Atlantic Housing Partners L.L.L.P. v. Brevard County

UNITED STATES DISTRICT COURT

MIDDLE DISTRICT OF FLORIDA

ORLANDO DIVISION

ATLANTIC HOUSING PARTNERS

L.L.L.P., A FLORIDA LIMITED

LIABILITY PARTNERSHIP;

CANTON CONSTRUCTION, LLC, A

FLORIDA LIMITED LIABILITY

CORPORATION; CONCORD

MANAGEMENT, LTD., A FLORIDA

LIMITED PARTNERSHIP; and THE

VENUE AT HERITAGE OAKS

PARTNERS, LTD.,

Plaintiffs,

v. Case No: 6:23-cv-2473-JSS-DCI

BREVARD COUNTY, A POLITICAL

SUBDIVISION OF THE STATE OF

FLORIDA,

Defendant.

___________________________________/

ORDER

Defendant, Brevard County, moves to dismiss Plaintiffs’ Amended Complaint

(Dkt. 17) asserting that Plaintiffs lack standing, under the Fair Housing Act and

Florida Fair Housing Act, violate Federal Rules of Civil Procedure 8, and fail to state

plausible claims for relief under the Fair Housing Act and Florida Fair Housing Act.

(Motion, Dkt. 19.) Plaintiffs oppose the Motion. (Dkt. 28.) For the reasons set forth

below, the Motion is granted in part and denied in part.

BACKGROUND1

This case stems from Brevard County’s (County) alleged violations of the

Federal Fair Housing Act (FHA) and the Florida Fair Housing Act (Florida FHA).

(Dkt. 17 ¶¶ 29–43.) Plaintiffs are four businesses that possessed an economic interest

in the development of an affordable housing complex in the County. (Id. ¶¶ 9–14.)

Specifically, The Venue at Heritage Oaks Partners, Ltd. (VHO) is the contract

purchaser of the land where the complex was to be built. (Id. ¶¶ 9–10.) Atlantic

Housing Partners L.L.L.P. (AHP) is the developer hired to manage the development

of the complex. (Id. ¶ 10.) Canton Construction, LLC (Canton) is the construction

company that contracted to build the complex. (Id. ¶ 11.) Concord Management, Ltd.

(Concord) is the management company that contracted to manage the complex. (Id.

¶ 13). The project never came to fruition because the Brevard County Board of County

Commissioners (BCBCC) rejected AHP’s bond financing application. (Id. ¶ 22.)

VHO and AHP planned to develop an affordable housing complex containing

105 multi-family dwelling units (the Development) under Florida’s Live Local Act.2

(Id. ¶ 10.) They planned to fund a substantial portion of the Development with federal

1 The court accepts the well-pleaded, non-conclusory factual allegations in Plaintiffs’

Amended Complaint (Dkt. 17) as true and construes them in the light most favorable to

Plaintiffs when considering the motion to dismiss. See Williams v. Bd. of Regents of Univ. Sys.

of Georgia, 477 F.3d 1282, 1291 (11th Cir. 2007).

2 The Live Local Act requires municipality authorization of multifamily affordable housing.

See Fla. Stat. § 166.04151(7)(a) (“A municipality must authorize multifamily and mixed-use

residential as allowable uses in any area zoned for commercial, industrial, or mixed use if at

least 40 percent of the residential units in a proposed multifamily development are rental units

that, for a period of at least 30 years, are affordable.”)

tax-exempt bonds and tax-credit resources they received through allocation from the

Brevard County Housing Finance Authority (BCHFA) and the Florida Housing

Finance Corporation pursuant to the Tax Equity and Fiscal Responsibility Act

(TEFRA), 26 U.S.C. §§ 141–50. 3 (Id. ¶ 14.)

TEFRA requires local government approval of the bond financing plan. See 26

U.S.C. § 147(f)(2)(A)(i).4 On July 31, 2023, AHP submitted an application for

approval of its tax-exempt bond financing plan for the Development to BCHFA. (Id.

¶ 15.) On October 25, 2023, BCHFA held a meeting to receive input from the public

regarding the application. (Id. ¶ 16.) On December 5, 2023, BCBCC held a meeting

on the application as required by 26 U.S.C. § 147(f)(2)(A)(i). (Id. ¶ 18). At both

meetings, members of the public spoke in opposition to the Development being built.

