Accessibility Defense, Helping Business Avoid and Defend ADA and FHA Lawsuits

ADA and FHA Defense

  • There was an old woman who swallowed a spider – reforming California’s Unruh Act

    Update – well, in the fast moving world of the internet it looks like this blog is out of date because the California bill it discusses is unlikely to pass. Nonetheless, the princinciple still applies – it’s easy to legislate and hard to fix the unintended consequences.

    In the children’s nonsense song written by Burl Ives an old woman swallows a fly for reasons unknown and then:

    • swallows a spider to catch the fly
    • swallows a bird to catch the spider
    • swallows a cat to catch the bird
    • swallows a dog to catch the cat
    • swallows a goat to catch the dog
    • swallows a cow to catch the goat
    • and finally, swallows a horse to catch the cow

    at which point “she died of course.” Senate Bill 84, just passed by the California legislature, reminds me quite a bit of this song, for it is only the latest in a long line of failed efforts to curb the industrial litigation problem exacerbated by the Unruh Act.

    In its original form California’s Unruh Act included a state equivalent of the Americans with Disabilities Act concerning physical accessibility. However, it added something that is not in the ADA, an automatic $4,000 penalty paid to the plaintiff if a violation was proved. This created California’s industrial ADA litigation machine by incentivizing litigation. In other states the only threat to a defendant besides being ordered to remediate is paying legal fees to the plaintiff’s lawyer. In California it has been legal fees plus $4,000. It even seemed, for a while, that it might be $4,000 per violation.

    Not surprisingly, California soon had more accessibility lawsuits than any other state and California businesses; especially smaller businesses with fewer financial resources, faced an unrelenting series of lawsuits about accessibility. You might say California swallowed a fly, although unlike the old woman in the song there was a reason for it.

    Within a few years the California legislature realized that its effort to incentivize enforcement had created a monster that was not improving accessibility but was terrorizing small businesses. In recent years it has taken steps to slay the dragon it created, including a notice requirement, new pleading requirements, a higher filing fee for serial plaintiffs and a smaller penalty – $2,000 – under some circumstances. This had no noticeable effect on the volume of cases filed because most Unruh Act claims were joined with an ADA claim and filed in federal court, where the state court filing fee and pleading requirements did not apply. The spider intended to catch the fly was wriggling and tiggling (as the song says) but despite the addition of a bird, cat and dog the problem had not been solved.

    While the California legislature was taking these steps the federal courts realized that they were being used both as a money making tool for lawyers who did not seem to care about accessibility and then as a loophole to evade what the California legislature intended with its various reforms of the Unruh Act. Most (not all) federal courts in California began dismissing state law claims joined to a federal ADA claims. That meant no state law penalty and less incentive to file suit. You might say that without help from the California legislature the federal courts had swallowed a goat in the hope of putting ADA litigation back on track as a tool to eliminate discrimination instead of a means of enriching lawyers.

    The plaintiffs’ bar, with the endless creativity inspired by the desire to make money, began pivoting to the state courts where, for procedural reasons, it was harder and therefore more expensive for defendants to raise issues about the new pleading standard.  The federal procedural goat couldn’t get rid of the dog any better than the spider etc. got rid of the fly. Federal courts began to see a reduction in the huge volume of ADA cases but the problem for business remained the same as did the underlying cause – a financial incentive that made industrial litigation profitable for lawyers.

    With Senate Bill 84 the California Senate is hoping that by swallowing a cow it might take down the ineffective goat and give small businesses a break. The law requires 120 days notice and an opportunity to cure before an Unruh Act lawsuit is filed against a business with 50 or fewer employees. The penalty for failing to give notice is a losing the chance to win statutory damages and legal fees. This seems, on its face, the perfect solution. It makes it much harder for lawyers to get the attorneys’ fees and penalties that created the litigation monster in the first place, which should tame the monster.

