Giles v. Alto Partners ( 2020 )

FILED
United States Court of Appeals
UNITED STATES COURT OF APPEALS Tenth Circuit
FOR THE TENTH CIRCUIT July 14, 2020
_________________________________
Christopher M. Wolpert
Clerk of Court
SAMUEL K. GILES,
Plaintiff - Appellant,
v. No. 19-1381
(D.C. No. 1:18-CV-00467-RBJ)
ALTO PARTNERS LLLP, (D. Colo.)
Defendant - Appellee.
_________________________________
ORDER AND JUDGMENT*
_________________________________
Before BRISCOE, MATHESON, and EID, Circuit Judges.
_________________________________
Samuel K. Giles lives in a subsidized-housing complex that is owned by Alto
Partners, LLLP (“Alto”) and operated by Adams County Housing Authority
(“ACHA”).1 Giles, who is African American, filed this housing-discrimination
lawsuit against Alto after it denied his application to move to a different unit. Alto
*
After examining the briefs and appellate record, this panel has determined
unanimously that oral argument would not materially assist in the determination of
this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is therefore
ordered submitted without oral argument. This order and judgment is not binding
precedent, except under the doctrines of law of the case, res judicata, and collateral
estoppel. It may be cited, however, for its persuasive value consistent with
Fed. R. App. P. 32.1 and 10th Cir. R. 32.1.
1
ACHA is the sole member of Alto GP, LLC, which is the general partner of
Alto. Alto and ACHA frequently acted together during the events underlying this
lawsuit. To the extent they acted collectively, we refer to them as “Alto” like the
district court did.
told Giles that he did not qualify for the unit based on his income, but Giles questions
Alto’s motivation—certain that race, not finances, motivated its decision. The
district court held that Alto presented a legitimate, nondiscriminatory reason for its
decision and rejected Giles’s argument that the proffered reason was pretextual. The
district court then granted summary judgment to Alto. Exercising jurisdiction under
28 U.S.C. § 1291, we affirm.
I.
Giles lives in a low-income housing community in Westminster, Colorado
called Terrace Gardens Apartments. In 2017, ACHA notified residents of a possible
redevelopment in the coming years and gave them information on relocation
assistance in anticipation of that event. Shortly thereafter, Giles applied to transfer to
a specific unit at Alto Apartments, a new complex run by the same owner and
management team. Giles had to requalify financially in order to transfer.
Alto denied Giles’s application based on his income. Giles is the managing
director of his own company, so Alto first evaluated his application based on his net
earnings from self-employment. Because Giles reported a net loss for his business in
2016, Alto concluded that his self-employment income did not meet the
minimum-income threshold. Alto also looked at whether Giles qualified based on his
gross earnings from wages. But the documentation Giles provided contained
discrepancies, and he repeatedly refused to provide a 2017 profit-and-loss statement
that Alto says was critical to the income-verification process. Alto therefore
concluded that Giles did not qualify under that methodology either.
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Giles disagreed with the manner in which Alto calculated his income and
accused Alto of racial discrimination—even though African American and other
minority residents make up a substantial part of the population at Alto Apartments,
and Alto ultimately rented the unit Giles requested to an African American mother
and child. A representative with ACHA offered to personally review Giles’s income
to search for possible grounds to appeal the denial of his application, but he filed this
lawsuit instead. His pro se complaint seeks declaratory and injunctive relief. He
asserts claims under Title VIII of the Civil Rights Act of 1968 (the “Fair Housing Act” or
“FHA”), 42 U.S.C. §§ 3601-3619, as well as state-law claims for breach of contract,
breach of the covenant of good faith and fair dealing, and unfair housing practices. All of
the claims are predicated on the same alleged discriminatory acts.
This is the second appeal in this case. We incorporate by reference our
decision in the first appeal, which contains a detailed description of Giles’s claims
and the facts underlying them. See Giles v. Alto Partners, LLLP, 762 F. App’x 505,
506-08 (10th Cir. 2019). In that appeal, we affirmed the district court’s order
denying Giles’s motion for a preliminary injunction. Giles had asked the district
court to preclude Alto from renting his desired unit to anyone else pending the
resolution of his lawsuit. The district court denied his motion after concluding that
(1) Giles is not presently at risk of being displaced from his current residence at Terrace
Gardens because any redevelopment will not occur for another five to eight years;
(2) Giles has conceded he has no right to get into a specific apartment; (3) there is no
evidence of racial discrimination; and (4) Giles does not have a viable pretext argument
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based on Alto’s alleged deviations from its normal calculation methods. We agreed with
the district court’s reasoning and found no abuse of discretion. See id. at 509-10.