(Id. ¶ 20.) At the BCBCC hearing, a representative of AHP was allowed three minutes

to speak about the Development but was not allowed an opportunity to respond to

members of the public who spoke in opposition to the Development. (Id. ¶ 21.)

Following the hearing, BCBCCs staff published a report stating that:

3 TEFRA imposes requirements on the issuers of state and local government bonds. 26 U.S.C.

§§ 141–50. Under the private business use test, a bond is a “private activity bond” if “more

than 10 percent of the proceeds of the issue are to be used for any private business use.” 26

U.S.C. § 141(b)(1). According to Plaintiffs’ Amended Complaint, 100 percent of the proceeds

of the bonds AHP applied for were intended for private business use, as the bonds were to

fund the Development, a private business venture. See (Dkt. 17 ¶ 14.)

4 Private activity bonds require public approval by the governmental unit issuing the bond or

the “governmental unit . . . on behalf of which such bond was issued.”

26 U.S.C. § 147(f)(2)(A)(i). There are two methods of obtaining public approval of a private

activity bond: “(i) by the applicable elected representative of such governmental unit after a

public hearing following reasonable public notice, or (ii) by voter referendum of such

governmental unit.” 26 U.S.C. § 147(f)(2)(B)(i)–(ii). The Brevard County Commissioners

chose the first method. See (Dkt. 17 ¶ 18.)

There is no fiscal impact to [BCBCC or BCHFA]. The

County is only authorizing the [BCHFA] to issue the bonds

under the IRS requirements for tax-exempt bonds[,] and the

County shall be indemnified from the issuance of bonds and

the [p]roject.

(Id. ¶ 19) (emphasis omitted). Despite this report, BCBCC denied AHP’s bond

financing application following the hearing. (Id. ¶¶ 19, 22.)

On December 27, 2023, Plaintiffs filed their initial Complaint. (Dkt. 1.) On

January 19, 2024, the County filed a motion to dismiss. (Dkt. 13.) In response to the

motion, on February 9, 2024, Plaintiffs filed their Amended Complaint pursuant to

Federal Rule of Civil Procedure 15(a)(1)(B). (Dkt. 17.) Plaintiffs’ Amended

Complaint asserts two causes of action: (1) violation of the FHA, 42 U.S.C. §§ 3604

and 3613 and (2) violation of the Florida FHA, Fla. Stat. §§ 760.23, 760.26, and

760.35. (Id. ¶¶ 29–43.) Plaintiffs allege that BCBCC did not deny the bond financing

application for a legitimate, nondiscriminatory reason. (Id. ¶ 23.) Further, Plaintiffs

allege that the denial of the application has frustrated Plaintiffs’ efforts to build the

Development and that Plaintiffs have “not received the benefits of the various

agreements they entered into with respect to the proposed development.” (Id. ¶¶ 24,

27.)

On February 23, 2024, the County filed the instant Motion. (Dkt 19.) The

County moves to dismiss Plaintiffs’ Amended Complaint on three grounds. (Id. at 6–

14.) First, the County argues that Plaintiffs lack statutory standing to bring their claims

under the FHA and Florida FHA. (Id. at 13–14.) Second, the County argues that

Plaintiffs fail to state a segregative effect or disparate impact claim under the FHA and

Florida FHA upon which relief can be granted. (Id. at 8–13.) Third, the County asserts

that Plaintiffs’ Amended Complaint is an impermissible shotgun pleading because it

lumps the Plaintiffs together and combines Plaintiffs’ segregative effect and disparate

impact claims together. (Id. at 6–7.) Plaintiffs respond that they have standing because

they are “aggrieved” persons under the broad definition of “aggrieved” in the FHA.

(Dkt. 28 at 15–18.) Second, Plaintiffs argue that they plausibly plead a claim for

housing discrimination under the FHA and Florida FHA because the facts alleged

permit the reasonable inference that the County’s application of 26 U.S.C. § 147(f),

“to the bond [f]inancing application was ‘artificial, arbitrary, and unnecessary.’” (Id.

at 10). Third, Plaintiffs argue that the Amended Complaint is not a shotgun pleading

because it identifies each of the Plaintiffs and their corresponding economic interest in

the Development. (Id. at 7.) The court will address each argument in turn.

APPLICABLE STANDARDS

A. Standing

“The party invoking federal jurisdiction bears the burden of establishing

standing.” Lujan v. Defs. of Wildlife, 504 U.S. 555, 561 (1992). At the pleading stage, a

plaintiff must plead sufficient facts to establish each element of standing; that he has

“(1) suffered an injury in fact, (2) that is fairly traceable to the challenged conduct of

the defendant, and (3) that is likely to be redressed by a favorable judicial decision.”

