Quid Pro Quo and Hostile Environment Harassment and Liability for Discriminatory Housing Practices Under the Fair Housing Act, 63054-63075 [2016-21868]
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Dated: September 6, 2016.
William T. Flynn,
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[FR Doc. 2016–21985 Filed 9–13–16; 8:45 am]
BILLING CODE 4164–01–P
DEPARTMENT OF HOUSING AND
URBAN DEVELOPMENT
24 CFR Part 100
[Docket No. FR–5248–F–02]
RIN 2529–AA94
Quid Pro Quo and Hostile Environment
Harassment and Liability for
Discriminatory Housing Practices
Under the Fair Housing Act
Office of the Assistant
Secretary for Fair Housing and Equal
Opportunity, HUD.
ACTION: Final rule.
AGENCY:
This final rule amends HUD’s
fair housing regulations to formalize
standards for use in investigations and
adjudications involving allegations of
harassment on the basis of race, color,
religion, national origin, sex, familial
status, or disability. The rule specifies
how HUD will evaluate complaints of
quid pro quo (‘‘this for that’’)
harassment and hostile environment
harassment under the Fair Housing Act.
It will also provide for uniform
treatment of Fair Housing Act claims
raising allegations of quid pro quo and
hostile environment harassment in
judicial and administrative forums. This
rule defines ‘‘quid pro quo’’ and
‘‘hostile environment harassment,’’ as
prohibited under the Fair Housing Act,
and provides illustrations of
discriminatory housing practices that
constitute such harassment. In addition,
this rule clarifies the operation of
traditional principles of direct and
vicarious liability in the Fair Housing
Act context.
DATES: Effective date: October 14, 2016.
FOR FURTHER INFORMATION CONTACT:
Lynn Grosso, Acting Deputy Assistant
Secretary for Enforcement and
Programs, Office of Fair Housing and
Equal Opportunity, Department of
Housing and Urban Development, 451
7th Street SW., Room 5204, Washington
DC 20410–2000; telephone number 202–
402–5361 (this is not a toll-free
number). Persons with hearing or
speech impairments may contact this
number via TTY by calling the toll-free
Federal Relay Service at 800–877–8339.
SUPPLEMENTARY INFORMATION:
SUMMARY:
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I. Executive Summary
A. Purpose of the Regulatory Action
Both HUD and the courts have long
recognized that Title VIII of the Civil
Rights Act of 1968, as amended, (42
U.S.C. 3601 et seq.) (Fair Housing Act or
Act) prohibits harassment in housing
and housing-related transactions
because of race, color, religion, sex,
national origin, disability,1 and familial
status, just as Title VII of the Civil
Rights Act of 1964 (42 U.S.C. 2000e et
seq.) (Title VII) prohibits such
harassment in employment. But no
standards had been formalized for
assessing claims of harassment under
the Fair Housing Act. Courts have often
applied standards first adopted under
Title VII to evaluate claims of
harassment under the Fair Housing Act,
but there are differences between the
Fair Housing Act and Title VII, and
between harassment in the workplace
and harassment in or around one’s
home, that warrant this rulemaking.
This rule formalizes standards for
evaluating claims of quid pro quo and
hostile environment harassment in the
housing context. The rule does so by
defining ‘‘quid pro quo harassment’’ and
‘‘hostile environment harassment’’ as
conduct prohibited under the Fair
Housing Act, and by specifying the
standards to be used to evaluate
whether particular conduct creates a
quid pro quo or hostile environment in
violation of the Act. Such standards will
apply both in administrative
adjudications and in cases brought in
federal and state courts under the Fair
Housing Act. This rule also adds to
HUD’s existing Fair Housing Act
regulations illustrations of
discriminatory housing practices that
may constitute illegal quid pro quo and
hostile environment harassment.
By establishing consistent standards
for evaluating claims of quid pro quo
and hostile environment harassment,
this rule provides guidance to providers
of housing or housing-related services
seeking to ensure that their properties or
businesses are free of unlawful
harassment. The rule also provides
clarity to victims of harassment and
their representatives regarding how to
assess potential claims of illegal
harassment under the Fair Housing Act.
In addition, this final rule clarifies
when housing providers and other
entities or individuals covered by the
Fair Housing Act may be held directly
or vicariously liable under the Act for
1 This rule uses the term ‘‘disability’’ to refer to
what the Fair Housing Act and its implementing
regulations refer to as ‘‘handicap.’’ Both terms have
the same legal meaning. See Bragdon v. Abbott, 524
U.S. 624, 631 (1998).
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Federal Register / Vol. 81, No. 178 / Wednesday, September 14, 2016 / Rules and Regulations
illegal harassment, as well as for other
discriminatory housing practices that
violate the Act. This rule sets forth how
these traditional liability standards
apply in the housing context because, in
HUD’s experience, there has been
significant misunderstanding among
public and private housing providers as
to the circumstances under which they
will be subject to liability under the Fair
Housing Act for discriminatory housing
practices undertaken by others.
B. Legal Authority for the Regulation
The legal authority for this regulation
is found in the Fair Housing Act, which
gives the Secretary of HUD the
‘‘authority and responsibility for
administering this Act.’’ 42 U.S.C.
3608(a). In addition, the Act provides
that ‘‘[t]he Secretary may make rules
(including rules for the collection,
maintenance, and analysis of
appropriate data) to carry out this title.
The Secretary shall give public notice
and opportunity for comment with
respect to all rules made under this
section.’’ 42 U.S.C. 3614a. HUD also has
general rulemaking authority under the
Department of Housing and Urban
Development Act to make such rules
and regulations as may be necessary to
carry out its functions, powers and
duties. See 42 U.S.C. 3535(d).
C. Summary of Major Provisions
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The major provisions of this rule:
• Formalize definitions of ‘‘quid pro
quo harassment’’ and ‘‘hostile
environment harassment’’ under the
Fair Housing Act.
• Formalize standards for evaluating
claims of quid pro quo and hostile
environment harassment under the Fair
Housing Act.
• Add illustrations of prohibited quid
pro quo and hostile environment
harassment to HUD’s existing Fair
Housing Act regulations.
• Identify traditional principles of
direct and vicarious liability applicable
to all discriminatory housing practices
under the Fair Housing Act, including
quid pro quo and hostile environment
harassment.
Please refer to section III of this
preamble, entitled ‘‘This Final Rule,’’
for a discussion of the changes made to
HUD’s regulations by this final rule.
D. Costs and Benefits
This rule formalizes clear, consistent,
nationwide standards for evaluating
harassment claims under the Fair
Housing Act. The rule does not create
any new forms of liability under the Fair
Housing Act and thus adds no
additional costs for housing providers
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and others engaged in housing
transactions.
The benefits of the rule are that it will
assist in ensuring compliance with the
Fair Housing Act by defining quid pro
quo and hostile environment
harassment that violates the Act and by
specifying traditional principles of
direct and vicarious liability, consistent
with Supreme Court precedent.
Articulating clear standards enables
entities subject to the Fair Housing Act’s
prohibitions and persons protected by
its terms to understand the types of
conduct that constitute actionable quid
pro quo and hostile environment
harassment. As a result, HUD expects
this rule to facilitate more effective
training to avoid discriminatory
harassment in housing and decrease the
need for protracted litigation to resolve
disputed claims.
II. Background
Title VIII of the Civil Rights Act of
1968, as amended (the Fair Housing Act
or Act), prohibits discrimination in the
availability and enjoyment of housing
and housing-related services, facilities,
and transactions because of race, color,
national origin, religion, sex, disability,
and familial status. 42 U.S.C. 3601–19.
The Act prohibits a wide range of
discriminatory housing and housingrelated practices, including, among
other things, making discriminatory
statements, refusing to rent or sell,
denying access to services, setting
different terms or conditions, refusing to
make reasonable modifications or
accommodations, discriminating in
residential real estate-related
transactions, and retaliating. See 42
U.S.C. 3604, 3605, 3606 and 3617.
In 1989, HUD promulgated fair
housing regulations at 24 CFR part 100
that address discriminatory conduct in
housing generally. The 1989 regulations
include examples of discriminatory
housing practices that cover quid pro
quo sexual harassment and hostile
environment harassment generally.
Section 100.65(b)(5) identifies, as an
example of unlawful conduct, denying
or limiting housing-related services or
facilities because a person refused to
provide sexual favors. Section
100.400(c)(2) offers as an example of
illegal conduct ‘‘. . . interfering with
persons in their enjoyment of a dwelling
because of race, color, religion, sex,
handicap, familial status, or national
origin of such persons, or of visitors or
associates of such persons.’’ The 1989
regulations do not, however, expressly
define quid pro quo or hostile
environment harassment, specify
standards for examining such claims, or
provide illustrations of other types of
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quid pro quo or hostile environment
harassment prohibited by the Act. The
1989 regulations also do not discuss
liability standards for prohibited
harassment or other discriminatory
housing practices.
Over time, forms of harassment that
violate civil rights laws have coalesced
into two legal doctrines—quid pro quo
and hostile environment. Although
HUD and the courts have recognized
that the Fair Housing Act prohibits
harassment because of race or color,2
disability,3 religion,4 national origin,5
familial status,6 and sex,7 the doctrines
of quid pro quo and hostile environment
harassment are not well developed
under the Fair Housing Act.
As a result, when deciding
harassment cases under the Fair
Housing Act, courts have often looked
to case law decided under Title VII,
which prohibits employment
discrimination because of race, color,
religion, sex, and national origin.8 But
the home and the workplace are
significantly different environments
such that strict reliance on Title VII case
law is not always appropriate. One’s
home is a place of privacy, security, and
refuge (or should be), and harassment
that occurs in or around one’s home can
be far more intrusive, violative and
threatening than harassment in the more
public environment of one’s work
place.9 Consistent with this reality, the
2 See, e.g., Smith v. Mission Assoc. Ltd. P’ship,
225 F. Supp. 2d 1293, 1298–99 (D. Kan. 2002) (42
U.S.C. 3604(b)); HUD v. Tucker, 2002 ALJ LEXIS 33,
*3–4 (HUD ALJ 2002) (42 U.S.C. 3604(a) and (b)).
3 See, e.g., Neudecker v. Boisclair Corp., 351 F. 3d
361, 364 (8th Cir. 2003) (42 U.S.C. 3604(f)(2)).
4 See, e.g., Bloch v. Frischholz, 587 F. 3d 771, 787
(7th Cir. 2009) (42 U.S.C. 3604(b), 3617).
5 See, e.g., Effendi v. Amber Fields Homeowners
Assoc., 2011 U.S. Dist. Lexis 35265, *1 (N.D. Ill.
2011) (42 U.S.C. 3604(b) and 3617); Texas v. Crest
Asset Mgmt., 85 F. Supp. 722, 736 (S.D. TX 2000)
(42 U.S.C. 3604(a) and (b), 3617).
6 See, e.g., Bischoff v. Brittain, 2014 U.S. Dist.
LEXIS 145945, *13–14, *17 (E.D. Cal. 2014)
(3604(b)); United States v. M. Westland Co., 1995
U.S. Dist. LEXIS 22466, *4 (C.D. Cal. 1995) (Fair
Housing Act provision not specified).
7 See, e.g., Quigley v. Winter, 598 F. 3d 938, 946
(8th Cir. 2010) (42 U.S.C. 804(b), 3617); Krueger v.
Cuomo, 115 F. 3d 487, 491 (7th Cir. 1997) (42
U.S.C. 3604(b), 3617); Honce v. Vigil, 1 F. 3d 1085,
1088 (10th Cir. 1993) (42 U.S.C. 3604(b));
Shellhammer v. Lewallen, 770 F. 2d 167 (6th Cir.
1985) (sexual harassment under the Fair Housing
Act in general).
8 See, e.g., Honce v. Vigil, 1 F. 3d at 1088;
Shellhammer v. Lewallen, 770 F. 2d 167; Glover v.
Jones, 522 F. Supp. 2d 496, 503 (W.D.N.Y. 2007);
Beliveau v. Caras, 873 F. Supp. 1393, 1396 (C.D.
Cal. 1995); see also Neudecker v. Boisclair Corp.,
351 F. 3d at 364 (applying Title VII concepts to find
hostile environment based on disability violated
Act). Unlike Title VII, the Act also includes
disability and familial status among its protected
characteristics.
9 See, e.g., Quigley v. Winter, 598 F. 3d at 947
(emphasizing that defendant’s harassing conduct
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Supreme Court has recognized that
individuals have heightened
expectations of privacy within the
home.10
This rule therefore formalizes
standards to address harassment in and
around one’s home and identifies some
of the differences between harassment
in the home and harassment in the
workplace. While Title VII and Fair
Housing Act case law contain many
similar concepts, this regulation
describes the appropriate analytical
framework for harassment claims under
the Fair Housing Act.
The rule addresses only quid pro quo
and hostile environment harassment,
and not conduct generically referred to
as harassment that, for different reasons,
may violate section 818 or other
provisions of the Fair Housing Act. For
example, a racially hostile statement by
a housing provider could indicate a
discriminatory preference in violation of
section 804(c) of the Act, or it could
evidence intent to deny housing or
discriminate in the terms or conditions
of housing in violation of sections
804(a) or 804(b), even if the statement
does not create a hostile environment or
establish a quid pro quo. Section 818,
which makes it unlawful to ‘‘coerce,
intimidate, threaten, or interfere with
any person in the exercise or enjoyment
of’’ rights protected by the Act, or on
account of a person having aided others
in exercising or enjoying rights
protected by the Act, could be violated
by conduct that creates a quid pro quo
was made ‘‘even more egregious’’ by the fact that
it occurred in plaintiff’s home, ‘‘a place where [she]
was entitled to feel safe and secure and need not
flee.’’); Salisbury v. Hickman, 974 F. Supp. 2d 1282,
1292 (E.D. Cal. 2013) (‘‘[c]ourts have recognized
that harassment in one’s own home is particularly
egregious and is a factor that must be considered
in determining the seriousness of the alleged
harassment’’); Williams v. Poretsky Management,
955 F. Supp. 490, 498 (D. Md. 1996) (noting sexual
harassment in the home more severe than in
workplace); Beliveau v. Caras, 873 F. Supp. at 1398
(describing home as place where one should be safe
and not vulnerable to sexual harassment); D.
Benjamin Barros, Home As a Legal Concept, 46
Santa Clara L. Rev. 255, 277–82 (2006) (discussing
legal concept of home as source of security, liberty
and privacy which justifies favored legal status in
many circumstances); Nicole A. Forkenbrock
Lindemyer, Article, Sexual Harassment on the
Second Shift: The Misfit Application of Title VII
Employment Standards to Title VIII Housing Cases,
18 Law & Ineq. 351, 368–80 (2000) (noting that
transporting of Title VII workplace standards for
sexual harassment into Fair Housing Act cases of
residential sexual harassment ignores important
distinctions between the two settings); Michelle
Adams, Knowing Your Place: Theorizing Sexual
Harassment at Home, 40 Ariz. L. Rev. 17, 21–28
(1998) (describing destabilizing effect of sexual
harassment in the home).
10 See, e.g. Frisby v. Schultz, 487 U.S. 474, 484
(1988) (‘‘[w]e have repeatedly held that individuals
are not required to welcome unwanted speech into
their own homes and that the government may
protect this freedom’’).
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or hostile environment. It is not,
however, limited to quid pro quo or
hostile environment claims and could
be violated by other conduct that
constitutes retaliation or another form of
coercion, intimidation, threats, or
interference because of a protected
characteristic. In sum, this rule provides
standards that are uniformly applicable
to claims of quid pro quo and hostile
environment harassment under the Fair
Housing Act, regardless of the section of
the Act that is alleged to have been
violated, and the same discriminatory
conduct could violate more than one
provision of the Act whether or not it
also constitutes quid pro quo or hostile
environment harassment.
III. Changes Made at the Final Rule
Stage
A. Overview of Changes Made at the
Final Rule Stage
In response to public comment and
upon further consideration by HUD of
the issues presented in this rulemaking,
HUD makes the following changes at
this final rule stage:
• Re-words proposed § 100.7(a)(1)(iii)
to avoid confusing the substantive
obligation to comply with the Fair
Housing Act with the standard of
liability for discriminatory third-party
conduct. Proposed § 100.7(a)(1)(iii)
stated that a person is directly liable for
‘‘failing to fulfill a duty to take prompt
action to correct and end a
discriminatory housing practice by a
third-party, where the person knew or
should have known of the
discriminatory conduct. The duty to
take prompt action to correct and end a
discriminatory housing practice by a
third-party derives from an obligation to
the aggrieved person created by contract
or lease (including bylaws or other rules
of a homeowner’s association,
condominium or cooperative), or by
federal, state or local law.’’ Section
100.7(a)(1)(iii) of this final rule provides
that a person is directly liable for
‘‘failing to take prompt action to correct
and end a discriminatory housing
practice by a third-party, where the
person knew or should have known of
the discriminatory conduct and had the
power to correct it. The power to take
prompt action to correct a
discriminatory housing practice by a
third-party depends upon the extent of
control or any other legal responsibility
the person may have with respect to the
conduct of such third-party.’’
• Adds to § 100.400 a new paragraph
(c)(6) specifying as an example of a
discriminatory housing practice
retaliation because a person reported a
discriminatory housing practice,
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including quid pro quo or hostile
environment harassment.
• Adds to § 100.600(a)(2)(i), ‘‘Totality
of the circumstances,’’ a new paragraph
(C) that explains the reasonable person
standard under which hostile
environment harassment is assessed
‘‘Whether unwelcome conduct is
sufficiently severe or pervasive as to
create a hostile environment is
evaluated from the perspective of a
reasonable person in the aggrieved
person’s position.’’
• Re-words proposed
§ 100.600(a)(2)(i)(B) to clarify that proof
of hostile environment would not
require demonstrating psychological or
physical harm to avoid any confusion
on that point. Proposed
§ 100.600(a)(2)(i)(B) stated ‘‘Evidence of
psychological or physical harm is
relevant in determining whether a
hostile environment was created, as
well as the amount of damages to which
an aggrieved person may be entitled.
Neither psychological nor physical
harm, however, must be demonstrated
to prove that a hostile environment
exists.’’ Section 100.600(a)(2)(i)(B) in
this final rule provides: ‘‘Neither
psychological nor physical harm must
be demonstrated to prove that a hostile
environment exists. Evidence of
psychological or physical harm may,
however, be relevant in determining
whether a hostile environment existed
and, if so, the amount of damages to
which an aggrieved person may be
entitled.’’
• Re-words proposed § 100.600(c) to
clarify that a single incident may
constitute either quid pro quo or hostile
environment harassment if the incident
meets the standard for either type of
harassment under § 100.600(a)(1) or
(a)(2). Proposed § 100.600(c) provided
‘‘A single incident of harassment
because of race, color, religion, sex,
familial status, national origin, or
handicap may constitute a
discriminatory housing practice, where
the incident is severe, or evidences a
quid pro quo.’’ Section 100.600(c) in
this final rule provides ‘‘A single
incident of harassment because of race,
color, religion, sex, familial status,
national origin, or handicap may
constitute a discriminatory housing
practice, where the incident is
sufficiently severe to create a hostile
environment, or evidences a quid pro
quo.’’
• Corrects the illustration in proposed
§ 100.65(b)(7) to fix a typographical
error in the proposed rule. In the final
rule, the word ‘‘service’’ is corrected
and made plural.
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IV. The Public Comments
On October 21, 2015, at 80 FR 63720,
HUD published for public comment a
proposed rule on Quid Pro Quo and
Hostile Environment Harassment and
Liability for Discriminatory Housing
Practices Under the Fair Housing Act.
The public comment period closed on
December 21, 2015. HUD received 63
comments. The comments were
submitted by public housing agencies
(PHAs) and other government agencies;
private housing providers and their
representatives; nonprofit organizations,
including fair housing, civil rights,
housing advocacy, and legal groups;
tenants and other individuals. This
section of the preamble addresses
significant issues raised in the public
comments and provides HUD’s
responses. All public comments can be
viewed at: https://www.regulations.gov/
#!docketDetail;D=HUD-2015-0095.
The majority of the commenters were
generally supportive of the rule, with
some urging HUD to publish the rule
quickly. This summary does not provide
responses to comments that expressed
support for the proposed rule without
suggesting any modifications to the rule.
General supportive comments included
statements of the importance of the rule
in addressing and preventing sexual
assault of tenants by landlords and
descriptions of how the rule would
empower housing providers, renters,
and other consumers to understand and
avoid illegal housing practices by
defining and illustrating quid pro quo
and hostile environment harassment.
Some commenters stated that this rule
may help providers focus on the
importance of eliminating harassment
on their properties, and some
commenters identified provisions of the
rule that would provide useful guidance
to housing providers, tenants, residents,
and others involved in housing
transactions.
More specifically, commenters
expressed appreciation that the rule
would apply not solely to sexual
harassment but to harassment because
of all protected characteristics, with
some commenters sharing anecdotes of
harassment based on a variety of
protected characteristics that they
believe the rule may help remedy. Other
commenters supported the proposed
rule’s distinction between the Fair
Housing Act and Title VII, with
commenters endorsing the Department’s
proposal not to adopt the Title VII
affirmative defense to an employer’s
vicarious liability.
A number of commenters assessed the
rule to be in accord with case law, and
approved of the balance the rule strikes
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between the rights and obligations of the
parties in a fair housing matter. Some
commenters noted that the proposed
standard for determining whether
conduct constitutes a hostile
environment is appropriately
individualized to the facts of each case.
Some commenters specifically
identified the benefits provided by the
rule in establishing a uniform
framework for fairly evaluating and
appropriately responding to alleged
harassment, which minimizes the
subjective nature of adjudicating such
claims. Other commenters expressed
appreciation for the proposed rule’s
recognition that a single incident may
establish hostile environment
harassment. Some commenters
expressed support for the rule’s
acknowledgement of the fear of
retaliation many individuals with
disabilities experience when trying to
address issues of harassment in their
housing.
Many commenters stated that the
rule’s description of traditional
principles of agency liability is accurate
and not an expansion of existing
liability. Some commenters expressed
appreciation that the rule would
incorporate traditional liability
principles for any type of discriminatory
housing practice, not just harassment,
and would rely on negligence principles
and distinguish between direct and
vicarious liability. Other commenters
stated that the rule would not burden
housing providers because the direct
liability standard is aligned with
established housing provider business
practice. Some commenters expressed
appreciation that the rule would place
landlords on notice that they should
take corrective action early on, once
they know or should have known of the
discrimination.
Several commenters stated that
housing providers are already in
possession of the tools they need to
create living environments free from
harassment. In particular, the
commenters stated that housing
providers are familiar with the
corrective actions they may take in
order to enforce their own rules.
Another commenter stated that housing
providers are in the best position to
select, train, oversee, and assure the
correct behavior of their agents, noting
that effective enforcement of the rule
depends on the potential for liability on
the part of housing providers.
Some commenters expressed support
for the proposed rule while seeking
modifications at the final rule stage. For
example, a commenter encouraged
broad application of the rule so that
intervention and corrective action
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63057
would occur before victims of housing
discrimination are forced out of their
homes. Another commenter sought an
expansive reading of the rule in order to
prevent all forms of bullying. Some
commenters sought to add factors to the
totality of circumstances consideration,
while other commenters sought to add
to the classes protected by the rule.
Following are HUD’s responses to
commenters’ suggested modifications to
the rule and the other significant issues
raised in the public comments.
A. Quid Pro Quo and Hostile
Environment Harassment: § 100.600
a. General: § 100.600(a)
Issue: A commenter requested that
HUD add seniors as a protected class
under the rule. Other commenters stated
that elderly persons often have
disabilities, which make them
particularly vulnerable to harassment.
These commenters requested that the
final rule make clear that the rule
protects elderly persons from
harassment because of disability.
HUD Response: HUD shares the
commenters’ concern for elderly
persons but does not have the authority
to add a new protected class to the Fair
Housing Act and therefore is unable to
adopt the commenters’ recommendation
to expand the scope of the rule in this
way. Neither age nor senior status is a
protected characteristic under the Act,
although persons who are discriminated
against because of their disabilities are
protected under the Act without regard
to their age. Therefore, elderly
individuals who are subjected to quid
pro quo or hostile environment
harassment on the basis of disability or
another protected characteristic are
protected under the Act and this final
rule.
Issue: A commenter suggested that
HUD include a clause in the final rule
to protect whistleblowers who
experience harassment for reporting
quid pro quo or hostile environment
harassment. The commenter reported
having witnessed such harassment and
explained that whistleblowers are
particularly vulnerable to quid pro quo
and hostile environment harassment,
but because they are not harassed on the
basis of their race, color, religion,
national origin, sex, familial status, or
disability, they are not directly
protected by the proposed regulation.
HUD Response: Anyone who is
harassed for reporting discriminatory
harassment in housing is protected by
the Fair Housing Act. Section 818 of the
Act makes it unlawful to coerce,
intimidate, threaten, or interfere with a
person on account of his or her having
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aided or encouraged another person in
the exercise or enjoyment of any right
granted or protected by sections 803–
806 of the Act. To highlight the essential
role whistleblower protection plays in
ensuring fair housing, HUD is adding to
§ 100.400 a new paragraph (c)(6), which
provides the following example of a
discriminatory housing practice
‘‘Retaliating against any person because
that person reported a discriminatory
housing practice to a housing provider
or other authority.’’
Issue: Several commenters urged HUD
to state in the final rule that harassment
against persons who are lesbian, gay,
bisexual, or transgender (LGBT), or
because of pregnancy, violates the Fair
Housing Act. They asked HUD to define
harassment because of sex to include
harassment based on sexual orientation,
gender identity, sex stereotyping, or
pregnancy. The commenters referenced
studies about the pervasive harassment
and discrimination such persons face in
housing. They also noted that a number
of federal courts and federal agencies
have interpreted Title VII and other
laws prohibiting discrimination because
of sex to include discrimination on the
basis of gender identity, gender
transition, or transgender status. The
commenters also pointed to HUD’s
‘‘Equal Access to Housing in HUD
Programs Regardless of Sexual
Orientation or Gender Identity’’ rule,
which provides that persons may not be
denied access to HUD programs because
of sexual orientation or gender identity.
HUD Response: The Fair Housing Act
already expressly prohibits
discrimination based on pregnancy as
part of its prohibition of discrimination
because of familial status (42 U.S.C.
3602(k)), and HUD’s Equal Access Rule
applies only to HUD programs.
HUD agrees with the commenters’
view that the Fair Housing Act’s
prohibition on sex discrimination
prohibits discrimination because of
gender identity. In Price Waterhouse v.
Hopkins, the Supreme Court interpreted
Title VII’s prohibition of sex
discrimination to encompass
discrimination based on nonconformance with sex stereotypes,
stating that ‘‘[i]n forbidding employers
to discriminate against individuals
because of their sex, Congress intended
to strike at the entire spectrum of
disparate treatment of men and women
resulting from sex stereotypes.’’ 11
Taking note of Price Waterhouse and its
progeny, in 2010, HUD issued a
memorandum recognizing that sex
discrimination prohibited by the Fair
Housing Act includes discrimination
11 490
U.S. 228, 251 (1989).
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because of gender identity. In 2012, the
Equal Employment Opportunity
Commission (EEOC) reached the same
conclusion, ‘‘clarifying that claims of
discrimination based on transgender
status, also referred to as claims of
discrimination based on gender identity,
are cognizable under Title VII’s sex
discrimination prohibition.’’ 12
Following the EEOC’s decision, the
Attorney General also concluded that:
the best reading of Title VII’s prohibition of
sex discrimination is that it encompasses
discrimination based on gender identity,
including transgender status. The most
straightforward reading of Title VII is that
discrimination ‘‘because of . . . sex’’
includes discrimination because an
employee’s gender identification is as a
member of a particular sex, or because the
employee is transitioning, or has
transitioned, to another sex.13
HUD reaffirms its view that under the
Fair Housing Act, discrimination based
on gender identity is sex discrimination.
Accordingly, quid pro quo or hostile
environment harassment in housing
because of a person’s gender identity is
indistinguishable from harassment
because of sex.14
HUD, in its 2010 memorandum, also
advised that claims of housing
discrimination because of sexual
orientation can be investigated under
the Price Waterhouse sex-stereotyping
12 Macy v. Dept. of Justice, No. 0120120821, 2012
EEOPUB LEXIS 1181, *13 (EEOC Apr. 20, 2012);
see also Lusardi v. Dept. of the Army, No.
0120133395, 2015 EEOPUB LEXIS 896, *17 (EEOC
Apr. 1, 2015).
13 Attorney General Memorandum, Treatment of
Transgender Employment Discrimination Claims
Under Title VII of the Civil Rights Act of 1964 (Dec.
15, 2014), posted at https://www.justice.gov/file/
188671/download. Similarly, the Office of
Personnel Management revised its
nondiscrimination regulations to make clear that
sex discrimination under Title VII includes
discrimination based on gender identity. See 5 CFR
300.102–300.103; see also OFCCP Directive 2014–
02, Gender Identity and Sex Discrimination (Aug.
19, 2014) (stating that discrimination based on
gender identity or transgender status is
discrimination based on sex), posted at https://
www.dol.gov/ofccp/regs/compliance/directives/
Directive_2014–02_508c.pdf.
14 See Glenn v. Brumby, 663 F.3d at 1317
(‘‘discrimination against a transgender individual
because of her gender nonconformity is sex
discrimination, whether it is described as being on
the basis of sex or gender.’’); see also Finkle v.
Howard Cnty, 12 F. Supp. 3d 780, 788 (D. Md.
2014) (holding that ‘‘Plaintiff’s claim that she was
discriminated against ‘because of her obvious
transgender[] status is a cognizable claim of sex
discrimination under Title VII’’); Rumble v.
Fairview Health Services, No. 14–cv–2037, 2015
U.S. Dist. LEXIS 31591, *4–5 (D. Minn. Mar. 16,
2015) (in Affordable Care Act case, holding that
‘‘[b]ecause the term ‘transgender’ describes people
whose gender expression differs from their assigned
sex at birth, discrimination based on an individual’s
transgender status constitutes discrimination based
on gender stereotyping. Therefore, Plaintiff’s
transgender status is necessarily part of his ‘sex’ or
‘gender’ identity’’).
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theory. Over the past two decades, an
increasing number of Federal courts,
building on the Price Waterhouse
rationale, have found protections under
Title VII for those asserting
discrimination claims related to their
sexual orientation.15 Many Federalsector EEOC decisions have found the
same.16 Although some Federal
15 See, e.g., Prowel v. Wise Bus. Forms, Inc., 579
F.3d 285, 291–92 (3rd Cir. 2009) (harassment of a
plaintiff because of his ‘‘effeminate traits’’ and
behaviors could constitute sufficient evidence that
he ‘‘was harassed because he did not conform to
[the employer’s] vision of how a man should look,
speak, and act—rather than harassment based solely
on his sexual orientation’’); Nichols v. Azteca Rest.
Enter., Inc., 256 F.3d 864, 874–75 (9th Cir. 2001)
(coworkers’ and supervisors’ harassment of a gay
male because he did not conform to gender norms
created a hostile work environment in violation of
Title VII); Hall v. BNSF Ry. Co., No. C13–2160 RSM,
2014 U.S. Dist. LEXIS 132878 *8–9 (W.D. Wash.
September 22, 2014) (plaintiff’s allegation that ‘‘he
(as a male who married a male) was treated
differently in comparison to his female coworkers
who also married males’’ stated a sex
discrimination claim under Title VII); Terveer v.
Billington, 34 F. Supp. 3d 100, 116 (D.D.C. 2014)
(Title VII claim based on sex stated when plaintiff’s
‘‘orientation as homosexual’’ removed him from the
employer’s preconceived definition of male); Heller
v. Columbia Edgewater Country Club, 195 F. Supp.
2d 1212, 1224 (D. Or. 2002) (‘‘[A] jury could find
that Cagle repeatedly harassed (and ultimately
discharged) Heller because Heller did not conform
to Cagle’s stereotype of how a woman ought to
behave. Heller is attracted to and dates other
women, whereas Cagle believes that a woman
should be attracted to and date only men.’’); Centola
v. Potter, 183 F. Supp. 2d 403, 410 (D. Mass. 2002)
(‘‘Sexual orientation harassment is often, if not
always, motivated by a desire to enforce
heterosexually defined gender norms. In fact,
stereotypes about homosexuality are directly related
to our stereotype about the proper roles of men and
women.’’). Cf. Videckis v. Pepperdine Univ., 2015
U.S. Dist. LEXIS 167672, *16 (C.D. Cal. 2015) (‘‘It
is impossible to categorically separate ‘sexual
orientation discrimination’ from discrimination on
the basis of sex or from gender stereotypes; to do
so would result in a false choice. Simply put, to
allege discrimination on the basis of sexuality is to
state a Title IX claim on the basis of sex or
gender.’’).
16 Baldwin v. Dep’t of Transp., EEOC Appeal No.
0120133080, slip op. at 9–11 (July 16, 2015);
Complainant v. Dep’t of Homeland Sec., EEOC
Appeal No. 0120110576, slip op. at 1 (Aug. 20,
2014) (‘‘While Title VII’s prohibition of
discrimination does not explicitly include sexual
orientation as a basis, Title VII prohibits sex
discrimination, including sex-stereotyping
discrimination and gender discrimination’’ and
‘‘sex discrimination claims may intersect with
claims of sexual orientation discrimination.’’);
Couch v. Dep’t of Energy, EEOC Appeal No.
0120131136, slip op. at 1 (Aug. 13, 2013) (finding
harassment claim based on perceived sexual
orientation is a discrimination claim based on
failure to conform to gender stereotypes); Culp v.
Dep’t of Homeland Sec., EEOC Appeal 0720130012,
slip op. at 1 (May 7, 2013) (Title VII covers
discrimination based on associating with lesbian
colleague); Castello v. U.S. Postal Serv., EEOC
Appeal No. 0520110649, slip op. at 1 (Dec. 20,
2011) (vacating prior decision and holding that
complainant stated claim of discrimination based
on sex-stereotyping through evidence of offensive
comments by manager about female subordinate’s
relationships with women); Veretto v. U.S. Postal
Serv., EEOC Appeal No. 0120110873, slip op. at 1
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appellate courts have declined to find
sex discrimination under Title VII based
on the sole fact of the person’s sexual
orientation, those courts nonetheless
recognized the Price Waterhouse sexstereotyping theory may be used to find
discrimination based on sex.17 These
Title VII legal authorities are consistent
with HUD’s 2010 memorandum, in
which HUD interprets the Fair Housing
Act’s prohibition on sex discrimination
to include, at a minimum,
discrimination related to an individual’s
sexual orientation where the evidence
establishes that the discrimination is
based on sex stereotypes. HUD’s
interpretation of sex discrimination
under the Fair Housing Act is also
consistent with the Department of
Health and Human Services’ rule
interpreting sex discrimination under
Section 1557 the Affordable Care Act 18
and the Department of Labor’s rule
interpreting sex discrimination under
Title VII of the Civil Rights Act of
1964.19
Issue: Some commenters asked HUD
to provide a definition of harassment. A
commenter noted that the proposed rule
defines two types of harassment—quid
pro quo and hostile environment, but
does not define the general term
‘‘harassment.’’ Another commenter
stated that if HUD believes that other
(July 1, 2011) (court found that ‘‘Complainant has
alleged a plausible sex-stereotyping’’ claim of
harassment because he married a man).
