Opinion ID: 3188956
Heading Depth: 3
Heading Rank: 1

Heading: Sequence of Events Leading Up to the Challenged

Text: Decision and the Legislative History The gravamen of Developers’ disparate-treatment claims is that the City discriminated against them by denying their application in order to appease its constituents, despite knowing that opposition to the application was based largely on racial animus, and despite the recommendations of its zoning commission and planning staff and its regular practice. Here, the allegations in the complaint are sufficient to raise these claims. The presence of community animus can support a finding of discriminatory motives by government officials, even if the officials do not personally hold such views. Innovative Health Sys., Inc. v. City of White Plains, 117 F.3d 37, 49 (2d Cir. 1997), superseded on other grounds as recognized in Zervos v. Verizon N.Y., Inc., 252 F.3d 163 (2d Cir. 2001); LeBlanc-Sternberg v. Fletcher, 67 F.3d 412, 425 (2d Cir. 1995) (plaintiff alleging a disparate-treatment claim under the FHA “can establish a prima facie case by showing that animus against the protected group was a significant factor in the position taken by the municipal decision-makers themselves or by those to whom the decision-makers were knowingly responsive.” (internal quotation marks omitted)). This standard “recognize[s] the reality of such controversial proposals in the urban setting,” United States v. City of New Orleans, 2012 WL 6085081, at  (E.D. La. Dec. 6, 2012), in which council members may vote based on constituents concerns about “an influx of undesirables” into the neighborhood. Smith v. Town of Clarkton, 682 F.2d 1055, 1066 (4th Cir. 1982). AVENUE 6E INVESTMENTS V. CITY OF YUMA 21 Neither Budnick nor Arlington Heights, which the City cites to support its position, holds otherwise. In Budnick, the plaintiff sought a special use permit to build a continuing-care retirement community and, only after the Town Council denied his application, raised for the first time the contention that the planned facility would serve disabled residents; plaintiff in his prior declarations had asserted that residents would be limited to “healthy, active, independent seniors.” Budnick, 518 F.3d at 1112–13. This alone undercut any finding of discriminatory intent by the Town Council, as the plaintiff failed to explain how the Town could have discriminated against residents it did not know would be housed at the facility. Here, by contrast, Developers allege that their reputation as developers of subdivisions favored by Hispanics, and the general demographic trends suggesting that the higher-density development they proposed would attract a greater number of Hispanic homebuyers, were known prior to the denial of their application. Accordingly, here, unlike in Budnick, community members’ opposition to Developers’ application, using language indicating animus toward a protected class, provides circumstantial evidence of discriminatory intent by the City. The facts of Arlington Heights likewise do not support defendant’s argument. In that case, the Supreme Court affirmed the district court’s finding following a trial that, although some opponents of plaintiffs’ requested zoning change might have been motivated by opposition to minority groups, the evidence did not warrant the conclusion that this motivated defendants. 429 U.S. at 269–70. Unlike this case, the Supreme Court in Arlington Heights was required to review the district court’s factual finding for clear error after a trial, while here we must accept Developers’ allegations as true and review the district court’s order de novo. See 22 AVENUE 6E INVESTMENTS V. CITY OF YUMA Anderson v. City of Bessemer City, 470 U.S. 564, 566 (1985); Newark Branch, N.A.A.C.P. v. City of Bayonne, N.J., 134 F.3d 113, 119–20 (3d Cir. 1998). Moreover, other facts not similar to any before the district court on the present motion to dismiss supported the district court’s factual finding in Arlington Heights. For example, as the Supreme Court noted, the area surrounding the site of the desired zoning change to permit high-density zoning had been zoned for single-family homes for more than a decade, and the zoning change would have been contrary to a “buffer policy” consistently applied in prior instances. 