Spokeo, Inc. v. Robins, 578 U.S. 330, 338 (2016); accord Lujan, 504 U.S. at 560–61. If a

plaintiff’s injury is one which is “stigmatic” in nature, or generally “suffered by all

members of a racial group” when the alleged discrimination is racial, the plaintiff must

assert a “judicially cognizable injury” to survive dismissal. Allen v. Wright, 468 U.S.

737, 754 (1984). A judicially cognizable injury cannot be an “abstract stigmatic

injury.” Id. at 756. Rather, a stigmatic injury is judicially cognizable if there is “some

concrete interest with respect to which [the injured parties] are personally subject to

discriminatory treatment,” and that interest “satisf[ies] the causation requirement of

[the] standing doctrine.” Id. at 757 n.22. Absent standing, a claim is due to be

dismissed. Bochese v. Town of Ponce Inlet, 405 F.3d 964, 974 (11th Cir. 2005). A

dismissal for lack of standing “has the same effect as a dismissal for lack of subject

matter jurisdiction under Fed. R. Civ. P. 12(b)(1).” Stalley ex rel. U.S. v. Orlando Reg’l

Healthcare Sys., Inc., 524 F.3d 1229, 1232 (11th Cir. 2008) (citing Cone Corp. v. Fla. Dep’t

of Transp., 921 F.2d 1190, 1203 n.42 (11th Cir. 1991)).

B. Shotgun Pleading

Federal Rule of Civil Procedure 8(a)(2) requires a complaint to “contain . . . a

short and plain statement of [a] claim showing that the [plaintiff] is entitled to

relief.” Fed. R. Civ. P. 8(a)(2). Federal Rule of Civil Procedure 10(b) requires the

plaintiff to “state its claims . . . in numbered paragraphs, each limited as far as

practicable to a single set of circumstances.” Fed. R. Civ. P. 10(b). To “promote

clarity,” Rule 10(b) also requires the plaintiff to state “each claim founded on a

separate transaction or occurrence . . . in a separate count.” Id. “Complaints that

violate either Rule 8(a)(2) or Rule 10(b), or both, are often disparagingly referred to

as ‘shotgun pleadings.’” Weiland v. Palm Beach Cnty. Sheriff’s Off., 792 F.3d 1313,

1320 (11th Cir. 2015). Shotgun pleadings “fail . . . to give the defendants adequate

notice of the claims against them and the grounds upon which each claim rests.”

Id. at 1323. A court may dismiss a complaint as a shotgun pleading “where ‘it is

virtually impossible to know which allegations of fact are intended to support which

claim(s) for relief.’” Id. at 1325 (quoting Anderson v. Dist. Bd. of Trs. of Cent. Fla. Cmty.

Coll., 77 F.3d 364, 366 (11th Cir. 1996)).

C. Rule 12(b)(6)

When ruling on a motion to dismiss pursuant to Federal Rule of Civil Procedure

12(b)(6), the court must accept all well-pleaded factual allegations as true. See Ashcroft

v. Iqbal, 556 U.S. 662, 678 (2009); Lotierzo v. A Woman’s World Med. Ctr., Inc., 278 F.3d

1180, 1182 (11th Cir. 2002). To survive a motion to dismiss, a pleading must allege

facts that reasonably demonstrate that evidence exists to support the plaintiff’s claims.

Bell Atl. Corp. v. Twombly, 550 U.S. 544, 556 (2007). A plaintiff cannot put forth solely

“[t]hreadbare recitals of the elements of a cause of action, supported by mere

conclusory statements.” Iqbal, 556 U.S. at 678. “To avoid dismissal, the ‘complaint

must contain sufficient factual matter . . . to state a claim to relief that is plausible on

its face.’” Gates v. Khokhar, 884 F.3d 1290, 1296 (11th Cir. 2018) (quoting Iqbal, 556

U.S. at 678). “A complaint is plausible on its face when it contains sufficient facts to

support a reasonable inference that the defendant is liable for the misconduct alleged.”

Id. The plausibility standard requires “more than a sheer possibility that a defendant

has acted unlawfully.” Franklin v. Curry, 738 F.3d 1246, 1251 (11th Cir. 2013) (quoting

Iqbal, 556 U.S. at 678).

