiffs-Appellants,

v.

No. 95-1998

STEPHEN HOMES, INCORPORATED;

SHEILA ORT,

Defendants-Appellees.

UNITED STATES OF AMERICA,

Amicus Curiae.

JONATHAN E. PUMPHREY; CLAY

KEITH; BALTIMORE NEIGHBORHOODS,

INCORPORATED,

Plaintiffs-Appellees,

v.

No. 95-3032

STEPHEN HOMES, INCORPORATED;

SHEILA ORT,

Defendants-Appellants.

UNITED STATES OF AMERICA,

Amicus Curiae.
JONATHAN E. PUMPHREY,

Plaintiff-Appellant,

and

CLAY KEITH; BALTIMORE

NEIGHBORHOODS, INCORPORATED,

Plaintiffs,

No. 96-1157

v.

STEPHEN HOMES, INCORPORATED;

SHEILA ORT,

Defendants-Appellees.

UNITED STATES OF AMERICA,

Amicus Curiae.

Appeals from the United States District Court

for the District of Maryland, at Baltimore.

John R. Hargrove, Senior District Judge.

(CA-93-1329-HAR)

Argued: October 31, 1996

Decided: March 25, 1997

Before RUSSELL, ERVIN, and WILKINS, Circuit Judges.

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Affirmed in part, reversed in part, and remanded by unpublished per

curiam opinion.

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COUNSEL

ARGUED: Andrew David Freeman, BROWN, GOLDSTEIN &

LEVY, Baltimore, Maryland, for Appellants. Francis Raymond Laws,

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KOHLMAN & SHEEHAN, P.A., Baltimore, Maryland, for Appellees. ON BRIEF: Lauren E. Willis, BROWN, GOLDSTEIN &

LEVY, Baltimore, Maryland, for Appellants. Deval L. Patrick, Assistant Attorney General, David K. Flynn, Lisa J. Stark, UNITED

STATES DEPARTMENT OF JUSTICE, Washington, D.C., for

Amicus Curiae.

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Unpublished opinions are not binding precedent in this circuit. See

Local Rule 36(c).

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OPINION

PER CURIAM:

Plaintiffs Jonathan E. Pumphrey, Clay Keith, and Baltimore Neighborhoods, Inc. (BNI) appeal various rulings of the district court concerning their action alleging that Stephen Homes, Inc. and Sheila Ort,

a sales agent for Stephen Homes, engaged in discriminatory housing

practices in violation of 42 U.S.C.A. § 3604(a), (d) (West 1994).1 Stephen Homes and Ort cross-appeal, challenging the denial of their

motion for attorney's fees and the award of attorney's fees to Pumphrey. We affirm in part, reverse in part, and remand.

I.

Pumphrey is an African-American who lived in a neighborhood

known as Greenridge II in Harford County, Maryland. Stephen

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1 Subsection (a) provides that it is unlawful "[t]o refuse to sell or rent

after the making of a bona fide offer, or to refuse to negotiate for the sale

or rental of, or otherwise make unavailable or deny, a dwelling to any

person because of race, color, religion, sex, familial status, or national

origin." 42 U.S.C.A. § 3604(a). Subsection (d) makes it unlawful "[t]o

represent to any person because of race, color, religion, sex, handicap,

familial status, or national origin that any dwelling is not available for

inspection, sale, or rental when such dwelling is in fact so available." 42

U.S.C.A. § 3604(d).

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Homes was building houses on several lots in Greenridge II and

employed Ort as a sales representative for the community. Pumphrey

became interested in moving to another location in the neighborhood,

and he approached Ort about the possibility of purchasing a lot and

building one of the houses offered by Stephen Homes. Ort indicated

that the only lot in Greenridge II that could accommodate the type of

house that Pumphrey desired to build was Lot No. 698. After viewing

the lot, Pumphrey expressed an interest in it and asked Ort how he

should proceed. According to Pumphrey, Ort did not instruct him to

place a deposit on the lot, but instead advised him not to take any

action until Ort verified that the lot would accommodate the house

Pumphrey was interested in building.

Pumphrey testified that Ort telephoned him the following day and

informed him that the lot was unavailable because it had been sold.