    I am not optimistic that this particular evil genie can ever be returned to its bottle.¹ The foundation on which ADA and Unruh Act industrial litigation rests is the asymmetrical nature of the risks and rewards from such litigation. Under both the ADA and Unruh Act a winning plaintiff will be awarded attorneys’ fees but a winning defendant will get nothing. For a plaintiff’s lawyer there is a low risk (a few hundred dollars in filing expense) and a large potential reward (thousands of dollars in attorneys fees). For the defendant there is only risk. If the defendant wins they lose all the money they spent on their attorneys. If they lose they pay their attorney and the plaintiff’s attorney. While the Unruh Act’s penalty provision certainly made California the hotbed of accessibility litigation it is today, it is the asymmetry of risk and reward that supports the industrial ADA litigation machine across the nation.

    What about the 120 day notice and cure provision? Surely that gives small businesses a chance to fix their problems and therefore avoid a lawsuit. There are three problems here. First, of course, the federal ADA remains unchanged. Second, depending on the business and the nature of the accessibility problems 120 days may be too short a time and the cost may be more than the business can afford. Defendants in ADA/Unruh Act lawsuits are very often small businesses occupying the cheapest available space in aging strip shopping centers. They are often run by recent immigrants or their children.³  For a marginally profitable business that survives only because the whole family works, the cost of remediation may be beyond reach. This is especially true for the most common violations, which involve accessible parking. Existing guidance suggests that any substantial work on a parking space may trigger an obligation to remediate the entire parking lot, which multiplies the expense. Finally, when remediation work requires complex permitting 120 days may not be long enough, even assuming the labor required is available. There are a good reasons why so many businesses in California that are hit with an Unruh Act or ADA claim simply allow a default judgment to be taken or close down entirely.

    No doubt a few years down the road we’ll see another legislative effort at the state or federal level to make adjustments that discourage litigation. Once you’ve swallowed a cow, why not try a horse? The problem is that no amount of fiddling can solve the fundamental problems that create industrial ADA litigation. The first is the asymmetry in cost and risk when a plaintiff who has nothing to lose except a little time and expense sues a defendant whose absolutely best outcome is paying their own attorney thousands or tens of thousands of dollars that cannot be recovered. The second is the fact that in most cases remediation costs money but does not improve revenues or profitability, making remediation difficult or impossible for small businesses.² Finally, those small businesses are likely to occupy the oldest buildings and therefore most likely to have accessibility violations.

    We don’t need to throw the baby out with the bath water¹, but creating a more accessible world and reducing litigation will require solutions that don’t just involve tinkering around with notice requirements and providing an opportunity to cure. The existing model of trying to encourage accessibility by incentivizing litigation and punishing businesses that are not accessible has been a complete failure as applied to small businesses in aging buildings. The number of ADA accessibility cases filed each year has not gone down for decades, which is proof enough that the existing system of incentives and punishments does not work. What happened to the old lady who swallowed a horse? “She died, of course.” After more than three decades of failures the California legislature and the Congress need to find real solutions to the problem of accessibility.(4)

    +++++++++++++++++++++++++++++++++++++++++++

    Thanks to Jim Vitale for pointing out this new legislation. You can read more about the details at Ogletree Deakin’s article on JD Supra, “California Senate Passes”

    ¹ Mixing metaphors is the author’s prerogative.

    ² There are tax incentives for remediation, but they don’t apply to buildings built after 1991, and are therefore of little use to most defendants. More important, we know that most accessibility litigation concerns problems that do not have a significant impact on real disabled customers. Businesses would invest in remediation voluntarily if they thought it would improve revenues. Real customers, rather than serial filers, would enforce the Unruh Act and ADA if they believed they were being denied meaningful access. Even allowing for ignorance and misconceptions the real problem with accessibility is that the cost outweighs the benefit when measured in purely economic terms, and most of those with disabilities would rather live their lives and simply do business with those that are accessible. Accessibility is an important social good, but forcing individual businesses to bear the cost of that social good is likely to fail when there is no obvious dollar benefit to the business itself.

    ³ There is considerable evidence that the law firms in California and elsewhere who file ADA claims deliberately seek out businesses likely to be owned by minorities or recent immigrants, sweeping through the local Chinatown or Koreatown while avoiding neighborhoods that are predominantly White.

    (4) I’m afraid these will probably involve spending taxpayer dollars, which is of course anathema in California and the U.S. as a whole. Everybody wants an accessible society, but nobody wants to pay for it.