ANALYSIS

A. Standing

The County contends that Plaintiffs lack statutory standing to bring their claims

because they “are entities pursuing a commercial venture for their own benefit—not

individuals of a protected class who are trying to vindicate their rights.” (Dkt. 19 at

14.) Plaintiffs counter that they have statutory standing under the FHA because their

alleged financial injury falls within the zone of interests the FHA protects and that they

have alleged sufficient facts to satisfy the Article III standing requirements. (Dkt. 28

at 15–20.)

Under 42 U.S.C. § 3613, “[a]n aggrieved person may commence a civil action

in an appropriate United States district court or State court not later than 2 years after

the occurrence or the termination of an alleged discriminatory housing practice.” 42

U.S.C. § 3613(a)(1)(A). An “aggrieved person” “includes any person who claims to

have been injured by a discriminatory housing practice[,] or believes that such person

will be injured by a discriminatory housing practice that is about to occur.” 42 U.S.C.

§ 3602(i). A statutory cause of action is presumed to extend only to plaintiffs whose

interests fall within the zone of interests protected by the law invoked. See Lexmark

Int’l, Inc. v. Static Control Components, Inc., 572 U.S. 118, 134 (2014). Statutory standing

is very broad under the FHA and Florida FHA. See Bank of Am. Corp. v. City of Miami,

Fla., 581 U.S. 189, 198 (2017) (“This Court has repeatedly written that the FHA’s

definition of person ‘aggrieved’ reflects a congressional intent to confer standing . . .

as broadly as is permitted by Article III of the Constitution.”); Baytree of Inverrary Realty

Partners v. City of Lauderhill, 873 F.2d 1407, 1408–09 (11th Cir. 1989) (“Here, [the

plaintiff developer] alleges its injury results from racial animus. Thus, [the plaintiff

developer’s] allegation of injury was sufficient to establish standing under the [FHA].

Standing under the [Florida FHA] . . . should be treated similarly because [the Florida

FHA’s] identical in substance to [FHA].”); River Cross Land Co., LLC v. Seminole Cnty.,

No. 6:18-cv-01646-Orl-22KRS, 2019 WL 12518729, at *3 (M.D. Fla. Feb. 13, 2019)

(“[I]t is well-established that developers . . . can bring suit under the FHA so long as

they can establish [Article III] standing.”)

Here, Plaintiffs have alleged sufficient facts to confer standing under the FHA

and the Florida FHA based on a financial injury because they allege that they have

“not received the benefits of the various agreements they entered into with respect to

the proposed development,” due to BCBCC’s arbitrary denial of the bond financing

application. (Dkt. 17 ¶¶ 22–28.) See Tex. Dep’t of Hous. & Cmty. Affs. v. Inclusive Cmtys.

Project, Inc., 576 U.S. 519, 540 (2015) (noting that private developers can bring FHA

claims “to vindicate the FHA’s objectives and to protect their property rights by

stopping municipalities from enforcing arbitrary and, in practice, discriminatory

ordinances barring the construction of certain types of housing units.”) Further,

Plaintiffs have also alleged sufficient facts to confer standing under the FHA and the

Florida FHA because they allege the County’s arbitrary denial of the bond financing

application frustrated Plaintiffs’ AHP, Canton, and Concord’s efforts to develop,

construct, and manage the Development since the funds expired December 31, 2023,

without the County’s approval. (Dkt. 17 ¶¶ 24–27.)

As the court finds that Plaintiffs have alleged sufficient facts to support standing

under the FHA and the Florida FHA, the court now turns to Plaintiffs’ Article III

requirements. To establish Article III standing, a “plaintiff must have (1) suffered an

injury in fact, (2) that is fairly traceable to the challenged conduct of the defendant,

and (3) that is likely to be redressed by a favorable judicial decision.” Spokeo, Inc., 578

U.S. at 338. Here, taking all of Plaintiffs’ factual allegations to be true, the court

concludes that Plaintiffs have properly asserted Article III standing. First, Plaintiffs

allege an injury-in-fact by alleging that denial of the bond financing application

altogether frustrated the plans for the Development to be built, developed, and

managed and that Plaintiffs have not “received the benefits of the various agreements

they entered.” (Dkt. 17. ¶¶ 24–27.) Second, Plaintiffs plausibly allege that their injuries

are fairly traceable to the County’s alleged conduct because “[t]he County’s utilization

of [TEFRA’s approval requirements] to arbitrarily deny the requested [b]ond

[f]inancing has altogether frustrated Plaintiffs’ efforts to develop the [housing]

