## Facts

- Heights Community Congress (HCC), a nonprofit organization that monitors fair housing compliance and seeks to maintain racial integration, and the City of Cleveland Heights sued a real estate brokerage (Hilltop Realty) and two of its agents under the Fair Housing Act (FHA), 42 U.S.C. § 3604.
- Cleveland Heights was a racially transitional suburb where concerns about neighborhood racial change were salient.
- HCC used matched black and white “testers” to inquire about housing through Hilltop, aiming to detect discriminatory practices.
- In multiple tester encounters, Hilltop’s agents allegedly provided different information, listings, and neighborhood guidance to black and white testers, including comments to white testers about areas “changing” or becoming more Black.
- The plaintiffs also challenged one agent statement to a tester as indicating a race-based preference or limitation.
- Plaintiffs further alleged “blockbusting” based on a postcard solicitation campaign sent to homeowners; the postcards invited recipients to consider selling but did not reference race.
- After a bench trial, the district court found eight instances of racial steering in violation of § 3604(a), one discriminatory statement in violation of § 3604(c), and one instance of blockbusting in violation of § 3604(e); it entered declaratory relief, awarded HCC $1 nominal damages, and denied injunctive relief.

## Issues

1. Whether the district court clearly erred in finding violations of FHA § 3604(a) (racial steering) and § 3604(c) (statement indicating racial preference) based on tester evidence.
2. Whether the postcard solicitation campaign constituted blockbusting under § 3604(e), which requires inducement “by representations” regarding the entry or prospective entry of persons of a particular race.
3. Whether HCC had standing to sue and receive nominal damages based on injury to its mission and diversion of resources.
4. Whether the district court abused its discretion in denying injunctive relief after finding FHA violations.

## Decision

- The Sixth Circuit affirmed the findings that defendants violated § 3604(a) by racial steering and violated § 3604(c) by making a statement indicating a racial preference or limitation.
- The Sixth Circuit reversed the finding of liability under § 3604(e), holding the evidence did not show inducement “by representations” about racial entry into the neighborhood.
- The court affirmed HCC’s standing and the $1 nominal damages award.
- The court affirmed the denial of injunctive relief as within the district court’s equitable discretion.

## Legal Principles

- FHA § 3604(a)’s prohibition on actions that “otherwise make unavailable or deny” housing because of race reaches racial steering, even without an outright refusal to sell or rent.
- Tester evidence may support FHA liability where matched testers are treated differently in ways attributable to race.
- FHA § 3604(c) covers agent statements about neighborhood racial composition when they indicate a race-based preference, limitation, or discrimination, including indirectly phrased comments.
- FHA § 3604(e) blockbusting requires inducement (or attempted inducement) “by representations” concerning the entry or prospective entry of persons of a particular race; neutral solicitations without race-based representations are insufficient.
- A fair-housing organization has standing where discriminatory practices frustrate its mission and cause diversion of resources; nominal damages may be awarded to recognize the legal injury even absent proof of substantial compensatory loss.
- Injunctive relief is discretionary; a court may deny an injunction where declaratory relief and nominal damages are deemed sufficient given the record on recurrence and remediation.

## Conclusion

The Sixth Circuit sustained FHA liability for racial steering and a discriminatory statement based on tester encounters, but rejected blockbusting liability because neutral postcards lacked race-based “representations” required by § 3604(e); it also upheld HCC’s organizational standing, nominal damages, and the trial court’s refusal to issue an injunction.


Heights Cmty. Cong. v. Hilltop Realty, Inc., 774 F.2d 135 (6th Cir. 1985)