Ort agreed that she indicated the lot was unavailable, but claimed that

it was because she accepted a "verbal hold" on the lot--without

requiring any money from the prospective purchasers--after Pumphrey decided not to place a deposit on it. One week later, however,

the Crimis--friends of Pumphrey who were Caucasian--visited Ort

and inquired about the availability of Lot No. 698. Ort informed them

that the lot was for sale. Pumphrey claimed that upon learning of

Ort's conversation with the Crimis, he called Ort to reaffirm his interest in Lot No. 698, but that she again stated that it was unavailable.

Further, Pumphrey alleged that Ort did not respond to a letter that he

slipped under her office door expressing his continuing interest in the

lot.

Pumphrey subsequently contacted BNI and requested that it investigate Stephen Homes' housing practices.2 BNI sent two "testers"--

one African-American and one Caucasian--to visit Ort in her office

and inquire about the availability of lots. Ort allegedly informed the

Caucasian tester that five lots were available in a new section of

Greenridge II. Also, Ort asked him whether he was a contingent or

non-contingent buyer, explaining that two additional lots could be

made available for non-contingent buyers. The African-American tes-

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2 BNI is an organization that is concerned generally with community

housing issues, including the enforcement of federal and state fair housing laws.

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ter, Clay Keith, testified that Ort told him no lots were available in

Greenridge II and that he might consider looking elsewhere. Keith

further contended that Ort did not inquire whether he was a contingent or non-contingent buyer. Keith admitted, however, that Ort

answered all of his questions, provided him with a price list and

advised him that, although no property was currently available, Stephen Homes planned to open a new section in thirty days.

Pumphrey, Keith, and BNI then filed this action against Ort and

Stephen Homes, asserting that they had unlawfully misrepresented the

availability of lots in Greenridge II and refused to negotiate for the

sale of a dwelling because of Pumphrey's and Keith's race in violation of 42 U.S.C.A. § 3604(a), (d).3 At the close of the presentation

of evidence, the district court granted judgment as a matter of law to

Stephen Homes and Ort on Plaintiffs' claims brought pursuant to

§ 3604(a) and on Plaintiffs' request for punitive damages. The jury

then returned a verdict in favor of Pumphrey, but against Keith and

BNI, on their claim that Stephen Homes and Ort misrepresented the

availability of the Greenridge II property in violation of § 3604(d).

Following trial, the district court granted Pumphrey's motion for

attorney's fees and costs, awarding him $37,796.82, and denied a

cross-motion by Stephen Homes and Ort for attorney's fees. Pumphrey appeals the decision of the district court granting judgment as

a matter of law on his claim for punitive damages and challenges the

adequacy of the award of attorney's fees.4 Keith and BNI appeal the

dismissal of their claims under § 3604(a). Stephen Homes and Ort

cross-appeal the award of attorney's fees to Pumphrey and the refusal

of the district court to award attorney's fees to them.

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3 Plaintiffs also asserted a cause of action pursuant to 42 U.S.C.A.

§§ 1981, 1982 (West 1994). That claim is not at issue on appeal.

4 Keith and BNI also appeal the dismissal of punitive damages.

Because we affirm the grant of judgment as a matter of law on their

claims under § 3604(a), and since the jury returned a verdict against

Keith and BNI on their § 3604(d) claims, we decline to address their

argument with respect to punitive damages.

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II.

Pumphrey contends that the district court erred in ruling that under

Maryland law, he had not produced sufficient evidence of malice or

ill will to warrant submitting the issue of punitive damages to the

jury. We conclude that the district court erred in determining that

Maryland law governed the recovery of punitive damages. Moreover,

we find that the record contains sufficient evidence to merit submission of punitive damages to the jury as to Ort.

Although Congress has provided for the recovery of punitive damages by victims of discriminatory housing practices, it established no

guidance with respect to the evidentiary standard that justifies an

award of punitive damages. See 42 U.S.C.A.§ 3613(c)(1) (West

1994). The parties agree that the standard for recovery of punitive

damages in fair housing cases is a question of federal law. And, federal courts have consistently held that punitive damages are recoverable in actions under § 3604 "`when the defendant's conduct is shown

to be motivated by evil motive or intent, or when it involves reckless

or callous indifference to the federally protected rights of others.'"