    (5) See, Bill to Stop Shakedown ADA


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  • Two blogs for the price of one

    My partner, Jeanne Huey, just published her blog “The Stakes Just Got Higher: Texas Legislataure Cracks down on Barratry.” Barratry is, of course, stirring up unnecessary litigation or, more particularly, doing one of several things that have been made a crime and/or ethical violation in most states. These include:

    • paying a client to hire a lawyer
    • soliciting clients in ways that are not allowed by local advertising regulations
    • lying to clients to get them to hire a lawyer.

    As Jeanne points out, the civil penalties for barratry have just gotten higher in Texas as the legislature tries to rein in “ambulance chasers” and other forms of illegally getting clients and creating lawsuits.

    This is a blog about the ADA and FHA, not legal ethics and barratry, so you may wonder why I’m mentioning Jeanne’s blog here. As it turns out, barratry has always been lurking in the background of industrial scale ADA litigation, something I’ve noted several times over the last decade:

    Under Title III of the ADA a winning plaintiff gets no money – just an order telling the defendant to stop violating the ADA. The winning lawyer, on the other hand, gets his fees paid. When a lawyer files dozens or hundreds of lawsuits for a single plaintiff and only the lawyer stands to profit, it is reasonable to ask whether the plaintiff is being paid by the lawyer to allow their name to be used for the lawyer’s benefit. If the lawyer is paying the plaintiff, even if that payment is a split of a settlement, the arrangement may very well constitute illegal barratry.

    And that is why Jeanne’s blog should matters in the ADA and FHA world. If you or your client have been sued by a serial plaintiff represented by a law firm that files a large number of cookie cutter cases it is worthwhile to consider how the laws against barratry may apply to the lawyers who filed the case.


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  • ADA website litigation – up, down or sideways?

    What can be made of this assortment of information concerning ADA litigation over website accessibility?

    May 2025 website accessibility litigation – 445 new cases, 123 of which against previous defendants and 119 against websites using some form of widget that supposedly improves accessibility.¹

    May 2025 headline “Federal Trade Commission Orders accessiBe to Pay $1M For Misleading Claims Relating to Automated Website Accessibility Remediation Tool”²

    Another May 2025 headline: “New York Federal Courts Are Not Rolling Out the Welcome Mat for Serial Plaintiffs in Website Accessibility Lawsuits Anymore”³

    December 2024 headline: “Websites Are Not Places of Public Accommodation Subject to Title III of the ADA, Federal Court in New York Rules” (4)

    June 2023 headline: “Lawsuits over disabled Americans’ access to websites have surged.” (5)

    The first thing you might note is that the last headline is just at two years old. It was, however, at the top of Google search hits for “ADA Website Litigation.”  If you are looking at the internet for information about the changing litigation landscape you have to be careful about your sources.  I blogged about DOJ’s new Title II website regulations when they were finally adopted last April (6) but it was barely news since they had been proposed years earlier and more or less copied WCAG 2.1, the private accessibility standard that litigants and courts have used for years.

    As for the first and third headlines, a new decision from a federal district judge is always interesting, but New York federal courts have had mixed views of the application of Title III of the ADA to stand alone internet businesses for years and the old adage “know your judge” hasn’t changed as the key piece of information for any defendant.(7)

    The accessiBe fine from the FTC is news because, as the Usablenet article cited above shows, at least 25% of new filings in May were against businesses supposedly protected by a widget of some kind. The real news is, however, that it has taken the FTC many years to figure out what the accessibility community knew long ago; that is, widgets and similar tools that claim to completely automate website accessibility only work in a limited fashion. (8)

    So then, has there been progress in either making the internet more accessible for the blind or making the courts less dangerous for online businesses? As to the first, there certainly has as the largest companies have invested in accessibility and  many more developers now emphasize accessibility both in design and remediation of websites (9). As for the latter I think the answer is no. The law firms who file website accessibility lawsuits have proven they can easily pivot from one venue to another when a court or courts seem unfavorable.(10) In terms of litigation we are going sideways and the eternal truths about industrial ADA litigation remain:

    • The law firms that file the lawsuits do not care about practical accessibility; that is, whether a disabled person can use the website, but instead look for technical violations of the WCAG 2.x standards as a justification for a lawsuit.
    • Too many internet business operators still do not care about accessibility, and too many others have placed an unjustified reliance on a widget or similar tool because they do not understand what accessibility means.
    • It is still difficult for small internet businesses to create and maintain accessible websites in a cost effective manner because the available development and testing tools cost too much or are not used at all. You can still create your own e-commerce website, but it probably won’t meet WCAG 2.x standards.