17 See, e.g., Gilbert v. Country Music Ass’n, 432
F. App’x 516, 520 (6th Cir. 2011) (acknowledging
the validity of a sex-stereotyping claim ‘‘based on
gender non-conforming ‘behavior observed at work
or affecting . . . job performance,’ such as . . .
‘appearance or mannerisms on the job,’ ’’ but
rejecting the plaintiff’s sex discrimination claim
because his ‘‘allegations involve discrimination
based on sexual orientation, nothing more. He does
not make a single allegation that anyone
discriminated against him based on his ‘appearance
or mannerisms’ or for his ‘gender nonconformity.’ ’’) (quoting Vickers v. Fairfield Med.
Ctr., 453 F.3d 757, 763 (6th Cir. 2006); Pagan v.
Gonzalez, 430 F. App’x 170, 171–72 (3d Cir. 2011)
(recognizing that ‘‘discrimination based on a failure
to conform to gender stereotypes is cognizable’’ but
affirming dismissal of the plaintiff’s sex
discrimination claim based on ‘‘the absence of any
evidence to show that the discrimination was based
on Pagan’s acting in a masculine manner’’); Dawson
v. Bumble & Bumble, 398 F.3d 211, 221, 222–23 (2d
Cir. 2005) (observing that ‘‘one can fail to conform
to gender stereotypes in two ways: (1) Through
behavior or (2) through appearance, but dismissing
the plaintiff’s sex discrimination claim because she
‘‘has produced no substantial evidence from which
we may plausibly infer that her alleged failure to
conform her appearance to feminine stereotypes
resulted in her suffering any adverse employment
action’’). See also Hively v. Ivy Tech Community
College, 2016 U.S. App. LEXIS 13746, *16–25 (7th
Cir. 2016) (reviewing this line of cases).
18 Nondiscrimination in Health Programs and
Activities, 81 FR 31376, 31388–90 (May 18, 2016)
(to be codified at 45 CFR part 92).
19 Discrimination Because of Sex, 81 FR 39108,
39137–40 (June 15, 2016) (to be codified at 41 CFR
part 60–20).
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types of harassment may also violate the
Fair Housing Act, HUD should provide
a definition of harassment. Other
commenters strongly supported the
rule’s definitions of quid pro quo and
hostile environment harassment,
describing them as clear and inclusive,
and stated that the definitions and
related examples provided in the rule
clarify what conduct the Fair Housing
Act prohibits and will aid all
stakeholders’ understanding of the
rule’s provisions.
HUD Response: The term harassment
has broad colloquial usage with no
defined parameters. For this reason, the
final rule defines the specific terms
‘‘quid pro quo’’ and ‘‘hostile
environment harassment.’’ Other
conduct that might generically be
referred to as harassment might fall in
the categories of quid pro quo or hostile
environment, or the conduct may
constitute a different type of
discriminatory housing practice in
violation of section 818 of the Act or
other provisions of the Act, or the
conduct may not violate the Act at all.
As the preamble to the proposed rule
explained, a violation of section 818
may be established using the standards
for quid pro quo or hostile environment
harassment or by the specific elements
of a section 818 violation, i.e., (1) the
plaintiff or complainant exercised or
enjoyed—or aided or encouraged
another person in the exercise or
enjoyment of—a right guaranteed by
sections 803–06; (2) the defendant’s or
respondent’s conduct constituted
coercion, intimidation, a threat, or
interference; and (3) a causal connection
existed between the exercise,
enjoyment, aid or encouragement of the
right and the defendant’s or
respondent’s conduct.
Issue: Some commenters expressed
concern that the proposed rule did not
expressly state that sections 804(b) and
818 of the Fair Housing Act apply to
discrimination that occurs after the
complainant or plaintiff acquires the
dwelling. The commenters stated that
some courts have held that these
provisions apply only to discrimination
that affects access to housing and urged
HUD to add language to the rule making
clear that these particular provisions
apply to post-acquisition discrimination
claims.
HUD Response: HUD believes that the
definitions of ‘‘quid pro quo’’ and
‘‘hostile environment harassment’’ make
clear HUD’s view that the Act covers
post-acquisition conduct and therefore
no additional language is required.
These definitions mirror the coverage of
sections 804(b), 804(f)(2), and 818 of the
Fair Housing Act, which plainly apply
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to both pre-acquisition and postacquisition discrimination claims.
Moreover, HUD has long interpreted
and enforced these provisions of the Act
and others to protect against
discrimination that occurs before one
acquires a dwelling as well as while one
is living in the dwelling. HUD’s 1989
regulations interpreting sections 804(b),
804(f)(2), and 818 of the Act, for
example, provide that discrimination
prohibited under these provisions
includes the ‘‘maintenance or repairs of
sale or rental dwellings,’’ ‘‘[d]enying or
limiting the use of privileges, services,
or facilities associated with a dwelling,’’
and threatening, intimidating or
interfering with persons ‘‘in their
enjoyment of a dwelling.’’ The inclusion
of language covering the maintenance of
housing, the continued use of privileges,
services, or facilities associated with
housing, and the ‘‘exercise or
enjoyment’’ of housing indicates
circumstances in which residents—as
opposed to just applicants—benefit from
the Act’s protections throughout their
residency.
Sections 100.65(b)(6)–(7) of the
proposed and of the final rule further
illustrate some ways in which a person
may violate sections 804(b), 804(f)(2),
and 818 of the Fair Housing Act:
‘‘conditioning the terms, conditions, or
privileges relating to the sale or rental
of a dwelling, or denying or limiting the
services or facilities in connection
therewith, on a person’s response to
harassment because of [a protected
characteristic]; ‘‘subjecting a person to
harassment because of [a protected
characteristic] that has the effect of
imposing different terms, conditions, or
privileges relating to the sale or rental
of a dwelling or denying or limiting
services or facilities in connection with
the sale or rental of a dwelling.’’ In sum,
the Act and HUD’s regulations,
including this final rule, make clear that
the Act prohibits discrimination that
occurs while a person resides in a
dwelling, and courts have repeatedly
interpreted the Act similarly.20
20 See, e.g., Bloch v. Frischholz, 587 F.3d at779–
81 (ruling that post-sale conduct by a homeowner’s
association could violate section 804(b) of the Act
and allowing section 3604(b) claims to address
post-acquisition conduct was consistent with
HUD’s regulations (citing 24 CFR 100.65(b)(4)));
Comm. Concerning Cmty. Improvement v. City of
Modesto, 583 F.3d 690, 713 (9th Cir. 2009)
(concluding that the Act covers post-acquisition
discrimination); Neudecker v. Boisclair Corp., 351
F.3d at 364 (finding plaintiff’s post-acquisition
harassment claim valid under the Act); DiCenso v.
Cisneros, 96 F.3d 1004, 1008 (7th Cir. 1996)
(recognizing claim for sexual harassment hostile
housing environment under the Act); Honce v.
Vigil, 1 F.3d at 1089–90 (recognizing that the Act
prohibits both quid pro quo and hostile housing
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Issue: Some commenters asked HUD
to clarify how to distinguish potentially
actionable harassment under the Fair
Housing Act from protected speech
under the First Amendment. A
commenter said that it is not clear how
conduct that allegedly constitutes
harassment under the rule may be
distinguished from other speech or
conduct that is constitutionally
protected or so trivial so as not to
qualify as harassment in the first place.
Another commenter said that courts
have consistently held that the First
Amendment protects a tenant who
publicly speaks about a neighbor, even
if that conduct is motivated by
discriminatory intent. Another
commenter asked whether the proposed
rule would implicate constitutional
protections of free speech or free
exercise of religion if the housing
provider evicts a tenant where, for
example, two tenants are having heated
religious arguments about the other’s
choice of religious attire. Another
commenter stated that the proposed rule
properly balanced the competing rights
at issue and did not interfere with
constitutionally protected speech
because the rule would not encompass
speech that is merely offensive or that
causes nothing more than hurt feelings.
HUD Response: As discussed
elsewhere in this preamble, not every
dispute between neighbors is a violation
of the Fair Housing Act. Moreover,
speech that is protected by the First
Amendment is not within the Act’s
prohibitions. First Amendment
protections do not extend to certain acts
of coercion, intimidation, or threats of
bodily harm proscribed by section 818
environment sexual harassment); Woods-Drake v.
Lundy, 667 F.2d 1198, 1201 (5th Cir. 1982) (finding
that a landlord’s discriminatory conduct against
current tenants violated section 3604(b) of the Act);
Richards v. Bono, No. 5:04CV484–OC–10GRJ, 2005
WL 1065141, at *3 (M.D. Fla. May 2, 2005)
(‘‘[b]ecause the plain meaning of ‘rental’
contemplates an ongoing relationship, the use of
that term in § 3604(b) means that the statute
prohibits discrimination at any time during the
landlord/tenant relationship, including after the
tenant takes possession of the property’’); United
States v. Koch, 352 F. Supp. 2d 970, 976 (D. Neb.
2004) (‘‘[I]t is difficult to imagine a privilege that
flows more naturally from the purchase or rental of
a dwelling than the privilege of residing therein.’’);
U.S. Department of Housing and Urban
Development, Office of Fair Housing and Equal
Opportunity, Questions and Answers on Sexual
Harassment under the Fair Housing Act (2008),
available at https://portal.hud.gov/hudportal/
documents/huddoc?id=QAndASexualHarassment
.pdf (recognizing that current tenants may file fair
housing complaints under the Act); Robert G.
Schwemm, Fair Housing Litigation After Inclusive
Communities: What’s New and What’s Not, 115
Colum. L. Rev. Sidebar 106, 122–23 (2015)
(explaining that many post-acquisition actions,
such as evictions and harassment, may give rise to
violations under sections 804(a) and 804(b) of the
Act).
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of the Act. As the Supreme Court has
stated, ‘‘true threats’’ have no First
Amendment protection.21 In Notice
FHEO–2015–01, HUD has set out
substantive and procedural guidelines
regarding the filing and investigation of
Fair Housing Act complaints that may
implicate the First Amendment.22 The
Notice discusses how HUD handles
complaints against persons who are not
otherwise covered by the Act, but who
are alleged to have violated Section 818
of the Act.
Issue: A commenter suggested that the
rule is unnecessary because other
administrative and legal remedies
already exist for victims of harassment
under state and local law. Another
commenter suggested that the rule is
unnecessary because HUD has already
charged cases involving harassment
under the Act.
HUD Response: This final rule
formalizes and provides uniform
standards for evaluating complaints of
quid pro quo and hostile environment
harassment under the Fair Housing Act.
While other administrative and legal
causes of action may exist for victims of
quid pro quo and hostile environment
harassment under landlord-tenant law,
tort law, or other state law, they do not
substitute for the protections against
discrimination and the remedies
provided under the Act. Moreover, the
fact that HUD has previously issued
charges of discrimination involving
quid pro quo or hostile environment
harassment does not negate the need for
this rule.
Issue: A commenter asked HUD to
abandon the rulemaking process and
instead provide specific, clear guidance
to the regulated community so that
housing providers can ascertain the
types of behavior that do and do not
constitute harassment under the Fair
Housing Act. Other commenters
requested that HUD provide technical
assistance on various aspects of the rule
to residents, housing providers, and
practitioners to ensure all parties know
their rights under the law.
HUD Response: HUD declines to
abandon this rulemaking. This
regulation is needed to formalize
standards for assessing claims of
harassment under the Fair Housing Act
and to clarify when housing providers
and others covered by the Act may be
liable for illegal harassment or other
discriminatory housing practices. It has
been HUD’s experience that there is
21 See,
e.g., R.A.V. v. City of St. Paul, 505 U.S.
377, 388 (1992).
22 Notice FHEO 2015–01 found at: https://
portal.hud.gov/hudportal/documents/huddoc?id=526-2015notice.pdf.
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significant misunderstanding among
public and private housing providers
about the circumstances under which
they may be liable. This regulation
provides greater clarity in making that
assessment. HUD will continue to offer
guidance and training on the Fair
Housing Act generally and on this final
rule, as needed.
Issue: A commenter recommended
that the rule expand the limits for
damages in cases that establish sexual
harassment in housing.
HUD Response: HUD declines to
make this change because it is
unnecessary. The Act contains no limit
on damages that may be awarded,
specifically authorizing an award of
‘‘actual damages.’’ 42 U.S.C. 3612(g)(3);
3613(c)(1); 3614(d)(1)(B).
Issue: A commenter asked HUD to
consider expanding the time for filing
sexual harassment complaints where a
hostile environment case includes
subsequent harassment that occurs
many months after the initial act of
sexual harassment.
HUD Response: HUD declines to
adopt this recommendation because the
Fair Housing Act specifically defines
the statute of limitations for filing
complaints. It is one year after an
alleged discriminatory housing practice
occurred or terminated for a complaint
with HUD and two years after an alleged
discriminatory housing practice
occurred or terminated for a civil action
in federal district court or state court.
See 42 U.S.C. 3610; 3613. If a violation
is continuing, the limitations period
runs from the date of the last occurrence
or termination of the discriminatory
act.23
1. Quid Pro Quo Harassment:
§ 100.600(a)(1)
Issue: A commenter asked how the
rule would ‘‘differentiate between a
situation of involuntary quid pro quo
that genuinely must be governed by the
Act and a situation where one party is
manipulating the rule following a
mutually beneficial and agreed upon
transaction.’’
HUD Response: The rule’s definition
of quid pro quo harassment requires a
request or demand that is ‘‘unwelcome.’’
A mutually beneficial and agreed upon
transaction is not unwelcome and
would not constitute quid pro quo
harassment under the rule or the Act. It
is important to note, however, that, as
the rule states, if an individual
23 See, e.g., Havens Realty Corp. v. Coleman, 455
U.S. 363, 380–81 (1982); Neudecker v. Boisclair
Corp., 351 F.3d at 363 ; Spann v. Colonial Vill., Inc.,
899 F.2d 24, 34–35 (D.C. Cir. 1990); Heights Cmty
Congress v. Hilltop Realty, Inc., 774 F.2d 135, 139–
41 (6th Cir. 1985).
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acquiesces to an unwelcome request or
demand, unlawful quid pro quo
harassment may have occurred.
Moreover, if a housing provider
regularly or routinely confers housing
benefits based upon the granting of
sexual favors, such conduct may
constitute quid pro quo harassment or
hostile environment harassment against
others who do not welcome such
conduct, regardless of whether any
objectionable conduct is directed at
them and regardless of whether the
individuals who received favorable
treatment willingly granted the sexual
favors.24 Liability in all situations
involving allegations of harassment
must be determined on a case-by-case
basis.
Issue: A commenter stated that the
preamble to the proposed rule was
vague in stating that ‘‘a person is
aggrieved if that person is denied or
delayed in receiving a housing-related
opportunity or benefit because another
received the benefit.’’ The commenter
was concerned that this statement
would require a PHA to identify,
investigate, and document a defense to
any tenant-perceived delay in receiving
benefits.
HUD Response: The quoted phrase is
not vague when read in context, which
explains the meaning of quid pro quo
harassment under the Fair Housing Act.
The phrase refers to a person who is
aggrieved because he or she is denied a
benefit that went to another in exchange
for sexual favors, for example.
Aggrieved persons under the Act and
HUD’s regulation are limited to those
who were injured (or are about to be
injured) by a discriminatory housing
practice as defined in the Act. Neither
the Fair Housing Act nor this final rule
prohibits delays in receiving housingrelated opportunities or benefits for
nondiscriminatory reasons. If, however,
an applicant or tenant alleges that he or
she has been denied or delayed in
receiving a benefit because others
submitted to requests for sexual favors,
the PHA should investigate to determine
if quid pro quo or hostile environment
harassment has occurred.
2. Hostile Environment Harassment:
§ 100.600(a)(2)
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Issue: Several commenters
recommended that HUD ensure
24 Cf. EEOC Policy Guidance No. N–915.048,
Employer Liability under Title VII for Sexual
Favoritism (Jan. 12, 1990) (providing that
widespread sexual favoritism based upon
solicitations for and/or the granting of sexual favors
or other sexual conduct ‘‘can form the basis of an
implicit ‘quid pro quo’ harassment claim for female
employees, as well as a hostile environment claim
for both women and men who find this offensive’’).
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consistency of the discussion of hostile
environment harassment throughout the
preamble in order to prevent any
unintentional barriers for harassment
victims seeking to bring claims under
the Fair Housing Act. The commenters
specifically stated that in one section of
the preamble to the proposed rule, HUD
defines ‘‘hostile environment
harassment’’ to require unwelcome
conduct because of a protected
characteristic that ‘‘unreasonably
interferes’’ with the use and enjoyment
of a dwelling, or with the exercise of
other rights protected by the Act. By
contrast, the commenters stated, other
sections of the preamble rightly omit the
‘‘unreasonably’’ qualifier when
discussing hostile environment
harassment. The commenters requested
that the word ‘‘unreasonably’’ be
removed from the discussion in the
preamble because it is unnecessary and
will create confusion. They stated that
unwelcome conduct that is ‘‘sufficiently
severe or pervasive’’ as to interfere with
one’s enjoyment of rights protected
under the Act is in itself unreasonable.
HUD Response: The term
‘‘unreasonably’’ does not appear in the
definition of ‘‘hostile environment
harassment’’ in the regulatory text of the
proposed rule. The term ‘‘unreasonably’’
was used in the preamble to the
proposed rule to convey how a claim of
hostile environment would be
evaluated; that is, from the perspective
of a reasonable person in the aggrieved
person’s position. HUD agrees that the
use of the term ‘‘unreasonably’’ in the
preamble may have caused confusion by
conflating the substantive standard with
the method of proof. In this final rule,
as was the case in the proposed rule, the
definition of ‘‘hostile environment
harassment’’ in § 100.600(a)(2) is not
phrased as requiring proof that
unwelcome conduct ‘‘unreasonably’’
interfere with a right protected by the
Fair Housing Act. But it remains that
whether unwelcome conduct is
sufficiently severe or pervasive as to
interfere with rights protected by the
Act, and therefore constitute hostile
environment harassment, is evaluated
from the perspective of a reasonable
person in the aggrieved person’s
position.
Issue: A commenter suggested that
HUD include definitions and
descriptions of ‘‘bullying’’ in this final
rule because bullying is very similar to
hostile environment harassment.
HUD Response: HUD does not agree
that it is necessary to add the word
‘‘bullying’’ to the final rule in order to
cover conduct that could be considered
bullying. Section 100.600(a)(2) of the
proposed rule and of this final rule,
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which defines hostile environment
harassment and specifies the factors to
be considered when evaluating whether
particular conduct creates a hostile
environment in violation of the Act, is
broadly worded and fully captures the
concept of bullying because of a
protected characteristic that the
commenter seeks to include.
Issue: A commenter said HUD should
include social isolation and neglect as
forms of harassment under the rule,
especially when they occur with the
intent to drive a person from his or her
home or interfere with his or her
enjoyment of a dwelling. According to
the commenter, these actions have
major implications for the psychological
well-being of an individual.
HUD Response: HUD appreciates that
social isolation and neglect are serious
concerns. This rule is limited to conduct
engaged in because of a protected
characteristic. If a tenant is subjected to
unwanted severe or pervasive conduct
because of a disability, for example,
which leads to social isolation with the
intent or effect of driving the tenant
from his or her home or interfering with
his or her enjoyment of a dwelling, such
conduct could constitute hostile
environment harassment under the
standards set forth in the rule.
Issue: A commenter said the rule
could more clearly distinguish
harassment from inappropriate behavior
or disputes that do not rise to the level
of harassment. Other commenters stated
that they appreciated the rule’s
emphasis on the totality of the
circumstances, which will ensure that
mere disagreements, mistaken remarks,
or isolated words spoken in the heat of
the moment will not result in liability
unless the totality of the circumstances
establishes hostile environment
harassment.
HUD Response: HUD agrees that not
every disagreement between persons
involved in a housing transaction
constitutes unlawful harassment
because of a protected characteristic in
violation of the Act and believes the
rule appropriately captures the
distinction. Section 100.600(a)(2) of the
proposed rule and of this final rule
defining hostile environment
harassment requires that the unwelcome
conduct be ‘‘sufficiently severe or
pervasive’’ as to interfere with defined
features of the housing transaction: The
availability, sale, rental, or use or
enjoyment of a dwelling; the terms,
conditions, or privileges of the sale or
rental, or the provision or enjoyment of
services or facilities in connection
therewith; or the availability, terms or
conditions of a residential real estaterelated transaction.
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Issue: A commenter recommended
that the final rule recognize the role of
preferential treatment for services and
living arrangements, except when
provided because of disability, as a type
of discrimination. The commenter said
that preferential treatment is a means
through which to encourage and reward
secondary actors for their role in
creating a hostile environment, and the
rule should recognize it as such. The
commenter also recommended that
HUD request and make available data
regarding repairs or upgrades so any
non-monetary favor in exchange for
harassment, by an agent not directly
employed by the management or owner,
may be determined.
HUD Response: HUD declines to
adopt the commenter’s suggestions
because the rule as currently proposed
already accommodates the commenter’s
concerns. Providing preferential
treatment that creates a hostile
environment because of race, color,
religion, sex, familial status, or national
origin already violates the Fair Housing
Act under the standards proposed in the
rule. Moreover, HUD’s regulations
already contain illustrations as to this
type of violation. Therefore, additional
language regarding preferential
treatment is not needed. In addition,
processes for requesting and making
available data regarding repairs or
upgrades are outside the scope of this
rule. HUD notes that in investigations,
it requests data regarding repairs or
upgrades as appropriate to determine
whether a violation of the Fair Housing
Act has occurred.
Issue: Two commenters asked
whether the rule would apply to
situations in which residential property
managers or other employees of a
housing provider are harassed by the
housing provider’s tenants. One of the
commenters explained that she was a
resident of the building she managed,
that she had a disability, and that she
had suffered harassment and threats by
other residents.
HUD Response: The proposed
standards generally would not apply to
situations in which a property manager
or other housing provider employee is
harassed by the housing provider’s
tenants because such situations
ordinarily do not involve a housingrelated transaction covered by the Act.
Where, however, a property manager is
also a resident of the building that the
property manager manages (e.g., a
resident-manager), the property manager
is entitled to the same protection from
discriminatory harassment under the
Act and under this final rule as any
other resident. Additionally, Section
818 of the Act makes it unlawful to
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coerce, intimidate, threaten, or interfere
with any person on account of the
person having assisted others in
enjoying or exercising their fair housing
rights. Therefore, to the extent that a
property manager or other housing
provider employee (whether a resident
or not) is subjected to coercion,
intimidation, threats, or interference
because he or she aided or encouraged
other people in exercising or enjoying a
right protected by the Act—e.g., by
receiving and responding to one tenant’s
complaint of discriminatory harassment
by another tenant—the manager or
employee may be entitled to protection
under the Act.25
i. Totality of the Circumstances:
§ 100.600(a)(2)(i)
Issue: Some commenters requested
that HUD clarify the definition of
‘‘totality of the circumstances’’ in
§ 100.600(a)(2)(i) because, in the
commenters’ view, the proposed rule
does not sufficiently explain the
showing required to prove hostile
environment harassment in violation of
the Fair Housing Act. Other commenters
supported HUD’s standard for
determining whether conduct
constitutes a hostile environment,
stating that the standard and its factors
are clear and permit an appropriately
individualized assessment of the facts of
each case. These commenters stated that
the rule’s explanation of hostile
environment harassment provides
meaningful guidance to both housing
providers and potential claimants.
HUD Response: HUD believes the
‘‘totality of the circumstances’’ standard
in this final rule provides an
appropriate standard for assessing
claims of hostile environment
harassment, while also providing courts
with the flexibility to consider the
numerous and varied factual
circumstances that may be relevant
when assessing a specific claim. HUD
therefore chooses not to alter the
definition of the term ‘‘totality of the
circumstances,’’ although it will add to
the final rule the standard by which the
evidence is to be evaluated, which is
from the perspective of a reasonable
person in the aggrieved person’s
position. Section 100.600(a)(2) defines
what constitutes hostile environment
harassment under the Act. In
accordance with this provision,
establishing a hostile environment
harassment violation requires proving
that: A person was subjected to
unwelcome spoken, written, or physical
25 A property manager may also be protected by
Title VII, whether or not he or she resides at the
housing.
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conduct; the conduct was because of a
protected characteristic; and the
conduct was, considering the totality of
the circumstances, sufficiently severe or
pervasive as to interfere with or deprive
the victim of his or her right to use and
enjoy the housing or to exercise other
rights protected by the Act. Whether a
hostile environment harassment
violation has occurred is a fact-specific
inquiry, and the rule supplies a nonexhaustive list of factors that must be
considered in making that
determination. It would be impossible
to quantify in the rule the amount of
evidence necessary to make such a
showing in every case involving a claim
of hostile environment harassment. The
additional instruction in the rule text,
and not just the preamble, that the
‘‘totality of the circumstances’’ is to be
evaluated from the perspective of a
reasonable person in the aggrieved
person’s position will aid all parties in
assessing whether a ‘‘hostile
environment’’ has been created.
Issue: HUD received several
comments regarding the explanation in
the preamble to the proposed rule that
hostile environment harassment should
be assessed from the perspective of a
reasonable person in the aggrieved
person’s position. A commenter
expressed concern that this standard is
too subjective, stating that one
reasonable person’s measure may be
different from another reasonable
person’s measure. Another commenter
asked HUD to provide a definition of the
term ‘‘reasonable person.’’ Other
commenters approved of the standard
articulated in the preamble to the
proposed rule and commended HUD for
recognizing that the reasonable person
standard must take into account the
circumstances of the aggrieved person.
A commenter recommended that the
rule text itself explicitly state this
objective standard. Another commenter,
however, recommended that HUD not
add the standard to the rule text itself
because such addition may invite courts
to second-guess the rationality and
behavior of the actual victim, rather
than focusing on the conduct and its
surrounding circumstances.
HUD Response: As HUD explained in
the preamble to the proposed rule,
whether unwelcome conduct is
sufficiently severe or pervasive to create
a hostile housing environment is
evaluated from the perspective of a
reasonable person in the aggrieved
person’s position. This standard is an
objective one, but ensures that an
assessment of the totality of the
circumstances includes consideration of
whether persons of the same protected
class and of like personal experience as
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the plaintiff or complainant would find
the challenged conduct to create a
hostile environment. At the proposed
rule stage, HUD chose not to add the
‘‘reasonable person in the aggrieved
person’s position’’ standard to the text
of the rule itself. But in light of the
confusion expressed by some of the
commenters, HUD has added this
standard to the text of the final rule
discussing the totality of the
circumstances standard. In adding this
reasonable person standard for assessing
the evidence to the rule text, HUD does
not intend to create an additional
requirement for proving a hostile
environment harassment claim beyond
the showing required under
§ 100.600(a)(2) of the rule. The
definition of hostile environment
harassment in this final rule remains
unchanged and focuses on defining the
types of conduct that may establish a
claim of hostile environment
harassment under the Fair Housing Act.
(A) Factors To Be Considered:
§ 100.600(a)(2)(i)(A)
Issue: Several commenters
commended HUD’s explanation in the
preamble to the proposed rule that
individuals have heightened rights
within their home for privacy and
freedom from unwelcome speech and
conduct. Many commenters agreed with
HUD that harassment in or around one’s
home can be far more intrusive,
violative, and threatening than
harassment in the more public
environment of one’s workplace. Some
commenters said these considerations
should be explicitly incorporated into
the text of the rule itself. Commenters
specifically requested that HUD revise
proposed § 100.600(a)(2)(i)(A) by adding
as a factor to be considered in
determining whether hostile
environment harassment exists ‘‘the
heightened rights in or around one’s
home for privacy and freedom from
harassment’’ or ‘‘the heightened
reasonable expectation of privacy and
freedom from harassment in one’s
home.’’ Another commenter said that
§ 100.600(a)(2)(i)(A) should expressly
state that conduct occurring in one’s
home may result in a violation of the
Fair Housing Act even though the same
conduct in one’s place of employment
may not violate Title VII.
HUD Response: HUD declines to add
language regarding individuals’
heightened rights within the home for
privacy and freedom from unwelcome
speech and conduct to the rule text in
§ 100.600(a)(2)(i)(A). The nonexhaustive list of factors included in
§ 100.600(a)(2)(i)(A) identifies
circumstances that can be demonstrated
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with evidence during the adjudication
of a claim of hostile environment
harassment under the Act. Evidence
regarding the ‘‘location of the conduct,’’
as explicitly identified in
§ 100.600(a)(2)(i)(A), is a critical factor
for consideration and will allow courts
to take into account the heightened
privacy and other rights that exist
within the home when determining
whether hostile environment
harassment occurred. For similar
reasons, HUD also declines to add
language stating that harassing conduct
may result in a violation of the Fair
Housing Act even though such conduct
might not violate Title VII. HUD
believes that by establishing a hostile
environment harassment standard
tailored to the specific rights protected
by the Fair Housing Act and by
directing that hostile environment
claims under the Act are to be evaluated
by assessing the totality of the
circumstances—including the location
of the unwelcome conduct and the
context in which it occurred—the final
rule ensures that courts consider factors
unique to the housing context when
making the fact-specific determination
of whether the particular conduct at
issue violates the Act. Therefore, while
HUD agrees that unwelcome conduct in
or around the home can be particularly
intrusive and threatening and may
violate the Fair Housing Act even
though the same or similar conduct in
an employment setting may not violate
Title VII, HUD does not believe the
proposed additions to
§ 100.600(a)(2)(i)(A) are necessary.
Issue: A commenter supported HUD’s
identification of the relationship of the
persons involved as a factor to be
considered when determining whether
hostile environment harassment has
occurred, but recommended that the
final rule further refine the concept.
Specifically, in the homeowner’s
association context, the commenter
drew distinctions between the
relationships among the different
resident-owners and between a board
member and a resident-owner. The
commenter also distinguished these
relationships from landlord-tenant
relationships.
HUD Response: HUD appreciates
these distinctions and believes the rule
already accommodates them by
requiring the relationship of the parties
involved be taken into account in
determining whether a hostile
environment has been created. This is
one of several factors that HUD
identified for evaluating allegations of
hostile environment harassment. In a
community governed by a homeowner’s
association, for example, the influence
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63063
an owner-board member has over
another resident by virtue of his or her
authority to make association policy, to
approve homeowner requests, and to
bring or adjudicate charges of
association rule violations may be
greater than a non-board member, and
thus each person’s relationship to the
victim should be considered when
assessing whether a hostile environment
exists. No further refinement to the rule
is necessary to address the commenter’s
concerns; nor is any further refinement
desirable, as it would risk inadvertently
inserting limiting factors into the
otherwise broad and flexible totality of
the circumstances test.
(B) Physiological or Physical Harm:
§ 100.600(a)(2)(i)(B)
Issue: A commenter stated that
§ 100.600(a)(2)(i)(B) of the proposed
rule, which concerns psychological or
physical harm, is confusing. The
commenter requested that HUD clarify
the meaning of this provision.
HUD Response: HUD agrees that
§ 100.600(a)(2)(i)(B) may be confusing
and has revised this provision at the
final rule stage; the revision is intended
to clarify without altering the meaning
of the provision. Proposed
§ 100.600(a)(2)(i)(B) provided that
‘‘Evidence of psychological or physical
harm is relevant in determining whether
a hostile environment was created, as
well as the amount of damages to which
an aggrieved person may be entitled.
Neither psychological nor physical
harm, however, must be demonstrated
to prove that a hostile environment
exists.’’ Final § 100.600(a)(2)(i)(B)
provides that ‘‘Neither psychological
nor physical harm must be
demonstrated to prove that a hostile
environment exists. Evidence of
psychological or physical harm may,
however, be relevant in determining
whether a hostile environment was
created and, if so, the amount of
damages to which an aggrieved person
may be entitled.’’ As explained at the
proposed rule stage, evidence of such
harm is but one of many factors that
may be considered in assessing the
totality of the circumstances. So long as
the unwelcome conduct is sufficiently
severe or pervasive as to interfere with
or deprive the victim of a right protected
by the Act, there is no need to also
demonstrate psychological or physical
injury in order to prove a hostile
environment violation.
ii. Title VII Affirmative Defense:
§ 100.600(a)(2)(ii)
Issue: HUD received several
comments on § 100.600(a)(2)(ii) of the
proposed rule, which provides that the
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Title VII affirmative defense to an
employer’s vicarious liability for hostile
environment harassment by a supervisor
does not apply to claims brought
pursuant to the Fair Housing Act.
Several commenters commended HUD’s
decision not to extend the Title VII
affirmative defense to the Fair Housing
Act and agreed with HUD that such a
defense would be inappropriate in the
housing context, in part because of the
lack of an exhaustion requirement under
the Fair Housing Act, as well as the
differences between an agent in the
employment context versus an agent in
the housing context.
Other commenters recommended that
HUD apply the judicially-created Title
VII affirmative defense to Fair Housing
Act claims. One such commenter stated
that HUD, by rule, cannot import a Title
VII cause of action onto the Fair
Housing Act without the judiciallycreated limitations on a Title VII
employer’s liability under that cause of
action. Another commenter believed
that HUD eliminated an existing
affirmative defense for housing
providers that is available in the
employment context. Given the scope of
potential harassment claims, this
commenter found unwarranted HUD’s
position that the Title VII affirmative
defense is not relevant to harassment in
the housing context because, in HUD’s
view, a housing agent who harasses
residents is inevitably aided by his or
her agency relationship with the
housing provider. In the commenter’s
view, a responsible housing provider
who exercises reasonable care to
prevent harassment, and who provides
a complaint mechanism that a resident
unreasonably fails to invoke, should be
afforded the same affirmative defense
available to employers in analogous
situations. Another commenter asked
HUD to reconsider its decision to reject
the affirmative defense as it appears
unfair and based on an assertion that
agents of housing providers are
equivalent to a supervisory employer in
terms of their power over applicants
and/or tenants.
HUD Response: After carefully
considering the analysis provided by the
commenters on both sides of the issue,
HUD has retained its view that the Title
VII affirmative defense is not
appropriate to include as a defense
under the Fair Housing Act. HUD has
never found occasion to employ such a
defense and remains unaware of any
court having extended the Title VII
affirmative defense to fair housing
claims, and commenters did not identify
any such case law. Moreover, unlike
Title VII, which requires employees to
exhaust their administrative remedies
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before filing an action in court, the Fair
Housing Act has no exhaustion
requirement, and nothing in the text of
the Fair Housing Act otherwise
indicates that Congress intended to
permit a housing provider to avoid
vicarious liability for discriminatory
harassment perpetrated by its agents by
establishing its own complaint process
or procedure. To the contrary, the Act
authorizes any aggrieved person to
directly commence a civil action in
federal or state court, whether or not the
individual has previously chosen to file
an administrative complaint with
HUD.26 Therefore, as explained in the
preamble to the proposed rule, the Title
VII affirmative defense is not
appropriately applied to harassment in
the housing context because its
adoption would impose burdens on
victims of discriminatory harassment
that are incompatible with the broad
protections and streamlined
enforcement mechanisms afforded by
the Fair Housing Act.