[p]roject.” (Dkt. 17 ¶ 24.) See Village of Arlington Heights, 429 U.S. at 261 (holding that

developer that contracted to purchase a tract of land to build racially integrated low

and moderate income housing had Article III standing when the government

defendant’s denial of rezoning land from single-family to multiple-family classification

stood “as an absolute barrier to constructing the housing [for which the developer] had

contracted [to build].”) Last, Plaintiffs’ injury would be redressed by a favorable

decision because Plaintiffs are seeking monetary damages, which if granted as

authorized by 42 U.S.C. § 3613(c)(1), would remedy Plaintiffs’ injuries resulting from

the County’s alleged arbitrary denial of the bond financing application in violation of

the FHA and Florida FHA. (Id. ¶¶ 35, 43.) See also Food & Drug Admin. v. All. for

Hippocratic Med., 602 U.S. 367, 381 (2024) (“If a defendant's action causes an injury,

enjoining the action or awarding damages for the action will typically redress that

injury.”); Harding v. Orlando Apts., LLC, No. 6:11-cv-85-Orl-19DAB, 2011 WL

1457164, at *4 (M.D. Fla. Apr. 15, 2011) (“‘[T]he fundamental distinction between

arguing no cause of action and arguing no Article III redressability, . . . [is] that the

former argument is not squarely directed at jurisdiction itself, but rather at the

existence of a remedy for the alleged violation of federal rights[.]’”) (quoting Steel Co.

v. Citizens for a Better Env’t, 523 U.S. 83, 96 (1998)). Accordingly, Plaintiffs have

established Article III standing to maintain their claims.

B. Shotgun Pleading

Shotgun pleadings generally present in the following ways: (1) a complaint

“containing multiple counts where each count adopts the allegations of all preceding

counts, causing each successive count to carry all that came before and the last count

to be a combination of the entire complaint”; (2) a complaint “replete with conclusory,

vague, and immaterial facts not obviously connected to any particular cause of

action”; (3) a complaint that fails to separate “into a different count each cause of

action or claim for relief”; and (4) complaints containing “multiple claims against

multiple defendants without specifying which of the defendants are responsible for

which acts or omissions, or which of the defendants the claim is brought against.”

Weiland, 792 F.3d at 1321–23.

The County contends that the Amended Complaint constitutes the third type of

shotgun pleading “because it lumps the Plaintiffs together, as well as their purported

claims against [the] County.” (Dkt. 19 at 6.) While the Amended Complaint could

be clearer, it puts the County on sufficient notice of the claims against it and the

grounds upon which they rest because all of Plaintiffs’ claims stem from the County’s

denial of the bond financing application. Specifically, Plaintiffs sufficiently allege that

but for BCBCC’s arbitrary denial of the bond financing application, VHO and AHP

would have been able to develop an affordable housing community with the funds it

sought approval for, Canton would have been able to construct the Development as

contracted, and Concord would have been able to manage it as contracted. (Dkt. 17

¶¶ 9–28.) Further, a court’s shotgun pleading analysis is focused on a plaintiff lumping

multiple claims against different defendants together, creating a notice problem as to

which defendant committed what harm—not lumping multiple plaintiffs together that

have alleged injuries that all flow from one defendant’s singular decision. Weiland,

792 F.3d at 1325 (explaining that a court may dismiss a complaint as a shotgun

pleading “whe[n] ‘it is virtually impossible to know which allegations of fact are

intended to support which claim(s) for relief’”) (quoting Anderson, 77 F.3d 364,

366).

However, the court does find it problematic that Plaintiffs lump their segregative

effect and disparate impact claims together into one count under each statute since

both claims require different elements. (Dkt. 17 ¶¶ 29–43.) See Weiland, 792 F.3d at

1322–23; Novak v. Cobb Cnty. Kennestone Hosp. Auth., 74 F.3d 1173, 1175 & n.5 (11th

Cir. 1996) (referring to a complaint that pleaded multiple causes of action in a single

count as “a quintessential ‘shotgun pleading’”) If Plaintiffs choose to file a second

amended complaint, the court instructs Plaintiffs to separate their segregative effect

and disparate impact claims into different counts.