    This means we still need what we have needed for years; that is, (a) some way to both identify tester standing issues and dispose of tester cases quickly and inexpensively, (b) more education for small businesses on what accessibility means, (c) better development tools, especially those that would insure accessibility for template placed website design products like WordPress, SquareSpace and others, (d) a new Title III regulation that is based not on compliance with a complex technical standard, but instead on the practical usability of a website, and finally, (e) a pleading standard that requires the identification and description of specific accessibility problems as a prerequisite to the continuation of a lawsuit (11). There has been lots of motion, but little progress in accessibility for the many small online businesses and even less is dealing with industrial scale ADA website litigation. Up, down or sideways? Sideways is, I’m afraid, the answer.

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    ¹ These figures taken from Usablenet’s monthly tracker at Usablenet Website Tracker

    ² See  FTC Press Release for the original report from the FTC and Seyfarth Shaw Article for the quoted headline.

    ³ See Seyfarth Shaw Article 2 for the quoted headline.

    (4) See Ogletree Deakins Article

    (5) See, The Economist Article

    (6) See, ADA Title II website regulations – does anyone have a better idea?

    (7) See my blog from December 13, 2022 – “Quick Hits, Happy Holidays Edition” – for a useful analysis from one of those federal judges:

    The sheer number of judges who, when presented with this statute, have diverged in their interpretations, tells this court that the plain language of Title III of the ADA is ambiguous as to whether standalone websites are covered entities under the statute.

    Martinez v. Gutsy LLC., 2022 WL 17303830, at *3 (E.D.N.Y. Nov. 29, 2022).
    (8) See my blog “Quick Hits, Who Needs the Grinch” for a December 2021 opinion on this subject from Judge Ramos of the Southern District of New York, and the 2021 statement concerning accessiBe from the National Federation for the Blind. National Convention Sponsorship Statement Regarding accessiBe

    (9) I can’t endorse any developer because I’m a lawyer and I don’t have the technical expertise to judge their work. I can say I had a great time working with Equalize Digital on their podcast earlier this year (Equalize Digital Podcast) as I have with long established accessibility specialists like Usablenet and more recent entrants into the field like Access Design Studio. I can email anyone who is interested a list of those with whom I have some familiarity.

    (10) For example, now that the Third Circuit’s view of Title III has been adopted by federal courts in the Western District of Pennsylvania, hundreds of lawsuits have been filed in Pennsylvania state courts under Pennsylvania’s ADA equivalent state law. The same has happened in New York and California. The results have been mixed, but one reason statistics about ADA website litigation differ from source to source is that some include state court litigation while others don’t.

    (11) It would be a radical change, but for years federal courts have referred lawsuits that are likely to fail from pro se litigants like prisoners to magistrate judges who screen them to weed out the meritless cases before the defendants are required to spend thousands of dollars on defense. Doing the same for serial ADA filers would at least limit the use of ADA lawsuits as a means of making a quick buck from the threat of litigation against defendants who can’t afford the considerable expense of litigation.


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  • “Toddler mauled by service dog” – the cost of thoughtless disability letters.

    The headline was all too familiar, “Toddler mauled by service dog.” We have seen it before when untrained animals were allowed on airlines or in other public places.(6) When it is passenger passing off a peacock as an emotional support bird it is funny. When it is a child who may be disfigured for life nobody’s laughing. But all these stories share two things in common: First, of course, some adult who should have known better decided to take advantage of federal law, usually the ADA, FHA or Air Carrier Access Act. They thought it would be nice if they could take their pet everywhere, and so they claimed to have anxiety, depression or some other mental condition, claimed to have trained service dog, and then found a medical professional willing to write a letter. The second thing these stories have in common is the medical professional or healthcare provider; maybe a doctor, but more likely a  therapist or social worker willing to write a letter certifying the animal as a service animal without bothering to properly diagnose the existence of a disabling mental disorder or asking about the supposed training of the “service dog.”