HUD notes that some comments on
this issue demonstrated a
misunderstanding of the potential scope
of the Title VII affirmative defense. The
Title VII affirmative defense does not
apply to harassment claims based on
direct liability. Thus, contrary to the
perceptions of some commenters, the
affirmative defense does not apply to
cases in which an employer—or housing
provider—knew or should have known
of an agent or third-party’s harassment
and failed to stop it, because such cases
involve direct rather than vicarious
liability.
Therefore, in exercising its power to
promulgate rules to interpret and carry
out the Act, HUD believes it would be
inappropriate to add, for the first time,
an affirmative defense that would
require victims of hostile environment
harassment—who are often housing
insecure or otherwise especially
vulnerable—to choose between the risk
of retaliation by the perpetrator and the
risk of losing their right to hold a
housing provider liable for the acts of its
agents. Instead, the traditional
principles of vicarious liability—
including those standards that hold a
principal liable for an agent’s conduct
that is taken within the scope of
employment, with the apparent
authority of the principal, or that is
otherwise aided by the agency
relationship—will continue to govern a
housing provider’s liability for
harassment. While HUD declines to
extend the Title VII affirmative defense
to the Fair Housing Act, the
development and dissemination of anti26 See
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harassment policies will still assist
housing providers to avoid litigation by
identifying and quickly addressing
improper conduct by employees or
other agents.
Issue: A commenter requested that
HUD create safe harbors from liability
for housing providers for harassment by
their agents and third-parties.
Specifically, the commenter stated that
liability for unknown and unintended
harassment by an agent or third-party
should not be imposed on a housing
provider where the housing provider:
(1) Provides periodic mandatory fair
housing training for its employees and
agents (including training related to
harassment claims); (2) requires
unaffiliated management companies to
conduct similar training of their
employees, report to the property owner
on a regular basis about the steps it is
taking to avoid fair housing claims
generally, and promptly report any
potential fair housing claim to a
designated official of the housing
provider; and (3) implements and
publicizes a hotline or other secure
communication mechanism whereby a
tenant can confidentially notify the
housing provider about possible
harassment by employees or other
tenants.
Another commenter expressed
concern that the rule as proposed would
expand a PHA’s exposure to liability by
making the PHA liable for perceived
hostile environment harassment that
occurs beyond its knowledge or control
and fails to create or incentivize any
new remedies to protect tenants against
hostile environment harassment. As a
result, according to the commenter, the
proposed rule raises the possibility that
future litigation over alleged harassment
might be driven by plaintiff attorneys’
fees rather than the merit of the
allegations or effective remedies. In light
of these concerns, the commenter
suggested that HUD revise the proposed
rule to adopt defenses similar to those
applicable to public agencies under
California state law for injuries caused
by dangerous conditions on the public
agency’s property. As described by the
commenter, the State law defense
provides that liability attaches to the
public agency if the plaintiff establishes
that: (1) The public employee’s
negligence or wrongful act or omission
created the dangerous condition; or (2)
the public entity had actual or
constructive notice of the dangerous
condition before the injury occurred.
The commenter believes this standard
incentivizes the public agency to
maintain its property and train its staff
in order to limit its exposure to liability
and reduce the risk of injuries.
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HUD Response: As explained in the
preamble to the proposed rule,
traditional principles of tort liability
and agency law apply in fair housing
cases. The standards for direct and
vicarious liability established in this
final rule continue to reflect such
principles and do not impose any new
legal obligations or create or define new
agency relationships or duties of care.
For the same reasons that HUD does not
interpret the Fair Housing Act to import
the Title VII affirmative defense for a
claim of hostile environment
harassment by the provider’s agent,
HUD does not believe the requested safe
harbor or state law-derived defense from
liability is appropriate.
The California State law identified by
the commenter essentially imposes a
negligence standard for public agency
liability, which is akin to the standard
of direct liability that governs Fair
Housing Act claims under
§ 100.7(a)(1)(ii). In addition, under
traditional principles of agency law, a
housing provider may be held
vicariously liable for the discriminatory
acts of an employee or agent regardless
of whether the housing provider knew
of or intended the discriminatory
conduct where the employee was acting
within scope of his or her agency, or
where the harassment was aided by the
agency relationship. HUD believes that
traditional tort and agency law
standards for assessing liability under
the Act will encourage housing
providers to provide appropriate
training for their staff and to ensure
compliance with the Act.
Issue: A commenter asserted that the
proposed rule, including HUD’s
decision not to adopt the Title VII
affirmative defense, raises Federalism
implications. The commenter stated that
the proposed rule creates a cause of
action based on Title VII law that could,
ostensibly, be brought against a State,
even when the actions are performed by
a city or other sub-recipient of funds,
and obviate the State’s sovereign
immunity despite its ongoing assertion
that it has not waived such sovereign
immunity. The commenter said that the
rule would do so while removing the
judicially-created Title VII affirmative
defense. The commenter recommended
that HUD withdraw the rule or create a
specific carve-out for actions against a
State that limits and defines the extent
of vicarious liability, including a safehaven for conduct or policy akin to an
affirmative defense.
HUD Response: Executive Order
13132 (entitled ‘‘Federalism’’) prohibits
an agency from publishing any rule that
has federalism implications if the rule
either (1) imposes substantial, direct
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compliance costs on state and local
governments and is not required by
statute, or (2) preempts state law, unless
the agency meets the consultation and
funding requirements of section 6 of the
Executive Order. Under the Executive
Order, Federalism implications are
those having substantial direct effects
on states or local governments
(individually or collectively), on the
relationship between the national
government and the states, or on the
distribution of power and
responsibilities among the various
levels of government. This final rule
does not have such implications. As
discussed elsewhere, the rule creates no
new cause of action, liability or
obligation on the part of any housing
provider, including a State. The rule
interprets the Fair Housing Act’s
prohibition on discriminatory
harassment, and in doing so, neither
alters the substantive prohibitions
against discrimination in the Act nor
creates enhanced liability or compliance
costs for States or any other entities or
individuals. Similarly, the rule does not
alter any sovereign immunity
protections that a State may have under
the Eleventh Amendment. In addition,
the rule does not remove a pre-existing
affirmative defense, because no court of
which HUD is aware has ever applied
the Title VII affirmative defense or any
other affirmative defense or safe harbor
to Fair Housing Act claims; nor has
HUD ever applied such a standard. HUD
notes further that creating an affirmative
defense or safe harbor for States would
not be consistent with Congressional
intent, for the reasons discussed above.
b. Type of Conduct: § 100.600(b)
Issue: A commenter inquired whether
a verbal or written account from an
aggrieved tenant would be enough to
comprise a showing of hostile
environment harassment under the Act.
HUD Response: A verbal or written
account from an aggrieved tenant may
be enough to provide notice to a
housing provider that a hostile
environment may be occurring, but
whether it would be sufficient to
establish that the conduct is sufficiently
severe or pervasive to create a hostile
environment depends on the totality of
the circumstances.
c. Number of Incidents: § 100.600(c)
Issue: A commenter expressed
concern that the proposed rule includes
both a ‘‘totality of the circumstances
standard’’ and a ‘‘single incident
standard’’ and asked HUD to provide
more descriptive language to determine
the existence of a hostile environment
based on such standards. The
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commenter asked HUD to clarify or
provide examples of when a single
incident of harassment would be
sufficient to create a hostile
environment. Several other commenters
expressed approval of § 100.600(c) of
the proposed rule, which provides that
a single incident of harassment because
of race, color, religion, sex, familial
status, national origin, or disability may
constitute a discriminatory housing
practice, where the incident is severe, or
evidences a quid pro quo. Other
commenters stated that in some cases a
single act can be so severe as to deprive
individuals of their right to use and
enjoy their housing.
HUD Response: HUD did not intend
to propose two different standards for
determining whether hostile
environment harassment has occurred.
To avoid confusion and better clarify
the relationship between § 100.600(c)
and § 100.600(a)(2), HUD is revising
§ 100.600(c) at this final rule stage.
Section 100.600(a)(2) of the rule
provides the only standard that must be
met to prove a claim of hostile
environment harassment under the
Act—namely, that: A person was
subjected to unwelcome spoken,
written, or physical conduct; the
conduct was because of a protected
characteristic; and the conduct was
sufficiently severe or pervasive as to
interfere with or deprive the victim of
his or her right to use and enjoy the
housing or to exercise other rights
protected by the Act. As provided in
§ 100.600(a)(2)(i), a determination of
whether this standard has been met is
to be based on the totality of the
circumstances. Section 100.600(c) is
included in the rule to make clear that
a single incident of harassment because
of a protected characteristic, if
sufficiently severe, can constitute a
hostile environment harassment
violation (as defined in § 100.600(a)(2)).
Whether a claim of hostile environment
harassment is based on a single incident
or repeated incidents of unwelcome
conduct, an assessment of the totality of
the circumstances is still required. For
example, the nature of the unwelcome
conduct (e.g., whether it was spoken,
written and/or physical) and the
location of the conduct (e.g., whether it
occurred inside the victim’s apartment
or in a common space), among other
potential considerations, would factor
into an assessment of whether a single
incident of harassment was sufficiently
severe to interfere with or deprive the
victim of his or her right to use and
enjoy the housing or to exercise other
rights protected by the Act.
HUD is revising proposed § 100.600(c)
at this final rule stage as follows.
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Proposed § 100.600(c) provided that: ‘‘A
single incident of harassment because of
race, color, religion, sex, familial status,
national origin, or handicap may
constitute a discriminatory housing
practice, where the incident is severe, or
evidences a quid pro quo.’’ Final
§ 100.600(c) now provides: ‘‘A single
incident of harassment because of race,
color, religion, sex, familial status,
national origin, or handicap may
constitute a discriminatory housing
practice, where the incident is
sufficiently severe to create a hostile
environment, or evidences a quid pro
quo.’’
B. Illustrations: §§ 100.60, 100.65,
100.80, 100.90, 100.120, 100.130, and
100.135
Issue: Several commenters supported
the illustrations included throughout
the proposed rule and asked HUD to
provide additional examples of
prohibited practices in the final rule.
They requested more examples of:
Unwelcome conduct; how quid pro quo
harassment occurs with respect to
protected classes other than sex; single
incidents that constitute a hostile
environment; and when direct liability
exists. Commenters also recommended
that HUD add to the final rule examples
clarifying the relationship between age
and disability and add examples of
harassment of pregnant women,
Muslims, persons with limited English
proficiency, persons with mental healthrelated disabilities or HIV/AIDS, and
persons who assert their rights to
organize. Another commenter stated
that HUD has provided useful
illustrations of what does not violate the
Act in other fair housing contexts, and
requested that HUD do the same here,
citing 24 CFR 100.205(b) (concerning
the impracticality of meeting the Act’s
design and construction standards).
HUD Response: HUD retains the
illustrations contained in the proposed
rule, but otherwise declines to add more
illustrations to the final rule. The rule
contains numerous illustrations of
possible quid pro quo and hostile
environment harassment referencing all
protected classes. But whether illegal
harassment has or has not occurred in
a particular situation is fact-specific and
must be determined on a case-by-case
basis. For this reason, the illustrations
provided are simply more specific
descriptions of the legal standard, e.g.,
conditioning the availability of housing
on a person’s response to sexual
harassment illustrates an unlawful
refusal to sell or rent. Providing
illustrations as to what does not violate
the Act would not be appropriate
because of the necessarily fact-specific
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nature of such an inquiry. HUD notes
that § 100.205(b), which the commenter
cited, does not describe conduct that
does not violate the Act, but rather
provides examples of when the
impracticality exception to the Act’s
design and construction requirements is
applicable. Lastly, some of the suggested
examples are outside the scope of the
Act, e.g., the right to organize, but HUD
notes that persons would be protected
by the Act to the extent the harassment
is because of their race, color, religion,
sex, familial status, national origin, or
disability.
C. Liability for Discriminatory Housing
Practices: § 100.7
a. Direct Liability for One’s Own
Discriminatory Conduct: § 100.7(a)(1)(i)
Issue: A commenter stated that the
language in § 100.7(a)(1)(i), which states
that a person is directly liable for the
person’s own conduct that results in a
discriminatory housing practice, may
lead to the liability of innocent actors
and third-parties who somehow
contributed to an illegal discriminatory
action. The commenter gave as an
example a situation in which a person
supplied the pen that a housing
provider used to make notes on an
application that the housing provider
later rejected because of a protected
characteristic of the applicant.
HUD Response: The rule creates no
new or enhanced forms of liability. As
discussed in the preamble of the
proposed rule, § 100.7(a)(1)(i) does
nothing more than restate the most basic
form of direct liability, i.e., that a person
is directly liable for his or her own
discriminatory housing practices, as
defined by the Act. Whether a person’s
conduct constitutes a discriminatory
housing practice under sections 804–
806 or 818 of the Act depends upon the
specific facts.
b. Direct Liability for Negligent Failure
To Correct and End Discrimination:
§ 100.7(a)(1)(ii) and (iii)
Issue: Several commenters expressed
concern about the ‘‘should have known’’
standard in proposed § 100.7(a)(1)(ii)
and (iii), which states that a person is
directly liable for ‘‘(ii) [f]ailing to take
prompt action to correct and end a
discriminatory housing practice by that
person’s employee or agent, where the
person knew or should have known of
the discriminatory conduct,’’ and ‘‘(iii)
[f]ailing to fulfill a duty to take prompt
action to correct and end a
discriminatory housing practice by a
third-party, where the person knew or
should have known of the
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discriminatory conduct . . . ’’
(emphasis added).
Some commenters stated that this
standard creates almost certain liability
for landlords and that requiring actual
knowledge would be more fair to
property owners because liability would
only attach for failing to act on known
discrimination. A commenter stated that
the final rule should limit liability
where a housing provider has limited
knowledge of misconduct. In contrast,
other commenters stated that the ‘‘knew
or should have known’’ standard is
reasonable and consistent with the Fair
Housing Act, legal negligence
principles, and business practices of
housing providers. One commenter
complained that the proposed rule
appears to require actual knowledge,
even though the standard only requires
that a defendant ‘‘should have known’’
of the harassment.
Commenters asked HUD to clarify
how a housing provider ‘‘should have
known’’ about harassment, especially in
the context of tenant-on-tenant
harassment. A commenter questioned
what the housing provider needs to
know before liability attaches and
whether the housing provider needs to
know that the harasser’s actions violate
the Fair Housing Act or only that the
harasser took some action toward the
victim. Several commenters expressed
concern that a PHA might be liable
when a housing voucher holder is
harassed but neither the apartment
owner nor voucher holder informs the
housing agency about the harassment.
One commenter expressed a similar
concern that owners living in another
city or state may not learn that
harassment is taking place on their
property unless the tenant tells the
owner, and another commenter asked
about a PHA’s potential liability when
harassment occurs over the internet but
is unknown to the housing agency.
HUD Response: The ‘‘knew or should
have known’’ standard is well
established in civil rights and tort law.27
A housing provider ‘‘should have
known’’ of the harassment of one
resident by another when the housing
provider had knowledge from which a
reasonable person would conclude that
the harassment was occurring. Such
knowledge can come from, for example,
the harassed resident, another resident,
27 As the Supreme Court has recognized, fair
housing actions are essentially tort actions. See
Meyer v. Holley, 537 U.S. 280, 285 (2003) (citing
Curtis v. Loether, 415 U.S. 189, 195–96 (1974)); see
also Burlington Indus. v. Ellerth, 524 U.S. 742, 759
(‘‘An employer is negligent with respect to sexual
harassment if it knew or should have known about
the conduct and failed to stop it. Negligence sets a
minimum standard for employer liability under
Title VII. . . .’’) (emphasis added).
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or a friend of the harassed resident.28
There is no requirement that the
resident contact the housing provider
about the harassment, only that the
housing provider have knowledge from
which a reasonable person would
conclude that harassment was
occurring. If the housing provider has
no information from which a reasonable
person would conclude that one
resident or a third-party was harassing
another resident, the housing provider
is not liable for failing to take action to
correct and end the harassment. If the
knowledge component is not met, a
housing provider cannot be held liable
for a resident’s or third-party’s
discriminatory conduct. HUD disagrees
that this standard will subject landlords
to certain liability. Application of this
standard to the liability provisions of
the rule helps clarify the Act’s coverage
for residents and housing providers. It is
intended to help guide housing
providers in their assessment of when to
intervene to prevent or end
discriminatory conduct. HUD
encourages housing providers to create
safe, welcoming, and responsive
housing environments by regularly
training staff, developing and
publicizing anti-discrimination policies,
and acting quickly to resolve complaints
once sufficient information exists that
would lead a reasonable person to
conclude that harassment was
occurring.
Issue: A commenter was concerned
that § 100.7(a)(1)(ii) is seeking to hold
the agent liable for the actions of its
principal, contrary to Supreme Court
precedent, and asked why this provision
is necessary in light of proposed
§ 100.7(b) (vicarious liability), which
states that the housing provider is
already liable for the unlawful actions of
the agent, whether known or not.
HUD Response: Section 100.7(a)(1)(ii)
addresses a principal’s direct liability
for the principal’s own negligent
conduct in overseeing (or failing to
oversee) its agent or employee. Under
the negligence theory of direct liability,
the principal is liable only if the
principal knew or should have known
of the agent’s discriminatory conduct
and failed to take corrective action to
end it. Section 100.7(b), by contrast,
holds the principal vicariously liable for
the discriminatory conduct of its agent,
28 See, e.g., Neudecker v. Boisclair Corp., 351 F.3d
at 364 (owner may be liable for acts of tenants and
management’s children after failing to respond to
plaintiff’s complaints of harassment); Bradley v.
Carydale Enterprises, 707 F. Supp. 217 (E.D. Va.
1989) (finding that owners and managers’ failure to
address one tenant’s complaints of racial
harassment by another tenant stated a claim under
42 U.S.C. 1981 and 1982).
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regardless of whether the principal
knew or should have known of the
agent’s conduct. As the commenter
noted, an agent is not vicariously liable
for the principal’s conduct, but is
directly liable for his or her own
actions. Section 100.7 does not create
liability that does not already exist; it
does not hold the agent liable for the
conduct of the principal, and it is
entirely consistent with traditional
agency principles and Supreme Court
precedent.
Issue: A commenter asked for
clarification of the term ‘‘third-party’’ in
§ 100.7(a)(1)(iii). The commenter was
concerned that if left undefined, the
term would include everyone. The
commenter asked HUD to limit the term
to what the commenter perceived to be
HUD’s primary concern—‘‘liability
resulting from a landlord’s failure to
assist a tenant subject to another
tenant’s harassment.’’
HUD Response: HUD does not agree
that its use of the term ‘‘third-party’’
requires further clarification in the text
of the rule. In the context of the rule,
liability for discriminatory conduct by a
‘‘third-party’’ is appropriately limited to
a non-employee or non-agent who
engaged in quid pro quo or hostile
environment harassment of which the
housing provider knew or should have
known and had the power to correct.
Issue: A commenter stated that it is
unclear from the proposed rule whether
the obligation in proposed
§ 100.7(a)(1)(iii) to take action to end a
discriminatory housing practice by a
third-party must be derived from a
contract, lease, or law, or whether it
could be derived from these sources.
The commenter also requested that HUD
clarify in the rule whether generic lease
provisions related to the use and
enjoyment of one’s home that are found
in almost every lease would be enough
to create the obligation and related
liability contemplated in
§ 100.7(a)(1)(iii). Another commenter
expressed a concern that housing
providers would take steps to minimize
their liability for failing to take
corrective action by revising their leases
and other documents so that they do not
create a duty to protect tenants. A
commenter expressed concern that the
term ‘‘duty,’’ incorporated from other
laws and contracts, is difficult to fully
assess and therefore bound to create
unanticipated consequences.
HUD Response: HUD recognizes that
proposed § 100.7(a)(1)(iii) may have
caused some confusion, so HUD has
reworded the provision in the final rule.
Proposed § 100.7(a)(1)(iii) stated that a
person is directly liable for ‘‘failing to
fulfill a duty to take prompt action to
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correct and end a discriminatory
housing practice by a third-party, where
the person knew or should have known
of the discriminatory conduct. The duty
to take prompt action to correct and end
a discriminatory housing practice by a
third-party derives from an obligation to
the aggrieved person created by contract
or lease (including bylaws or other rules
of a homeowner’s association,
condominium or cooperative), or by
federal, state or local law.’’ Revised
section 100.7(a)(1)(iii) of this final rule
provides that a person is directly liable
for ‘‘failing to take prompt action to
correct and end a discriminatory
housing practice by a third-party, where
the person knew or should have known
of the discriminatory conduct and had
the power to correct it. The power to
take prompt action to correct a
discriminatory housing practice by a
third-party depends upon the extent of
control or any other legal responsibility
the person may have with respect to the
conduct of such third-party.’’ The final
rule does not use the term ‘‘duty,’’ and
no longer identifies specific categories
of potential sources for such a duty. A
housing provider’s obligation to take
prompt action to correct and end a
discriminatory housing practice by a
third-party derives from the Fair
Housing Act itself, and its liability for
not correcting the discriminatory
conduct of which it knew or should
have known depends upon the extent of
the housing provider’s control or any
other legal responsibility the provider
may have with respect to the conduct of
such third-party.29 For example, when a
housing provider enters into a lease
agreement with a tenant, the lease
typically obligates the housing provider
to exercise reasonable care to protect the
residents’ safety and curtail unlawful
conduct in areas under the housing
provider’s control, whether or not the
lease contains specific language creating
that responsibility. Even if the lease
does not expressly create such
obligations, the power to act may derive
from other legal responsibilities or the
operation of law.30
29 See, e.g., Neudecker v. Boisclair Corp., 351 F.
3d at 364 (owner may be liable for acts of tenants
and management’s children after failing to respond
to plaintiff’s complaints of harassment); Fahnbulleh
v. GFZ Realty, LLC, 795 F. Supp. 2d 360, 364–65
(D. Md. 2011) (denying landlord’s motion to
dismiss because the Act imposes no categorical rule
against landlord liability for tenant-on-tenant
harassment); Reeves v. Carrollsburg Condo. Unit
Owners Ass’n, 1997 U.S. Dist. LEXIS 21762, *26
(D.D.C. 1997) (condo association that knew of
harassment by resident but failed to take corrective
actions may violate Act).
30 See, e.g., Wilstein v. San Tropai Condo. Master
Ass’n, 1999 U.S. Dist. LEXIS 7031, *28–33 (N.D. Ill.
Apr. 21, 1999) (rejecting condo association’s
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Issue: A commenter expressed
concern that proposed § 100.7(a)(1)(iii)
creates liability on the part of a
community association (homeowner
association, condominium or
cooperative) for the illegal acts of
residents over whom they have no
control. The commenter urged HUD to
remove or revise the proposed rule’s
extension of direct liability to
community associations for the
discriminatory actions of non-agents.
The commenter stated that community
associations generally lack legal
authority to mandate that residents take
actions described in the preamble of the
proposed rule because the associations
cannot evict homeowners or otherwise
impose conditions not specifically
authorized by the association’s
covenants, conditions, and restrictions
(CC&Rs) or state law. The commenter
suggested that if the language in
§ 100.7(a)(1)(iii) remains, it should be
modified to clearly state which terms
and conditions in association bylaws
and regulations constitute a duty on the
part of an association or its agents to
investigate and punish residents for
illegal discriminatory housing practices.
HUD Response: As noted above, HUD
has slightly revised § 100.7(a)(1)(iii) to
clarify that a housing provider is liable
under the Fair Housing Act for thirdparty conduct if the provider knew or
should have known of the
discriminatory conduct, has the power
to correct it, and failed to do so. HUD
also notes that the rule does not add any
new forms of liability under the Act or
create obligations that do not otherwise
exist. The rule does not impose
vicarious liability (see § 100.7(b)) on a
community association for the actions of
persons who are not its agents. Section
100.7(a)(1)(ii) describes a community
association’s liability for its own
negligent supervision of its agents, and
§ 100.7(a)(1)(iii) describes a community
association’s liability for its own
negligence for failing to take prompt
action to correct and end a
discriminatory housing practice by a
third-party. With respect to
§ 100.7(a)(1)(iii), the rule requires that
when a community association has the
power to act to correct a discriminatory
housing practice by a third party of
argument that it had no duty to stop harassment of
plaintiff by other residents and holding that
association could be liable where evidence
indicated that association knew of the harassment
and bylaws authorized the association to regulate
such conduct); see also Bradley v. Carydale
Enterprises, 707 F. Supp. 217 (E.D. Va. 1989)
(finding that owners and managers’ failure to
address one tenant’s racial harassment of a
neighboring tenant states a claim under 42 U.S.C.
1981, 1982).
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which it knows or should have known,
the community association must do so.
As the commenter recognizes, a
community association generally has
the power to respond to third-party
harassment by imposing conditions
authorized by the association’s CC&Rs
or by other legal authority.31
Community associations regularly
require residents to comply with CC&Rs
and community rules through such
mechanisms as notices of violations,
threats of fines, and fines. HUD
understands that community
associations may not always have the
ability to deny a unit owner access to
his or her dwelling; the rule merely
requires the community association to
take whatever actions it legally can take
to end the harassing conduct.
Issue: A few commenters suggested
that HUD should reconsider imposing
liability on a landlord for tenant-ontenant harassment because the law in
this area is not well-settled. The
commenters expressed concern that
proposed § 100.7(a)(1)(iii) exceeds the
scope of the Act by expanding liability
for housing providers to include
liability for third-party harassment of a
resident when the housing provider did
not act with discriminatory intent. One
commenter, relying on Title VII case law
and an interpretation of the phrase
‘‘because of,’’ stated that a landlord
must have acted with discriminatory
intent in order to be liable under the
Fair Housing Act. Another commenter
stated that although section 804(a) of the
Fair Housing Act does not require a
showing of intentional discrimination,
claims brought under sections 804(b)
and 817 of the Act do, citing Francis v.
King Park Manor, Inc., 91 F. Supp. 3d
420 (E.D.N.Y. 2015). Another comment
stated that to establish a housing
provider’s liability for failing to take
action to correct third-party harassment,
the plaintiff must show not just that the
housing provider failed to correct the
harassment but also that the housing
provider did so because of animus
against the victim due to a protected
characteristic. A commenter pointed to
Lawrence v. Courtyards of Deerwood
31 See, e.g., Wilstein v. San Tropai Condo. Master
Ass’n, supra*28–33; Reeves v. Carrollsburg Condo.
Unit Owners Ass’n, 1997 U.S. Dist. LEXIS 21762,
*26. See also Freeman v. Dal-Tile Corp., 750 F. 3d
413, 422–23 (4th Cir. 2014) (holding that ‘‘an
employer is liable under Title VII for third parties
creating a hostile work environment if the employer
knew or should have known of the harassment and
failed to take prompt remedial action reasonably
calculated to end [it].’’) (internal quotation marks
and citations omitted); Galdamez v. Potter, 415 F.
3d 1015, 1022 (9th Cir. 2005) (‘‘An employer may
be held liable for the actionable third-party
harassment of its employees where it ratifies or
condones the conduct by failing to investigate and
remedy it after learning of it.’’).
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Ass’n, Inc., 318 F. Supp. 2d 1133 (S.D.
Fla. 2004), as an example of a case in
which the court dismissed the fair
housing claim against the housing
provider because the plaintiffs failed to
establish that the housing provider’s
ineffective response to the harassment
was due to racial animus. Commenters
also pointed to Ohio Civil Rights
Comm’n v. Akron Metro. Hous. Auth.,
892 NE.2d 415, 420 (Ohio 2008), in
which the court declined to impose
liability on landlords for failing to take
corrective action in response to
discriminatory harassment committed
by the landlord’s tenants. A commenter
also suggested that not requiring
discriminatory animus on the part of the
housing provider would amount to strict
liability. The commenters proposed that
in light of these contrary federal and
state court decisions, HUD should
require proof of some degree of animus
by the housing provider before
subjecting the provider to direct liability
for the acts of third parties.
HUD Response: HUD does not agree
that a housing provider’s failure to act
to correct third-party harassment must
be motivated by a discriminatory intent
or animus before the provider can be
held liable for a Fair Housing Act
violation. In reaching this conclusion,
HUD considered its own experience in
administering and enforcing the Fair
Housing Act, the broad remedial
purposes of the Act,32 relevant case law
including the Supreme Court’s recent
ruling in Texas Department of
Community Affairs v. Inclusive
Communities Project, Inc. holding that
the Fair Housing Act is not limited to
claims of intentional discrimination,
and the views of the EEOC regarding
Title VII. The case law cited by the
commenters fails to support the
proposition that the Fair Housing Act
requires discriminatory intent in order
to find a housing provider liable for its
negligent failure to correct resident-onresident or other third-party
discriminatory conduct. The district
court decision in Francis v. Kings Park
Manor is the sole exception to that
principle, and HUD disagrees with its
ruling. HUD notes that this decision is
on appeal to the Second Circuit.
Section 100.7(a)(1)(iii) sets out a
negligence standard of liability, which
does not require proof of discriminatory
32 See e.g., Havens Realty Corp. v. Coleman, 455
U.S. 363, 380 (1982) (Congress intended Fair
Housing Act to be broadly remedial); cf. Jones v.
Alfred H. Mayer Co., 392 U.S. 409, 413 (1968)
(describing the Fair Housing Act as ‘‘a
comprehensive open housing law’’); 42 U.S.C. 3601
(‘‘It is the policy of the United States to provide,
within constitutional limitations, for fair housing
throughout the United States.’’).
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intent or animus on the part of the
provider, but is far from strict liability.
Under this standard, a plaintiff or the
charging party must prove three
elements to establish a housing
provider’s liability for third-party
harassment: (1) The third-party created
a hostile environment for the plaintiff or
complainant; (2) the housing provider
knew or should have known about the
conduct creating the hostile
environment; and (3) the housing
provider failed to take prompt action to
correct and end the harassment while
having the power to do so. HUD does
not agree that a fourth element—that the
housing provider’s failure to act was
more than negligent, and was motivated
by discriminatory intent—is necessary
or appropriate.
Contrary to one comment, the
Supreme Court in Inclusive
Communities Project has already ruled
that the ‘‘because of’’ clause in the Fair
Housing Act does not require proof of
discriminatory intent. While not
addressing every aspect of the cited
decisions, HUD notes the following: In
Lawrence v. Courtyards of Deerwood
Ass’n, cited by another commenter, the
court dismissed the discriminatory
harassment claim not for lack of
discriminatory intent on the part of the
landlord, but because it found, inter
alia, that the dispute did not involve
discriminatory harassment of one tenant
by another but instead reflected mutual
antagonism between two tenants. The
court in Lawrence distinguished Reeves
v. Carrollsburg Condo. Unit Owners
Ass’n, 1997 U.S. Dist. LEXIS 21762, *22
(D.D.C 1997), which held the landlord
liable under the Fair Housing Act for its
failure to adequately address sexual
harassment of one tenant by another
because ‘‘the [Carrollsburg Condo]
association’s by-laws specifically
authorized the association to curtail
conduct that contravened the law’’ and
provided that a violation of local or
federal law was a violation of the
association rules.33
Finally, the state court decision cited
by one commenter did not involve
claims under the Fair Housing Act and
does not provide reason for HUD to alter
§ 100.7(a)(1)(iii) at the final rule stage. In
Ohio Civil Rights Commission v. Akron
Metropolitan Housing Authority, the
Ohio Supreme Court’s refusal to hold a
landlord liable under a state civil rights
law for failing to take corrective action
in response to one tenant’s racial
harassment of another tenant was
33 Lawrence v. Courtyards of Deerwood Ass’n, 318
F. Supp. 2d at 1149 (citing Reeves v. Carrollsburg
Condo. Unit Owners Ass’n, 1997 U.S. Dist. LEXIS
21762 at *22.
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premised on an incorrect reading of
Title VII jurisprudence. The court
misconstrued Title VII case law to
require an agency relationship between
an employer and a perpetrator of
harassment in order to hold the
employer liable for negligently failing to
stop sexual harassment by the
perpetrator.34 In fact, under Title VII, an
agency relationship is not required in
order to hold employers liable for
negligently failing to stop
discriminatory harassment of which the
employer knew or should have known.
Both the EEOC and the federal courts
have recognized that an employer may
be held liable for negligently failing to
stop discriminatory harassment in the
workplace by non-employees or nonagents.35 The principle of liability
codified in § 100.7(a)(1)(iii) of this final
rule is consistent with these Title VII
authorities and, in HUD’s view,
appropriately serves the Fair Housing
Act’s parallel antidiscrimination
objectives in the housing context. In
sum, the proposed rule and this final
rule reflect HUD’s considered judgment,
consistent with prevailing precedent
and EEOC regulations, that a housing
provider (including a homeowner’s
association) or property manager is
liable under the Act for negligently
failing to take corrective action against
a third-party harasser when the provider
or manager knew or should have known
of the harassment and had the power to
end it. In light of the above, HUD
declines to make the proposed revisions
to the final rule.
Issue: A commenter stated that the
imposition of liability on private
landlords for tenant-on-tenant
harassment is inappropriate and will
have several negative consequences.
The commenter stated that private
owners do not have the expertise or
resources to undertake what is
essentially a social services function to
mediate disputes between neighbors. In
addition, the commenter expressed
concern that the proposed rule could
make it more difficult and risky for
property owners to take affirmative
steps to operate racially integrated
34 892
NE.2d at 419–20.
29 CFR 1604.11(e) (‘‘An employer may also
be responsible for the acts of non-employees, with
respect to sexual harassment of employees in the
workplace, where there employer (or its agents or
supervisory employees) knows or should have
known of the conduct and fails to take immediate
and appropriate corrective action.’’); see also, e.g.,
Freeman v. Dal-Tile Corp., 750 F.3d 413, 422–24
(4th Cir. 2014) (employer potentially liable for
failing to address discriminatory harassment by a
customer); Lockard v. Pizza Hut, Inc., 162 F.3d
1062, 1072–75 (10th Cir. 1998) (same; collecting
cases recognizing employer liability for failing to
correct third-party harassment).
35 See
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housing. The commenter stated that the
rule will be an economic disincentive
for individuals, companies, and other
investors to engage in the business of
renting residential real estate and that
the Section 8 voucher program depends
on the participation of these private
entities in order to achieve other fair
housing goals. The commenter
expressed concern that the effect of the
proposed rule will be to reduce the
supply of available affordable units,
thus disproportionately harming lowincome families. Other commenters
raised concerns that landlords, when
confronted by tenants who mutually
accuse each other of harassment, will be
unable to take necessary corrective
actions because of the rule’s prohibition
against moving or causing injury to a
complaining tenant, or will reprimand
the wrong tenant because they lack
expertise with investigations.
Numerous other commenters
supported the rule’s recognition that a
housing provider may be directly liable
for harassment of a tenant by the
housing provider’s employee or a thirdparty. These commenters stated that any
suggestion that this rule will unduly
burden housing providers is
exaggerated, that the rule is wholly
consistent with the ordinary
responsibilities of housing providers to
ensure habitability, and that housing
providers are familiar with the tools
they have to enforce their own rules—
tools they frequently wield.