C. Rule 12(b)(6)

As a threshold matter, the court will apply the same analysis to Plaintiffs’ FHA

and Florida FHA claims. See Hawn v. Shoreline Towers Phase 1 Condo. Ass’n, Inc., 347

F. App’x 464, 467 (11th Cir. 2009) (“‘The Florida [FHA] contains statutory provisions

that are substantively identical to the [FHA].’ Accordingly, we apply the same analysis

to [the plaintiff’s] claims under these two statutes.”) (quoting Loren v. Sasser, 309 F.3d

1296, 1299 n.9 (11th Cir. 2002)); see also Alley v. Les Chateaux Condo. Ass’n, Inc., No.

8:10-cv-760-T-33TGW, 2010 WL 4739508, at *3 n.2 (M.D. Fla. Nov. 16, 2010)

(applying the same analysis to claims for violations of the FHA and Florida FHA).

The FHA protects certain classes of people from discrimination in the sale,

rental, and financing of housing. Inclusive Cmtys. Project, Inc., 576 U.S. at 540 (“[T]he

FHA aims to ensure that [government] priorities can be achieved without arbitrarily

creating discriminatory effects or perpetuating segregation.”). In an FHA case, the

plaintiff “has the burden of proving that a challenged practice caused or predictably

will cause a discriminatory effect.” Id. at 527 (citing 24 C.F.R. § 100.500(c)(1)). A

plaintiff can demonstrate a discriminatory effect in two ways. Hallmark Devs., Inc. v.

Fulton County., Ga., 466 F.3d 1276, 1286 (11th Cir. 2006). First, “it can demonstrate

that the decision [at issue] has a segregative effect.” Id. (internal citation and quotation

omitted). Second, the plaintiff can show that the decision “makes housing options

significantly more restrictive for members of a protected group than for persons outside

that group.” Id. (quotation omitted). The second method is commonly called as a

“disparate impact” claim. Oviedo Town Ctr. II, L.L.L.P. v. City of Oviedo, Fla., 759 F.

App’x 828, 833 (11th Cir. 2018).

Plaintiffs allege that the County’s actions have a segregative effect on diverse

persons seeking housing in an area that already has segregated housing patterns. (Dkt.

17 ¶ 27.) Plaintiffs further allege that the County’s actions have a disparate impact on

racial minorities “based on statistical housing patterns, demographic statistics for the

market area, and racial population disparities within the market area.” (Dkt. ¶ 28.)

The County argues that Plaintiffs fail to plead sufficient facts under either a segregative

effect and disparate impact theory because Plaintiffs’ allegations as to both theories are

conclusory in nature and therefore should not be accepted as true. (Dkt. 19 at 8–13.)

i. Segregative Effect

To state a segregative effect claim, a complaint must plead facts plausibly

showing that the government’s actions perpetuated segregation. See Dept’ of Hous. &

Urban Dev.’s Implementation of the Fair Hous. Act Discriminatory Effects Standard, 78 Fed.

Reg. 11,460 (Feb. 15, 2013) (codified at 24 C.F.R. § 100.500(a)) (prohibiting a practice

that “creates, increases, reinforces, or perpetuates segregated housing patterns because

of race, color, religion, sex, handicap, familial status, or national origin”); see also

Hallmark Devs., Inc., 466 F.3d at 1286 (explaining that a plaintiff can demonstrate

discriminatory effect by showing the government defendant’s decision “makes housing

options significantly more restrictive for members of a protected group than for persons

outside that group”) (quotation omitted).

Here, the only fact that Plaintiffs allege to support their segregative effect claims

is that “[t]he County’s arbitrary denial of the requested [b]ond [f]inancing has served

to perpetuate segregated housing patterns in and around Brevard County by

preventing the development of affordable multi-family rental housing on appropriately

zoned property, which housing would be utilized by diverse persons and groups of

persons.” (Dkt. 17 ¶ 27.) Plaintiffs conclusorily assert that the denial of the bond

financing application perpetuates segregated housing patterns in the County without

providing any facts to plausibly support the contention that existing housing patterns

in Brevard County are segregated. Oxford Asset Mgmt., Ltd. v. Jaharis, 297 F.3d 1182,

1188 (11th Cir. 2002) (“[C]onclusory allegations, unwarranted deductions of facts or

legal conclusions masquerading as facts[,] will not prevent dismissal.”). Further,

Plaintiffs do not plead any facts to support the contention that a class protected under

the FHA is being segregated against as “diverse persons” are not a protected class

under the FHA. (Dkt. 17 ¶ 27.) To the extent Plaintiffs seek to bring their claims

based on a protected race class, Plaintiffs do not plead any facts supporting that a

specific racial minority or minorities are affected by purported segregated housing

patterns in and around the County. (See id.)