429 U.S. at 269. Here, by contrast, the R-1-6 zoning sought by Developers was entirely consistent with the City’s General Plan. Although the relevant cases clearly hold that a city’s denial of a zoning change following discriminatory statements by members of the public supports a claim of discriminatory intent, the question remains whether the statements alleged in Developers’ Second Amended Complaint actually constituted animus. None of the alleged statements expressly refers to race or national origin; rather, they raise various concerns about issues including large families, unattended children, parking, and crime. We have held, however, that the use of “code words” may demonstrate discriminatory intent. Galdamez v. Potter, 415 F.3d 1015, 1024 n.6 (9th Cir. 2005) (citing McGinest, 360 F.3d at 1117). In McGinest, we adopted the reasoning of the Third Circuit’s opinion in Aman v. Cort Furniture Rental Corp., 85 F.3d 1074, 1083 (3d Cir. 1996). Considering comments that plaintiff, an African American, was a “drug dealer,” we quoted Aman at length: [A] reasonable jury could conclude that the intent to discriminate is implicit in these AVENUE 6E INVESTMENTS V. CITY OF YUMA 23 comments. There are no talismanic expressions which must be invoked as a condition-precedent to the application of laws designed to protect against discrimination. The words themselves are only relevant for what they reveal–the intent of the speaker. A reasonable jury could find that statements like the ones allegedly made in this case send a clear message and carry the distinct tone of racial motivations and implications. They could be seen as conveying the message that members of a particular race are disfavored and that members of that race are, therefore, not full and equal members of the workplace. McGinest, 360 F.3d at 1117 (quoting Aman, 85 F.3d at 1083) (alteration in original). The McGinest court then held that “[t]he reference to [plaintiff, an African-American] as a ‘drug dealer’ might certainly be deemed to be a code word or phrase” demonstrating animus. Id.; see also Guimaraes v. SuperValu, Inc., 674 F.3d 962, 974 (8th Cir. 2012) (“[R]acially charged code words may provide evidence of discriminatory intent by sending a clear message and carrying the distinct tone of racial motivations and implications.”) (quotation marks omitted) (alteration in original); Jenkins v. Methodist Hosps. of Dallas, 478 F.3d 255, 265 (5th Cir. 2007) (citing Aman, 85 F.3d at 1083). Whether a code word evidences racial animus may depend upon factors including local custom and historical usage. Ash v. Tyson Foods, Inc., 546 U.S. 454, 456 (2006). Although these cases involve employment rather than housing discrimination, these lessons are equally applicable to both types of cases. See Texas Dep’t of Hous., 135 S. Ct. at 2522–23. 24 AVENUE 6E INVESTMENTS V. CITY OF YUMA Here, construing the allegations in the complaint in favor of plaintiffs as well as drawing all inferences in their favor, the alleged statements by the neighborhood opposition submitted to city officials contained such code words consisting of stereotypes of Hispanics that would be wellunderstood in Yuma. Neighbors expressed concern that the type of people living in “the Hall neighborhoods” had large households and used single-family homes as multi-family dwellings. These people, neighbors complained, own numerous vehicles which they park in the streets and yards, fail to maintain their residences, and lack pride of ownership. They also allow unattended children to roam the streets (what some may call letting children play in the neighborhood). Several landowners attending the public hearing even brought pictures of another Hall subdivision, in which 77% of the homebuyers are Hispanic, to exemplify the complaints they had about the potential new development. See Greater New Orleans Fair Hous. Action Ctr. v. St. Bernard Parish, 641 F. Supp. 2d 563, 571–72 (E.D. La. 2009) (repeated references to Village Square, where Village Square was a local complex with a significant black population, demonstrated racial animus). After Developers presented their compromise plan to transition from the 8,000-foot lots down to 6,000-foot lots near the RV park, another landowner noted that it would be a smooth transition in terms of lot size, but not ownership demographics, suggesting—at least to a reasonable juror—a change in racial composition. In sum, landowners worried that the type of people who live in “Hall neighborhoods” create a “low cost, high crime neighborhood” that these landowners had worked hard “to keep our children out of.” See id. (finding references to crime were “racially-loaded”); Atkins v. Robinson, 545 F. Supp. 852, 874 (E.D. Va. 1982) (reference to “an abundance of crime” “may be interpreted as [a] veiled reference[] to race”). AVENUE 6E INVESTMENTS V. CITY OF YUMA 25 Taken together, these allegations, along with the allegation that Developers are known to many as a developer of Hispanic neighborhoods on the basis of their housing projects in Yuma, provide plausible circumstantial evidence that community opposition to Developers’ proposed development was motivated in part by animus, and that the City Council was fully aware of these concerns when it took the highly unusual step of acceding to the opposition and overruling the recommendations of its zoning commission and planning staff.