HUD Response: The rule does not
create new or enhanced liabilities for
housing providers, including those who
participate in the Section 8 program.
HUD believes that this rule will help
clarify the obligations that housing
providers already have in offering and
maintaining housing environments free
from discrimination and that comply
with the Fair Housing Act. We are long
past the time when racial harassment is
a tolerable price for integrated housing;
a housing provider is responsible for
maintaining its properties free from all
discrimination prohibited by the Fair
Housing Act. Under the Act,
discriminatory practices are those that
violate sections 804, 805, 806, or 818.
Such practices do not encompass all
incivilities, and thus it is important to
note that not every quarrel among
neighbors amounts to a violation of the
Fair Housing Act.36 Ending harassing or
36 See, e.g., Bloch v. Frischholz, 587 F.3d at 783
(quoting Halprin v. Prairie Single Family Homes of
Dearborn Park Ass’n, 388 F.3d 327, 330 (7th Cir.
2004) (noting that interference under § 818 ‘‘is more
than a ‘quarrel among neighbors’ ’’); Sporn v. Ocean
Colony Condominium Assn, 173 F. Supp. 2d 244,
251–52 (D.N.J. 2001) (noting that section 818 ‘‘does
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otherwise discriminatory conduct may
necessitate evicting the tenant who has
engaged in the conduct, not the
aggrieved tenant.37 The Act does not,
however, prohibit housing providers
from offering to move an aggrieved
tenant, as long as that tenant may refuse
the offer without consequence or
retaliation.
Issue: Some commenters stated that
the proposed rule outlining third-party
liability conflicts with HUD’s PIH
Notice 2015–19, titled Guidance for
Public Housing Agencies (PHAs) and
Owners of Federally-Assisted Housing
on Excluding the Use of Arrest Records
in Housing Decisions. One commenter
was concerned that PIH Notice 2015–19
makes it harder for PHAs to correct
situations that may lead to hostile
environment harassment, while the
proposed harassment rule would make
it easier for PHAs to be held liable for
the activities of tenants who take actions
against other tenants to create a hostile
environment. Another commenter was
concerned that PHAs would be forced to
choose whether to comply with HUD’s
harassment rule or with HUD’s Notice,
which prohibits the use of an arrest
record as evidence of criminal activity
that can support an adverse admission,
termination, or eviction decision. These
commenters therefore asked HUD to
remove third-party liability from the
rule.
HUD Response: HUD believes the
commenters’ concerns are misplaced
because there is no conflict between this
rule and PIH Notice 2015–19. The rule
does not add any new forms of liability
under the Fair Housing Act and the
formalization of clear and consistent
standards for evaluating harassment
claims under the Act does not conflict
with the requirements of the PIH Notice.
Compliance with PIH Notice 2015–19
does not prevent a PHA from
considering reliable evidence of relevant
criminal activity when considering how
to respond to complaints of harassment.
Nor does this rule require a PHA to
make use of arrest records to determine
whether discriminatory harassment has
occurred. Consistent with traditional
not [] impose a code of civility’’ on neighbors);
United States v. Weisz, 914 F. Supp. 1050, 1054–
55 (S.D.N.Y. 1996) (holding that allegations that
Jewish neighbor harassed complainants because of
their religion were ‘‘nothing more than a series of
skirmishes in an unfortunate war between
neighbors’’). But see Ohana v. 180 Prospect Place,
996 F. Supp. 238, 243 (E.D.N.Y. 1998) (neighbors
who intentionally intrude upon quietude of
another’s home may violate Act).
37 See, e.g., Miller v. Towne Oaks East
Apartments, 797 F. Supp. 557, 562 (E.D. Tex.1992)
(finding landlord liable for violating Act by evicting
both harasser and victim of harassment instead of
only harasser).
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tort liability principles, as well as
current federal Fair Housing Act
jurisprudence, this rule codifies HUD’s
longstanding view that a property
owner, including a PHA, may be held
liable for failing to take corrective action
within its power in response to tenanton-tenant harassment of which the
owner knew or should have known.
Where a PHA receives a complaint or
otherwise learns of possible
discriminatory harassment of one
resident by another, the PHA is advised
to assess the situation and, if necessary,
take appropriate corrective action to end
the harassment.
Issue: Several commenters expressed
concern that application of the rule
would conflict with HUD’s homeless or
permanent supportive housing programs
or might have a detrimental effect on
persons with mental disabilities. A
commenter stated that tenants with
severe mental health disabilities may
create a hostile environment for
neighbors and asked HUD to explain
what direct responsibility the housing
provider has to correct negative
behaviors. A commenter stated that the
rule incentivizes evictions over efforts
to determine whether a reasonable
accommodation might be appropriate
for persons with mental disabilities.
Another commenter stated that because
tenants with mental illness often have
difficulty finding housing, the proposed
rule might result in an increased rate of
homelessness among persons with
mental disabilities. A commenter asked
HUD to revisit the proposed rule’s thirdparty liability provision to avoid
harming this particularly vulnerable
population.
Other commenters stated that the rule
would help protect many vulnerable
persons from eviction. These
commenters supported the statement in
the proposed rule’s preamble that
eviction is only one of the many
corrective actions housing providers
may utilize to address harassment.
HUD Response: The rule neither
changes a housing provider’s
responsibilities toward tenants with
mental disabilities nor incentivizes
evictions of such persons. It is not
uncommon for the behavior of one
tenant to frustrate, displease, or annoy
another tenant. This is true for behavior
by tenants with and without psychiatric
disabilities. The rule does not require a
housing provider to take action
whenever one tenant engages in
behavior that another tenant finds
objectionable. The Act prohibits
discrimination against applicants and
tenants with disabilities, including
evicting individuals with disabilities
because other tenants find them
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frustrating, displeasing, or annoying.
The Act does not, however, require that
a dwelling be made available to a person
whose tenancy would constitute a direct
threat to the health or safety of others or
would result in substantial physical
damage to the property of others.38 The
housing provider must make an
individualized assessment as to whether
such a threat exists based on reliable
objective evidence that considers: (1)
The nature, duration, and severity of the
risk of injury; (2) the probability that
injury will actually occur; and (3)
whether there are any reasonable
accommodations that will eliminate the
direct threat. In evaluating a recent
history of overt acts, a housing provider
must take into account whether the
individual has received intervening
treatment or medication that has
eliminated the direct threat. Reasonable
accommodations must be made when
they may be necessary to afford such
persons an equal opportunity to use and
enjoy a dwelling. HUD refers the reader
to the Joint Statement of HUD and DOJ
on Reasonable Accommodations under
the Fair Housing Act for further
information.39
1. Corrective Action: § 100.7(a)(2)
Issue: A commenter asked HUD to
remove the prohibition against causing
injury to a complaining party.
HUD Response: HUD declines to
remove the prohibition on causing
additional injury to a person who has
already been injured by illegal
harassment. Permitting such additional
injury would be inconsistent with the
Act’s purposes to prevent unlawful
discrimination and remedy
discrimination that has already
occurred.
Issue: One commenter requested
further guidance as to what constitutes
appropriate corrective action by a
housing provider to stop tenant-ontenant harassment. The commenter
specifically inquired whether a single
verbal statement by a landlord to a
tenant who allegedly engaged in
harassing conduct would be sufficient
corrective action to relieve a landlord
from liability under the rule. Another
commenter asked HUD to impose
realistic and reasonable limitations on
housing providers’ obligation to take
corrective action.
HUD Response: There is no one way
that a housing provider must respond to
complaints of third-party harassment,
38 42
U.S.C. 3604(f)(9).
Joint Statement of HUD and DOJ on
Reasonable Accommodations Under the Fair
Housing Act (May 17, 2004), posted at https://
www.hud.gov/offices/fheo/library/
huddojstatement.pdf.
39 See
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although the rule makes clear that a
provider that fails to effectively respond
may be subject to liability under the
Act. Section 100.7(a)(2) provides that
corrective actions must be effective in
ending the discrimination, but may not
injure the aggrieved persons. For
example, corrective actions appropriate
for a housing provider to utilize to stop
tenant-on-tenant harassment or other
third-party harassment might include
verbal and written warnings; enforcing
lease provisions to move, evict, or
otherwise sanction tenants who harass
or permit guests to harass; issuing notrespass orders against guests; or
reporting conduct to the police. What
constitutes appropriate and effective
corrective action will depend on the
nature, frequency, and severity of the
harassment. While in some cases a
single verbal reprimand by a housing
provider may be sufficient to effectively
end discriminatory harassment of one
tenant by another, the housing provider
should notify the victim that such
action was taken, and it is advisable for
the housing provider to document this
action in its records. Additionally, the
housing provider should follow up with
the victim of the harassment after the
corrective action is taken to ensure that
it was effective. If the housing provider
knows or should have known that the
corrective action was ineffective, the
provider has a responsibility to take
additional corrective actions within its
power. If, however, corrective action is
effective in ending the discriminatory
conduct, a housing provider is not
required to take additional action
simply because the victim believes
further action should have been taken.
HUD does not agree that there is a need
to add a specific limitation on a housing
provider’s responsibility to take
corrective action within its power to act
in response to discriminatory
harassment of which the provider knew
or should have known.
Issue: A commenter stated that
because tenants are not agents or
employees, landlords cannot simply
compel tenants to take or avoid
particular action and do not have the
ability to shape or alter tenants’
behavior beyond threatening and
carrying out evictions. Another
commenter asked HUD to consider that
there are substantial practical
differences between the ability of
housing providers to take corrective
action to end tenant-on-tenant
harassment and their ability to control
the actions of their employees because
there is no agency relationship in the
former. Another commenter stated that
most homeowners would be very
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concerned if association board
members, employees, or agents injected
themselves into the interpersonal
relationships of homeowners and
residents to investigate their
interactions and relationships for
discriminatory elements. This
commenter also said that for PHAs,
eviction is often unavailable as a
remedy for alleged tenant-on-tenant
harassment because the U.S. Housing
Act of 1937 and federal regulations limit
the ability of PHAs to carry out
evictions, except for specified causes. In
addition, the commenter stated that the
result of these restrictions and the
proposed rule would be to create
significant new liability for PHAs for
tenant-on-tenant harassment without
creating any new mechanisms for PHAs
to mitigate this liability.
In contrast, other commenters stated
that the rule does not create any new
liability because landlords have an
obligation to protect tenants’ rights to
quiet enjoyment and generally have the
right to take actions against renters and
occupants who disturb the quiet
enjoyment of others.
HUD Response: Neither the proposed
rule nor this final rule create new
liability for housing providers,
including PHAs or homeowner’s
associations, regarding resident-onresident harassment. Nor does the rule
require a housing provider to take action
that is beyond the scope of its power to
act. HUD recognizes that specific
remedies that may be available to
employers to stop an employee’s illegal
practices will be distinct from those that
a housing provider may use to stop
residents who are engaging in
discriminatory conduct. Creating and
posting policy statements against
harassment and establishing complaint
procedures, offering fair housing
training to residents and mediating
disputes before they escalate, issuing
verbal and written warnings and notices
of rule violations, enforcing bylaws
prohibiting illegal or disruptive
conduct, issuing and enforcing notices
to quit, issuing threats of eviction and,
if necessary, enforcing evictions and
involving the police are powerful tools
available to a housing provider to
control or remedy a tenant’s illegal
conduct. These tools are also available
to PHAs, and, contrary to one
commenter’s concern, eviction is
available to a PHA to correct a tenant’s
discriminatory conduct as the PHA may
terminate a tenancy for ‘‘serious or
repeated violation of material terms of
the lease,’’ 24 CFR 966.4(l)(2)(i), which
include the obligation that tenants must
‘‘act . . . in a manner which will not
disturb other residents’ peaceful
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63071
enjoyment of their
accommodations. . . .’’ 24 CFR
966.4(f)(11).
Issue: A commenter expressed
concern that a PHA may be held directly
liable for failing to correct actions by
third-parties over whom they have little
or no control. As an example, the
commenter cited harassment of a
voucher-holding tenant by neighbors
who are not also voucher-holders and
not otherwise affiliated with the PHA.
Similarly, another commenter stated
that the rule could be interpreted to
make landlords liable for conduct that
occurs off their property or that has
nothing to do with a tenant’s home.
HUD Response: This rule describes
the standard for assessing liability under
the Fair Housing Act. These fair housing
standards apply to private and public
landlords alike and do not turn on
whether a tenant holds a Housing
Choice Voucher or receives other
government rental assistance. HUD also
reiterates that a housing provider is not
responsible for correcting every negative
action by any third-party. Rather, the
third-party action must constitute a
discriminatory housing practice as
defined by the Act, and the housing
provider must have the power to correct
it. As provided in the final rule and
discussed elsewhere in this preamble,
whether a housing provider has the
power to take corrective measures in a
specific situation—and what corrective
measures are appropriate—is dependent
on the facts, including the extent of
control or any other legal responsibility
the person may have with respect to the
conduct of such third-party. There may
be instances where the ability to correct
the unlawful conduct is beyond a
housing provider’s control. Thus, when
confronted with discriminatory
harassment of one of its Housing Choice
Voucher-holders or other tenants, the
housing agency should explore what
corrective actions are within its power
and are appropriate to take.
Issue: A commenter suggested that an
unintended consequence of the
proposed rule could be that property
owners would remove security devices,
such as video cameras and other
surveillance mechanisms, for fear that
such measures may create a duty on the
part of the property owner to correct
neighbor-on-neighbor harassment. In
contrast, other commenters stated that
housing providers may feel the need to
provide for more oversight of residences
which may interfere with residents’
right to peaceful enjoyment of their
dwelling.
HUD Response: Removing security
devices will not relieve a housing
provider of its obligation to take the
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actions within its power to promptly
correct and end a discriminatory
housing practice. Elsewhere in the
preamble, HUD discusses various
options that may be available to housing
providers to address neighbor-onneighbor harassment.
Issue: A commenter stated that
owners should be encouraged to use
positive incentives, such as promoting
better communication with—and
healthy relationships among—tenants,
and educating tenants about their rights
to prevent harassment, instead of taking
corrective actions that may harm
tenants, such as ending a lease or
evicting a tenant—.
HUD Response: HUD agrees that
positive incentives are useful tools for
preventing harassment. HUD believes,
however, that warnings, threats of
evictions, evictions, and lease
terminations may also be necessary
corrective actions to end harassment.
The preamble and rule make clear that
there is no one way to prevent or correct
harassment, only that the methods need
to be effective at ending it.
c. Vicarious Liability: § 100.7(b)
Issue: Several commenters questioned
the description of vicarious liability at
§ 100.7(b) of the proposed rule. One
commenter said § 100.7(b) could be
interpreted to impose vicarious liability
on an organization’s directors, officers,
or owners and suggested HUD clarify,
consistent with Meyer v. Holley, that it
is the organization—not the individual
directors, officers, or board members—
who are the ‘‘principal or employer’’
subject to vicarious liability under the
Fair Housing Act. The commenter asked
HUD to issue clarification that the
proposed regulations do not contravene
or attempt to reverse Meyer v. Holley,
537 U.S. 280 (2003). In contrast, other
commenters applauded the description
of vicarious liability in the rule, stated
that the description follows wellestablished common law tort and
agency principles, and expressed
support for the proposed rule’s reliance
on Meyer v. Holley.
HUD Response: Subsection 100.7(b)
merely describes the well-established
concept of vicarious liability, under
which principals may be held liable for
the discriminatory acts of their agents or
employees whether or not they knew of
the discriminatory conduct. As
articulated in Meyer v. Holley, and as
explained in the preambles to the
proposed rule and this final rule,
traditional agency principles apply to
the Fair Housing Act.40 Under agency
principles, a principal is vicariously
40 537
U.S. at 282, 287.
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liable for the actions of his or her agents
taken within the scope of their
relationship or employment, or for
actions taken outside the scope of their
relationship or employment when the
agent is aided in the commission of
such acts by the existence of the agency
relationship.41 Determining whether an
agency relationship exists is a factual
determination that looks to an agent’s
responsibilities, duties, and functions;
whether the discriminatory conduct of
the agent was within the scope of the
agency relationship or aided by the
existence of the agency relationship is
also a fact-specific inquiry.
Issue: Some commenters questioned
the statement in the proposed rule’s
preamble that a principal is vicariously
liable for the actions of an agent or
employee taken outside the scope of the
agency relationship or employment
when the agent or employee is aided in
the commission of such acts by the
existence of the agency relationship. A
commenter agreed that a principal is
vicariously liable for the acts of its
agents committed within the scope of
the agency, regardless of knowledge or
intent to violate the Act by the
principal, but believes that, in adopting
the ‘‘aided in agency’’ standard, the
proposed rule goes beyond traditional
tort concepts and does not reflect the
limited concepts of vicarious liability
endorsed in Meyer v. Holley. The
commenter considered it acceptable to
hold a real estate company liable for
discriminatory acts or statements made
41 See, e.g., Glover v. Jones, 522 F. Supp. 2d 496,
507 (W.D.N.Y. 2007) (holding that ‘‘a property
owner may be vicariously liable under the Fair
Housing Act for the actions of an employee even
when they are outside the scope of employment
. . . if the employee was aided in accomplishing
the tort by the existence of the agency relation.’’)
(quoting Mack v. Otis Elevator Co., 326 F. 3d 116,
123 (2d Cir. 2003) (internal quotation marks
omitted); see also Boswell v. GumBayTay, No. 2:07–
CV–135–WKW[WO], 2009 U.S. Dist. LEXIS 45954,
*17 (M.D. Ala. June 1, 2009) (holding that vicarious
liability attached to property owner where property
manager’s ‘‘position essentially gave him unfettered
access to communicate with and personally visit
[the plaintiff]’’ and he ‘‘used his power as property
manager as a vehicle through which to perpetrate
his unlawful conduct by refusing repairs, raising
the rent, and attempting to evict [the plaintiff] as
a consequence for [her] refusal to provide sexual
favors.’’); Glover at 522 F. Supp. 2d at 507 (rejecting
defendant property owner’s motion for summary
judgment on the issue of vicarious liability where
evidence showed that property manager used his
‘‘position as the de facto landlord to perpetrate FHA
[harassment] violations . . . giving] him the
opportunity to visit the apartment when he wanted,
and enabl[ing] him to control Plaintiff’s rent’’);
Richards v. Bono, 2005 U.S. Dist. LEXIS 43585 at
*30 (holding that wife/co-owner of property could
be vicariously liable for husband’s harassment
where husband acted as her agent and used his
position as owner, property manager, and
maintenance supervisor to subject plaintiff to
sexual harassment by using a key to enter plaintiff’s
apartment and threatening plaintiff with eviction).
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by its brokers in the scope of their
agency, but disagreed that a housing
provider should be liable for
misconduct of a janitorial employee
outside the scope of that employee’s
duty because he wore a badged uniform
or possessed keys or passes to tenants’
dwellings. Another commenter asked
for clarity on the reasoning behind the
assertion in the preamble to the
proposed rule that an agent who
harasses residents or applicants is
necessarily aided by his or her agency
relationship with the housing provider.
HUD Response: As discussed
throughout this preamble, the proposed
and final rule do not create new forms
of liability. Instead, HUD has decided to
adopt well-established principles of
agency law, including that a principal
may be vicariously liable for the actions
of an agent or employee that are taken
outside the scope of the employment or
agency relationship if the agent or
employee is aided in committing the
acts by the existence of the employment
or agency relationship. Agency law
must be applied to the specific facts at
issue to determine whether such a
situation exists and gives rise to a
principal’s liability. The statement in
the proposed rule that an agent who
engages in hostile environment
harassment of residents or applicants is
aided by the agency relationship with
the housing provider was not intended
to suggest the agent is necessarily so
aided with respect to every
discriminatory housing practice. It was
intended to explain one of the reasons
HUD chose not to import into the Fair
Housing Act the Title VII affirmative
defense to an employer’s vicarious
liability for hostile environment
harassment. As explained in that
context, a housing provider’s agent who
engages in harassment holds a position
of power and authority over the
victimized resident or applicant,
regardless of the agent’s specific duties.
This is because a resident or applicant
has only an arms-length economic
relationship with the housing provider,
while an agent-perpetrator is clothed
with the authority of the housing
provider. Given this inherent imbalance
of power and control over the terms or
conditions of the housing environment,
the distinction between harassment by
supervisory and non-supervisory
employees that supported the creation
of the affirmative defense in the
employment context do not extend to
the housing context.
D. Other Issues
Issue: A commenter stated that HUD
should apply the proposed rule only to
its own investigative and administrative
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Federal Register / Vol. 81, No. 178 / Wednesday, September 14, 2016 / Rules and Regulations
actions and should not purport to
preempt court-established rules. The
commenter stated that in some instances
it may be appropriate for federal courts
to defer to agency rules, but that this is
not a case where Chevron 42 deference is
appropriate because HUD is not basing
the rule on its own experience, but
largely on interpretations of federal
court decisions. The commenter stated
that HUD has no particular expertise in
tort law and no authority to interpret
tort laws. Another commenter stated
that HUD appears to be using the
administrative rule-making process to
substitute its views for those of the
courts, and that HUD must pursue the
change it seeks through Congress and/or
the courts.
HUD Response: The commenters
misconstrue both the rule and HUD’s
authority under the Act. The Act
specifically grants the Secretary of HUD
the authority and responsibility to
administer and enforce the Act,
including promulgating rules to carry
out the Act.43 This rule-making
authority is not limited to HUD’s
investigations or administrative
proceedings. Moreover, the rule does
not construe tort law, but rather clarifies
standards for liability under this part,
based on traditional principles of tort
liability. It imposes no new legal
obligations or duties of care. In addition,
the introductory portion of this
preamble describes the grounds for
Chevron deference.
Issue: Some commenters disagreed
with HUD’s statement in the preamble
to the proposed rule that the rule does
not create additional costs for housing
providers and others covered by the Fair
Housing Act. They stated that the
proposed rule would lead to increased
costs for and litigation against housing
providers. Among the other costs cited
by commenters are costs for compliance
and training, increased insurance
premiums, and increased liability
because many housing providers would
not have the ability to remain diligent
to address all harassment claims,
leaving them vulnerable to litigation.
Another commenter said that the
proposed rule creates the possibility for
substantial judgments for money
damages that PHAs have little ability to
pay, because they may not use federal
funds to pay judgments for damages.
HUD Response: As noted throughout
this preamble, this final rule does not
impose any new or enhanced liabilities.
Rather, it clarifies existing law under
the Fair Housing Act and well42 Chevron U.S.A., Inc. v. Natural Resources
Defense Council, Inc., 467 U.S. 837 (1984).
43 42 U.S.C. 3608(a), 3610, 3615.
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20:49 Sep 13, 2016
Jkt 238001
established common law tort and
agency principles as they apply under
the Act. The rule does not change
substantive obligations, but merely
formalizes them in a regulation. Because
the standards articulated in the rule are
already law, the risks of liability and
costs of complying will not increase
with issuance of the rule. HUD
presumes that the vast majority of
housing providers are in compliance
with the law. Any costs incurred by
housing providers to come into
compliance as a result of this
rulemaking will simply be the costs of
compliance with a preexisting statute,
administrative practice, and case law. In
fact, by formalizing uniform standards
for investigations and adjudications
under the Fair Housing Act, the rule
serves to reduce costs for housing
providers by establishing greater clarity
with respect to how a determination of
liability is to be made.
V. Findings and Certifications
Regulatory Review—Executive Orders
12866 and 13563
Under Executive Order 12866
(Regulatory Planning and Review), a
determination must be made whether a
regulatory action is significant and
therefore, subject to review by the Office
of Management and Budget (OMB) in
accordance with the requirements of the
order. Executive Order 13563
(Improving Regulations and Regulatory
Review) directs executive agencies to
analyze regulations that are ‘‘outmoded,
ineffective, insufficient, or excessively
burdensome, and to modify, streamline,
expand, or repeal them in accordance
with what has been learned.’’ Executive
Order 13563 also directs that, where
relevant, feasible, and consistent with
regulatory objectives, and to the extent
permitted by law, agencies are to
identify and consider regulatory
approaches that reduce burdens and
maintain flexibility and freedom of
choice for the public. This rule was
determined to be a ‘‘significant
regulatory action’’ as defined in section
3(f) of Executive Order (although not an
economically significant regulatory
action, as provided under section 3(f)(1)
of the Executive Order).
This rule establishes uniform
standards for use in investigations and
processing cases involving harassment
and liability under the Fair Housing
Act. In establishing such standards,
HUD is exercising its rulemaking
authority to bring uniformity, clarity,
and certainty to an area of legal practice.
The docket file for this rule is
available for public inspection between
the hours of 8 a.m. and 5 p.m. weekdays
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63073
in the Regulations Division, Office of
General Counsel, Department of
Housing and Urban Development, Room
10276, 451 7th Street SW., Washington,
DC 20410–0500. Due to security
measures at the HUD Headquarters
building, please schedule an
appointment to review the docket file by
calling the Regulations Division at 202–
708–3055 (this is not a toll-free
number). Persons with hearing or
speech impairments may access the
above telephone number via TTY by
calling the toll-free Federal Relay
Service at 800–877–8339.
Environmental Impact
This rule does not direct, provide for
assistance or loan and mortgage
insurance for, or otherwise govern or
regulate, real property acquisition,
disposition, leasing, rehabilitation,
alteration, demolition or new
construction, or establish, revise, or
provide for standards for construction or
construction materials, manufactured
housing, or occupancy. This rule is
limited to the procedures governing fair
housing enforcement. Accordingly,
under 24 CFR 50.19(c)(3), this rule is
categorically excluded from
environmental review under the
National Environmental Policy Act (42
U.S.C. 4321).
Regulatory Flexibility Act
The Regulatory Flexibility Act (5
U.S.C. 4321, et seq.) generally requires
an agency to conduct a regulatory
flexibility analysis of any rule subject to
notice and comment rulemaking
requirements, unless the agency certifies
that the rule will not have a significant
economic impact on a substantial
number of small entities. The rule
establishes standards for evaluating
claims of harassment and liability under
the Fair Housing Act. The scope of the
rule is procedural, and the regulatory
changes do not establish any substantive
regulatory burdens on small entities.
Accordingly, the undersigned certifies
that this rule will not have a significant
economic impact on a substantial
number of small entities.
Unfunded Mandates Reform Act
Title II of the Unfunded Mandates
Reform Act of 1995 (2 U.S.C. 1531–
1538) (UMRA) establishes requirements
for federal agencies to assess the effects
of their regulatory actions on state,
local, and tribal governments and the
private sector. This rule does not
impose any federal mandates on any
state, local, or tribal governments or the
private sector within the meaning of
UMRA.
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Federal Register / Vol. 81, No. 178 / Wednesday, September 14, 2016 / Rules and Regulations
Executive Order 13132, Federalism
Executive Order 13132 (entitled
‘‘Federalism’’) prohibits an agency from
publishing any rule that has federalism
implications if the rule either (1)
imposes substantial, direct compliance
costs on state and local governments,
and is not required by statute, or (2)
preempts state law, unless the agency
meets the consultation and funding
requirements of section 6 of the
Executive Order. This rule does not
have federalism implications and does
not impose substantial direct
compliance costs on state and local
governments or preempt state law
within the meaning of the Executive
Order.
Catalogue of Federal Domestic
Assistance
The Catalogue of Federal Domestic
Assistance Number for the equal
opportunity in housing program is
14.400.
§ 100.60 Unlawful refusal to sell or rent or
to negotiate for the sale or rental.
*
List of Subjects in 24 CFR Part 100
Aged, Fair housing, Individuals with
disabilities, Mortgages, Reporting and
recordkeeping requirements.
Accordingly, for the reasons stated in
the preamble, and in accordance with
HUD’s authority in 42 U.S.C. 3535(d),
HUD amends 24 CFR part 100 as
follows:
PART 100—DISCRIMINATORY
CONDUCT UNDER THE FAIR HOUSING
ACT
1. The authority citation for 24 CFR
part 100 continues to read as follows:
■
Authority: 42 U.S.C. 3535(d), 3600–3620.
■
2. Add § 100.7 to read as follows:
asabaliauskas on DSK3SPTVN1PROD with RULES
§ 100.7 Liability for discriminatory housing
practices.
(a) Direct liability. (1) A person is
directly liable for:
(i) The person’s own conduct that
results in a discriminatory housing
practice.
(ii) Failing to take prompt action to
correct and end a discriminatory
housing practice by that person’s
employee or agent, where the person
knew or should have known of the
discriminatory conduct.
(iii) Failing to take prompt action to
correct and end a discriminatory
housing practice by a third-party, where
the person knew or should have known
of the discriminatory conduct and had
the power to correct it. The power to
take prompt action to correct and end a
discriminatory housing practice by a
third-party depends upon the extent of
the person’s control or any other legal
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responsibility the person may have with
respect to the conduct of such thirdparty.
(2) For purposes of determining
liability under paragraphs (a)(1)(ii) and
(iii) of this section, prompt action to
correct and end the discriminatory
housing practice may not include any
action that penalizes or harms the
aggrieved person, such as eviction of the
aggrieved person.
(b) Vicarious liability. A person is
vicariously liable for a discriminatory
housing practice by the person’s agent
or employee, regardless of whether the
person knew or should have known of
the conduct that resulted in a
discriminatory housing practice,
consistent with agency law.
■ 3. In § 100.60, add paragraphs (b)(6)
and (7) to read as follows:
*
*
*
*
(b) * * *
(6) Conditioning the availability of a
dwelling, including the price,
qualification criteria, or standards or
procedures for securing the dwelling, on
a person’s response to harassment
because of race, color, religion, sex,
handicap, familial status, or national
origin.
(7) Subjecting a person to harassment
because of race, color, religion, sex,
handicap, familial status, or national
origin that causes the person to vacate
a dwelling or abandon efforts to secure
the dwelling.
■ 4. In § 100.65, add paragraphs (b)(6)
and (7) to read as follows:
§ 100.65 Discrimination in terms,
conditions and privileges and in services
and facilities.
*
*
*
*
*
(b) * * *
(6) Conditioning the terms,
conditions, or privileges relating to the
sale or rental of a dwelling, or denying
or limiting the services or facilities in
connection therewith, on a person’s
response to harassment because of race,
color, religion, sex, handicap, familial
status, or national origin.
(7) Subjecting a person to harassment
because of race, color, religion, sex,
handicap, familial status, or national
origin that has the effect of imposing
different terms, conditions, or privileges
relating to the sale or rental of a
dwelling or denying or limiting services
or facilities in connection with the sale
or rental of a dwelling.
■ 5. In § 100.80, add paragraph (b)(6) to
read as follows:
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§ 100.80 Discriminatory representation on
the availability of dwellings.
*
*
*
*
*
(b) * * *
(6) Representing to an applicant that
a unit is unavailable because of the
applicant’s response to a request for a
sexual favor or other harassment
because of race, color, religion, sex,
handicap, familial status, or national
origin.
■ 6. In § 100.90, add paragraphs (b)(5)
and (6) to read as follows:
§ 100.90 Discrimination in the provision of
brokerage services.
*
*
*
*
*
(b) * * *
(5) Conditioning access to brokerage
services on a person’s response to
harassment because of race, color,
religion, sex, handicap, familial status,
or national origin.
(6) Subjecting a person to harassment
because of race, color, religion, sex,
handicap, familial status, or national
origin that has the effect of discouraging
or denying access to brokerage services.
■ 7. In § 100.120, add paragraphs (b)(3)
and (4) to read as follows:
§ 100.120 Discrimination in the making of
loans and in the provision of other financial
assistance.
*
*
*
*
*
(b) * * *
(3) Conditioning the availability of a
loan or other financial assistance on a
person’s response to harassment
because of race, color, religion, sex,
handicap, familial status, or national
origin.
(4) Subjecting a person to harassment
because of race, color, religion, sex,
handicap, familial status, or national
origin that affects the availability of a
loan or other financial assistance.
■ 8. In § 100.130, add paragraphs (b)(4)
and (5) to read as follows:
§ 100.130 Discrimination in the terms and
conditions for making available loans or
other financial assistance.
*
*
*
*
*
(b) * * *
(4) Conditioning an aspect of a loan or
other financial assistance to be provided
with respect to a dwelling, or the terms
or conditions thereof, on a person’s
response to harassment because of race,
color, religion, sex, handicap, familial
status, or national origin.
(5) Subjecting a person to harassment
because of race, color, religion, sex,
handicap, familial status, or national
origin that has the effect of imposing
different terms or conditions for the
availability of such loans or other
financial assistance.
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Federal Register / Vol. 81, No. 178 / Wednesday, September 14, 2016 / Rules and Regulations
9. In § 100.135, revise paragraph (d) to
read as follows:
■
§ 100.135 Unlawful practices in the selling,
brokering, or appraising of residential real
property.
*
*
*
*
*
(d) Practices which are unlawful
under this section include, but are not
limited to:
(1) Using an appraisal of residential
real property in connection with the
sale, rental, or financing of any dwelling
where the person knows or reasonably
should know that the appraisal
improperly takes into consideration
race, color, religion, sex, handicap,
familial status, or national origin.
(2) Conditioning the terms of an
appraisal of residential real property in
connection with the sale, rental, or
financing of a dwelling on a person’s
response to harassment because of race,
color, religion, sex, handicap, familial
status, or national origin.
■ 10. In § 100.400, add paragraph (c)(6)
to read as follows:
§ 100.400 Prohibited interference, coercion
or intimidation.
*
*
*
*
*
(c) * * *
(6) Retaliating against any person
because that person reported a
discriminatory housing practice to a
housing provider or other authority.
■ 11. Add subpart H, consisting of
§ 100.600, to read as follows:
Subpart H— Quid Pro Quo and Hostile
Environment Harassment
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§ 100.600 Quid pro quo and hostile
environment harassment.
(a) General. Quid pro quo and hostile
environment harassment because of
race, color, religion, sex, familial status,
national origin or handicap may violate
sections 804, 805, 806 or 818 of the Act,
depending on the conduct. The same
conduct may violate one or more of
these provisions.
(1) Quid pro quo harassment. Quid
pro quo harassment refers to an
unwelcome request or demand to
engage in conduct where submission to
the request or demand, either explicitly
or implicitly, is made a condition
related to: The sale, rental or availability
of a dwelling; the terms, conditions, or
privileges of the sale or rental, or the
provision of services or facilities in
connection therewith; or the
availability, terms, or conditions of a
residential real estate-related
transaction. An unwelcome request or
demand may constitute quid pro quo
harassment even if a person acquiesces
in the unwelcome request or demand.
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(2) Hostile environment harassment.
Hostile environment harassment refers
to unwelcome conduct that is
sufficiently severe or pervasive as to
interfere with: The availability, sale,
rental, or use or enjoyment of a
dwelling; the terms, conditions, or
privileges of the sale or rental, or the
provision or enjoyment of services or
facilities in connection therewith; or the
availability, terms, or conditions of a
residential real estate-related
transaction. Hostile environment
harassment does not require a change in
the economic benefits, terms, or
conditions of the dwelling or housingrelated services or facilities, or of the
residential real-estate transaction.
(i) Totality of the circumstances.
Whether hostile environment
harassment exists depends upon the
totality of the circumstances.