To survive a 12(b)(6) motion to dismiss, segregative effect FHA claims often

require publicly available statistical evidence plausibly establishing that a particular

community has segregated housing patterns that negatively affect a class protected

under the FHA. Compare Jackson v. Okaloosa County., Fla., 21 F.3d 1531, 1543 (11th

Cir. 1994) (reversing 12(b)(6) dismissal of an FHA claim where plaintiffs pleaded that

“[t]he exclusion of public housing from the unincorporated five-mile area allegedly

ha[d] a harsher impact on African Americans than whites because 86% of the persons

on the wait-list for public housing [we]re African American[] and the neighborhood

where the new public housing project will probably be built (absent court action) [wa]s

racially impacted”), with Boykin v. Fenty, 650 F. App’x 42, 44–45 (D.C. Cir. 2016)

(affirming 12(b)(6) dismissal of an FHA claim where African American and Hispanic

plaintiffs, who were former residents of a homeless shelter closed by the government

defendant, alleged that the defendant closed the homeless shelter in order to move

predominately minority homeless persons from majority-white neighborhoods into

minority neighborhoods, reasoning that the plaintiffs allegations did not “support an

inference that homeless persons were targeted for exclusion because of their race

[because although the plaintiffs attached] exhibits containing statistics about the racial

and ethnic composition of various neighborhoods in the [d]istrict where shelters and

placements were located, [they did not attach] any statistics about the racial makeup

of the homeless population”) Plaintiffs contend that the “exact statistical information

necessary to support [their claims] will be revealed through discovery,” (Dkt. 28 at 13),

but to plausibly allege claims, conclusory statements will not suffice. Iqbal, 556 U.S.

at 678. Further, publicly available data may well be available even at this early stage

in the litigation. See Robert G. Schwemm, Segregative-Effect Claims Under the Fair

Housing Act, 20 N.Y.U. J. Legis. & Pub. Pol’y 709, 738 (2017) (“[S]egregative-effect

precedents suggest a fairly straightforward approach that relies exclusively on local

census data.”). Therefore, Defendant’s Motion is granted in part and Counts One and

Two are dismissed without prejudice for failure to state a segregative effect claim under

the FHA and Florida FHA.

ii. Disparate Impact

Disparate impact claims require a plaintiff to plead facts that plausibly support

the application of a facially neutral policy “had a harsher impact” on a protected group

of individuals, such as a racial minority, even if the effect was unintended. Hallmark

Devs., Inc., 466 F.3d at 1286. To plead a disparate impact claim, a complaint must

assert facts that plausibly:

(1) show statistically-imbalanced . . . patterns which adversely

impact a minority group; (2) identify a facially-neutral policy

used by [d]efendants; (3) allege that such policy was “artificial,

arbitrary, and unnecessary;” and (4) provide factual allegations

that meet the “robust causality requirement” linking the

challenged neutral policy to a specific adverse racial or ethnic

disparity.

City of Miami v. Bank of Am. Corp., 171 F. Supp. 3d 1314, 1320 (S.D. Fla. 2016) (quoting

Inclusive Cmtys. Project, Inc., 576 U.S. at 540–43). The Amended Complaint does not

show statistically imbalanced patterns that meet the robust causality requirement.

Plaintiffs do not provide any statistical evidence in their Amended Complaint.

(See Dkt. 17.) Accordingly, they do not allege facts establishing that the County applies

its policy of conducting public hearings to approve private bond financing applications

as authorized by 26 U.S.C. § 147(f)(2)(A)(i) in a manner that adversely impacts a

minority group in a statistically unbalanced way. (See Dkt. 19 at 12); Inclusive Cmtys.

Project, Inc., 576 U.S at 543 (“A plaintiff who fails to allege facts at the pleading stage

or produce statistical evidence demonstrating a causal connection cannot make out a

prima facie case of disparate impact.”). Rather, Plaintiffs make a conclusory statement

about the existence of statistical evidence without any support. See (Dkt. 17 ¶ 28)

(stating, “Moreover, based on statistical housing patterns, demographic statistics for

the market area, and racial population disparities within the market area, denial of the

requested Bond Financing has a clear and negative disparate impact on racial

minorities, denying them rights to housing.”) Further, as mentioned previously,

Plaintiffs’ general reference to an unidentified minority group is not enough to survive

the Motion. See Jackson, 21 F.3d at 1543. Therefore, the court finds that Plaintiffs’

have not pleaded sufficient facts to show a statistically imbalanced pattern. Compare

River Cross Land Co., LLC, 2019 WL 12518729, at *7 (granting a motion to dismiss

when plaintiff presented “no comparative [statistical] data at all”), with Fulton County.,

Ga. v. Wells Fargo & Co., No. 1:21-cv-1800-MLB, 2022 WL 846903, at *16–18 (N.D.