    In the recent case of Leibman v. Waldroup, No. 23-0317, 2025 WL 1610583. (Tex. June 6, 2025) the doctor was a gynecologist. The holding from the Texas Supreme Court was narrow, but very important for anyone, including landlords, business owners and individuals who have been victimized by service animal or ESA verifications that never should have been written in the first place.

    The case began when the defendant, Dr. Maurice Leibman, wrote a letter for his patient Julia Romano, certifying that she was disabled by anxiety and that her dog was a service dog. With that letter any restaurant or other public place would be required by the ADA to allow her to bring her dog.  That included the restaurant where the Waldroups were dining with their infant daughter. The dog attacked the infant, severely injuring her. The Waldroups sued the restaurant, the owner and, importantly, Dr. Leibman, but it is only Dr. Liebman’s case that came to the Supreme Court. The Texas Supreme Court addressed two questions. First, was there a sufficient connection between Dr. Liebman’s letter and the attack for there to be any claim at all. The second was whether the claim against Dr. Liebman was a medical malpractice claim; that is, a claim that Dr. Liebman failed to meet the appropriate standard of care for a doctor engaged in medical practice. Under Texas law claims of medical malpractice cannot be filed without a timely file expert report stating that the doctor failed to meet his standard of care.  The Waldroups did not file such a report and their claims against Dr. Liebman had been dismissed in lower courts. To sue Dr. Liebman they had to show that what he did was something other than medical malpractice.

    The Supreme Court’s answer to the first question was “yes,” because the injury to the Waldroup’s daughter might be fairly  traced to Dr. Liebman’s letter. The Court observed that the Waldroups will still be required to prove the letter was in fact a cause of their daughter’s injury. Nonetheless, the holding opens to door and allows them to try to prove the letter caused the injury.

    The Supreme Court’s second holding requires more discussion. Deciding whether the Texas law requiring an expert report applies in this case depends, according to the court, on whether when he wrote the letter Dr. Liebman was engaged in the diagnosis or treatment of a mental disease or physical disorder. The Supreme Court says this about the Waldroups’ claims:

