Cohen Milstein is partnering with Connecticut Fair Housing Center and the National Housing Law Project in the representation of Carmen Arroyo, as well as the Connecticut Fair Housing Center itself, against CoreLogic Rental Property Solutions (“CoreLogic”), a third-party tenant-screening company, for violating the Fair Housing Act by discriminatory use of criminal records as rental criteria.
This litigation seeks to ensure that CoreLogic and all tenant-screening companies follow fair housing requirements when they functionally make rental decisions on behalf of landlords, which adversely affected both Ms. Arroyo and the Connecticut Fair Housing Center and its mission of ensuring fair housing for the people of Connecticut.
On August 7, 2020, the U.S. District Court, District of Connecticut denied CoreLogic’s motion for summary judgment regarding Plaintiffs’ standing and Plaintiffs’ claims of race and national origin discrimination in violation of the Fair Housing Act. First, the Court held that both Carmen Arroyo and the Connecticut Fair Housing Center have standing to sue under the Fair Housing Act and the Connecticut Unfair Trade Practices Act. Next, the Court found that Plaintiffs had presented sufficient statistical evidence based on national and state data to put into dispute whether CoreLogic’s criminal background reporting system has a disparate impact on African American and Latino people, noting that “disparities adverse to African Americans and Latinos and in favor of whites exist at all stages of the criminal justice process: in arrest rates, in jail detention rates, and in prison incarceration rates.” The Court further held that no reasonable factfinder could find that CoreLogic has a business justification for screening applicants solely on the basis that someone has a pending arrest, in the absence of the details of the arrest, which CoreLogic does not necessarily disclose to housing providers. The Court found CoreLogic’s evidence that someone who has been arrested once is more likely than others to be arrested again unconvincing, as it “only demonstrates that whatever characteristics are associated with being arrested likely persist over time – and many characteristics, including implicit bias, cultural incompetence, race and place of residence, persist over time.” Finally, the Court denied CoreLogic’s motion for summary judgment on Plaintiffs’ intentional race and national origin discrimination claims, ruling that a factfinder at trial could conclude that because CoreLogic was aware that its criminal background screening product could have a disproportionate and arbitrary effect on racial minorities, and that it took no steps to modify its product, Plaintiffs presented evidence of discriminatory intent.
On July 20, 2023, after a bench trial that was started on March 14, 2022 and subsequently postponed by the court to re-start on October 24, 2022 and ultimately concluded on November 4, 2022, the court ruled that CoreLogic is not subject to the FHA. Plaintiffs filed an appeal with the United States Court of Appeals for the Second Circuit on August 4, 2023.
On November 24, 2023, the Department of Justice filed an amicus brief with the Second Circuit, asking the appellate court to remand the case with instructions for reconsidering whether CoreLogic’s actions create liability under the Fair Housing Act.
The U.S. Department of Housing & Urban Development observed in 2016 that excluding rental applicants because of their criminal records disproportionately harms Latinos and African Americans, who are significantly more likely than whites to be arrested or convicted. Studies show such disparities are linked to differential enforcement rather than to differences in likelihood of engaging in criminal activity. HUD advised that to avoid discriminating, an “individualized review” should be conducted considering the nature of the offense, how long ago it occurred, intervening changed circumstances, and other relevant factors to avoid denying housing to an applicant who does not pose a genuine and ongoing threat to persons or property. Further, HUD’s guidance specifically advises landlords not to consider arrests that did not result in a conviction in making their evaluations.
Originally filed on April 24, 2018 with the U.S. District Court, District of Connecticut, the lawsuit asserts that CoreLogic’s automated tenant screening software tool (“CrimSAFE”) denied Carmen Arroyo’s request to move her disabled son into her rental apartment based on a record of a dismissed shoplifting arrest from 2014, before he became disabled.
Arroyo, whose son Mikhail was injured in a July 2015 accident that left him unable to speak, walk, or care for himself, is her son’s conservator. After becoming his conservator, Arroyo asked her landlord for permission to move Mikhail into her home and out of the nursing home where he was recovering. She submitted a rental application on her son’s behalf. But, his application was denied. CoreLogic’s “CrimSAFE” background check stated that Mikhail had a “disqualifying [criminal] record.”
Arroyo claims that CoreLogic’s criminal background report did not provide the landlord with any details about Mikhail’s underlying criminal history—only a computer-generated notation that the application did not meet the landlord’s criteria. Arroyo asserts that CoreLogic refused to provide her with a copy of the information it relied on to make the screening decision, information which she was entitled to receive under federal law, as she was her son’s conservator. Because CoreLogic refused to recognize Ms. Arroyo’s authority as conservator for her son, she asserts that CoreLogic also violated its obligation to provide a reasonable accommodation to her disabled son.
Arroyo subsequently learned that her son’s only criminal record was a charge – from before his accident, and later dropped – for shoplifting, an infraction below the level of a misdemeanor. Without this information, Arroyo could not challenge Mikhail’s denial, and neither CoreLogic nor the landlord made the sort of individualized assessment that HUD says is required. As a result, he remained in a nursing home for approximately a year longer than necessary.
On March 25, 2019, the U.S. District Court, District of Connecticut denied CoreLogic’s motion to dismiss, holding that because CoreLogic “held itself out as a company with the knowledge and ingenuity to screen housing applicants by interpreting criminal records and specifically advertised its ability to improve ‘Fair Housing compliance,’” that it could be held liable for violations of the Fair Housing Act. As automated decisions by third-party screening companies are rapidly becoming the norm, this ruling has significant implications for landlords, renters and the entire screening industry.
Case Name: Connecticut Fair Housing Center, et al. v. CoreLogic Rental Property Solutions, Case No. 3:18-cv-00705, U.S. District Court for the District of Connecticut
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