Ga. Mar. 22, 2022) (denying 12(b)(6) motion to dismiss where plaintiffs provided

detailed statistical data supporting mortgage loan issuer defendants issued “a

disproportionate number of high-cost, subprime, or other nonprime loans to minority

borrowers” as compared to non-minorities).

The Amended Complaint also does not satisfy the robust causality requirement

because it does not contain any facts linking the challenged neutral policy to a specific

adverse racial or ethnic disparity. (See Dkt. 17, 19 at 11–12.) See also River Cross Land

Co., LLC, 2019 WL 12518729, at *7 (explaining that to meet the robust causality

requirement when faced with a 12(b)(6) motion, “a plaintiff must allege facts

demonstrating a casual connection’ between the challenged policy and the alleged

statistical disparity”) (cleaned up) (quoting City of Miami, 171 F. Supp. 3d at 1320).

The Amended Complaint does not identify a specific minority group that was

adversely impacted by the County’s application and does not provide statistical

evidence as support. Rather, Plaintiffs make the conclusory statement that minorities

were adversely impacted by the County’s denial of their application. (See Dkt. 17 ¶

28.) (“Moreover, based on statistical housing patterns, demographic statistics for the

market area, and racial population disparities within the market area, denial of the

requested Bond Financing has a clear and negative disparate impact on racial

minorities, denying them rights to housing.”)

The court rejects the County’s argument that Plaintiffs did not sufficiently

identify a facially neutral policy that was artificially, arbitrarily, and unnecessarily used

by the County. (Dkt. 19 at 11.) Specifically, the court finds that Plaintiffs plausibly

identify the County’s and BCBCC’s policy to conduct public hearings to approve the

bond financing application as authorized by 26 U.S.C. § 147(f)(2)(A)(i) is a facially

neutral policy that was used arbitrarily to deny approval of the bond financing

application. (Dkt. 17 ¶¶ 18–25.) In support of this contention, Plaintiffs allege that

BCHFA, the authority in charge of the issuance of the tax-exempt bonds that Plaintiffs

applied for, recommended approval of the bond financing application. (Dkt. 28 at 10.)

Plaintiffs further allege that BCBCC’s own published report suggests BCBCC’s

approval of the application.5 (Dkt. 17 ¶ 19.) Last, Plaintiffs allege that an AHP

representative was limited to three minutes to speak and could not provide a response

in rebuttal to members of the public who opposed approval of the application. (Id. ¶

21.)

Therefore, Defendant’s Motion is granted in part, and Counts One and Two are

dismissed without prejudice for failure to state a disparate impact claim under the FHA

and Florida FHA.

5 In its response to the Motion, Plaintiffs represent that the “BCHFA . . . recommended

approval of the [b]ond [f]inancing application.” (Dkt. 28 at 3) (citing Dkt. 17 ¶ 16.) However,

the court notes a review of the Amended Complaint shows that paragraph 16 does not state

that. (See Dkt. 17 ¶ 16.) (“On October 25, 2023, the BCHFA held a public meeting for the

purpose of receiving public input on the bond financing application (the “Community

Meeting”).”)

CONCLUSION

Accordingly, it is ORDERED that:

1. Brevard County’s Motion to Dismiss the Amended Complaint

(Dkt. 19) is GRANTED IN PART and DENIED IN PART.

2. The Motion is GRANTED to the extent that:

a. Count One is DISMISSED without prejudice for failure to

state a segregative effect or disparate impact claim under the

Fair Housing Act.

b. Count Two is DISMISSED without prejudice for failure to

state a segregative effect or disparate impact claim under the

Florida Fair Housing Act.

3. Otherwise, the Motion is DENIED.

4. On or before October 19, 2024, Plaintiffs may file a second

amended complaint that addresses the deficiencies described

herein.

ORDERED in Orlando, Florida, on September 19, 2024.

( a _ hack

JUVIE S. SNEED

UNITED STATES DISTRICT JUDGE

Copies furnished to:

Counsel of Record

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