## Facts

- Applicants for low-rent public housing in New York City sued the New York City Housing Authority (NYCHA) in a class action under 42 U.S.C. § 1983 and the Fourteenth Amendment.
- NYCHA administered a large public-housing system and admitted only a fraction of annual applicants due to limited supply.
- Eligibility rules included income/asset limits, a residency requirement, and a requirement that applicants live in substandard housing.
- Plaintiffs, who were non-preference applicants, alleged they filed numerous applications over several years but received no written determination of eligibility or ineligibility.
- Plaintiffs alleged NYCHA lacked a fair and orderly selection method for similarly situated applicants, did not reliably process applications, and sometimes failed to consider or lost applications.
- Plaintiffs further alleged NYCHA did not provide notice of decisions or reasons, preventing any meaningful challenge or review.
- NYCHA moved to dismiss for failure to state a claim and asked the district court to abstain; the district court denied both requests and directed NYCHA to develop more adequate admissions procedures.
- NYCHA appealed the interlocutory order.

## Issues

1. Whether applicants stated a claim under 42 U.S.C. § 1983 and the Due Process Clause by alleging NYCHA used arbitrary, standardless admissions procedures and failed to provide notice of determinations.
2. Whether the applicants had standing to challenge the admissions procedures despite lacking an asserted entitlement to admission.
3. Whether the federal court should abstain in favor of state processes or state courts.

## Decision

- The Second Circuit affirmed the district court’s order.
- The court held the complaint sufficiently alleged a due process violation actionable under § 1983.
- The court held plaintiffs had standing as applicants directly subject to the challenged administrative practices.
- The court declined to require abstention and allowed the federal case to proceed.

## Legal Principles

- Administration of a scarce public benefit by a governmental entity may not be left to unfettered discretion; due process may require selection under ascertainable standards rather than arbitrary decisionmaking.
- Due process can require procedures that permit applicants to understand their status and seek review, including notice of eligibility/ineligibility determinations and, where applicable, reasons.
- An applicant need not show a guaranteed right to receive the benefit to have standing to challenge unconstitutional procedures governing consideration for that benefit.
- Abstention is generally inappropriate where plaintiffs assert federal constitutional claims under § 1983 and there is no adequate, clearly available state mechanism that would resolve the federal issues without undue delay.

## Conclusion

The Second Circuit held that public-housing applicants plausibly alleged NYCHA administered admissions through standardless, arbitrary practices and provided no written notice enabling review, stating a due process claim under § 1983; the applicants had standing, and the federal court properly retained jurisdiction without abstaining.


Holmes v. N.Y.C. Hous. Auth., 398 F.2d 262 (2d Cir. 1968)