The case then proceeded in district court. During the discovery phase, Giles
resisted providing his complete financial information and filed a motion for a
protective order. But the district court made clear that Giles’s finances are at the
center of this lawsuit and ordered him to produce all documentation related to his
ability to qualify for the new apartment (including his 2016 and 2017 tax returns and
his 2017 profit and loss statement), which he did. Alto ultimately moved for
summary judgment on all of Giles’s claims. The district court granted summary
judgment in Alto’s favor, and Giles filed this timely appeal.
II.
We review the district court’s grant of summary judgment de novo, applying
the same standard that the district court applied. Cillo v. City of Greenwood Vill.,
739 F.3d 451, 461 (10th Cir. 2013). Summary judgment must be granted if “there is
no genuine dispute as to any material fact and the movant is entitled to judgment as a
matter of law.” Fed. R. Civ. P. 56(a). Stated otherwise, “[t]he moving party is
entitled to summary judgment where the record taken as a whole could not lead a
rational trier of fact to find for the non-moving party.” 19 Solid Waste Dep’t Mechs.
v. City of Albuquerque, 156 F.3d 1068, 1071 (10th Cir. 1998) (alteration and internal
quotation marks omitted). “When applying this standard, we examine the record and
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reasonable inferences drawn therefrom in the light most favorable to the non-moving
party.” Id.
Giles’s claims are based on alleged circumstantial evidence of discrimination,
so the three-part burden-shifting framework in McDonnell Douglas Corp. v. Green,
411 U.S. 792, 802-04 (1973), applies. See Asbury v. Brougham, 866 F.2d 1276, 1279
(10th Cir. 1989) (stating that the McDonnell Douglas framework applies to FHA
claims); see also Cinnamon Hills Youth Crisis Ctr., Inc. v. St. George City, 685 F.3d
917, 919 (10th Cir. 2012) (stating that the McDonnell Douglas framework is
“entrenched” in the FHA context).
This means that Giles “first must come forward with proof of a prima facie
case of discrimination,” Asbury, 866 F.2d at 1279. If he does so, the burden shifts to
Alto to produce evidence that it “was motivated by legitimate, non-racial
considerations,” id. If Alto articulates non-discriminatory reasons, the burden shifts
back to Giles to “show there is a genuine issue of material fact as to whether the
proffered reasons are pretextual.” Fassbender v. Correct Care Sols., LLC, 890 F.3d
875, 884 (10th Cir. 2018) (internal quotation marks omitted). Giles can show pretext
by demonstrating that (1) “the proffered reason is factually false,” Tabor v. Hilti,
Inc., 703 F.3d 1206, 1218 (10th Cir. 2013); (2) discrimination was a primary factor in
Alto’s decision, as evidenced by the fact that Alto’s proffered reason is so weak and
implausible that a reasonable fact finder could deem it unworthy of credence, see id.;
or (3) Alto acted contrary to a written or unwritten company policy or practice, see
DePaula v. Easter Seals El Mirador, 859 F.3d 957, 970 (10th Cir. 2017).
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In resolving Alto’s summary judgment motion, the district court first
concluded that Giles did not show direct evidence of discriminatory intent. It then
conducted a McDonnell Douglas analysis. It did not delve into whether Giles
established a prima facie case of racial discrimination based on circumstantial
evidence, but instead focused on the second and third steps of McDonnell Douglas.
At the second step, the district court held that Alto met its burden of showing a
legitimate, non-discriminatory reason for its denial of Giles’s housing application—
namely, it could not verify that Giles met the income requirements based on the
documentation he provided. In reaching this conclusion, the district court discussed
the income-verification process in detail and explained how Alto complied with the
procedures that administrators of the Low Income Housing Tax Credit Program must
follow. Those procedures are set forth in a manual published by the Colorado
Housing and Finance Authority (“CHFA”), which in turn references subsidized-
housing guidelines, a handbook published by the Department of Housing and Urban
Development (“HUD”), and the Internal Revenue Code.
