High court to weigh merits of discrimination suit
WASHINGTON (AP) – The Supreme Court heard Tuesday from a mixed-race couple stymied in efforts to buy a new home by a real estate agent who they said called them a “salt-and-pepper team.” The question for the justices: Can the couple sue the agent’s boss? Real estate company owners should be held accountable when their employees discriminate, said Robert Schwemm, lawyer for Emma and David Holley of Twentynine Palms, Calif.
But Realtors want the court to rule that the 34-year-old Fair Housing Act outlawing racial discrimination in housing should be used only to punish those who discriminate, not their employers.
The court’s ruling could determine how easy it is to collect damages for discrimination.
Emma Holley is black and her husband is white. They sued agent Grove Crank; his employer, Triad Inc. of Twentynine Palms, and company owner Dave Meyer in 1997 after Crank allegedly used epithets to describe the couple to the builder of a home they wanted to buy in the California desert. Crank also refused to make their offer on the house.
The Holleys were joined in their suit by the builder, Brooks Bauer, who sold the house for $20,000 less than the couple was ready to pay.
No one is alleging that Meyer took part in or knew of Crank’s alleged discrimination. But he should be held personally liable under the Fair Housing Act because he failed to ensure that his agent complied with the law, Schwemm said.
Meyer “wants to take certain parts of the law that are advantageous to him, but he doesn’t want to take other parts, the responsibility parts,” Schwemm told the justices.
The Bush administration is siding with the Holleys. Meyer “exercised pervasive control” over the company’s affairs, assistant solicitor general Malcolm Stewart said.
Douglas Benedon, Meyer’s lawyer, said though his client was Triad’s founder, owner and the holder of its real estate license, he had nothing to do with Crank’s behavior. “Crank was acting on behalf of Triad. He was not acting on behalf of Meyer,” Benedon said.
A U.S. District Court ruled Meyer could not be sued, but the San Francisco-based 9th U.S. Circuit Court of Appeals sided with the Holleys.
The discrimination claim has not been tried.
The couple and the builder sued Meyer personally because Crank and the corporation have no assets, while Meyer does.
Meyer should be shielded from the Holleys’ lawsuit just as shareholders in corporations typically are not financially liable for corporate actions, Benedon said.
That argument won a sympathetic reception from Justice Antonin Scalia. If the court ruled otherwise, Scalia said, “What’s the use of having a corporation then?”
The National Association of Realtors and the California Association of Realtors are supporting Meyer, who attended the oral argument.
“Who in their right mind would take this job if every single dollar you worked for could be swallowed up in a case if they named you individually?” he said after the arguments.
Meyer, the Holleys and Bauer all live in Twentynine Palms. Meyer said he no longer is in the real estate business.
The Holleys, who were in search of a larger home, still live in the same house they bought through Triad 15 years ago, he said.
The case is Meyer v. Holley, 01-1120.
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