(A) Factors to be considered to
determine whether hostile environment
harassment exists include, but are not
limited to, the nature of the conduct, the
context in which the incident(s)
occurred, the severity, scope, frequency,
duration, and location of the conduct,
and the relationships of the persons
involved.
(B) Neither psychological nor physical
harm must be demonstrated to prove
that a hostile environment exists.
Evidence of psychological or physical
harm may, however, be relevant in
determining whether a hostile
environment existed and, if so, the
amount of damages to which an
aggrieved person may be entitled.
(C) Whether unwelcome conduct is
sufficiently severe or pervasive as to
create a hostile environment is
evaluated from the perspective of a
reasonable person in the aggrieved
person’s position.
(ii) Title VII affirmative defense. The
affirmative defense to an employer’s
vicarious liability for hostile
environment harassment by a supervisor
under Title VII of the Civil Rights Act
of 1964 does not apply to cases brought
pursuant to the Fair Housing Act.
(b) Type of conduct. Harassment can
be written, verbal, or other conduct, and
does not require physical contact.
(c) Number of incidents. A single
incident of harassment because of race,
color, religion, sex, familial status,
national origin, or handicap may
constitute a discriminatory housing
practice, where the incident is
sufficiently severe to create a hostile
environment, or evidences a quid pro
quo.
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63075
Dated: August 18, 2016.
Gustavo Velasquez,
Assistant Secretary for Fair Housing and
Equal Opportunity.
[FR Doc. 2016–21868 Filed 9–13–16; 8:45 am]
BILLING CODE 4210–67–P
DEPARTMENT OF HOMELAND
SECURITY
Coast Guard
33 CFR Parts 100 and 165
[Docket Number USCG–2015–0854]
RIN 1625–AA00, AA08
Special Local Regulations and Safety
Zones; Recurring Marine Events and
Fireworks Displays Within the Fifth
Coast Guard District
Coast Guard, DHS.
Final rule.
AGENCY:
ACTION:
The Coast Guard is issuing a
final rule that revises the list of special
local regulations and safety zones
established for recurring marine events
and fireworks displays that take place
within the Fifth Coast Guard District
area of responsibility. This rule revises
the listing of events that informs the
public of regularly scheduled marine
parades, regattas, other organized water
events, and fireworks displays that
require additional safety measures
provided by regulations. Under this
rule, the list of recurring marine events
requiring special local regulations or
safety zones is updated with revisions,
additional events, and removal of events
that no longer take place in the Fifth
Coast Guard District. When these
regulations are enforced, certain
restrictions are placed on marine traffic
in specified areas. This rulemaking
project promotes efficiency by
eliminating the need to produce a
separate rule for each individual
recurring event, and serves to provide
notice of the known recurring events
requiring a special local regulation or
safety zone throughout the year.
DATES: This rule is effective October 14,
2016.
ADDRESSES: To view documents
mentioned in this preamble as being
available in the docket, go to https://
www.regulations.gov, type USCG–2015–
0854 in the ‘‘SEARCH’’ box and click
‘‘SEARCH’’. Click on Open Docket
Folder on the line associated with this
rule.
FOR FURTHER INFORMATION CONTACT: If
you have questions about this
rulemaking, call or email Dennis Sens,
SUMMARY:
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Agencies
[Federal Register Volume 81, Number 178 (Wednesday, September 14, 2016)]
[Rules and Regulations]
[Pages 63054-63075]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-21868]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
24 CFR Part 100
[Docket No. FR-5248-F-02]
RIN 2529-AA94
Quid Pro Quo and Hostile Environment Harassment and Liability for
Discriminatory Housing Practices Under the Fair Housing Act
AGENCY: Office of the Assistant Secretary for Fair Housing and Equal
Opportunity, HUD.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: This final rule amends HUD's fair housing regulations to
formalize standards for use in investigations and adjudications
involving allegations of harassment on the basis of race, color,
religion, national origin, sex, familial status, or disability. The
rule specifies how HUD will evaluate complaints of quid pro quo (``this
for that'') harassment and hostile environment harassment under the
Fair Housing Act. It will also provide for uniform treatment of Fair
Housing Act claims raising allegations of quid pro quo and hostile
environment harassment in judicial and administrative forums. This rule
defines ``quid pro quo'' and ``hostile environment harassment,'' as
prohibited under the Fair Housing Act, and provides illustrations of
discriminatory housing practices that constitute such harassment. In
addition, this rule clarifies the operation of traditional principles
of direct and vicarious liability in the Fair Housing Act context.
DATES: Effective date: October 14, 2016.
FOR FURTHER INFORMATION CONTACT: Lynn Grosso, Acting Deputy Assistant
Secretary for Enforcement and Programs, Office of Fair Housing and
Equal Opportunity, Department of Housing and Urban Development, 451 7th
Street SW., Room 5204, Washington DC 20410-2000; telephone number 202-
402-5361 (this is not a toll-free number). Persons with hearing or
speech impairments may contact this number via TTY by calling the toll-
free Federal Relay Service at 800-877-8339.
SUPPLEMENTARY INFORMATION:
I. Executive Summary
A. Purpose of the Regulatory Action
Both HUD and the courts have long recognized that Title VIII of the
Civil Rights Act of 1968, as amended, (42 U.S.C. 3601 et seq.) (Fair
Housing Act or Act) prohibits harassment in housing and housing-related
transactions because of race, color, religion, sex, national origin,
disability,\1\ and familial status, just as Title VII of the Civil
Rights Act of 1964 (42 U.S.C. 2000e et seq.) (Title VII) prohibits such
harassment in employment. But no standards had been formalized for
assessing claims of harassment under the Fair Housing Act. Courts have
often applied standards first adopted under Title VII to evaluate
claims of harassment under the Fair Housing Act, but there are
differences between the Fair Housing Act and Title VII, and between
harassment in the workplace and harassment in or around one's home,
that warrant this rulemaking.
---------------------------------------------------------------------------
\1\ This rule uses the term ``disability'' to refer to what the
Fair Housing Act and its implementing regulations refer to as
``handicap.'' Both terms have the same legal meaning. See Bragdon v.
Abbott, 524 U.S. 624, 631 (1998).
---------------------------------------------------------------------------
This rule formalizes standards for evaluating claims of quid pro
quo and hostile environment harassment in the housing context. The rule
does so by defining ``quid pro quo harassment'' and ``hostile
environment harassment'' as conduct prohibited under the Fair Housing
Act, and by specifying the standards to be used to evaluate whether
particular conduct creates a quid pro quo or hostile environment in
violation of the Act. Such standards will apply both in administrative
adjudications and in cases brought in federal and state courts under
the Fair Housing Act. This rule also adds to HUD's existing Fair
Housing Act regulations illustrations of discriminatory housing
practices that may constitute illegal quid pro quo and hostile
environment harassment.
By establishing consistent standards for evaluating claims of quid
pro quo and hostile environment harassment, this rule provides guidance
to providers of housing or housing-related services seeking to ensure
that their properties or businesses are free of unlawful harassment.
The rule also provides clarity to victims of harassment and their
representatives regarding how to assess potential claims of illegal
harassment under the Fair Housing Act.
In addition, this final rule clarifies when housing providers and
other entities or individuals covered by the Fair Housing Act may be
held directly or vicariously liable under the Act for
[[Page 63055]]
illegal harassment, as well as for other discriminatory housing
practices that violate the Act. This rule sets forth how these
traditional liability standards apply in the housing context because,
in HUD's experience, there has been significant misunderstanding among
public and private housing providers as to the circumstances under
which they will be subject to liability under the Fair Housing Act for
discriminatory housing practices undertaken by others.
B. Legal Authority for the Regulation
The legal authority for this regulation is found in the Fair
Housing Act, which gives the Secretary of HUD the ``authority and
responsibility for administering this Act.'' 42 U.S.C. 3608(a). In
addition, the Act provides that ``[t]he Secretary may make rules
(including rules for the collection, maintenance, and analysis of
appropriate data) to carry out this title. The Secretary shall give
public notice and opportunity for comment with respect to all rules
made under this section.'' 42 U.S.C. 3614a. HUD also has general
rulemaking authority under the Department of Housing and Urban
Development Act to make such rules and regulations as may be necessary
to carry out its functions, powers and duties. See 42 U.S.C. 3535(d).
C. Summary of Major Provisions
The major provisions of this rule:
Formalize definitions of ``quid pro quo harassment'' and
``hostile environment harassment'' under the Fair Housing Act.
Formalize standards for evaluating claims of quid pro quo
and hostile environment harassment under the Fair Housing Act.
Add illustrations of prohibited quid pro quo and hostile
environment harassment to HUD's existing Fair Housing Act regulations.
Identify traditional principles of direct and vicarious
liability applicable to all discriminatory housing practices under the
Fair Housing Act, including quid pro quo and hostile environment
harassment.
Please refer to section III of this preamble, entitled ``This Final
Rule,'' for a discussion of the changes made to HUD's regulations by
this final rule.
D. Costs and Benefits
This rule formalizes clear, consistent, nationwide standards for
evaluating harassment claims under the Fair Housing Act. The rule does
not create any new forms of liability under the Fair Housing Act and
thus adds no additional costs for housing providers and others engaged
in housing transactions.
The benefits of the rule are that it will assist in ensuring
compliance with the Fair Housing Act by defining quid pro quo and
hostile environment harassment that violates the Act and by specifying
traditional principles of direct and vicarious liability, consistent
with Supreme Court precedent. Articulating clear standards enables
entities subject to the Fair Housing Act's prohibitions and persons
protected by its terms to understand the types of conduct that
constitute actionable quid pro quo and hostile environment harassment.
As a result, HUD expects this rule to facilitate more effective
training to avoid discriminatory harassment in housing and decrease the
need for protracted litigation to resolve disputed claims.
II. Background
Title VIII of the Civil Rights Act of 1968, as amended (the Fair
Housing Act or Act), prohibits discrimination in the availability and
enjoyment of housing and housing-related services, facilities, and
transactions because of race, color, national origin, religion, sex,
disability, and familial status. 42 U.S.C. 3601-19. The Act prohibits a
wide range of discriminatory housing and housing-related practices,
including, among other things, making discriminatory statements,
refusing to rent or sell, denying access to services, setting different
terms or conditions, refusing to make reasonable modifications or
accommodations, discriminating in residential real estate-related
transactions, and retaliating. See 42 U.S.C. 3604, 3605, 3606 and 3617.
In 1989, HUD promulgated fair housing regulations at 24 CFR part
100 that address discriminatory conduct in housing generally. The 1989
regulations include examples of discriminatory housing practices that
cover quid pro quo sexual harassment and hostile environment harassment
generally. Section 100.65(b)(5) identifies, as an example of unlawful
conduct, denying or limiting housing-related services or facilities
because a person refused to provide sexual favors. Section
100.400(c)(2) offers as an example of illegal conduct ``. . .
interfering with persons in their enjoyment of a dwelling because of
race, color, religion, sex, handicap, familial status, or national
origin of such persons, or of visitors or associates of such persons.''
The 1989 regulations do not, however, expressly define quid pro quo or
hostile environment harassment, specify standards for examining such
claims, or provide illustrations of other types of quid pro quo or
hostile environment harassment prohibited by the Act. The 1989
regulations also do not discuss liability standards for prohibited
harassment or other discriminatory housing practices.
Over time, forms of harassment that violate civil rights laws have
coalesced into two legal doctrines--quid pro quo and hostile
environment. Although HUD and the courts have recognized that the Fair
Housing Act prohibits harassment because of race or color,\2\
disability,\3\ religion,\4\ national origin,\5\ familial status,\6\ and
sex,\7\ the doctrines of quid pro quo and hostile environment
harassment are not well developed under the Fair Housing Act.
---------------------------------------------------------------------------
\2\ See, e.g., Smith v. Mission Assoc. Ltd. P'ship, 225 F. Supp.
2d 1293, 1298-99 (D. Kan. 2002) (42 U.S.C. 3604(b)); HUD v. Tucker,
2002 ALJ LEXIS 33, *3-4 (HUD ALJ 2002) (42 U.S.C. 3604(a) and (b)).
\3\ See, e.g., Neudecker v. Boisclair Corp., 351 F. 3d 361, 364
(8th Cir. 2003) (42 U.S.C. 3604(f)(2)).
\4\ See, e.g., Bloch v. Frischholz, 587 F. 3d 771, 787 (7th Cir.
2009) (42 U.S.C. 3604(b), 3617).
\5\ See, e.g., Effendi v. Amber Fields Homeowners Assoc., 2011
U.S. Dist. Lexis 35265, *1 (N.D. Ill. 2011) (42 U.S.C. 3604(b) and
3617); Texas v. Crest Asset Mgmt., 85 F. Supp. 722, 736 (S.D. TX
2000) (42 U.S.C. 3604(a) and (b), 3617).
\6\ See, e.g., Bischoff v. Brittain, 2014 U.S. Dist. LEXIS
145945, *13-14, *17 (E.D. Cal. 2014) (3604(b)); United States v. M.
Westland Co., 1995 U.S. Dist. LEXIS 22466, *4 (C.D. Cal. 1995) (Fair
Housing Act provision not specified).
\7\ See, e.g., Quigley v. Winter, 598 F. 3d 938, 946 (8th Cir.
2010) (42 U.S.C. 804(b), 3617); Krueger v. Cuomo, 115 F. 3d 487, 491
(7th Cir. 1997) (42 U.S.C. 3604(b), 3617); Honce v. Vigil, 1 F. 3d
1085, 1088 (10th Cir. 1993) (42 U.S.C. 3604(b)); Shellhammer v.
Lewallen, 770 F. 2d 167 (6th Cir. 1985) (sexual harassment under the
Fair Housing Act in general).
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As a result, when deciding harassment cases under the Fair Housing
Act, courts have often looked to case law decided under Title VII,
which prohibits employment discrimination because of race, color,
religion, sex, and national origin.\8\ But the home and the workplace
are significantly different environments such that strict reliance on
Title VII case law is not always appropriate. One's home is a place of
privacy, security, and refuge (or should be), and harassment that
occurs in or around one's home can be far more intrusive, violative and
threatening than harassment in the more public environment of one's
work place.\9\ Consistent with this reality, the
[[Page 63056]]
Supreme Court has recognized that individuals have heightened
expectations of privacy within the home.\10\
---------------------------------------------------------------------------
\8\ See, e.g., Honce v. Vigil, 1 F. 3d at 1088; Shellhammer v.
Lewallen, 770 F. 2d 167; Glover v. Jones, 522 F. Supp. 2d 496, 503
(W.D.N.Y. 2007); Beliveau v. Caras, 873 F. Supp. 1393, 1396 (C.D.
Cal. 1995); see also Neudecker v. Boisclair Corp., 351 F. 3d at 364
(applying Title VII concepts to find hostile environment based on
disability violated Act). Unlike Title VII, the Act also includes
disability and familial status among its protected characteristics.
\9\ See, e.g., Quigley v. Winter, 598 F. 3d at 947 (emphasizing
that defendant's harassing conduct was made ``even more egregious''
by the fact that it occurred in plaintiff's home, ``a place where
[she] was entitled to feel safe and secure and need not flee.'');
Salisbury v. Hickman, 974 F. Supp. 2d 1282, 1292 (E.D. Cal. 2013)
(``[c]ourts have recognized that harassment in one's own home is
particularly egregious and is a factor that must be considered in
determining the seriousness of the alleged harassment''); Williams
v. Poretsky Management, 955 F. Supp. 490, 498 (D. Md. 1996) (noting
sexual harassment in the home more severe than in workplace);
Beliveau v. Caras, 873 F. Supp. at 1398 (describing home as place
where one should be safe and not vulnerable to sexual harassment);
D. Benjamin Barros, Home As a Legal Concept, 46 Santa Clara L. Rev.
255, 277-82 (2006) (discussing legal concept of home as source of
security, liberty and privacy which justifies favored legal status
in many circumstances); Nicole A. Forkenbrock Lindemyer, Article,
Sexual Harassment on the Second Shift: The Misfit Application of
Title VII Employment Standards to Title VIII Housing Cases, 18 Law &
Ineq. 351, 368-80 (2000) (noting that transporting of Title VII
workplace standards for sexual harassment into Fair Housing Act
cases of residential sexual harassment ignores important
distinctions between the two settings); Michelle Adams, Knowing Your
Place: Theorizing Sexual Harassment at Home, 40 Ariz. L. Rev. 17,
21-28 (1998) (describing destabilizing effect of sexual harassment
in the home).
\10\ See, e.g. Frisby v. Schultz, 487 U.S. 474, 484 (1988)
(``[w]e have repeatedly held that individuals are not required to
welcome unwanted speech into their own homes and that the government
may protect this freedom'').
---------------------------------------------------------------------------
This rule therefore formalizes standards to address harassment in
and around one's home and identifies some of the differences between
harassment in the home and harassment in the workplace. While Title VII
and Fair Housing Act case law contain many similar concepts, this
regulation describes the appropriate analytical framework for
harassment claims under the Fair Housing Act.
The rule addresses only quid pro quo and hostile environment
harassment, and not conduct generically referred to as harassment that,
for different reasons, may violate section 818 or other provisions of
the Fair Housing Act. For example, a racially hostile statement by a
housing provider could indicate a discriminatory preference in
violation of section 804(c) of the Act, or it could evidence intent to
deny housing or discriminate in the terms or conditions of housing in
violation of sections 804(a) or 804(b), even if the statement does not
create a hostile environment or establish a quid pro quo. Section 818,
which makes it unlawful to ``coerce, intimidate, threaten, or interfere
with any person in the exercise or enjoyment of'' rights protected by
the Act, or on account of a person having aided others in exercising or
enjoying rights protected by the Act, could be violated by conduct that
creates a quid pro quo or hostile environment. It is not, however,
limited to quid pro quo or hostile environment claims and could be
violated by other conduct that constitutes retaliation or another form
of coercion, intimidation, threats, or interference because of a
protected characteristic. In sum, this rule provides standards that are
uniformly applicable to claims of quid pro quo and hostile environment
harassment under the Fair Housing Act, regardless of the section of the
Act that is alleged to have been violated, and the same discriminatory
conduct could violate more than one provision of the Act whether or not
it also constitutes quid pro quo or hostile environment harassment.
III. Changes Made at the Final Rule Stage
A. Overview of Changes Made at the Final Rule Stage
In response to public comment and upon further consideration by HUD
of the issues presented in this rulemaking, HUD makes the following
changes at this final rule stage:
Re-words proposed Sec. 100.7(a)(1)(iii) to avoid
confusing the substantive obligation to comply with the Fair Housing
Act with the standard of liability for discriminatory third-party
conduct. Proposed Sec. 100.7(a)(1)(iii) stated that a person is
directly liable for ``failing to fulfill a duty to take prompt action
to correct and end a discriminatory housing practice by a third-party,
where the person knew or should have known of the discriminatory
conduct. The duty to take prompt action to correct and end a
discriminatory housing practice by a third-party derives from an
obligation to the aggrieved person created by contract or lease
(including bylaws or other rules of a homeowner's association,
condominium or cooperative), or by federal, state or local law.''
Section 100.7(a)(1)(iii) of this final rule provides that a person is
directly liable for ``failing to take prompt action to correct and end
a discriminatory housing practice by a third-party, where the person
knew or should have known of the discriminatory conduct and had the
power to correct it. The power to take prompt action to correct a
discriminatory housing practice by a third-party depends upon the
extent of control or any other legal responsibility the person may have
with respect to the conduct of such third-party.''
Adds to Sec. 100.400 a new paragraph (c)(6) specifying as
an example of a discriminatory housing practice retaliation because a
person reported a discriminatory housing practice, including quid pro
quo or hostile environment harassment.
Adds to Sec. 100.600(a)(2)(i), ``Totality of the
circumstances,'' a new paragraph (C) that explains the reasonable
person standard under which hostile environment harassment is assessed
``Whether unwelcome conduct is sufficiently severe or pervasive as to
create a hostile environment is evaluated from the perspective of a
reasonable person in the aggrieved person's position.''
Re-words proposed Sec. 100.600(a)(2)(i)(B) to clarify
that proof of hostile environment would not require demonstrating
psychological or physical harm to avoid any confusion on that point.
Proposed Sec. 100.600(a)(2)(i)(B) stated ``Evidence of psychological
or physical harm is relevant in determining whether a hostile
environment was created, as well as the amount of damages to which an
aggrieved person may be entitled. Neither psychological nor physical
harm, however, must be demonstrated to prove that a hostile environment
exists.'' Section 100.600(a)(2)(i)(B) in this final rule provides:
``Neither psychological nor physical harm must be demonstrated to prove
that a hostile environment exists. Evidence of psychological or
physical harm may, however, be relevant in determining whether a
hostile environment existed and, if so, the amount of damages to which
an aggrieved person may be entitled.''
Re-words proposed Sec. 100.600(c) to clarify that a
single incident may constitute either quid pro quo or hostile
environment harassment if the incident meets the standard for either
type of harassment under Sec. 100.600(a)(1) or (a)(2). Proposed Sec.
100.600(c) provided ``A single incident of harassment because of race,
color, religion, sex, familial status, national origin, or handicap may
constitute a discriminatory housing practice, where the incident is
severe, or evidences a quid pro quo.'' Section 100.600(c) in this final
rule provides ``A single incident of harassment because of race, color,
religion, sex, familial status, national origin, or handicap may
constitute a discriminatory housing practice, where the incident is
sufficiently severe to create a hostile environment, or evidences a
quid pro quo.''
Corrects the illustration in proposed Sec. 100.65(b)(7)
to fix a typographical error in the proposed rule. In the final rule,
the word ``service'' is corrected and made plural.
[[Page 63057]]
IV. The Public Comments
On October 21, 2015, at 80 FR 63720, HUD published for public
comment a proposed rule on Quid Pro Quo and Hostile Environment
Harassment and Liability for Discriminatory Housing Practices Under the
Fair Housing Act. The public comment period closed on December 21,
2015. HUD received 63 comments. The comments were submitted by public
housing agencies (PHAs) and other government agencies; private housing
providers and their representatives; nonprofit organizations, including
fair housing, civil rights, housing advocacy, and legal groups; tenants
and other individuals. This section of the preamble addresses
significant issues raised in the public comments and provides HUD's
responses. All public comments can be viewed at: https://www.regulations.gov/#!docketDetail;D=HUD-2015-0095.
The majority of the commenters were generally supportive of the
rule, with some urging HUD to publish the rule quickly. This summary
does not provide responses to comments that expressed support for the
proposed rule without suggesting any modifications to the rule. General
supportive comments included statements of the importance of the rule
in addressing and preventing sexual assault of tenants by landlords and
descriptions of how the rule would empower housing providers, renters,
and other consumers to understand and avoid illegal housing practices
by defining and illustrating quid pro quo and hostile environment
harassment. Some commenters stated that this rule may help providers
focus on the importance of eliminating harassment on their properties,
and some commenters identified provisions of the rule that would
provide useful guidance to housing providers, tenants, residents, and
others involved in housing transactions.
More specifically, commenters expressed appreciation that the rule
would apply not solely to sexual harassment but to harassment because
of all protected characteristics, with some commenters sharing
anecdotes of harassment based on a variety of protected characteristics
that they believe the rule may help remedy. Other commenters supported
the proposed rule's distinction between the Fair Housing Act and Title
VII, with commenters endorsing the Department's proposal not to adopt
the Title VII affirmative defense to an employer's vicarious liability.
A number of commenters assessed the rule to be in accord with case
law, and approved of the balance the rule strikes between the rights
and obligations of the parties in a fair housing matter. Some
commenters noted that the proposed standard for determining whether
conduct constitutes a hostile environment is appropriately
individualized to the facts of each case. Some commenters specifically
identified the benefits provided by the rule in establishing a uniform
framework for fairly evaluating and appropriately responding to alleged
harassment, which minimizes the subjective nature of adjudicating such
claims. Other commenters expressed appreciation for the proposed rule's
recognition that a single incident may establish hostile environment
harassment. Some commenters expressed support for the rule's
acknowledgement of the fear of retaliation many individuals with
disabilities experience when trying to address issues of harassment in
their housing.
Many commenters stated that the rule's description of traditional
principles of agency liability is accurate and not an expansion of
existing liability. Some commenters expressed appreciation that the
rule would incorporate traditional liability principles for any type of
discriminatory housing practice, not just harassment, and would rely on
negligence principles and distinguish between direct and vicarious
liability. Other commenters stated that the rule would not burden
housing providers because the direct liability standard is aligned with
established housing provider business practice. Some commenters
expressed appreciation that the rule would place landlords on notice
that they should take corrective action early on, once they know or
should have known of the discrimination.
Several commenters stated that housing providers are already in
possession of the tools they need to create living environments free
from harassment. In particular, the commenters stated that housing
providers are familiar with the corrective actions they may take in
order to enforce their own rules. Another commenter stated that housing
providers are in the best position to select, train, oversee, and
assure the correct behavior of their agents, noting that effective
enforcement of the rule depends on the potential for liability on the
part of housing providers.
Some commenters expressed support for the proposed rule while
seeking modifications at the final rule stage. For example, a commenter
encouraged broad application of the rule so that intervention and
corrective action would occur before victims of housing discrimination
are forced out of their homes. Another commenter sought an expansive
reading of the rule in order to prevent all forms of bullying. Some
commenters sought to add factors to the totality of circumstances
consideration, while other commenters sought to add to the classes
protected by the rule.
Following are HUD's responses to commenters' suggested
modifications to the rule and the other significant issues raised in
the public comments.
A. Quid Pro Quo and Hostile Environment Harassment: Sec. 100.600
a. General: Sec. 100.600(a)
Issue: A commenter requested that HUD add seniors as a protected
class under the rule. Other commenters stated that elderly persons
often have disabilities, which make them particularly vulnerable to
harassment. These commenters requested that the final rule make clear
that the rule protects elderly persons from harassment because of
disability.
HUD Response: HUD shares the commenters' concern for elderly
persons but does not have the authority to add a new protected class to
the Fair Housing Act and therefore is unable to adopt the commenters'
recommendation to expand the scope of the rule in this way. Neither age
nor senior status is a protected characteristic under the Act, although
persons who are discriminated against because of their disabilities are
protected under the Act without regard to their age. Therefore, elderly
individuals who are subjected to quid pro quo or hostile environment
harassment on the basis of disability or another protected
characteristic are protected under the Act and this final rule.
Issue: A commenter suggested that HUD include a clause in the final
rule to protect whistleblowers who experience harassment for reporting
quid pro quo or hostile environment harassment. The commenter reported
having witnessed such harassment and explained that whistleblowers are
particularly vulnerable to quid pro quo and hostile environment
harassment, but because they are not harassed on the basis of their
race, color, religion, national origin, sex, familial status, or
disability, they are not directly protected by the proposed regulation.
HUD Response: Anyone who is harassed for reporting discriminatory
harassment in housing is protected by the Fair Housing Act. Section 818
of the Act makes it unlawful to coerce, intimidate, threaten, or
interfere with a person on account of his or her having
[[Page 63058]]
aided or encouraged another person in the exercise or enjoyment of any
right granted or protected by sections 803-806 of the Act. To highlight
the essential role whistleblower protection plays in ensuring fair
housing, HUD is adding to Sec. 100.400 a new paragraph (c)(6), which
provides the following example of a discriminatory housing practice
``Retaliating against any person because that person reported a
discriminatory housing practice to a housing provider or other
authority.''
Issue: Several commenters urged HUD to state in the final rule that
harassment against persons who are lesbian, gay, bisexual, or
transgender (LGBT), or because of pregnancy, violates the Fair Housing
Act. They asked HUD to define harassment because of sex to include
harassment based on sexual orientation, gender identity, sex
stereotyping, or pregnancy. The commenters referenced studies about the
pervasive harassment and discrimination such persons face in housing.
They also noted that a number of federal courts and federal agencies
have interpreted Title VII and other laws prohibiting discrimination
because of sex to include discrimination on the basis of gender
identity, gender transition, or transgender status. The commenters also
pointed to HUD's ``Equal Access to Housing in HUD Programs Regardless
of Sexual Orientation or Gender Identity'' rule, which provides that
persons may not be denied access to HUD programs because of sexual
orientation or gender identity.
HUD Response: The Fair Housing Act already expressly prohibits
discrimination based on pregnancy as part of its prohibition of
discrimination because of familial status (42 U.S.C. 3602(k)), and
HUD's Equal Access Rule applies only to HUD programs.
HUD agrees with the commenters' view that the Fair Housing Act's
prohibition on sex discrimination prohibits discrimination because of
gender identity. In Price Waterhouse v. Hopkins, the Supreme Court
interpreted Title VII's prohibition of sex discrimination to encompass
discrimination based on non-conformance with sex stereotypes, stating
that ``[i]n forbidding employers to discriminate against individuals
because of their sex, Congress intended to strike at the entire
spectrum of disparate treatment of men and women resulting from sex
stereotypes.'' \11\ Taking note of Price Waterhouse and its progeny, in
2010, HUD issued a memorandum recognizing that sex discrimination
prohibited by the Fair Housing Act includes discrimination because of
gender identity. In 2012, the Equal Employment Opportunity Commission
(EEOC) reached the same conclusion, ``clarifying that claims of
discrimination based on transgender status, also referred to as claims
of discrimination based on gender identity, are cognizable under Title
VII's sex discrimination prohibition.'' \12\ Following the EEOC's
decision, the Attorney General also concluded that:
---------------------------------------------------------------------------
\11\ 490 U.S. 228, 251 (1989).
\12\ Macy v. Dept. of Justice, No. 0120120821, 2012 EEOPUB LEXIS
1181, *13 (EEOC Apr. 20, 2012); see also Lusardi v. Dept. of the
Army, No. 0120133395, 2015 EEOPUB LEXIS 896, *17 (EEOC Apr. 1,
2015).
the best reading of Title VII's prohibition of sex discrimination is
that it encompasses discrimination based on gender identity,
including transgender status. The most straightforward reading of
Title VII is that discrimination ``because of . . . sex'' includes
discrimination because an employee's gender identification is as a
member of a particular sex, or because the employee is
transitioning, or has transitioned, to another sex.\13\
---------------------------------------------------------------------------
\13\ Attorney General Memorandum, Treatment of Transgender
Employment Discrimination Claims Under Title VII of the Civil Rights
Act of 1964 (Dec. 15, 2014), posted at https://www.justice.gov/file/188671/download. Similarly, the Office of Personnel Management
revised its nondiscrimination regulations to make clear that sex
discrimination under Title VII includes discrimination based on
gender identity. See 5 CFR 300.102-300.103; see also OFCCP Directive
2014-02, Gender Identity and Sex Discrimination (Aug. 19, 2014)
(stating that discrimination based on gender identity or transgender
status is discrimination based on sex), posted at https://www.dol.gov/ofccp/regs/compliance/directives/Directive_2014-02_508c.pdf.
HUD reaffirms its view that under the Fair Housing Act,
discrimination based on gender identity is sex discrimination.
Accordingly, quid pro quo or hostile environment harassment in housing
because of a person's gender identity is indistinguishable from
harassment because of sex.\14\
---------------------------------------------------------------------------
\14\ See Glenn v. Brumby, 663 F.3d at 1317 (``discrimination
against a transgender individual because of her gender nonconformity
is sex discrimination, whether it is described as being on the basis
of sex or gender.''); see also Finkle v. Howard Cnty, 12 F. Supp. 3d
780, 788 (D. Md. 2014) (holding that ``Plaintiff's claim that she
was discriminated against `because of her obvious transgender[]
status is a cognizable claim of sex discrimination under Title
VII''); Rumble v. Fairview Health Services, No. 14-cv-2037, 2015
U.S. Dist. LEXIS 31591, *4-5 (D. Minn. Mar. 16, 2015) (in Affordable
Care Act case, holding that ``[b]ecause the term `transgender'
describes people whose gender expression differs from their assigned
sex at birth, discrimination based on an individual's transgender
status constitutes discrimination based on gender stereotyping.
Therefore, Plaintiff's transgender status is necessarily part of his
`sex' or `gender' identity'').
---------------------------------------------------------------------------
HUD, in its 2010 memorandum, also advised that claims of housing
discrimination because of sexual orientation can be investigated under
the Price Waterhouse sex-stereotyping theory. Over the past two
decades, an increasing number of Federal courts, building on the Price
Waterhouse rationale, have found protections under Title VII for those
asserting discrimination claims related to their sexual
orientation.\15\ Many Federal-sector EEOC decisions have found the
same.\16\ Although some Federal
[[Page 63059]]
appellate courts have declined to find sex discrimination under Title
VII based on the sole fact of the person's sexual orientation, those
courts nonetheless recognized the Price Waterhouse sex-stereotyping
theory may be used to find discrimination based on sex.\17\ These Title
VII legal authorities are consistent with HUD's 2010 memorandum, in
which HUD interprets the Fair Housing Act's prohibition on sex
discrimination to include, at a minimum, discrimination related to an
individual's sexual orientation where the evidence establishes that the
discrimination is based on sex stereotypes. HUD's interpretation of sex
discrimination under the Fair Housing Act is also consistent with the
Department of Health and Human Services' rule interpreting sex
discrimination under Section 1557 the Affordable Care Act \18\ and the
Department of Labor's rule interpreting sex discrimination under Title
VII of the Civil Rights Act of 1964.\19\
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\15\ See, e.g., Prowel v. Wise Bus. Forms, Inc., 579 F.3d 285,
291-92 (3rd Cir. 2009) (harassment of a plaintiff because of his
``effeminate traits'' and behaviors could constitute sufficient
evidence that he ``was harassed because he did not conform to [the
employer's] vision of how a man should look, speak, and act--rather
than harassment based solely on his sexual orientation''); Nichols
v. Azteca Rest. Enter., Inc., 256 F.3d 864, 874-75 (9th Cir. 2001)
(coworkers' and supervisors' harassment of a gay male because he did
not conform to gender norms created a hostile work environment in
violation of Title VII); Hall v. BNSF Ry. Co., No. C13-2160 RSM,
2014 U.S. Dist. LEXIS 132878 *8-9 (W.D. Wash. September 22, 2014)
(plaintiff's allegation that ``he (as a male who married a male) was
treated differently in comparison to his female coworkers who also
married males'' stated a sex discrimination claim under Title VII);
Terveer v. Billington, 34 F. Supp. 3d 100, 116 (D.D.C. 2014) (Title
VII claim based on sex stated when plaintiff's ``orientation as
homosexual'' removed him from the employer's preconceived definition
of male); Heller v. Columbia Edgewater Country Club, 195 F. Supp. 2d
1212, 1224 (D. Or. 2002) (``[A] jury could find that Cagle
repeatedly harassed (and ultimately discharged) Heller because
Heller did not conform to Cagle's stereotype of how a woman ought to
behave. Heller is attracted to and dates other women, whereas Cagle
believes that a woman should be attracted to and date only men.'');
Centola v. Potter, 183 F. Supp. 2d 403, 410 (D. Mass. 2002)
(``Sexual orientation harassment is often, if not always, motivated
by a desire to enforce heterosexually defined gender norms. In fact,
stereotypes about homosexuality are directly related to our
stereotype about the proper roles of men and women.''). Cf. Videckis
v. Pepperdine Univ., 2015 U.S. Dist. LEXIS 167672, *16 (C.D. Cal.