    Their claims focus solely on Dr. Leibman’s letters and his alleged failure to determine whether Romano’s dog really was a properly trained service animal with appropriate public behavior.
    Equally important is what their claims were not. The Waldroups did not claim that Dr. Liebman had misdiagnosed Ms. Romano or that he had mistakenly said a service dog would help help. What he had done was tell the world, through his letter, that the dog had the characteristics of a service dog, including being trained to behave in public places.¹ The letter was not wrong because of failure of medical diagnosis, but because it implicitly said something Dr. Liebman did not know; that is, that the dog was safe around strangers.
    The Supreme Court emphasized that the Waldroups have a long way to go before they can tie Dr. Liebman’s letter to their daughter’s injuries, but the holding is still important.² It should remind medical professionals that just doing what their client or patient asks may not just be doing them a harmless favor, because the letter they write amounts to claiming they know something they probably do not know; that is, that the dog is not dangerous. A health care provider who writes a letter knowing it will allow their patient to take a dog into stores and restaurants has assumed some responsibility for the behavior of that dog.  This gives businesses, landlords and direct victims of fake service dog letters a possible remedy and creates a threat that might make medical professionals think twice about carelessly writing an ESA or service dog letter.
    There is, of course, more to be said about this case, and that requires a diversion to a recent decision from the Louisiana State Board of Social Work Examiners. In File #2024-33 concerning Melissa Montrose, a licensed clinical social worker, the Board issued (by consent) a reprimand, fines amounting to more than $2000, requirements for additional professional education, and reporting requirements to the Board. What did Ms. Montrose do to deserve this? She wrote a letter certifying that her client was disabled and needed an emotional support dog. She did this on the basis of a 15 minute telehealth consultation and answers to some screening questions. She did not try to gather any information about her client’s background, family, work, or medical history. She did not prescribe any treatment other than an emotional support dog. Even social workers have to do more than that before they give their professional opinion that their client needs something. By failing to fulfill her professional responsibilities Montrose violated Louisiana laws concerning the standards of practice for social workers.
    There is a pretty large gap in training and qualifications between a social worker who sells ESA letters in Louisiana and a licensed MD in Texas, but the similarity is clear. Even though it was not an issue in Liebman, when a healthcare provider writes a service dog letter or ESA letter they are engaged in professional practice and obligated to meet the standards of that practice. It is worth asking whether before writing Ms. Romano’s service dog letter Dr. Liebman did what a medical doctor would ordinarily do.  Did he conduct a proper forensic examination to determine that Ms. Romano suffered from anxiety that met the statutory definition of “disability” under the ADA or FHA?³ Did he ask whether the dog had been individually trained to perform a specific task related to Ms. Romano’s anxiety and if so just what that task might have been? Did he do any research in the effectiveness of psychiatric service animals for helping those suffering from a disabling level of anxiety? In short, did he do any of the things he would have done before trying to diagnose and treat any gynecological disorder? We don’t know, but I would be surprised if he did.(4)
    The specific legal posture of this case means we will probably never learn whether Dr. Liebman engaged in medical malpractice when he wrote the letter for Ms. Romano, but the Montrose case from Louisiana is a reminder that for every kind of healthcare provider from MD to social worker that writing letters claiming their client or patient has a disabling level of some mental disorder and that requires a service dog or emotional support animal must be approached with the same level of care that they approach any other part of their practice.  A healthcare provider who diagnoses a disability has a duty to conduct a professional examination to determine whether their patient suffers from a mental health disorder, to understand the legal definition of “disability” before claiming their client meets that definition, and to understand the use of service animals and emotional support animals in exactly the same way they understand the use of any drug or surgical treatment before they recommend it. A doctor should not prescribe a service dog any more lightly than they would prescribe a narcotic, because both can be dangerous to the patient and others. A therapist should not prescribe a service dog any more lightly than they would prescribe any course of treatment for a serious mental illness because prescriptions of this kind have effects in the real world that can include anything from a child disfigured by an dog’s attack to loss of a license to practice.(5) ESA and service dog letters are not just good business, they are also serious business.
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    ¹ There is no explicit requirement in the Americans with Disabilities Act that service dogs have such training.  The relevant regulation, 28 CFR §36.104 requires that a service dog be “individually trained to do work or perform tasks for the benefit of an individual with a disability.” It says nothing about behavior. However, a service dog could not do its job, whatever that might be, if it were constantly reacting to, let alone attacking, strangers. Thus, all genuine service dogs are trained to behave well around other people.
    ² The published opinion is still not final and four of the nine judges dissented, so the outcome remains a little uncertain.
    ³ Ms Romano originally sought the letter from Dr. Liebman because she wanted to keep her dog in her apartment. For this the applicable law is Section 3604(f)(3)(B) of the Fair Housing Act. Taking the dog into a public place like a restaurant is the domain of Section 12182(b)(2)(A)(ii) of the Americans with Disabilities Act. The definitions of “handicap” under the FHA and “disability” under the ADA are not the same, and by writing the letter Dr. Liebman claimed, implicitly if not explicitly, that he was familiar with these statutory definitions and the related regulations.
    (4) If Dr. Liebman did the research he might have found the 2022 study finding no significant difference in mental well being between patients who had a psychiatric service dog and those who did not. Katlyn Morales, The Differences in Mental Well-Being for Individuals With and Without Service Dogs,  August 2022, available at service dog article. There do not appear to be any peer reviewed studies that demonstrate the effectiveness of psychiatric service dogs, and if anyone who reads this knows of any I would love to hear more about them. What we seem to have instead is many studies where people who already own dogs tell the researchers how much they like them. These all suggest that people who like their dogs feel better when their dogs are around. What a surprise.
    (5) It is worth asking whether Ms. Montrose would have gotten off with a reprimand and fine if the ESA she prescribed had severely injured a child.
    (6) I first learned of the case discussed below from William Goren’s 2023 blog about the court of appeals opinion, which you can read at “Goren Blog.” My earlier blogs on related topics can be found at – Science v. HUD – science and business are the losers., HUD’s new Guidance on assistance animals will encourage emotional support animal fraud., and HUD gets it wrong again on emotional support animals – two is one too many.