At the third step, the district court placed Giles’s pretext argument within the
third category discussed above, characterizing it as an argument that Alto had
deviated from the stated or written policy contained in the CHFA manual. The
district court acknowledged that the application process for subsidized housing can
be confusing and that aspects of the minimum and maximum income limitations seem
to “make[] no sense,” R., Vol. II at 103 n.1. But it carefully dissected each of Giles’s
arguments alleging failure to comply with the CHFA manual and concluded that Alto
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did its best to adhere to the governing procedures. Thus, the district court held that
Giles failed to show a genuine dispute of material fact as to whether Alto’s proffered
reason for denying his application was pretextual. It also determined that Giles failed
to produce any evidence whatsoever suggesting that Alto denied his application
because of his race. For all these reasons, the district court granted summary
judgment to Alto.
III.
On appeal, Giles asserts that the district court misinterpreted the Internal
Revenue Code when it found that Alto met its burden of showing a legitimate,
non-discriminatory reason for its denial of Giles’s housing application, and also erred
in rejecting his pretext theory. To support both of these assertions, Giles largely
reiterates the arguments he made below regarding Alto’s failure to comply with the
CHFA manual that spells out how to calculate income. The gist of his contention
seems to be that Alto (and later the district court) should have looked at his annual or
gross income instead of his net income to determine if he qualified for the Alto
Apartments. According to Giles, Alto’s calculations and methodology run so far
afield from the broad definition of “income” in the Internal Revenue Code and
relevant state and federal handbooks that it did not sustain its burden at step two of
the analysis; furthermore, Alto’s reason for denying his application must be a pretext
for racial discrimination at step three.
Giles further asserts that the district court’s order amounts to improper
“judicial legislation” that effectively undoes Congress’s subsidized-housing
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legislation and its plan to allocate affordable housing to those in need. See, e.g.,
Aplt. Opening Br. at 6, 13, 17, 41. Expanding upon his judicial-legislation argument,
Giles contends the district court’s order violates his constitutional rights by
pronouncing a “facially unconstitutional ex post facto rule,” id. at 28.
We construe Giles’s pleadings liberally because he proceeds pro se. See
Ledbetter v. City of Topeka, 318 F.3d 1183, 1187 (10th Cir. 2003). Even under that
standard, we are not persuaded by his arguments. We agree with the district court’s
careful analysis and affirm for substantially the same reasons stated in its order
granting summary judgment. See R., Vol. II at 102-17.2
IV.
Last, we consider Giles’s “Motion for Judicial Notice” of six categories of
documents. To the extent the motion asks us to “instruct[] the district court and
subsequent jury to accept the noticed fact[s] as conclusive” under Federal Rule of
Evidence 201(f), Aplt. Mot. for Jud. Notice at 19, it is now moot. We deny the
remainder of the motion because Giles has not established that judicial notice is
necessary and appropriate under Federal Rule of Evidence 201. We note, however,
2
Because Alto prevails on summary judgment based on the second and third
steps of the McDonnell Douglas analysis, we need not delve into Giles’s appellate
argument regarding the first step—i.e., that the evidence he presented created a
genuine issue of material fact as to whether he established a prima facie case by
qualifying for housing. And because we agree with the district court’s reasoning and
the result in this case, we need not reach his argument that its summary judgment
order constitutes impermissible judicial legislation and violated his constitutional
rights.
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that we were able to fully consider the parties’ arguments without taking judicial
notice of the documents listed in the motion.
In addition to seeking judicial notice, the motion asks us to find that the
district court abused its discretion by failing to rule on a similar, partially
overlapping filing entitled, “Request for Judicial Notice.” Giles did not make this
argument in his principal briefs, so it is not properly before us. See Fed. R. App. P.
28(a)(8)(A). “Consistent with [the requirement in Rule 28(a)(8)(A)], we routinely
have declined to consider arguments that are not raised, or are inadequately
presented, in an appellant’s opening brief.” Bronson v. Swensen, 500 F.3d 1099,
1104 (10th Cir. 2007).
V.
We deny Giles’s motion for judicial notice. We affirm the district court’s
judgment.
Entered for the Court
Allison H. Eid
Circuit Judge
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