2015) (``It is impossible to categorically separate `sexual
orientation discrimination' from discrimination on the basis of sex
or from gender stereotypes; to do so would result in a false choice.
Simply put, to allege discrimination on the basis of sexuality is to
state a Title IX claim on the basis of sex or gender.'').
\16\ Baldwin v. Dep't of Transp., EEOC Appeal No. 0120133080,
slip op. at 9-11 (July 16, 2015); Complainant v. Dep't of Homeland
Sec., EEOC Appeal No. 0120110576, slip op. at 1 (Aug. 20, 2014)
(``While Title VII's prohibition of discrimination does not
explicitly include sexual orientation as a basis, Title VII
prohibits sex discrimination, including sex-stereotyping
discrimination and gender discrimination'' and ``sex discrimination
claims may intersect with claims of sexual orientation
discrimination.''); Couch v. Dep't of Energy, EEOC Appeal No.
0120131136, slip op. at 1 (Aug. 13, 2013) (finding harassment claim
based on perceived sexual orientation is a discrimination claim
based on failure to conform to gender stereotypes); Culp v. Dep't of
Homeland Sec., EEOC Appeal 0720130012, slip op. at 1 (May 7, 2013)
(Title VII covers discrimination based on associating with lesbian
colleague); Castello v. U.S. Postal Serv., EEOC Appeal No.
0520110649, slip op. at 1 (Dec. 20, 2011) (vacating prior decision
and holding that complainant stated claim of discrimination based on
sex-stereotyping through evidence of offensive comments by manager
about female subordinate's relationships with women); Veretto v.
U.S. Postal Serv., EEOC Appeal No. 0120110873, slip op. at 1 (July
1, 2011) (court found that ``Complainant has alleged a plausible
sex-stereotyping'' claim of harassment because he married a man).
\17\ See, e.g., Gilbert v. Country Music Ass'n, 432 F. App'x
516, 520 (6th Cir. 2011) (acknowledging the validity of a sex-
stereotyping claim ``based on gender non-conforming `behavior
observed at work or affecting . . . job performance,' such as . . .
`appearance or mannerisms on the job,' '' but rejecting the
plaintiff's sex discrimination claim because his ``allegations
involve discrimination based on sexual orientation, nothing more. He
does not make a single allegation that anyone discriminated against
him based on his `appearance or mannerisms' or for his `gender non-
conformity.' '') (quoting Vickers v. Fairfield Med. Ctr., 453 F.3d
757, 763 (6th Cir. 2006); Pagan v. Gonzalez, 430 F. App'x 170, 171-
72 (3d Cir. 2011) (recognizing that ``discrimination based on a
failure to conform to gender stereotypes is cognizable'' but
affirming dismissal of the plaintiff's sex discrimination claim
based on ``the absence of any evidence to show that the
discrimination was based on Pagan's acting in a masculine manner'');
Dawson v. Bumble & Bumble, 398 F.3d 211, 221, 222-23 (2d Cir. 2005)
(observing that ``one can fail to conform to gender stereotypes in
two ways: (1) Through behavior or (2) through appearance, but
dismissing the plaintiff's sex discrimination claim because she
``has produced no substantial evidence from which we may plausibly
infer that her alleged failure to conform her appearance to feminine
stereotypes resulted in her suffering any adverse employment
action''). See also Hively v. Ivy Tech Community College, 2016 U.S.
App. LEXIS 13746, *16-25 (7th Cir. 2016) (reviewing this line of
cases).
\18\ Nondiscrimination in Health Programs and Activities, 81 FR
31376, 31388-90 (May 18, 2016) (to be codified at 45 CFR part 92).
\19\ Discrimination Because of Sex, 81 FR 39108, 39137-40 (June
15, 2016) (to be codified at 41 CFR part 60-20).
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Issue: Some commenters asked HUD to provide a definition of
harassment. A commenter noted that the proposed rule defines two types
of harassment--quid pro quo and hostile environment, but does not
define the general term ``harassment.'' Another commenter stated that
if HUD believes that other types of harassment may also violate the
Fair Housing Act, HUD should provide a definition of harassment. Other
commenters strongly supported the rule's definitions of quid pro quo
and hostile environment harassment, describing them as clear and
inclusive, and stated that the definitions and related examples
provided in the rule clarify what conduct the Fair Housing Act
prohibits and will aid all stakeholders' understanding of the rule's
provisions.
HUD Response: The term harassment has broad colloquial usage with
no defined parameters. For this reason, the final rule defines the
specific terms ``quid pro quo'' and ``hostile environment harassment.''
Other conduct that might generically be referred to as harassment might
fall in the categories of quid pro quo or hostile environment, or the
conduct may constitute a different type of discriminatory housing
practice in violation of section 818 of the Act or other provisions of
the Act, or the conduct may not violate the Act at all. As the preamble
to the proposed rule explained, a violation of section 818 may be
established using the standards for quid pro quo or hostile environment
harassment or by the specific elements of a section 818 violation,
i.e., (1) the plaintiff or complainant exercised or enjoyed--or aided
or encouraged another person in the exercise or enjoyment of--a right
guaranteed by sections 803-06; (2) the defendant's or respondent's
conduct constituted coercion, intimidation, a threat, or interference;
and (3) a causal connection existed between the exercise, enjoyment,
aid or encouragement of the right and the defendant's or respondent's
conduct.
Issue: Some commenters expressed concern that the proposed rule did
not expressly state that sections 804(b) and 818 of the Fair Housing
Act apply to discrimination that occurs after the complainant or
plaintiff acquires the dwelling. The commenters stated that some courts
have held that these provisions apply only to discrimination that
affects access to housing and urged HUD to add language to the rule
making clear that these particular provisions apply to post-acquisition
discrimination claims.
HUD Response: HUD believes that the definitions of ``quid pro quo''
and ``hostile environment harassment'' make clear HUD's view that the
Act covers post-acquisition conduct and therefore no additional
language is required. These definitions mirror the coverage of sections
804(b), 804(f)(2), and 818 of the Fair Housing Act, which plainly apply
to both pre-acquisition and post-acquisition discrimination claims.
Moreover, HUD has long interpreted and enforced these provisions of the
Act and others to protect against discrimination that occurs before one
acquires a dwelling as well as while one is living in the dwelling.
HUD's 1989 regulations interpreting sections 804(b), 804(f)(2), and 818
of the Act, for example, provide that discrimination prohibited under
these provisions includes the ``maintenance or repairs of sale or
rental dwellings,'' ``[d]enying or limiting the use of privileges,
services, or facilities associated with a dwelling,'' and threatening,
intimidating or interfering with persons ``in their enjoyment of a
dwelling.'' The inclusion of language covering the maintenance of
housing, the continued use of privileges, services, or facilities
associated with housing, and the ``exercise or enjoyment'' of housing
indicates circumstances in which residents--as opposed to just
applicants--benefit from the Act's protections throughout their
residency.
Sections 100.65(b)(6)-(7) of the proposed and of the final rule
further illustrate some ways in which a person may violate sections
804(b), 804(f)(2), and 818 of the Fair Housing Act: ``conditioning the
terms, conditions, or privileges relating to the sale or rental of a
dwelling, or denying or limiting the services or facilities in
connection therewith, on a person's response to harassment because of
[a protected characteristic]; ``subjecting a person to harassment
because of [a protected characteristic] that has the effect of imposing
different terms, conditions, or privileges relating to the sale or
rental of a dwelling or denying or limiting services or facilities in
connection with the sale or rental of a dwelling.'' In sum, the Act and
HUD's regulations, including this final rule, make clear that the Act
prohibits discrimination that occurs while a person resides in a
dwelling, and courts have repeatedly interpreted the Act similarly.\20\
---------------------------------------------------------------------------
\20\ See, e.g., Bloch v. Frischholz, 587 F.3d at779-81 (ruling
that post-sale conduct by a homeowner's association could violate
section 804(b) of the Act and allowing section 3604(b) claims to
address post-acquisition conduct was consistent with HUD's
regulations (citing 24 CFR 100.65(b)(4))); Comm. Concerning Cmty.
Improvement v. City of Modesto, 583 F.3d 690, 713 (9th Cir. 2009)
(concluding that the Act covers post-acquisition discrimination);
Neudecker v. Boisclair Corp., 351 F.3d at 364 (finding plaintiff's
post-acquisition harassment claim valid under the Act); DiCenso v.
Cisneros, 96 F.3d 1004, 1008 (7th Cir. 1996) (recognizing claim for
sexual harassment hostile housing environment under the Act); Honce
v. Vigil, 1 F.3d at 1089-90 (recognizing that the Act prohibits both
quid pro quo and hostile housing environment sexual harassment);
Woods-Drake v. Lundy, 667 F.2d 1198, 1201 (5th Cir. 1982) (finding
that a landlord's discriminatory conduct against current tenants
violated section 3604(b) of the Act); Richards v. Bono, No.
5:04CV484-OC-10GRJ, 2005 WL 1065141, at *3 (M.D. Fla. May 2, 2005)
(``[b]ecause the plain meaning of `rental' contemplates an ongoing
relationship, the use of that term in Sec. 3604(b) means that the
statute prohibits discrimination at any time during the landlord/
tenant relationship, including after the tenant takes possession of
the property''); United States v. Koch, 352 F. Supp. 2d 970, 976 (D.
Neb. 2004) (``[I]t is difficult to imagine a privilege that flows
more naturally from the purchase or rental of a dwelling than the
privilege of residing therein.''); U.S. Department of Housing and
Urban Development, Office of Fair Housing and Equal Opportunity,
Questions and Answers on Sexual Harassment under the Fair Housing
Act (2008), available at https://portal.hud.gov/hudportal/documents/huddoc?id=QAndASexualHarassment.pdf (recognizing that current
tenants may file fair housing complaints under the Act); Robert G.
Schwemm, Fair Housing Litigation After Inclusive Communities: What's
New and What's Not, 115 Colum. L. Rev. Sidebar 106, 122-23 (2015)
(explaining that many post-acquisition actions, such as evictions
and harassment, may give rise to violations under sections 804(a)
and 804(b) of the Act).
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[[Page 63060]]
Issue: Some commenters asked HUD to clarify how to distinguish
potentially actionable harassment under the Fair Housing Act from
protected speech under the First Amendment. A commenter said that it is
not clear how conduct that allegedly constitutes harassment under the
rule may be distinguished from other speech or conduct that is
constitutionally protected or so trivial so as not to qualify as
harassment in the first place. Another commenter said that courts have
consistently held that the First Amendment protects a tenant who
publicly speaks about a neighbor, even if that conduct is motivated by
discriminatory intent. Another commenter asked whether the proposed
rule would implicate constitutional protections of free speech or free
exercise of religion if the housing provider evicts a tenant where, for
example, two tenants are having heated religious arguments about the
other's choice of religious attire. Another commenter stated that the
proposed rule properly balanced the competing rights at issue and did
not interfere with constitutionally protected speech because the rule
would not encompass speech that is merely offensive or that causes
nothing more than hurt feelings.
HUD Response: As discussed elsewhere in this preamble, not every
dispute between neighbors is a violation of the Fair Housing Act.
Moreover, speech that is protected by the First Amendment is not within
the Act's prohibitions. First Amendment protections do not extend to
certain acts of coercion, intimidation, or threats of bodily harm
proscribed by section 818 of the Act. As the Supreme Court has stated,
``true threats'' have no First Amendment protection.\21\ In Notice
FHEO-2015-01, HUD has set out substantive and procedural guidelines
regarding the filing and investigation of Fair Housing Act complaints
that may implicate the First Amendment.\22\ The Notice discusses how
HUD handles complaints against persons who are not otherwise covered by
the Act, but who are alleged to have violated Section 818 of the Act.
---------------------------------------------------------------------------
\21\ See, e.g., R.A.V. v. City of St. Paul, 505 U.S. 377, 388
(1992).
\22\ Notice FHEO 2015-01 found at: https://portal.hud.gov/hudportal/documents/huddoc?id=5-26-2015notice.pdf.
---------------------------------------------------------------------------
Issue: A commenter suggested that the rule is unnecessary because
other administrative and legal remedies already exist for victims of
harassment under state and local law. Another commenter suggested that
the rule is unnecessary because HUD has already charged cases involving
harassment under the Act.
HUD Response: This final rule formalizes and provides uniform
standards for evaluating complaints of quid pro quo and hostile
environment harassment under the Fair Housing Act. While other
administrative and legal causes of action may exist for victims of quid
pro quo and hostile environment harassment under landlord-tenant law,
tort law, or other state law, they do not substitute for the
protections against discrimination and the remedies provided under the
Act. Moreover, the fact that HUD has previously issued charges of
discrimination involving quid pro quo or hostile environment harassment
does not negate the need for this rule.
Issue: A commenter asked HUD to abandon the rulemaking process and
instead provide specific, clear guidance to the regulated community so
that housing providers can ascertain the types of behavior that do and
do not constitute harassment under the Fair Housing Act. Other
commenters requested that HUD provide technical assistance on various
aspects of the rule to residents, housing providers, and practitioners
to ensure all parties know their rights under the law.
HUD Response: HUD declines to abandon this rulemaking. This
regulation is needed to formalize standards for assessing claims of
harassment under the Fair Housing Act and to clarify when housing
providers and others covered by the Act may be liable for illegal
harassment or other discriminatory housing practices. It has been HUD's
experience that there is significant misunderstanding among public and
private housing providers about the circumstances under which they may
be liable. This regulation provides greater clarity in making that
assessment. HUD will continue to offer guidance and training on the
Fair Housing Act generally and on this final rule, as needed.
Issue: A commenter recommended that the rule expand the limits for
damages in cases that establish sexual harassment in housing.
HUD Response: HUD declines to make this change because it is
unnecessary. The Act contains no limit on damages that may be awarded,
specifically authorizing an award of ``actual damages.'' 42 U.S.C.
3612(g)(3); 3613(c)(1); 3614(d)(1)(B).
Issue: A commenter asked HUD to consider expanding the time for
filing sexual harassment complaints where a hostile environment case
includes subsequent harassment that occurs many months after the
initial act of sexual harassment.
HUD Response: HUD declines to adopt this recommendation because the
Fair Housing Act specifically defines the statute of limitations for
filing complaints. It is one year after an alleged discriminatory
housing practice occurred or terminated for a complaint with HUD and
two years after an alleged discriminatory housing practice occurred or
terminated for a civil action in federal district court or state court.
See 42 U.S.C. 3610; 3613. If a violation is continuing, the limitations
period runs from the date of the last occurrence or termination of the
discriminatory act.\23\
---------------------------------------------------------------------------
\23\ See, e.g., Havens Realty Corp. v. Coleman, 455 U.S. 363,
380-81 (1982); Neudecker v. Boisclair Corp., 351 F.3d at 363 ; Spann
v. Colonial Vill., Inc., 899 F.2d 24, 34-35 (D.C. Cir. 1990);
Heights Cmty Congress v. Hilltop Realty, Inc., 774 F.2d 135, 139-41
(6th Cir. 1985).
---------------------------------------------------------------------------
1. Quid Pro Quo Harassment: Sec. 100.600(a)(1)
Issue: A commenter asked how the rule would ``differentiate between
a situation of involuntary quid pro quo that genuinely must be governed
by the Act and a situation where one party is manipulating the rule
following a mutually beneficial and agreed upon transaction.''
HUD Response: The rule's definition of quid pro quo harassment
requires a request or demand that is ``unwelcome.'' A mutually
beneficial and agreed upon transaction is not unwelcome and would not
constitute quid pro quo harassment under the rule or the Act. It is
important to note, however, that, as the rule states, if an individual
[[Page 63061]]
acquiesces to an unwelcome request or demand, unlawful quid pro quo
harassment may have occurred. Moreover, if a housing provider regularly
or routinely confers housing benefits based upon the granting of sexual
favors, such conduct may constitute quid pro quo harassment or hostile
environment harassment against others who do not welcome such conduct,
regardless of whether any objectionable conduct is directed at them and
regardless of whether the individuals who received favorable treatment
willingly granted the sexual favors.\24\ Liability in all situations
involving allegations of harassment must be determined on a case-by-
case basis.
---------------------------------------------------------------------------
\24\ Cf. EEOC Policy Guidance No. N-915.048, Employer Liability
under Title VII for Sexual Favoritism (Jan. 12, 1990) (providing
that widespread sexual favoritism based upon solicitations for and/
or the granting of sexual favors or other sexual conduct ``can form
the basis of an implicit `quid pro quo' harassment claim for female
employees, as well as a hostile environment claim for both women and
men who find this offensive'').
---------------------------------------------------------------------------
Issue: A commenter stated that the preamble to the proposed rule
was vague in stating that ``a person is aggrieved if that person is
denied or delayed in receiving a housing-related opportunity or benefit
because another received the benefit.'' The commenter was concerned
that this statement would require a PHA to identify, investigate, and
document a defense to any tenant-perceived delay in receiving benefits.
HUD Response: The quoted phrase is not vague when read in context,
which explains the meaning of quid pro quo harassment under the Fair
Housing Act. The phrase refers to a person who is aggrieved because he
or she is denied a benefit that went to another in exchange for sexual
favors, for example. Aggrieved persons under the Act and HUD's
regulation are limited to those who were injured (or are about to be
injured) by a discriminatory housing practice as defined in the Act.
Neither the Fair Housing Act nor this final rule prohibits delays in
receiving housing-related opportunities or benefits for
nondiscriminatory reasons. If, however, an applicant or tenant alleges
that he or she has been denied or delayed in receiving a benefit
because others submitted to requests for sexual favors, the PHA should
investigate to determine if quid pro quo or hostile environment
harassment has occurred.
2. Hostile Environment Harassment: Sec. 100.600(a)(2)
Issue: Several commenters recommended that HUD ensure consistency
of the discussion of hostile environment harassment throughout the
preamble in order to prevent any unintentional barriers for harassment
victims seeking to bring claims under the Fair Housing Act. The
commenters specifically stated that in one section of the preamble to
the proposed rule, HUD defines ``hostile environment harassment'' to
require unwelcome conduct because of a protected characteristic that
``unreasonably interferes'' with the use and enjoyment of a dwelling,
or with the exercise of other rights protected by the Act. By contrast,
the commenters stated, other sections of the preamble rightly omit the
``unreasonably'' qualifier when discussing hostile environment
harassment. The commenters requested that the word ``unreasonably'' be
removed from the discussion in the preamble because it is unnecessary
and will create confusion. They stated that unwelcome conduct that is
``sufficiently severe or pervasive'' as to interfere with one's
enjoyment of rights protected under the Act is in itself unreasonable.
HUD Response: The term ``unreasonably'' does not appear in the
definition of ``hostile environment harassment'' in the regulatory text
of the proposed rule. The term ``unreasonably'' was used in the
preamble to the proposed rule to convey how a claim of hostile
environment would be evaluated; that is, from the perspective of a
reasonable person in the aggrieved person's position. HUD agrees that
the use of the term ``unreasonably'' in the preamble may have caused
confusion by conflating the substantive standard with the method of
proof. In this final rule, as was the case in the proposed rule, the
definition of ``hostile environment harassment'' in Sec. 100.600(a)(2)
is not phrased as requiring proof that unwelcome conduct
``unreasonably'' interfere with a right protected by the Fair Housing
Act. But it remains that whether unwelcome conduct is sufficiently
severe or pervasive as to interfere with rights protected by the Act,
and therefore constitute hostile environment harassment, is evaluated
from the perspective of a reasonable person in the aggrieved person's
position.
Issue: A commenter suggested that HUD include definitions and
descriptions of ``bullying'' in this final rule because bullying is
very similar to hostile environment harassment.
HUD Response: HUD does not agree that it is necessary to add the
word ``bullying'' to the final rule in order to cover conduct that
could be considered bullying. Section 100.600(a)(2) of the proposed
rule and of this final rule, which defines hostile environment
harassment and specifies the factors to be considered when evaluating
whether particular conduct creates a hostile environment in violation
of the Act, is broadly worded and fully captures the concept of
bullying because of a protected characteristic that the commenter seeks
to include.
Issue: A commenter said HUD should include social isolation and
neglect as forms of harassment under the rule, especially when they
occur with the intent to drive a person from his or her home or
interfere with his or her enjoyment of a dwelling. According to the
commenter, these actions have major implications for the psychological
well-being of an individual.
HUD Response: HUD appreciates that social isolation and neglect are
serious concerns. This rule is limited to conduct engaged in because of
a protected characteristic. If a tenant is subjected to unwanted severe
or pervasive conduct because of a disability, for example, which leads
to social isolation with the intent or effect of driving the tenant
from his or her home or interfering with his or her enjoyment of a
dwelling, such conduct could constitute hostile environment harassment
under the standards set forth in the rule.
Issue: A commenter said the rule could more clearly distinguish
harassment from inappropriate behavior or disputes that do not rise to
the level of harassment. Other commenters stated that they appreciated
the rule's emphasis on the totality of the circumstances, which will
ensure that mere disagreements, mistaken remarks, or isolated words
spoken in the heat of the moment will not result in liability unless
the totality of the circumstances establishes hostile environment
harassment.
HUD Response: HUD agrees that not every disagreement between
persons involved in a housing transaction constitutes unlawful
harassment because of a protected characteristic in violation of the
Act and believes the rule appropriately captures the distinction.
Section 100.600(a)(2) of the proposed rule and of this final rule
defining hostile environment harassment requires that the unwelcome
conduct be ``sufficiently severe or pervasive'' as to interfere with
defined features of the housing transaction: The availability, sale,
rental, or use or enjoyment of a dwelling; the terms, conditions, or
privileges of the sale or rental, or the provision or enjoyment of
services or facilities in connection therewith; or the availability,
terms or conditions of a residential real estate-related transaction.
[[Page 63062]]
Issue: A commenter recommended that the final rule recognize the
role of preferential treatment for services and living arrangements,
except when provided because of disability, as a type of
discrimination. The commenter said that preferential treatment is a
means through which to encourage and reward secondary actors for their
role in creating a hostile environment, and the rule should recognize
it as such. The commenter also recommended that HUD request and make
available data regarding repairs or upgrades so any non-monetary favor
in exchange for harassment, by an agent not directly employed by the
management or owner, may be determined.
HUD Response: HUD declines to adopt the commenter's suggestions
because the rule as currently proposed already accommodates the
commenter's concerns. Providing preferential treatment that creates a
hostile environment because of race, color, religion, sex, familial
status, or national origin already violates the Fair Housing Act under
the standards proposed in the rule. Moreover, HUD's regulations already
contain illustrations as to this type of violation. Therefore,
additional language regarding preferential treatment is not needed. In
addition, processes for requesting and making available data regarding
repairs or upgrades are outside the scope of this rule. HUD notes that
in investigations, it requests data regarding repairs or upgrades as
appropriate to determine whether a violation of the Fair Housing Act
has occurred.
Issue: Two commenters asked whether the rule would apply to
situations in which residential property managers or other employees of
a housing provider are harassed by the housing provider's tenants. One
of the commenters explained that she was a resident of the building she
managed, that she had a disability, and that she had suffered
harassment and threats by other residents.
HUD Response: The proposed standards generally would not apply to
situations in which a property manager or other housing provider
employee is harassed by the housing provider's tenants because such
situations ordinarily do not involve a housing-related transaction
covered by the Act. Where, however, a property manager is also a
resident of the building that the property manager manages (e.g., a
resident-manager), the property manager is entitled to the same
protection from discriminatory harassment under the Act and under this
final rule as any other resident. Additionally, Section 818 of the Act
makes it unlawful to coerce, intimidate, threaten, or interfere with
any person on account of the person having assisted others in enjoying
or exercising their fair housing rights. Therefore, to the extent that
a property manager or other housing provider employee (whether a
resident or not) is subjected to coercion, intimidation, threats, or
interference because he or she aided or encouraged other people in
exercising or enjoying a right protected by the Act--e.g., by receiving
and responding to one tenant's complaint of discriminatory harassment
by another tenant--the manager or employee may be entitled to
protection under the Act.\25\
---------------------------------------------------------------------------
\25\ A property manager may also be protected by Title VII,
whether or not he or she resides at the housing.
---------------------------------------------------------------------------
i. Totality of the Circumstances: Sec. 100.600(a)(2)(i)
Issue: Some commenters requested that HUD clarify the definition of
``totality of the circumstances'' in Sec. 100.600(a)(2)(i) because, in
the commenters' view, the proposed rule does not sufficiently explain
the showing required to prove hostile environment harassment in
violation of the Fair Housing Act. Other commenters supported HUD's
standard for determining whether conduct constitutes a hostile
environment, stating that the standard and its factors are clear and
permit an appropriately individualized assessment of the facts of each
case. These commenters stated that the rule's explanation of hostile
environment harassment provides meaningful guidance to both housing
providers and potential claimants.
HUD Response: HUD believes the ``totality of the circumstances''
standard in this final rule provides an appropriate standard for
assessing claims of hostile environment harassment, while also
providing courts with the flexibility to consider the numerous and
varied factual circumstances that may be relevant when assessing a
specific claim. HUD therefore chooses not to alter the definition of
the term ``totality of the circumstances,'' although it will add to the
final rule the standard by which the evidence is to be evaluated, which
is from the perspective of a reasonable person in the aggrieved
person's position. Section 100.600(a)(2) defines what constitutes
hostile environment harassment under the Act. In accordance with this
provision, establishing a hostile environment harassment violation
requires proving that: A person was subjected to unwelcome spoken,
written, or physical conduct; the conduct was because of a protected
characteristic; and the conduct was, considering the totality of the
circumstances, sufficiently severe or pervasive as to interfere with or
deprive the victim of his or her right to use and enjoy the housing or
to exercise other rights protected by the Act. Whether a hostile
environment harassment violation has occurred is a fact-specific
inquiry, and the rule supplies a non-exhaustive list of factors that
must be considered in making that determination. It would be impossible
to quantify in the rule the amount of evidence necessary to make such a
showing in every case involving a claim of hostile environment
harassment. The additional instruction in the rule text, and not just
the preamble, that the ``totality of the circumstances'' is to be
evaluated from the perspective of a reasonable person in the aggrieved
person's position will aid all parties in assessing whether a ``hostile
environment'' has been created.
Issue: HUD received several comments regarding the explanation in
the preamble to the proposed rule that hostile environment harassment
should be assessed from the perspective of a reasonable person in the
aggrieved person's position. A commenter expressed concern that this
standard is too subjective, stating that one reasonable person's
measure may be different from another reasonable person's measure.
Another commenter asked HUD to provide a definition of the term
``reasonable person.'' Other commenters approved of the standard
articulated in the preamble to the proposed rule and commended HUD for
recognizing that the reasonable person standard must take into account
the circumstances of the aggrieved person. A commenter recommended that
the rule text itself explicitly state this objective standard. Another
commenter, however, recommended that HUD not add the standard to the
rule text itself because such addition may invite courts to second-
guess the rationality and behavior of the actual victim, rather than
focusing on the conduct and its surrounding circumstances.
HUD Response: As HUD explained in the preamble to the proposed
rule, whether unwelcome conduct is sufficiently severe or pervasive to
create a hostile housing environment is evaluated from the perspective
of a reasonable person in the aggrieved person's position. This
standard is an objective one, but ensures that an assessment of the
totality of the circumstances includes consideration of whether persons
of the same protected class and of like personal experience as
[[Page 63063]]
the plaintiff or complainant would find the challenged conduct to
create a hostile environment. At the proposed rule stage, HUD chose not
to add the ``reasonable person in the aggrieved person's position''
standard to the text of the rule itself. But in light of the confusion
expressed by some of the commenters, HUD has added this standard to the
text of the final rule discussing the totality of the circumstances
standard. In adding this reasonable person standard for assessing the
evidence to the rule text, HUD does not intend to create an additional
requirement for proving a hostile environment harassment claim beyond
the showing required under Sec. 100.600(a)(2) of the rule. The
definition of hostile environment harassment in this final rule remains
unchanged and focuses on defining the types of conduct that may
establish a claim of hostile environment harassment under the Fair
Housing Act.
(A) Factors To Be Considered: Sec. 100.600(a)(2)(i)(A)
Issue: Several commenters commended HUD's explanation in the
preamble to the proposed rule that individuals have heightened rights
within their home for privacy and freedom from unwelcome speech and
conduct. Many commenters agreed with HUD that harassment in or around
one's home can be far more intrusive, violative, and threatening than
harassment in the more public environment of one's workplace. Some
commenters said these considerations should be explicitly incorporated
into the text of the rule itself. Commenters specifically requested
that HUD revise proposed Sec. 100.600(a)(2)(i)(A) by adding as a
factor to be considered in determining whether hostile environment
harassment exists ``the heightened rights in or around one's home for
privacy and freedom from harassment'' or ``the heightened reasonable
expectation of privacy and freedom from harassment in one's home.''
Another commenter said that Sec. 100.600(a)(2)(i)(A) should expressly
state that conduct occurring in one's home may result in a violation of
the Fair Housing Act even though the same conduct in one's place of
employment may not violate Title VII.
HUD Response: HUD declines to add language regarding individuals'
heightened rights within the home for privacy and freedom from
unwelcome speech and conduct to the rule text in Sec.
100.600(a)(2)(i)(A). The non-exhaustive list of factors included in
Sec. 100.600(a)(2)(i)(A) identifies circumstances that can be
demonstrated with evidence during the adjudication of a claim of
hostile environment harassment under the Act. Evidence regarding the
``location of the conduct,'' as explicitly identified in Sec.
100.600(a)(2)(i)(A), is a critical factor for consideration and will
allow courts to take into account the heightened privacy and other
rights that exist within the home when determining whether hostile
environment harassment occurred. For similar reasons, HUD also declines
to add language stating that harassing conduct may result in a
violation of the Fair Housing Act even though such conduct might not
violate Title VII. HUD believes that by establishing a hostile
environment harassment standard tailored to the specific rights
protected by the Fair Housing Act and by directing that hostile
environment claims under the Act are to be evaluated by assessing the
totality of the circumstances--including the location of the unwelcome
conduct and the context in which it occurred--the final rule ensures
that courts consider factors unique to the housing context when making
the fact-specific determination of whether the particular conduct at
issue violates the Act. Therefore, while HUD agrees that unwelcome
conduct in or around the home can be particularly intrusive and
threatening and may violate the Fair Housing Act even though the same
or similar conduct in an employment setting may not violate Title VII,
HUD does not believe the proposed additions to Sec.
100.600(a)(2)(i)(A) are necessary.
Issue: A commenter supported HUD's identification of the
relationship of the persons involved as a factor to be considered when
determining whether hostile environment harassment has occurred, but
recommended that the final rule further refine the concept.
Specifically, in the homeowner's association context, the commenter
drew distinctions between the relationships among the different
resident-owners and between a board member and a resident-owner. The
commenter also distinguished these relationships from landlord-tenant
relationships.
HUD Response: HUD appreciates these distinctions and believes the
rule already accommodates them by requiring the relationship of the
parties involved be taken into account in determining whether a hostile
environment has been created. This is one of several factors that HUD
identified for evaluating allegations of hostile environment
harassment. In a community governed by a homeowner's association, for
example, the influence an owner-board member has over another resident
by virtue of his or her authority to make association policy, to
approve homeowner requests, and to bring or adjudicate charges of
association rule violations may be greater than a non-board member, and
thus each person's relationship to the victim should be considered when
assessing whether a hostile environment exists. No further refinement
to the rule is necessary to address the commenter's concerns; nor is
any further refinement desirable, as it would risk inadvertently
inserting limiting factors into the otherwise broad and flexible
totality of the circumstances test.
(B) Physiological or Physical Harm: Sec. 100.600(a)(2)(i)(B)
Issue: A commenter stated that Sec. 100.600(a)(2)(i)(B) of the
proposed rule, which concerns psychological or physical harm, is
confusing. The commenter requested that HUD clarify the meaning of this
provision.
HUD Response: HUD agrees that Sec. 100.600(a)(2)(i)(B) may be
confusing and has revised this provision at the final rule stage; the
revision is intended to clarify without altering the meaning of the
provision. Proposed Sec. 100.600(a)(2)(i)(B) provided that ``Evidence
of psychological or physical harm is relevant in determining whether a
hostile environment was created, as well as the amount of damages to
which an aggrieved person may be entitled. Neither psychological nor
physical harm, however, must be demonstrated to prove that a hostile
environment exists.'' Final Sec. 100.600(a)(2)(i)(B) provides that
``Neither psychological nor physical harm must be demonstrated to prove
that a hostile environment exists. Evidence of psychological or
physical harm may, however, be relevant in determining whether a
hostile environment was created and, if so, the amount of damages to
which an aggrieved person may be entitled.'' As explained at the
proposed rule stage, evidence of such harm is but one of many factors
that may be considered in assessing the totality of the circumstances.
So long as the unwelcome conduct is sufficiently severe or pervasive as
to interfere with or deprive the victim of a right protected by the
Act, there is no need to also demonstrate psychological or physical
injury in order to prove a hostile environment violation.
ii. Title VII Affirmative Defense: Sec. 100.600(a)(2)(ii)
Issue: HUD received several comments on Sec. 100.600(a)(2)(ii) of
the proposed rule, which provides that the
[[Page 63064]]
Title VII affirmative defense to an employer's vicarious liability for
hostile environment harassment by a supervisor does not apply to claims
brought pursuant to the Fair Housing Act. Several commenters commended
HUD's decision not to extend the Title VII affirmative defense to the
Fair Housing Act and agreed with HUD that such a defense would be
inappropriate in the housing context, in part because of the lack of an
exhaustion requirement under the Fair Housing Act, as well as the
differences between an agent in the employment context versus an agent
in the housing context.
Other commenters recommended that HUD apply the judicially-created
Title VII affirmative defense to Fair Housing Act claims. One such
commenter stated that HUD, by rule, cannot import a Title VII cause of
action onto the Fair Housing Act without the judicially-created
limitations on a Title VII employer's liability under that cause of
action. Another commenter believed that HUD eliminated an existing
affirmative defense for housing providers that is available in the
employment context. Given the scope of potential harassment claims,
this commenter found unwarranted HUD's position that the Title VII
affirmative defense is not relevant to harassment in the housing
context because, in HUD's view, a housing agent who harasses residents
is inevitably aided by his or her agency relationship with the housing
provider. In the commenter's view, a responsible housing provider who
exercises reasonable care to prevent harassment, and who provides a
complaint mechanism that a resident unreasonably fails to invoke,
should be afforded the same affirmative defense available to employers
in analogous situations. Another commenter asked HUD to reconsider its
decision to reject the affirmative defense as it appears unfair and
based on an assertion that agents of housing providers are equivalent
to a supervisory employer in terms of their power over applicants and/
or tenants.
HUD Response: After carefully considering the analysis provided by
the commenters on both sides of the issue, HUD has retained its view
that the Title VII affirmative defense is not appropriate to include as
a defense under the Fair Housing Act. HUD has never found occasion to
employ such a defense and remains unaware of any court having extended
the Title VII affirmative defense to fair housing claims, and
commenters did not identify any such case law. Moreover, unlike Title
VII, which requires employees to exhaust their administrative remedies
before filing an action in court, the Fair Housing Act has no
exhaustion requirement, and nothing in the text of the Fair Housing Act
otherwise indicates that Congress intended to permit a housing provider
to avoid vicarious liability for discriminatory harassment perpetrated
by its agents by establishing its own complaint process or procedure.