Asbury v. Brougham, 866 F.2d 1276, 1282 (10th Cir. 1989) (quoting

Smith v. Wade, 461 U.S. 30, 56 (1983)); United States v. Balistrieri,

981 F.2d 916, 936 (7th Cir. 1992) (citing Smith , 461 U.S. at 51); see

also Fountila v. Carter, 571 F.2d 487, 491 (9th Cir. 1978) (explaining

that actual malice is not a prerequisite to the recovery of punitive

damages for discriminatory housing practices). Thus, contrary to the

ruling of the district court, Pumphrey was not required to prove malice or ill will.

Applying this standard, we conclude that the district court erred in

refusing to submit the issue of punitive damages to the jury with

respect to Ort. One view of the evidence presented was sufficient to

demonstrate that Ort intentionally discriminated against Pumphrey.

Indeed, the district court instructed the jury that it could find in favor

of Pumphrey on the issue of compensatory damages only if "the

defendant intentionally and purposely discriminated against [Pumphrey] because of [his] race." J.A. 715. The jury therefore necessarily

found that Ort acted intentionally in misrepresenting the availability

of housing to Pumphrey in violation of § 3604(d)--a finding that is

not challenged on appeal. Additionally, Ort testified at trial that she

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was required to attend seminars that included instruction concerning

legal requirements relating to equal housing and that the model home

--where she spent six to eight hours each day--displayed posters

stating that racially discriminatory housing practices were illegal

under federal law. The fact that Ort knew discriminatory treatment

with respect to housing was unlawful, coupled with evidence that she

intentionally misrepresented the availability of lots being sold by Stephen Homes, could lead a reasonable juror to conclude that Ort acted

with a reckless or callous indifference to Pumphrey's rights under

§ 3604(d). See Tyus v. Urban Search Management, 102 F.3d 256, 266

(7th Cir. 1996) (reversing judgment as a matter of law in favor of

defendant on punitive damages in a Fair Housing Act case because

plaintiffs presented evidence that defendants had knowledge of the

law and engaged in intentional acts of housing discrimination).

Because there was evidence in the record, viewed in the light most

favorable to Pumphrey, from which the jury reasonably could have

concluded that an award of punitive damages was justified, we find

that the district court improperly granted judgment as a matter of law.

See Fed. R. Civ. P. 50(a)(1); Benesh v. Amphenol Corp. (In Re Wildewood Litig.), 52 F.3d 499, 503 (4th Cir. 1995). Accordingly, we

reverse the grant of judgment as a matter of law on Pumphrey's

request for punitive damages against Ort and remand for the issue of

punitive damages to be submitted to a jury.

However, we find no evidence in the record that Stephen Homes

ratified or facilitated the discriminatory acts of Ort. See City of Chicago v. Matchmaker Real Estate Sales Ctr., Inc., 982 F.2d 1086, 1100

(7th Cir. 1992) (noting that in fair housing actions "`[a] principal is

liable for punitive damages for the discriminatory acts of [its] agent

only if [the principal] knew of or ratified the acts'" (quoting Hamilton

v. Svatik, 779 F.2d 383, 389 (7th Cir. 1985) (first alteration in original))). We therefore affirm the judgment as a matter of law on Pumphrey's request for punitive damages against Stephen Homes.

III.

In addition to the punitive damages issue, the parties raise various

other challenges to the district court's rulings. Keith and BNI contend

that the district court erred in granting judgment as a matter of law

to Stephen Homes and Ort on their claims pursuant to§ 3604(a);

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Pumphrey challenges the amount of the award of attorney's fees as

calculated by the district court; and, Stephen Homes and Ort appeal

the award of attorney's fees to Pumphrey and the denial of their

motion for attorney's fees. After carefully considering the arguments

and briefs of counsel and reviewing the record, we conclude that the

district court committed no reversible error with respect to these rulings.5

IV.

For the foregoing reasons, we affirm the dismissal of the claims of

Keith and BNI under § 3604(a), the rulings with respect to attorney's

fees, and the evidentiary and pretrial determinations of the district

court. We reverse the decision of the district court granting judgment

as a matter of law to Ort on Pumphrey's claim for punitive damages

and remand for further proceedings consistent with this opinion.

AFFIRMED IN PART, REVERSED IN PART,

AND REMANDED

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5 Plaintiffs also raise various evidentiary and pretrial issues. We conclude that these claims are without merit.

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