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  • Source-of-income discrimination under the FHA

    That title is a little misleading because, in fact, the federal Fair Housing Act does not prohibit source-of-income discrimination.¹ I noted just this morning a case from Maryland² discussing a specific issue related to source-of-income discrimination and thought this was a good reason to take a brief look at source-of-income laws.

    I have to start by noting that the Poverty and Race Research Action Council is the source for my information on these laws because they conduct an annual survey of state and local source-of-income discrimination laws.³ Not all of these laws are created equal. In Texas, for example, the law concerning source of income discrimination forbids such laws, part of an effort by a conservative legislature to keep more liberal cities from passing such laws. The Wisconsin law has been interpreted to exclude Section 8 housing vouchers, which may be the most common kind of rental assistance, and as the PRRAC notes, other state laws have been weakened by interpretation as well.

    This kind of weakening (or merely interpreting, depending on your attitude) is what the Maryland Supreme Court is considering in Katrina Hare v. David S. Brown Enterprises, Ltd. The landlord in that case had an income qualification rule that permitted the rent to be no more than 40% of the tenant’s total income. The tenant, who lived on social security, had income of only around $800 a month, but had a housing voucher for about $1400 a month. Even counting the voucher as income, her total rent was far more than 40% of her income; in fact it was around 70% of her income because most of her income was assistance to pay rent. Her share of the rent, a few hundred dollars, was far less than 40% of her income even without rent assistance, but comparing the full rent to all her income meant she didn’t meet the landlord’s requirements.

    The landlord’s position was a simple “look at the words of the statute” argument. As written, the statute requires a landlord to treat a rent voucher as income and forbids discrimination based on source of income. The landlord claimed that it treated her voucher as income when calculating total income for its 40% rule and thus did not discriminate. The tenant’s position was practical. Tenants who get rental assistance usually have income that is far less than the rent they have to pay. If you add rent assistance that is equal to most of the rent to their existing income and do the landlord’s calculation the tenant will almost never qualify to rent the apartment for which they are getting assistance. Thus, the “look at the words of the statute” argument leads to the absurd result that landlords can still, in effect, discriminate based on source of income.

    I won’t guess how the Maryland Supreme Court is going to rule in this case, but it illustrates an important point for landlords and developers who are concerned about the administrative burden of accepting vouchers but do not want to violate source-of-income discrimination laws. You cannot just look at the PRRAC list and conclude that in the listed states and cities you must accept housing vouchers or, using the landlord’s argument in Maryland, assume you’ll be able to reject tenants with vouchers. The exact language of the law matters as do court decisions interpreting the law. Legislatures and city councils can learn the same lesson because if the goal is to require that landlords to accept housing vouchers and other rental assistance it may not be enough to simply outlaw source-of-income discrimination as the Maryland legislature has done.

    And as a final note, this is a more general problem with anti-discrimination laws. Everyone thinks they know what it means to say “thou shalt not discriminate” based on this or that, but not everyone “knows” the same thing. There is no easy statutory or regulatory path to achieving the goal of equal housing opportunity for all while at the same time not unduly burdening housing providers. There is also no easy way for landlords to be sure that because their motives are good they are doing what the law requires. If you are doing business in a jurisdiction on the PRRAC list an investment in closely examining the local source of income law will almost always pay off in the long run.

    ++++++++++++++++++++++++++++++

    ¹ Source of income discrimination occurs when a landlord refuses to accept rent vouchers or similar third-party sources of income when evaluating the tenant’s financial ability to pay rent or, in some cases, simply refuses to accept rent payments from certain third parties, usually a government agency or a charity of some kind. It is never mentioned in the federal Fair Housing Act although it is forbidden by regulation for certain federally subsidized housing programs.

    ² See, Source of Income lawsuit

    3 See, PRRAC Source of Income Survey

    4 What, you don’t agree?


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