To the contrary, the Act authorizes any aggrieved person to directly
commence a civil action in federal or state court, whether or not the
individual has previously chosen to file an administrative complaint
with HUD.\26\ Therefore, as explained in the preamble to the proposed
rule, the Title VII affirmative defense is not appropriately applied to
harassment in the housing context because its adoption would impose
burdens on victims of discriminatory harassment that are incompatible
with the broad protections and streamlined enforcement mechanisms
afforded by the Fair Housing Act.
---------------------------------------------------------------------------
\26\ See 42 U.S.C. 3614(a).
---------------------------------------------------------------------------
HUD notes that some comments on this issue demonstrated a
misunderstanding of the potential scope of the Title VII affirmative
defense. The Title VII affirmative defense does not apply to harassment
claims based on direct liability. Thus, contrary to the perceptions of
some commenters, the affirmative defense does not apply to cases in
which an employer--or housing provider--knew or should have known of an
agent or third-party's harassment and failed to stop it, because such
cases involve direct rather than vicarious liability.
Therefore, in exercising its power to promulgate rules to interpret
and carry out the Act, HUD believes it would be inappropriate to add,
for the first time, an affirmative defense that would require victims
of hostile environment harassment--who are often housing insecure or
otherwise especially vulnerable--to choose between the risk of
retaliation by the perpetrator and the risk of losing their right to
hold a housing provider liable for the acts of its agents. Instead, the
traditional principles of vicarious liability--including those
standards that hold a principal liable for an agent's conduct that is
taken within the scope of employment, with the apparent authority of
the principal, or that is otherwise aided by the agency relationship--
will continue to govern a housing provider's liability for harassment.
While HUD declines to extend the Title VII affirmative defense to the
Fair Housing Act, the development and dissemination of anti-harassment
policies will still assist housing providers to avoid litigation by
identifying and quickly addressing improper conduct by employees or
other agents.
Issue: A commenter requested that HUD create safe harbors from
liability for housing providers for harassment by their agents and
third-parties. Specifically, the commenter stated that liability for
unknown and unintended harassment by an agent or third-party should not
be imposed on a housing provider where the housing provider: (1)
Provides periodic mandatory fair housing training for its employees and
agents (including training related to harassment claims); (2) requires
unaffiliated management companies to conduct similar training of their
employees, report to the property owner on a regular basis about the
steps it is taking to avoid fair housing claims generally, and promptly
report any potential fair housing claim to a designated official of the
housing provider; and (3) implements and publicizes a hotline or other
secure communication mechanism whereby a tenant can confidentially
notify the housing provider about possible harassment by employees or
other tenants.
Another commenter expressed concern that the rule as proposed would
expand a PHA's exposure to liability by making the PHA liable for
perceived hostile environment harassment that occurs beyond its
knowledge or control and fails to create or incentivize any new
remedies to protect tenants against hostile environment harassment. As
a result, according to the commenter, the proposed rule raises the
possibility that future litigation over alleged harassment might be
driven by plaintiff attorneys' fees rather than the merit of the
allegations or effective remedies. In light of these concerns, the
commenter suggested that HUD revise the proposed rule to adopt defenses
similar to those applicable to public agencies under California state
law for injuries caused by dangerous conditions on the public agency's
property. As described by the commenter, the State law defense provides
that liability attaches to the public agency if the plaintiff
establishes that: (1) The public employee's negligence or wrongful act
or omission created the dangerous condition; or (2) the public entity
had actual or constructive notice of the dangerous condition before the
injury occurred. The commenter believes this standard incentivizes the
public agency to maintain its property and train its staff in order to
limit its exposure to liability and reduce the risk of injuries.
[[Page 63065]]
HUD Response: As explained in the preamble to the proposed rule,
traditional principles of tort liability and agency law apply in fair
housing cases. The standards for direct and vicarious liability
established in this final rule continue to reflect such principles and
do not impose any new legal obligations or create or define new agency
relationships or duties of care. For the same reasons that HUD does not
interpret the Fair Housing Act to import the Title VII affirmative
defense for a claim of hostile environment harassment by the provider's
agent, HUD does not believe the requested safe harbor or state law-
derived defense from liability is appropriate.
The California State law identified by the commenter essentially
imposes a negligence standard for public agency liability, which is
akin to the standard of direct liability that governs Fair Housing Act
claims under Sec. 100.7(a)(1)(ii). In addition, under traditional
principles of agency law, a housing provider may be held vicariously
liable for the discriminatory acts of an employee or agent regardless
of whether the housing provider knew of or intended the discriminatory
conduct where the employee was acting within scope of his or her
agency, or where the harassment was aided by the agency relationship.
HUD believes that traditional tort and agency law standards for
assessing liability under the Act will encourage housing providers to
provide appropriate training for their staff and to ensure compliance
with the Act.
Issue: A commenter asserted that the proposed rule, including HUD's
decision not to adopt the Title VII affirmative defense, raises
Federalism implications. The commenter stated that the proposed rule
creates a cause of action based on Title VII law that could,
ostensibly, be brought against a State, even when the actions are
performed by a city or other sub-recipient of funds, and obviate the
State's sovereign immunity despite its ongoing assertion that it has
not waived such sovereign immunity. The commenter said that the rule
would do so while removing the judicially-created Title VII affirmative
defense. The commenter recommended that HUD withdraw the rule or create
a specific carve-out for actions against a State that limits and
defines the extent of vicarious liability, including a safe-haven for
conduct or policy akin to an affirmative defense.
HUD Response: Executive Order 13132 (entitled ``Federalism'')
prohibits an agency from publishing any rule that has federalism
implications if the rule either (1) imposes substantial, direct
compliance costs on state and local governments and is not required by
statute, or (2) preempts state law, unless the agency meets the
consultation and funding requirements of section 6 of the Executive
Order. Under the Executive Order, Federalism implications are those
having substantial direct effects on states or local governments
(individually or collectively), on the relationship between the
national government and the states, or on the distribution of power and
responsibilities among the various levels of government. This final
rule does not have such implications. As discussed elsewhere, the rule
creates no new cause of action, liability or obligation on the part of
any housing provider, including a State. The rule interprets the Fair
Housing Act's prohibition on discriminatory harassment, and in doing
so, neither alters the substantive prohibitions against discrimination
in the Act nor creates enhanced liability or compliance costs for
States or any other entities or individuals. Similarly, the rule does
not alter any sovereign immunity protections that a State may have
under the Eleventh Amendment. In addition, the rule does not remove a
pre-existing affirmative defense, because no court of which HUD is
aware has ever applied the Title VII affirmative defense or any other
affirmative defense or safe harbor to Fair Housing Act claims; nor has
HUD ever applied such a standard. HUD notes further that creating an
affirmative defense or safe harbor for States would not be consistent
with Congressional intent, for the reasons discussed above.
b. Type of Conduct: Sec. 100.600(b)
Issue: A commenter inquired whether a verbal or written account
from an aggrieved tenant would be enough to comprise a showing of
hostile environment harassment under the Act.
HUD Response: A verbal or written account from an aggrieved tenant
may be enough to provide notice to a housing provider that a hostile
environment may be occurring, but whether it would be sufficient to
establish that the conduct is sufficiently severe or pervasive to
create a hostile environment depends on the totality of the
circumstances.
c. Number of Incidents: Sec. 100.600(c)
Issue: A commenter expressed concern that the proposed rule
includes both a ``totality of the circumstances standard'' and a
``single incident standard'' and asked HUD to provide more descriptive
language to determine the existence of a hostile environment based on
such standards. The commenter asked HUD to clarify or provide examples
of when a single incident of harassment would be sufficient to create a
hostile environment. Several other commenters expressed approval of
Sec. 100.600(c) of the proposed rule, which provides that a single
incident of harassment because of race, color, religion, sex, familial
status, national origin, or disability may constitute a discriminatory
housing practice, where the incident is severe, or evidences a quid pro
quo. Other commenters stated that in some cases a single act can be so
severe as to deprive individuals of their right to use and enjoy their
housing.
HUD Response: HUD did not intend to propose two different standards
for determining whether hostile environment harassment has occurred. To
avoid confusion and better clarify the relationship between Sec.
100.600(c) and Sec. 100.600(a)(2), HUD is revising Sec. 100.600(c) at
this final rule stage. Section 100.600(a)(2) of the rule provides the
only standard that must be met to prove a claim of hostile environment
harassment under the Act--namely, that: A person was subjected to
unwelcome spoken, written, or physical conduct; the conduct was because
of a protected characteristic; and the conduct was sufficiently severe
or pervasive as to interfere with or deprive the victim of his or her
right to use and enjoy the housing or to exercise other rights
protected by the Act. As provided in Sec. 100.600(a)(2)(i), a
determination of whether this standard has been met is to be based on
the totality of the circumstances. Section 100.600(c) is included in
the rule to make clear that a single incident of harassment because of
a protected characteristic, if sufficiently severe, can constitute a
hostile environment harassment violation (as defined in Sec.
100.600(a)(2)). Whether a claim of hostile environment harassment is
based on a single incident or repeated incidents of unwelcome conduct,
an assessment of the totality of the circumstances is still required.
For example, the nature of the unwelcome conduct (e.g., whether it was
spoken, written and/or physical) and the location of the conduct (e.g.,
whether it occurred inside the victim's apartment or in a common
space), among other potential considerations, would factor into an
assessment of whether a single incident of harassment was sufficiently
severe to interfere with or deprive the victim of his or her right to
use and enjoy the housing or to exercise other rights protected by the
Act.
HUD is revising proposed Sec. 100.600(c) at this final rule stage
as follows.
[[Page 63066]]
Proposed Sec. 100.600(c) provided that: ``A single incident of
harassment because of race, color, religion, sex, familial status,
national origin, or handicap may constitute a discriminatory housing
practice, where the incident is severe, or evidences a quid pro quo.''
Final Sec. 100.600(c) now provides: ``A single incident of harassment
because of race, color, religion, sex, familial status, national
origin, or handicap may constitute a discriminatory housing practice,
where the incident is sufficiently severe to create a hostile
environment, or evidences a quid pro quo.''
B. Illustrations: Sec. Sec. 100.60, 100.65, 100.80, 100.90, 100.120,
100.130, and 100.135
Issue: Several commenters supported the illustrations included
throughout the proposed rule and asked HUD to provide additional
examples of prohibited practices in the final rule. They requested more
examples of: Unwelcome conduct; how quid pro quo harassment occurs with
respect to protected classes other than sex; single incidents that
constitute a hostile environment; and when direct liability exists.
Commenters also recommended that HUD add to the final rule examples
clarifying the relationship between age and disability and add examples
of harassment of pregnant women, Muslims, persons with limited English
proficiency, persons with mental health-related disabilities or HIV/
AIDS, and persons who assert their rights to organize. Another
commenter stated that HUD has provided useful illustrations of what
does not violate the Act in other fair housing contexts, and requested
that HUD do the same here, citing 24 CFR 100.205(b) (concerning the
impracticality of meeting the Act's design and construction standards).
HUD Response: HUD retains the illustrations contained in the
proposed rule, but otherwise declines to add more illustrations to the
final rule. The rule contains numerous illustrations of possible quid
pro quo and hostile environment harassment referencing all protected
classes. But whether illegal harassment has or has not occurred in a
particular situation is fact-specific and must be determined on a case-
by-case basis. For this reason, the illustrations provided are simply
more specific descriptions of the legal standard, e.g., conditioning
the availability of housing on a person's response to sexual harassment
illustrates an unlawful refusal to sell or rent. Providing
illustrations as to what does not violate the Act would not be
appropriate because of the necessarily fact-specific nature of such an
inquiry. HUD notes that Sec. 100.205(b), which the commenter cited,
does not describe conduct that does not violate the Act, but rather
provides examples of when the impracticality exception to the Act's
design and construction requirements is applicable. Lastly, some of the
suggested examples are outside the scope of the Act, e.g., the right to
organize, but HUD notes that persons would be protected by the Act to
the extent the harassment is because of their race, color, religion,
sex, familial status, national origin, or disability.
C. Liability for Discriminatory Housing Practices: Sec. 100.7
a. Direct Liability for One's Own Discriminatory Conduct: Sec.
100.7(a)(1)(i)
Issue: A commenter stated that the language in Sec.
100.7(a)(1)(i), which states that a person is directly liable for the
person's own conduct that results in a discriminatory housing practice,
may lead to the liability of innocent actors and third-parties who
somehow contributed to an illegal discriminatory action. The commenter
gave as an example a situation in which a person supplied the pen that
a housing provider used to make notes on an application that the
housing provider later rejected because of a protected characteristic
of the applicant.
HUD Response: The rule creates no new or enhanced forms of
liability. As discussed in the preamble of the proposed rule, Sec.
100.7(a)(1)(i) does nothing more than restate the most basic form of
direct liability, i.e., that a person is directly liable for his or her
own discriminatory housing practices, as defined by the Act. Whether a
person's conduct constitutes a discriminatory housing practice under
sections 804-806 or 818 of the Act depends upon the specific facts.
b. Direct Liability for Negligent Failure To Correct and End
Discrimination: Sec. 100.7(a)(1)(ii) and (iii)
Issue: Several commenters expressed concern about the ``should have
known'' standard in proposed Sec. 100.7(a)(1)(ii) and (iii), which
states that a person is directly liable for ``(ii) [f]ailing to take
prompt action to correct and end a discriminatory housing practice by
that person's employee or agent, where the person knew or should have
known of the discriminatory conduct,'' and ``(iii) [f]ailing to fulfill
a duty to take prompt action to correct and end a discriminatory
housing practice by a third-party, where the person knew or should have
known of the discriminatory conduct . . . '' (emphasis added).
Some commenters stated that this standard creates almost certain
liability for landlords and that requiring actual knowledge would be
more fair to property owners because liability would only attach for
failing to act on known discrimination. A commenter stated that the
final rule should limit liability where a housing provider has limited
knowledge of misconduct. In contrast, other commenters stated that the
``knew or should have known'' standard is reasonable and consistent
with the Fair Housing Act, legal negligence principles, and business
practices of housing providers. One commenter complained that the
proposed rule appears to require actual knowledge, even though the
standard only requires that a defendant ``should have known'' of the
harassment.
Commenters asked HUD to clarify how a housing provider ``should
have known'' about harassment, especially in the context of tenant-on-
tenant harassment. A commenter questioned what the housing provider
needs to know before liability attaches and whether the housing
provider needs to know that the harasser's actions violate the Fair
Housing Act or only that the harasser took some action toward the
victim. Several commenters expressed concern that a PHA might be liable
when a housing voucher holder is harassed but neither the apartment
owner nor voucher holder informs the housing agency about the
harassment. One commenter expressed a similar concern that owners
living in another city or state may not learn that harassment is taking
place on their property unless the tenant tells the owner, and another
commenter asked about a PHA's potential liability when harassment
occurs over the internet but is unknown to the housing agency.
HUD Response: The ``knew or should have known'' standard is well
established in civil rights and tort law.\27\ A housing provider
``should have known'' of the harassment of one resident by another when
the housing provider had knowledge from which a reasonable person would
conclude that the harassment was occurring. Such knowledge can come
from, for example, the harassed resident, another resident,
[[Page 63067]]
or a friend of the harassed resident.\28\ There is no requirement that
the resident contact the housing provider about the harassment, only
that the housing provider have knowledge from which a reasonable person
would conclude that harassment was occurring. If the housing provider
has no information from which a reasonable person would conclude that
one resident or a third-party was harassing another resident, the
housing provider is not liable for failing to take action to correct
and end the harassment. If the knowledge component is not met, a
housing provider cannot be held liable for a resident's or third-
party's discriminatory conduct. HUD disagrees that this standard will
subject landlords to certain liability. Application of this standard to
the liability provisions of the rule helps clarify the Act's coverage
for residents and housing providers. It is intended to help guide
housing providers in their assessment of when to intervene to prevent
or end discriminatory conduct. HUD encourages housing providers to
create safe, welcoming, and responsive housing environments by
regularly training staff, developing and publicizing anti-
discrimination policies, and acting quickly to resolve complaints once
sufficient information exists that would lead a reasonable person to
conclude that harassment was occurring.
---------------------------------------------------------------------------
\27\ As the Supreme Court has recognized, fair housing actions
are essentially tort actions. See Meyer v. Holley, 537 U.S. 280, 285
(2003) (citing Curtis v. Loether, 415 U.S. 189, 195-96 (1974)); see
also Burlington Indus. v. Ellerth, 524 U.S. 742, 759 (``An employer
is negligent with respect to sexual harassment if it knew or should
have known about the conduct and failed to stop it. Negligence sets
a minimum standard for employer liability under Title VII. . . .'')
(emphasis added).
\28\ See, e.g., Neudecker v. Boisclair Corp., 351 F.3d at 364
(owner may be liable for acts of tenants and management's children
after failing to respond to plaintiff's complaints of harassment);
Bradley v. Carydale Enterprises, 707 F. Supp. 217 (E.D. Va. 1989)
(finding that owners and managers' failure to address one tenant's
complaints of racial harassment by another tenant stated a claim
under 42 U.S.C. 1981 and 1982).
---------------------------------------------------------------------------
Issue: A commenter was concerned that Sec. 100.7(a)(1)(ii) is
seeking to hold the agent liable for the actions of its principal,
contrary to Supreme Court precedent, and asked why this provision is
necessary in light of proposed Sec. 100.7(b) (vicarious liability),
which states that the housing provider is already liable for the
unlawful actions of the agent, whether known or not.
HUD Response: Section 100.7(a)(1)(ii) addresses a principal's
direct liability for the principal's own negligent conduct in
overseeing (or failing to oversee) its agent or employee. Under the
negligence theory of direct liability, the principal is liable only if
the principal knew or should have known of the agent's discriminatory
conduct and failed to take corrective action to end it. Section
100.7(b), by contrast, holds the principal vicariously liable for the
discriminatory conduct of its agent, regardless of whether the
principal knew or should have known of the agent's conduct. As the
commenter noted, an agent is not vicariously liable for the principal's
conduct, but is directly liable for his or her own actions. Section
100.7 does not create liability that does not already exist; it does
not hold the agent liable for the conduct of the principal, and it is
entirely consistent with traditional agency principles and Supreme
Court precedent.
Issue: A commenter asked for clarification of the term ``third-
party'' in Sec. 100.7(a)(1)(iii). The commenter was concerned that if
left undefined, the term would include everyone. The commenter asked
HUD to limit the term to what the commenter perceived to be HUD's
primary concern--``liability resulting from a landlord's failure to
assist a tenant subject to another tenant's harassment.''
HUD Response: HUD does not agree that its use of the term ``third-
party'' requires further clarification in the text of the rule. In the
context of the rule, liability for discriminatory conduct by a ``third-
party'' is appropriately limited to a non-employee or non-agent who
engaged in quid pro quo or hostile environment harassment of which the
housing provider knew or should have known and had the power to
correct.
Issue: A commenter stated that it is unclear from the proposed rule
whether the obligation in proposed Sec. 100.7(a)(1)(iii) to take
action to end a discriminatory housing practice by a third-party must
be derived from a contract, lease, or law, or whether it could be
derived from these sources. The commenter also requested that HUD
clarify in the rule whether generic lease provisions related to the use
and enjoyment of one's home that are found in almost every lease would
be enough to create the obligation and related liability contemplated
in Sec. 100.7(a)(1)(iii). Another commenter expressed a concern that
housing providers would take steps to minimize their liability for
failing to take corrective action by revising their leases and other
documents so that they do not create a duty to protect tenants. A
commenter expressed concern that the term ``duty,'' incorporated from
other laws and contracts, is difficult to fully assess and therefore
bound to create unanticipated consequences.
HUD Response: HUD recognizes that proposed Sec. 100.7(a)(1)(iii)
may have caused some confusion, so HUD has reworded the provision in
the final rule. Proposed Sec. 100.7(a)(1)(iii) stated that a person is
directly liable for ``failing to fulfill a duty to take prompt action
to correct and end a discriminatory housing practice by a third-party,
where the person knew or should have known of the discriminatory
conduct. The duty to take prompt action to correct and end a
discriminatory housing practice by a third-party derives from an
obligation to the aggrieved person created by contract or lease
(including bylaws or other rules of a homeowner's association,
condominium or cooperative), or by federal, state or local law.''
Revised section 100.7(a)(1)(iii) of this final rule provides that a
person is directly liable for ``failing to take prompt action to
correct and end a discriminatory housing practice by a third-party,
where the person knew or should have known of the discriminatory
conduct and had the power to correct it. The power to take prompt
action to correct a discriminatory housing practice by a third-party
depends upon the extent of control or any other legal responsibility
the person may have with respect to the conduct of such third-party.''
The final rule does not use the term ``duty,'' and no longer identifies
specific categories of potential sources for such a duty. A housing
provider's obligation to take prompt action to correct and end a
discriminatory housing practice by a third-party derives from the Fair
Housing Act itself, and its liability for not correcting the
discriminatory conduct of which it knew or should have known depends
upon the extent of the housing provider's control or any other legal
responsibility the provider may have with respect to the conduct of
such third-party.\29\ For example, when a housing provider enters into
a lease agreement with a tenant, the lease typically obligates the
housing provider to exercise reasonable care to protect the residents'
safety and curtail unlawful conduct in areas under the housing
provider's control, whether or not the lease contains specific language
creating that responsibility. Even if the lease does not expressly
create such obligations, the power to act may derive from other legal
responsibilities or the operation of law.\30\
---------------------------------------------------------------------------
\29\ See, e.g., Neudecker v. Boisclair Corp., 351 F. 3d at 364
(owner may be liable for acts of tenants and management's children
after failing to respond to plaintiff's complaints of harassment);
Fahnbulleh v. GFZ Realty, LLC, 795 F. Supp. 2d 360, 364-65 (D. Md.
2011) (denying landlord's motion to dismiss because the Act imposes
no categorical rule against landlord liability for tenant-on-tenant
harassment); Reeves v. Carrollsburg Condo. Unit Owners Ass'n, 1997
U.S. Dist. LEXIS 21762, *26 (D.D.C. 1997) (condo association that
knew of harassment by resident but failed to take corrective actions
may violate Act).
\30\ See, e.g., Wilstein v. San Tropai Condo. Master Ass'n, 1999
U.S. Dist. LEXIS 7031, *28-33 (N.D. Ill. Apr. 21, 1999) (rejecting
condo association's argument that it had no duty to stop harassment
of plaintiff by other residents and holding that association could
be liable where evidence indicated that association knew of the
harassment and bylaws authorized the association to regulate such
conduct); see also Bradley v. Carydale Enterprises, 707 F. Supp. 217
(E.D. Va. 1989) (finding that owners and managers' failure to
address one tenant's racial harassment of a neighboring tenant
states a claim under 42 U.S.C. 1981, 1982).
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[[Page 63068]]
Issue: A commenter expressed concern that proposed Sec.
100.7(a)(1)(iii) creates liability on the part of a community
association (homeowner association, condominium or cooperative) for the
illegal acts of residents over whom they have no control. The commenter
urged HUD to remove or revise the proposed rule's extension of direct
liability to community associations for the discriminatory actions of
non-agents. The commenter stated that community associations generally
lack legal authority to mandate that residents take actions described
in the preamble of the proposed rule because the associations cannot
evict homeowners or otherwise impose conditions not specifically
authorized by the association's covenants, conditions, and restrictions
(CC&Rs) or state law. The commenter suggested that if the language in
Sec. 100.7(a)(1)(iii) remains, it should be modified to clearly state
which terms and conditions in association bylaws and regulations
constitute a duty on the part of an association or its agents to
investigate and punish residents for illegal discriminatory housing
practices.
HUD Response: As noted above, HUD has slightly revised Sec.
100.7(a)(1)(iii) to clarify that a housing provider is liable under the
Fair Housing Act for third-party conduct if the provider knew or should
have known of the discriminatory conduct, has the power to correct it,
and failed to do so. HUD also notes that the rule does not add any new
forms of liability under the Act or create obligations that do not
otherwise exist. The rule does not impose vicarious liability (see
Sec. 100.7(b)) on a community association for the actions of persons
who are not its agents. Section 100.7(a)(1)(ii) describes a community
association's liability for its own negligent supervision of its
agents, and Sec. 100.7(a)(1)(iii) describes a community association's
liability for its own negligence for failing to take prompt action to
correct and end a discriminatory housing practice by a third-party.
With respect to Sec. 100.7(a)(1)(iii), the rule requires that when a
community association has the power to act to correct a discriminatory
housing practice by a third party of which it knows or should have
known, the community association must do so.
As the commenter recognizes, a community association generally has
the power to respond to third-party harassment by imposing conditions
authorized by the association's CC&Rs or by other legal authority.\31\
Community associations regularly require residents to comply with CC&Rs
and community rules through such mechanisms as notices of violations,
threats of fines, and fines. HUD understands that community
associations may not always have the ability to deny a unit owner
access to his or her dwelling; the rule merely requires the community
association to take whatever actions it legally can take to end the
harassing conduct.
---------------------------------------------------------------------------
\31\ See, e.g., Wilstein v. San Tropai Condo. Master Ass'n,
supra*28-33; Reeves v. Carrollsburg Condo. Unit Owners Ass'n, 1997
U.S. Dist. LEXIS 21762, *26. See also Freeman v. Dal-Tile Corp., 750
F. 3d 413, 422-23 (4th Cir. 2014) (holding that ``an employer is
liable under Title VII for third parties creating a hostile work
environment if the employer knew or should have known of the
harassment and failed to take prompt remedial action reasonably
calculated to end [it].'') (internal quotation marks and citations
omitted); Galdamez v. Potter, 415 F. 3d 1015, 1022 (9th Cir. 2005)
(``An employer may be held liable for the actionable third-party
harassment of its employees where it ratifies or condones the
conduct by failing to investigate and remedy it after learning of
it.'').
---------------------------------------------------------------------------
Issue: A few commenters suggested that HUD should reconsider
imposing liability on a landlord for tenant-on-tenant harassment
because the law in this area is not well-settled. The commenters
expressed concern that proposed Sec. 100.7(a)(1)(iii) exceeds the
scope of the Act by expanding liability for housing providers to
include liability for third-party harassment of a resident when the
housing provider did not act with discriminatory intent. One commenter,
relying on Title VII case law and an interpretation of the phrase
``because of,'' stated that a landlord must have acted with
discriminatory intent in order to be liable under the Fair Housing Act.
Another commenter stated that although section 804(a) of the Fair
Housing Act does not require a showing of intentional discrimination,
claims brought under sections 804(b) and 817 of the Act do, citing
Francis v. King Park Manor, Inc., 91 F. Supp. 3d 420 (E.D.N.Y. 2015).
Another comment stated that to establish a housing provider's liability
for failing to take action to correct third-party harassment, the
plaintiff must show not just that the housing provider failed to
correct the harassment but also that the housing provider did so
because of animus against the victim due to a protected characteristic.
A commenter pointed to Lawrence v. Courtyards of Deerwood Ass'n, Inc.,
318 F. Supp. 2d 1133 (S.D. Fla. 2004), as an example of a case in which
the court dismissed the fair housing claim against the housing provider
because the plaintiffs failed to establish that the housing provider's
ineffective response to the harassment was due to racial animus.
Commenters also pointed to Ohio Civil Rights Comm'n v. Akron Metro.
Hous. Auth., 892 NE.2d 415, 420 (Ohio 2008), in which the court
declined to impose liability on landlords for failing to take
corrective action in response to discriminatory harassment committed by
the landlord's tenants. A commenter also suggested that not requiring
discriminatory animus on the part of the housing provider would amount
to strict liability. The commenters proposed that in light of these
contrary federal and state court decisions, HUD should require proof of
some degree of animus by the housing provider before subjecting the
provider to direct liability for the acts of third parties.
HUD Response: HUD does not agree that a housing provider's failure
to act to correct third-party harassment must be motivated by a
discriminatory intent or animus before the provider can be held liable
for a Fair Housing Act violation. In reaching this conclusion, HUD
considered its own experience in administering and enforcing the Fair
Housing Act, the broad remedial purposes of the Act,\32\ relevant case
law including the Supreme Court's recent ruling in Texas Department of
Community Affairs v. Inclusive Communities Project, Inc. holding that
the Fair Housing Act is not limited to claims of intentional
discrimination, and the views of the EEOC regarding Title VII. The case
law cited by the commenters fails to support the proposition that the
Fair Housing Act requires discriminatory intent in order to find a
housing provider liable for its negligent failure to correct resident-
on-resident or other third-party discriminatory conduct. The district
court decision in Francis v. Kings Park Manor is the sole exception to
that principle, and HUD disagrees with its ruling. HUD notes that this
decision is on appeal to the Second Circuit.
---------------------------------------------------------------------------
\32\ See e.g., Havens Realty Corp. v. Coleman, 455 U.S. 363, 380
(1982) (Congress intended Fair Housing Act to be broadly remedial);
cf. Jones v. Alfred H. Mayer Co., 392 U.S. 409, 413 (1968)
(describing the Fair Housing Act as ``a comprehensive open housing
law''); 42 U.S.C. 3601 (``It is the policy of the United States to
provide, within constitutional limitations, for fair housing
throughout the United States.'').
---------------------------------------------------------------------------
Section 100.7(a)(1)(iii) sets out a negligence standard of
liability, which does not require proof of discriminatory
[[Page 63069]]
intent or animus on the part of the provider, but is far from strict
liability. Under this standard, a plaintiff or the charging party must
prove three elements to establish a housing provider's liability for
third-party harassment: (1) The third-party created a hostile
environment for the plaintiff or complainant; (2) the housing provider
knew or should have known about the conduct creating the hostile
environment; and (3) the housing provider failed to take prompt action
to correct and end the harassment while having the power to do so. HUD
does not agree that a fourth element--that the housing provider's
failure to act was more than negligent, and was motivated by
discriminatory intent--is necessary or appropriate.
Contrary to one comment, the Supreme Court in Inclusive Communities
Project has already ruled that the ``because of'' clause in the Fair
Housing Act does not require proof of discriminatory intent. While not
addressing every aspect of the cited decisions, HUD notes the
following: In Lawrence v. Courtyards of Deerwood Ass'n, cited by
another commenter, the court dismissed the discriminatory harassment
claim not for lack of discriminatory intent on the part of the
landlord, but because it found, inter alia, that the dispute did not
involve discriminatory harassment of one tenant by another but instead
reflected mutual antagonism between two tenants. The court in Lawrence
distinguished Reeves v. Carrollsburg Condo. Unit Owners Ass'n, 1997
U.S. Dist. LEXIS 21762, *22 (D.D.C 1997), which held the landlord
liable under the Fair Housing Act for its failure to adequately address
sexual harassment of one tenant by another because ``the [Carrollsburg
Condo] association's by-laws specifically authorized the association to
curtail conduct that contravened the law'' and provided that a
violation of local or federal law was a violation of the association
rules.\33\
---------------------------------------------------------------------------
\33\ Lawrence v. Courtyards of Deerwood Ass'n, 318 F. Supp. 2d
at 1149 (citing Reeves v. Carrollsburg Condo. Unit Owners Ass'n,
1997 U.S. Dist. LEXIS 21762 at *22.
---------------------------------------------------------------------------
Finally, the state court decision cited by one commenter did not
involve claims under the Fair Housing Act and does not provide reason
for HUD to alter Sec. 100.7(a)(1)(iii) at the final rule stage. In
Ohio Civil Rights Commission v. Akron Metropolitan Housing Authority,
the Ohio Supreme Court's refusal to hold a landlord liable under a
state civil rights law for failing to take corrective action in
response to one tenant's racial harassment of another tenant was
premised on an incorrect reading of Title VII jurisprudence. The court
misconstrued Title VII case law to require an agency relationship
between an employer and a perpetrator of harassment in order to hold
the employer liable for negligently failing to stop sexual harassment
by the perpetrator.\34\ In fact, under Title VII, an agency
relationship is not required in order to hold employers liable for
negligently failing to stop discriminatory harassment of which the
employer knew or should have known. Both the EEOC and the federal
courts have recognized that an employer may be held liable for
negligently failing to stop discriminatory harassment in the workplace
by non-employees or non-agents.\35\ The principle of liability codified
in Sec. 100.7(a)(1)(iii) of this final rule is consistent with these
Title VII authorities and, in HUD's view, appropriately serves the Fair
Housing Act's parallel antidiscrimination objectives in the housing
context. In sum, the proposed rule and this final rule reflect HUD's
considered judgment, consistent with prevailing precedent and EEOC
regulations, that a housing provider (including a homeowner's
association) or property manager is liable under the Act for
negligently failing to take corrective action against a third-party
harasser when the provider or manager knew or should have known of the
harassment and had the power to end it. In light of the above, HUD
declines to make the proposed revisions to the final rule.
---------------------------------------------------------------------------
\34\ 892 NE.2d at 419-20.
\35\ See 29 CFR 1604.11(e) (``An employer may also be
responsible for the acts of non-employees, with respect to sexual
harassment of employees in the workplace, where there employer (or
its agents or supervisory employees) knows or should have known of
the conduct and fails to take immediate and appropriate corrective
action.''); see also, e.g., Freeman v. Dal-Tile Corp., 750 F.3d 413,
422-24 (4th Cir. 2014) (employer potentially liable for failing to
address discriminatory harassment by a customer); Lockard v. Pizza
Hut, Inc., 162 F.3d 1062, 1072-75 (10th Cir. 1998) (same; collecting
cases recognizing employer liability for failing to correct third-
party harassment).
---------------------------------------------------------------------------
Issue: A commenter stated that the imposition of liability on
private landlords for tenant-on-tenant harassment is inappropriate and
will have several negative consequences. The commenter stated that
private owners do not have the expertise or resources to undertake what
is essentially a social services function to mediate disputes between
neighbors. In addition, the commenter expressed concern that the
proposed rule could make it more difficult and risky for property
owners to take affirmative steps to operate racially integrated
housing. The commenter stated that the rule will be an economic
disincentive for individuals, companies, and other investors to engage
in the business of renting residential real estate and that the Section
8 voucher program depends on the participation of these private
entities in order to achieve other fair housing goals. The commenter
expressed concern that the effect of the proposed rule will be to
reduce the supply of available affordable units, thus
disproportionately harming low-income families. Other commenters raised
concerns that landlords, when confronted by tenants who mutually accuse
each other of harassment, will be unable to take necessary corrective
actions because of the rule's prohibition against moving or causing
injury to a complaining tenant, or will reprimand the wrong tenant
because they lack expertise with investigations.
Numerous other commenters supported the rule's recognition that a
housing provider may be directly liable for harassment of a tenant by
the housing provider's employee or a third-party. These commenters
stated that any suggestion that this rule will unduly burden housing
providers is exaggerated, that the rule is wholly consistent with the
ordinary responsibilities of housing providers to ensure habitability,
and that housing providers are familiar with the tools they have to
enforce their own rules--tools they frequently wield.
HUD Response: The rule does not create new or enhanced liabilities
for housing providers, including those who participate in the Section 8
program. HUD believes that this rule will help clarify the obligations
that housing providers already have in offering and maintaining housing
environments free from discrimination and that comply with the Fair
Housing Act. We are long past the time when racial harassment is a
tolerable price for integrated housing; a housing provider is
responsible for maintaining its properties free from all discrimination
prohibited by the Fair Housing Act. Under the Act, discriminatory
practices are those that violate sections 804, 805, 806, or 818. Such
practices do not encompass all incivilities, and thus it is important
to note that not every quarrel among neighbors amounts to a violation
of the Fair Housing Act.\36\ Ending harassing or
[[Page 63070]]
otherwise discriminatory conduct may necessitate evicting the tenant
who has engaged in the conduct, not the aggrieved tenant.\37\ The Act
does not, however, prohibit housing providers from offering to move an
aggrieved tenant, as long as that tenant may refuse the offer without
consequence or retaliation.
---------------------------------------------------------------------------
\36\ See, e.g., Bloch v. Frischholz, 587 F.3d at 783 (quoting
Halprin v. Prairie Single Family Homes of Dearborn Park Ass'n, 388
F.3d 327, 330 (7th Cir. 2004) (noting that interference under Sec.
818 ``is more than a `quarrel among neighbors' ''); Sporn v. Ocean
Colony Condominium Assn, 173 F. Supp. 2d 244, 251-52 (D.N.J. 2001)
(noting that section 818 ``does not [] impose a code of civility''
on neighbors); United States v. Weisz, 914 F. Supp. 1050, 1054-55
(S.D.N.Y. 1996) (holding that allegations that Jewish neighbor
harassed complainants because of their religion were ``nothing more
than a series of skirmishes in an unfortunate war between
neighbors''). But see Ohana v. 180 Prospect Place, 996 F. Supp. 238,
243 (E.D.N.Y. 1998) (neighbors who intentionally intrude upon
quietude of another's home may violate Act).
\37\ See, e.g., Miller v. Towne Oaks East Apartments, 797 F.
Supp. 557, 562 (E.D. Tex.1992) (finding landlord liable for
violating Act by evicting both harasser and victim of harassment
instead of only harasser).
---------------------------------------------------------------------------
Issue: Some commenters stated that the proposed rule outlining
third-party liability conflicts with HUD's PIH Notice 2015-19, titled
Guidance for Public Housing Agencies (PHAs) and Owners of Federally-
Assisted Housing on Excluding the Use of Arrest Records in Housing
Decisions. One commenter was concerned that PIH Notice 2015-19 makes it
harder for PHAs to correct situations that may lead to hostile
environment harassment, while the proposed harassment rule would make
it easier for PHAs to be held liable for the activities of tenants who
take actions against other tenants to create a hostile environment.
Another commenter was concerned that PHAs would be forced to choose
whether to comply with HUD's harassment rule or with HUD's Notice,
which prohibits the use of an arrest record as evidence of criminal
activity that can support an adverse admission, termination, or
eviction decision. These commenters therefore asked HUD to remove
third-party liability from the rule.
HUD Response: HUD believes the commenters' concerns are misplaced
because there is no conflict between this rule and PIH Notice 2015-19.
The rule does not add any new forms of liability under the Fair Housing
Act and the formalization of clear and consistent standards for
evaluating harassment claims under the Act does not conflict with the
requirements of the PIH Notice. Compliance with PIH Notice 2015-19 does
not prevent a PHA from considering reliable evidence of relevant
criminal activity when considering how to respond to complaints of
harassment. Nor does this rule require a PHA to make use of arrest
records to determine whether discriminatory harassment has occurred.
Consistent with traditional tort liability principles, as well as
current federal Fair Housing Act jurisprudence, this rule codifies
HUD's longstanding view that a property owner, including a PHA, may be
held liable for failing to take corrective action within its power in
response to tenant-on-tenant harassment of which the owner knew or
should have known. Where a PHA receives a complaint or otherwise learns
of possible discriminatory harassment of one resident by another, the
PHA is advised to assess the situation and, if necessary, take
appropriate corrective action to end the harassment.
Issue: Several commenters expressed concern that application of the
rule would conflict with HUD's homeless or permanent supportive housing
programs or might have a detrimental effect on persons with mental
disabilities. A commenter stated that tenants with severe mental health
disabilities may create a hostile environment for neighbors and asked
HUD to explain what direct responsibility the housing provider has to
correct negative behaviors. A commenter stated that the rule
incentivizes evictions over efforts to determine whether a reasonable
accommodation might be appropriate for persons with mental
disabilities. Another commenter stated that because tenants with mental
illness often have difficulty finding housing, the proposed rule might
result in an increased rate of homelessness among persons with mental
disabilities. A commenter asked HUD to revisit the proposed rule's
third-party liability provision to avoid harming this particularly
vulnerable population.
Other commenters stated that the rule would help protect many
vulnerable persons from eviction. These commenters supported the
statement in the proposed rule's preamble that eviction is only one of
the many corrective actions housing providers may utilize to address
harassment.
HUD Response: The rule neither changes a housing provider's
responsibilities toward tenants with mental disabilities nor
incentivizes evictions of such persons. It is not uncommon for the
behavior of one tenant to frustrate, displease, or annoy another
tenant. This is true for behavior by tenants with and without
psychiatric disabilities. The rule does not require a housing provider
to take action whenever one tenant engages in behavior that another
tenant finds objectionable. The Act prohibits discrimination against
applicants and tenants with disabilities, including evicting
individuals with disabilities because other tenants find them
frustrating, displeasing, or annoying. The Act does not, however,
require that a dwelling be made available to a person whose tenancy
would constitute a direct threat to the health or safety of others or
would result in substantial physical damage to the property of
others.\38\ The housing provider must make an individualized assessment
as to whether such a threat exists based on reliable objective evidence
that considers: (1) The nature, duration, and severity of the risk of
injury; (2) the probability that injury will actually occur; and (3)
whether there are any reasonable accommodations that will eliminate the
direct threat. In evaluating a recent history of overt acts, a housing
provider must take into account whether the individual has received
intervening treatment or medication that has eliminated the direct
threat. Reasonable accommodations must be made when they may be
necessary to afford such persons an equal opportunity to use and enjoy
a dwelling. HUD refers the reader to the Joint Statement of HUD and DOJ
on Reasonable Accommodations under the Fair Housing Act for further
information.\39\
---------------------------------------------------------------------------
\38\ 42 U.S.C. 3604(f)(9).
\39\ See Joint Statement of HUD and DOJ on Reasonable
Accommodations Under the Fair Housing Act (May 17, 2004), posted at
https://www.hud.gov/offices/fheo/library/huddojstatement.pdf.
---------------------------------------------------------------------------
1. Corrective Action: Sec. 100.7(a)(2)
Issue: A commenter asked HUD to remove the prohibition against
causing injury to a complaining party.
HUD Response: HUD declines to remove the prohibition on causing
additional injury to a person who has already been injured by illegal
harassment. Permitting such additional injury would be inconsistent
with the Act's purposes to prevent unlawful discrimination and remedy
discrimination that has already occurred.
Issue: One commenter requested further guidance as to what
constitutes appropriate corrective action by a housing provider to stop
tenant-on-tenant harassment. The commenter specifically inquired
whether a single verbal statement by a landlord to a tenant who
allegedly engaged in harassing conduct would be sufficient corrective
action to relieve a landlord from liability under the rule. Another
commenter asked HUD to impose realistic and reasonable limitations on
housing providers' obligation to take corrective action.
HUD Response: There is no one way that a housing provider must
respond to complaints of third-party harassment,
[[Page 63071]]
although the rule makes clear that a provider that fails to effectively
respond may be subject to liability under the Act. Section 100.7(a)(2)
provides that corrective actions must be effective in ending the
discrimination, but may not injure the aggrieved persons. For example,
corrective actions appropriate for a housing provider to utilize to
stop tenant-on-tenant harassment or other third-party harassment might
include verbal and written warnings; enforcing lease provisions to
move, evict, or otherwise sanction tenants who harass or permit guests
to harass; issuing no-trespass orders against guests; or reporting
conduct to the police. What constitutes appropriate and effective
corrective action will depend on the nature, frequency, and severity of
the harassment. While in some cases a single verbal reprimand by a
housing provider may be sufficient to effectively end discriminatory
harassment of one tenant by another, the housing provider should notify
the victim that such action was taken, and it is advisable for the
housing provider to document this action in its records. Additionally,
the housing provider should follow up with the victim of the harassment
after the corrective action is taken to ensure that it was effective.
If the housing provider knows or should have known that the corrective
action was ineffective, the provider has a responsibility to take
additional corrective actions within its power. If, however, corrective
action is effective in ending the discriminatory conduct, a housing
provider is not required to take additional action simply because the
victim believes further action should have been taken. HUD does not
agree that there is a need to add a specific limitation on a housing
provider's responsibility to take corrective action within its power to
act in response to discriminatory harassment of which the provider knew
or should have known.
Issue: A commenter stated that because tenants are not agents or
employees, landlords cannot simply compel tenants to take or avoid
particular action and do not have the ability to shape or alter
tenants' behavior beyond threatening and carrying out evictions.
Another commenter asked HUD to consider that there are substantial
practical differences between the ability of housing providers to take
corrective action to end tenant-on-tenant harassment and their ability
to control the actions of their employees because there is no agency
relationship in the former. Another commenter stated that most
homeowners would be very concerned if association board members,
employees, or agents injected themselves into the interpersonal
relationships of homeowners and residents to investigate their
interactions and relationships for discriminatory elements. This
commenter also said that for PHAs, eviction is often unavailable as a
remedy for alleged tenant-on-tenant harassment because the U.S. Housing
Act of 1937 and federal regulations limit the ability of PHAs to carry
out evictions, except for specified causes. In addition, the commenter
stated that the result of these restrictions and the proposed rule
would be to create significant new liability for PHAs for tenant-on-
tenant harassment without creating any new mechanisms for PHAs to
mitigate this liability.
In contrast, other commenters stated that the rule does not create
any new liability because landlords have an obligation to protect
tenants' rights to quiet enjoyment and generally have the right to take
actions against renters and occupants who disturb the quiet enjoyment
of others.
HUD Response: Neither the proposed rule nor this final rule create
new liability for housing providers, including PHAs or homeowner's
associations, regarding resident-on-resident harassment. Nor does the
rule require a housing provider to take action that is beyond the scope
of its power to act. HUD recognizes that specific remedies that may be
available to employers to stop an employee's illegal practices will be
distinct from those that a housing provider may use to stop residents
who are engaging in discriminatory conduct. Creating and posting policy
statements against harassment and establishing complaint procedures,
offering fair housing training to residents and mediating disputes
before they escalate, issuing verbal and written warnings and notices
of rule violations, enforcing bylaws prohibiting illegal or disruptive
conduct, issuing and enforcing notices to quit, issuing threats of
eviction and, if necessary, enforcing evictions and involving the
police are powerful tools available to a housing provider to control or
remedy a tenant's illegal conduct. These tools are also available to
PHAs, and, contrary to one commenter's concern, eviction is available
to a PHA to correct a tenant's discriminatory conduct as the PHA may
terminate a tenancy for ``serious or repeated violation of material
terms of the lease,'' 24 CFR 966.4(l)(2)(i), which include the
obligation that tenants must ``act . . . in a manner which will not
disturb other residents' peaceful enjoyment of their accommodations. .
. .'' 24 CFR 966.4(f)(11).
Issue: A commenter expressed concern that a PHA may be held
directly liable for failing to correct actions by third-parties over
whom they have little or no control. As an example, the commenter cited
harassment of a voucher-holding tenant by neighbors who are not also
voucher-holders and not otherwise affiliated with the PHA. Similarly,
another commenter stated that the rule could be interpreted to make
landlords liable for conduct that occurs off their property or that has
nothing to do with a tenant's home.
HUD Response: This rule describes the standard for assessing
liability under the Fair Housing Act. These fair housing standards
apply to private and public landlords alike and do not turn on whether
a tenant holds a Housing Choice Voucher or receives other government
rental assistance. HUD also reiterates that a housing provider is not
responsible for correcting every negative action by any third-party.
Rather, the third-party action must constitute a discriminatory housing
practice as defined by the Act, and the housing provider must have the
power to correct it. As provided in the final rule and discussed
elsewhere in this preamble, whether a housing provider has the power to
take corrective measures in a specific situation--and what corrective
measures are appropriate--is dependent on the facts, including the
extent of control or any other legal responsibility the person may have
with respect to the conduct of such third-party. There may be instances
where the ability to correct the unlawful conduct is beyond a housing
provider's control. Thus, when confronted with discriminatory
harassment of one of its Housing Choice Voucher-holders or other
tenants, the housing agency should explore what corrective actions are
within its power and are appropriate to take.
Issue: A commenter suggested that an unintended consequence of the
proposed rule could be that property owners would remove security
devices, such as video cameras and other surveillance mechanisms, for
fear that such measures may create a duty on the part of the property
owner to correct neighbor-on-neighbor harassment. In contrast, other
commenters stated that housing providers may feel the need to provide
for more oversight of residences which may interfere with residents'
right to peaceful enjoyment of their dwelling.
HUD Response: Removing security devices will not relieve a housing
provider of its obligation to take the
[[Page 63072]]
actions within its power to promptly correct and end a discriminatory
housing practice. Elsewhere in the preamble, HUD discusses various
options that may be available to housing providers to address neighbor-
on-neighbor harassment.
Issue: A commenter stated that owners should be encouraged to use
positive incentives, such as promoting better communication with--and
healthy relationships among--tenants, and educating tenants about their
rights to prevent harassment, instead of taking corrective actions that
may harm tenants, such as ending a lease or evicting a tenant--.
HUD Response: HUD agrees that positive incentives are useful tools
for preventing harassment. HUD believes, however, that warnings,
threats of evictions, evictions, and lease terminations may also be
necessary corrective actions to end harassment. The preamble and rule
make clear that there is no one way to prevent or correct harassment,
only that the methods need to be effective at ending it.
c. Vicarious Liability: Sec. 100.7(b)
Issue: Several commenters questioned the description of vicarious
liability at Sec. 100.7(b) of the proposed rule. One commenter said
Sec. 100.7(b) could be interpreted to impose vicarious liability on an
organization's directors, officers, or owners and suggested HUD
clarify, consistent with Meyer v. Holley, that it is the organization--
not the individual directors, officers, or board members--who are the
``principal or employer'' subject to vicarious liability under the Fair
Housing Act. The commenter asked HUD to issue clarification that the
proposed regulations do not contravene or attempt to reverse Meyer v.
Holley, 537 U.S. 280 (2003). In contrast, other commenters applauded
the description of vicarious liability in the rule, stated that the
description follows well-established common law tort and agency
principles, and expressed support for the proposed rule's reliance on
Meyer v. Holley.
HUD Response: Subsection 100.7(b) merely describes the well-
established concept of vicarious liability, under which principals may
be held liable for the discriminatory acts of their agents or employees
whether or not they knew of the discriminatory conduct. As articulated
in Meyer v. Holley, and as explained in the preambles to the proposed
rule and this final rule, traditional agency principles apply to the
Fair Housing Act.\40\ Under agency principles, a principal is
vicariously liable for the actions of his or her agents taken within
the scope of their relationship or employment, or for actions taken
outside the scope of their relationship or employment when the agent is
aided in the commission of such acts by the existence of the agency
relationship.\41\ Determining whether an agency relationship exists is
a factual determination that looks to an agent's responsibilities,
duties, and functions; whether the discriminatory conduct of the agent
was within the scope of the agency relationship or aided by the
existence of the agency relationship is also a fact-specific inquiry.
---------------------------------------------------------------------------
\40\ 537 U.S. at 282, 287.
\41\ See, e.g., Glover v. Jones, 522 F. Supp. 2d 496, 507
(W.D.N.Y. 2007) (holding that ``a property owner may be vicariously
liable under the Fair Housing Act for the actions of an employee
even when they are outside the scope of employment . . . if the
employee was aided in accomplishing the tort by the existence of the
agency relation.'') (quoting Mack v. Otis Elevator Co., 326 F. 3d
116, 123 (2d Cir. 2003) (internal quotation marks omitted); see also
Boswell v. GumBayTay, No. 2:07-CV-135-WKW[WO], 2009 U.S. Dist. LEXIS
45954, *17 (M.D. Ala. June 1, 2009) (holding that vicarious
liability attached to property owner where property manager's
``position essentially gave him unfettered access to communicate
with and personally visit [the plaintiff]'' and he ``used his power
as property manager as a vehicle through which to perpetrate his
unlawful conduct by refusing repairs, raising the rent, and
attempting to evict [the plaintiff] as a consequence for [her]
refusal to provide sexual favors.''); Glover at 522 F. Supp. 2d at
507 (rejecting defendant property owner's motion for summary
judgment on the issue of vicarious liability where evidence showed
that property manager used his ``position as the de facto landlord
to perpetrate FHA [harassment] violations . . . giving] him the
opportunity to visit the apartment when he wanted, and enabl[ing]
him to control Plaintiff's rent''); Richards v. Bono, 2005 U.S.
Dist. LEXIS 43585 at *30 (holding that wife/co-owner of property
could be vicariously liable for husband's harassment where husband
acted as her agent and used his position as owner, property manager,
and maintenance supervisor to subject plaintiff to sexual harassment
by using a key to enter plaintiff's apartment and threatening
plaintiff with eviction).
---------------------------------------------------------------------------
Issue: Some commenters questioned the statement in the proposed
rule's preamble that a principal is vicariously liable for the actions
of an agent or employee taken outside the scope of the agency
relationship or employment when the agent or employee is aided in the
commission of such acts by the existence of the agency relationship. A
commenter agreed that a principal is vicariously liable for the acts of
its agents committed within the scope of the agency, regardless of
knowledge or intent to violate the Act by the principal, but believes
that, in adopting the ``aided in agency'' standard, the proposed rule
goes beyond traditional tort concepts and does not reflect the limited
concepts of vicarious liability endorsed in Meyer v. Holley. The
commenter considered it acceptable to hold a real estate company liable
for discriminatory acts or statements made by its brokers in the scope
of their agency, but disagreed that a housing provider should be liable
for misconduct of a janitorial employee outside the scope of that
employee's duty because he wore a badged uniform or possessed keys or
passes to tenants' dwellings. Another commenter asked for clarity on
the reasoning behind the assertion in the preamble to the proposed rule
that an agent who harasses residents or applicants is necessarily aided
by his or her agency relationship with the housing provider.
HUD Response: As discussed throughout this preamble, the proposed
and final rule do not create new forms of liability. Instead, HUD has
decided to adopt well-established principles of agency law, including
that a principal may be vicariously liable for the actions of an agent
or employee that are taken outside the scope of the employment or
agency relationship if the agent or employee is aided in committing the
acts by the existence of the employment or agency relationship. Agency
law must be applied to the specific facts at issue to determine whether
such a situation exists and gives rise to a principal's liability. The
statement in the proposed rule that an agent who engages in hostile
environment harassment of residents or applicants is aided by the
agency relationship with the housing provider was not intended to
suggest the agent is necessarily so aided with respect to every
discriminatory housing practice. It was intended to explain one of the
reasons HUD chose not to import into the Fair Housing Act the Title VII
affirmative defense to an employer's vicarious liability for hostile
environment harassment. As explained in that context, a housing
provider's agent who engages in harassment holds a position of power
and authority over the victimized resident or applicant, regardless of
the agent's specific duties. This is because a resident or applicant
has only an arms-length economic relationship with the housing
provider, while an agent-perpetrator is clothed with the authority of
the housing provider. Given this inherent imbalance of power and
control over the terms or conditions of the housing environment, the
distinction between harassment by supervisory and non-supervisory
employees that supported the creation of the affirmative defense in the
employment context do not extend to the housing context.
D. Other Issues
Issue: A commenter stated that HUD should apply the proposed rule
only to its own investigative and administrative
[[Page 63073]]
actions and should not purport to preempt court-established rules. The
commenter stated that in some instances it may be appropriate for
federal courts to defer to agency rules, but that this is not a case
where Chevron \42\ deference is appropriate because HUD is not basing
the rule on its own experience, but largely on interpretations of
federal court decisions. The commenter stated that HUD has no
particular expertise in tort law and no authority to interpret tort
laws. Another commenter stated that HUD appears to be using the
administrative rule-making process to substitute its views for those of
the courts, and that HUD must pursue the change it seeks through
Congress and/or the courts.
---------------------------------------------------------------------------
\42\ Chevron U.S.A., Inc. v. Natural Resources Defense Council,
Inc., 467 U.S. 837 (1984).
---------------------------------------------------------------------------
HUD Response: The commenters misconstrue both the rule and HUD's
authority under the Act. The Act specifically grants the Secretary of
HUD the authority and responsibility to administer and enforce the Act,
including promulgating rules to carry out the Act.\43\ This rule-making
authority is not limited to HUD's investigations or administrative
proceedings. Moreover, the rule does not construe tort law, but rather
clarifies standards for liability under this part, based on traditional
principles of tort liability. It imposes no new legal obligations or
duties of care. In addition, the introductory portion of this preamble
describes the grounds for Chevron deference.
---------------------------------------------------------------------------
\43\ 42 U.S.C. 3608(a), 3610, 3615.
---------------------------------------------------------------------------
Issue: Some commenters disagreed with HUD's statement in the
preamble to the proposed rule that the rule does not create additional
costs for housing providers and others covered by the Fair Housing Act.
They stated that the proposed rule would lead to increased costs for
and litigation against housing providers. Among the other costs cited
by commenters are costs for compliance and training, increased
insurance premiums, and increased liability because many housing
providers would not have the ability to remain diligent to address all
harassment claims, leaving them vulnerable to litigation. Another
commenter said that the proposed rule creates the possibility for
substantial judgments for money damages that PHAs have little ability
to pay, because they may not use federal funds to pay judgments for
damages.
HUD Response: As noted throughout this preamble, this final rule
does not impose any new or enhanced liabilities. Rather, it clarifies
existing law under the Fair Housing Act and well-established common law
tort and agency principles as they apply under the Act. The rule does
not change substantive obligations, but merely formalizes them in a
regulation. Because the standards articulated in the rule are already
law, the risks of liability and costs of complying will not increase
with issuance of the rule. HUD presumes that the vast majority of
housing providers are in compliance with the law. Any costs incurred by
housing providers to come into compliance as a result of this
rulemaking will simply be the costs of compliance with a preexisting
statute, administrative practice, and case law. In fact, by formalizing
uniform standards for investigations and adjudications under the Fair
Housing Act, the rule serves to reduce costs for housing providers by
establishing greater clarity with respect to how a determination of
liability is to be made.
V. Findings and Certifications
Regulatory Review--Executive Orders 12866 and 13563
Under Executive Order 12866 (Regulatory Planning and Review), a
determination must be made whether a regulatory action is significant
and therefore, subject to review by the Office of Management and Budget
(OMB) in accordance with the requirements of the order. Executive Order
13563 (Improving Regulations and Regulatory Review) directs executive
agencies to analyze regulations that are ``outmoded, ineffective,
insufficient, or excessively burdensome, and to modify, streamline,
expand, or repeal them in accordance with what has been learned.''
Executive Order 13563 also directs that, where relevant, feasible, and
consistent with regulatory objectives, and to the extent permitted by
law, agencies are to identify and consider regulatory approaches that
reduce burdens and maintain flexibility and freedom of choice for the
public. This rule was determined to be a ``significant regulatory
action'' as defined in section 3(f) of Executive Order (although not an
economically significant regulatory action, as provided under section
3(f)(1) of the Executive Order).
This rule establishes uniform standards for use in investigations
and processing cases involving harassment and liability under the Fair
Housing Act. In establishing such standards, HUD is exercising its
rulemaking authority to bring uniformity, clarity, and certainty to an
area of legal practice.
The docket file for this rule is available for public inspection
between the hours of 8 a.m. and 5 p.m. weekdays in the Regulations
Division, Office of General Counsel, Department of Housing and Urban
Development, Room 10276, 451 7th Street SW., Washington, DC 20410-0500.
Due to security measures at the HUD Headquarters building, please
schedule an appointment to review the docket file by calling the
Regulations Division at 202-708-3055 (this is not a toll-free number).
Persons with hearing or speech impairments may access the above
telephone number via TTY by calling the toll-free Federal Relay Service
at 800-877-8339.
Environmental Impact
This rule does not direct, provide for assistance or loan and
mortgage insurance for, or otherwise govern or regulate, real property
acquisition, disposition, leasing, rehabilitation, alteration,
demolition or new construction, or establish, revise, or provide for
standards for construction or construction materials, manufactured
housing, or occupancy. This rule is limited to the procedures governing
fair housing enforcement. Accordingly, under 24 CFR 50.19(c)(3), this
rule is categorically excluded from environmental review under the
National Environmental Policy Act (42 U.S.C. 4321).
Regulatory Flexibility Act
The Regulatory Flexibility Act (5 U.S.C. 4321, et seq.) generally
requires an agency to conduct a regulatory flexibility analysis of any
rule subject to notice and comment rulemaking requirements, unless the
agency certifies that the rule will not have a significant economic
impact on a substantial number of small entities. The rule establishes
standards for evaluating claims of harassment and liability under the
Fair Housing Act. The scope of the rule is procedural, and the
regulatory changes do not establish any substantive regulatory burdens
on small entities. Accordingly, the undersigned certifies that this
rule will not have a significant economic impact on a substantial
number of small entities.
Unfunded Mandates Reform Act
Title II of the Unfunded Mandates Reform Act of 1995 (2 U.S.C.
1531-1538) (UMRA) establishes requirements for federal agencies to
assess the effects of their regulatory actions on state, local, and
tribal governments and the private sector. This rule does not impose
any federal mandates on any state, local, or tribal governments or the
private sector within the meaning of UMRA.
[[Page 63074]]
Executive Order 13132, Federalism
Executive Order 13132 (entitled ``Federalism'') prohibits an agency
from publishing any rule that has federalism implications if the rule
either (1) imposes substantial, direct compliance costs on state and
local governments, and is not required by statute, or (2) preempts
state law, unless the agency meets the consultation and funding
requirements of section 6 of the Executive Order. This rule does not
have federalism implications and does not impose substantial direct
compliance costs on state and local governments or preempt state law
within the meaning of the Executive Order.
Catalogue of Federal Domestic Assistance
The Catalogue of Federal Domestic Assistance Number for the equal
opportunity in housing program is 14.400.
List of Subjects in 24 CFR Part 100
Aged, Fair housing, Individuals with disabilities, Mortgages,
Reporting and recordkeeping requirements.
Accordingly, for the reasons stated in the preamble, and in
accordance with HUD's authority in 42 U.S.C. 3535(d), HUD amends 24 CFR
part 100 as follows:
PART 100--DISCRIMINATORY CONDUCT UNDER THE FAIR HOUSING ACT
0
1. The authority citation for 24 CFR part 100 continues to read as
follows:
Authority: 42 U.S.C. 3535(d), 3600-3620.
0
2. Add Sec. 100.7 to read as follows:
Sec. 100.7 Liability for discriminatory housing practices.
(a) Direct liability. (1) A person is directly liable for:
(i) The person's own conduct that results in a discriminatory
housing practice.
(ii) Failing to take prompt action to correct and end a
discriminatory housing practice by that person's employee or agent,
where the person knew or should have known of the discriminatory
conduct.
(iii) Failing to take prompt action to correct and end a
discriminatory housing practice by a third-party, where the person knew
or should have known of the discriminatory conduct and had the power to
correct it. The power to take prompt action to correct and end a
discriminatory housing practice by a third-party depends upon the
extent of the person's control or any other legal responsibility the
person may have with respect to the conduct of such third-party.
(2) For purposes of determining liability under paragraphs
(a)(1)(ii) and (iii) of this section, prompt action to correct and end
the discriminatory housing practice may not include any action that
penalizes or harms the aggrieved person, such as eviction of the
aggrieved person.
(b) Vicarious liability. A person is vicariously liable for a
discriminatory housing practice by the person's agent or employee,
regardless of whether the person knew or should have known of the
conduct that resulted in a discriminatory housing practice, consistent
with agency law.
0
3. In Sec. 100.60, add paragraphs (b)(6) and (7) to read as follows:
Sec. 100.60 Unlawful refusal to sell or rent or to negotiate for the
sale or rental.
* * * * *
(b) * * *
(6) Conditioning the availability of a dwelling, including the
price, qualification criteria, or standards or procedures for securing
the dwelling, on a person's response to harassment because of race,
color, religion, sex, handicap, familial status, or national origin.
(7) Subjecting a person to harassment because of race, color,
religion, sex, handicap, familial status, or national origin that
causes the person to vacate a dwelling or abandon efforts to secure the
dwelling.
0
4. In Sec. 100.65, add paragraphs (b)(6) and (7) to read as follows:
Sec. 100.65 Discrimination in terms, conditions and privileges and in
services and facilities.
* * * * *
(b) * * *
(6) Conditioning the terms, conditions, or privileges relating to
the sale or rental of a dwelling, or denying or limiting the services
or facilities in connection therewith, on a person's response to
harassment because of race, color, religion, sex, handicap, familial
status, or national origin.
(7) Subjecting a person to harassment because of race, color,
religion, sex, handicap, familial status, or national origin that has
the effect of imposing different terms, conditions, or privileges
relating to the sale or rental of a dwelling or denying or limiting
services or facilities in connection with the sale or rental of a
dwelling.
0
5. In Sec. 100.80, add paragraph (b)(6) to read as follows:
Sec. 100.80 Discriminatory representation on the availability of
dwellings.
* * * * *
(b) * * *
(6) Representing to an applicant that a unit is unavailable because
of the applicant's response to a request for a sexual favor or other
harassment because of race, color, religion, sex, handicap, familial
status, or national origin.
0
6. In Sec. 100.90, add paragraphs (b)(5) and (6) to read as follows:
Sec. 100.90 Discrimination in the provision of brokerage services.
* * * * *
(b) * * *
(5) Conditioning access to brokerage services on a person's
response to harassment because of race, color, religion, sex, handicap,
familial status, or national origin.
(6) Subjecting a person to harassment because of race, color,
religion, sex, handicap, familial status, or national origin that has
the effect of discouraging or denying access to brokerage services.
0
7. In Sec. 100.120, add paragraphs (b)(3) and (4) to read as follows:
Sec. 100.120 Discrimination in the making of loans and in the
provision of other financial assistance.
* * * * *
(b) * * *
(3) Conditioning the availability of a loan or other financial
assistance on a person's response to harassment because of race, color,
religion, sex, handicap, familial status, or national origin.
(4) Subjecting a person to harassment because of race, color,
religion, sex, handicap, familial status, or national origin that
affects the availability of a loan or other financial assistance.
0
8. In Sec. 100.130, add paragraphs (b)(4) and (5) to read as follows:
Sec. 100.130 Discrimination in the terms and conditions for making
available loans or other financial assistance.
* * * * *
(b) * * *
(4) Conditioning an aspect of a loan or other financial assistance
to be provided with respect to a dwelling, or the terms or conditions
thereof, on a person's response to harassment because of race, color,
religion, sex, handicap, familial status, or national origin.
(5) Subjecting a person to harassment because of race, color,
religion, sex, handicap, familial status, or national origin that has
the effect of imposing different terms or conditions for the
availability of such loans or other financial assistance.
[[Page 63075]]
0
9. In Sec. 100.135, revise paragraph (d) to read as follows:
Sec. 100.135 Unlawful practices in the selling, brokering, or
appraising of residential real property.
* * * * *
(d) Practices which are unlawful under this section include, but
are not limited to:
(1) Using an appraisal of residential real property in connection
with the sale, rental, or financing of any dwelling where the person
knows or reasonably should know that the appraisal improperly takes
into consideration race, color, religion, sex, handicap, familial
status, or national origin.
(2) Conditioning the terms of an appraisal of residential real
property in connection with the sale, rental, or financing of a
dwelling on a person's response to harassment because of race, color,
religion, sex, handicap, familial status, or national origin.
0
10. In Sec. 100.400, add paragraph (c)(6) to read as follows:
Sec. 100.400 Prohibited interference, coercion or intimidation.
* * * * *
(c) * * *
(6) Retaliating against any person because that person reported a
discriminatory housing practice to a housing provider or other
authority.
0
11. Add subpart H, consisting of Sec. 100.600, to read as follows:
Subpart H-- Quid Pro Quo and Hostile Environment Harassment
Sec. 100.600 Quid pro quo and hostile environment harassment.
(a) General. Quid pro quo and hostile environment harassment
because of race, color, religion, sex, familial status, national origin
or handicap may violate sections 804, 805, 806 or 818 of the Act,
depending on the conduct. The same conduct may violate one or more of
these provisions.
(1) Quid pro quo harassment. Quid pro quo harassment refers to an
unwelcome request or demand to engage in conduct where submission to
the request or demand, either explicitly or implicitly, is made a
condition related to: The sale, rental or availability of a dwelling;
the terms, conditions, or privileges of the sale or rental, or the
provision of services or facilities in connection therewith; or the
availability, terms, or conditions of a residential real estate-related
transaction. An unwelcome request or demand may constitute quid pro quo
harassment even if a person acquiesces in the unwelcome request or
demand.
(2) Hostile environment harassment. Hostile environment harassment
refers to unwelcome conduct that is sufficiently severe or pervasive as
to interfere with: The availability, sale, rental, or use or enjoyment
of a dwelling; the terms, conditions, or privileges of the sale or
rental, or the provision or enjoyment of services or facilities in
connection therewith; or the availability, terms, or conditions of a
residential real estate-related transaction. Hostile environment
harassment does not require a change in the economic benefits, terms,
or conditions of the dwelling or housing-related services or
facilities, or of the residential real-estate transaction.
(i) Totality of the circumstances. Whether hostile environment
harassment exists depends upon the totality of the circumstances.
(A) Factors to be considered to determine whether hostile
environment harassment exists include, but are not limited to, the
nature of the conduct, the context in which the incident(s) occurred,
the severity, scope, frequency, duration, and location of the conduct,
and the relationships of the persons involved.
(B) Neither psychological nor physical harm must be demonstrated to
prove that a hostile environment exists. Evidence of psychological or
physical harm may, however, be relevant in determining whether a
hostile environment existed and, if so, the amount of damages to which
an aggrieved person may be entitled.
(C) Whether unwelcome conduct is sufficiently severe or pervasive
as to create a hostile environment is evaluated from the perspective of
a reasonable person in the aggrieved person's position.
(ii) Title VII affirmative defense. The affirmative defense to an
employer's vicarious liability for hostile environment harassment by a
supervisor under Title VII of the Civil Rights Act of 1964 does not
apply to cases brought pursuant to the Fair Housing Act.
(b) Type of conduct. Harassment can be written, verbal, or other
conduct, and does not require physical contact.
(c) Number of incidents. A single incident of harassment because of
race, color, religion, sex, familial status, national origin, or
handicap may constitute a discriminatory housing practice, where the
incident is sufficiently severe to create a hostile environment, or
evidences a quid pro quo.
Dated: August 18, 2016.
Gustavo Velasquez,
Assistant Secretary for Fair Housing and Equal Opportunity.
[FR Doc. 2016-21868 Filed 9-13-16; 8:45 am]
BILLING CODE 4210-67-P