Wednesday, January 17, 2018

discriminatory lending - Fair Housing Act - City of Phila. v. Wells Fargo

City of Phila. v. Wells Fargo – ED Pa. – Jan. 16, 2018


On May 15, 2017, Plaintiff City of Philadelphia filed its 52-page Complaint alleging one claim against Defendants Wells Fargo & Co., Inc. and Wells Fargo Bank, N.A. for violating the Fair Housing Act, 42 U.S.C. §§ 36-1, et seq. The Complaint accuses Wells Fargo of engaging in discriminatory mortgage-lending practices against African-American and Latino residents of Philadelphia. Wells Fargo’s alleged practices constitute “reverse redlining,” which involves targeting minorities and minority communities with exploitive loan products that have higher costs and worse terms than those offered to similarly situated white borrowers.  

Publicly available loan data has been analyzed by the City to indicate the existence of “at least 1,067 discriminatory high-cost or high-risk loans issued to minority borrowers by Wells Fargo in Philadelphia between 2004 and 2014 that resulted in foreclosure.”  These loans are concentrated in areas of the city that have high rates of poverty and significant AfricanAmerican and Latino populations.  According to the City, this practice has “continue[d] through the present and has not terminated.”

The City alleges disparate treatment and disparate impact as theories for its FHA claim, Compl. and based on those theories, the City alleges two types of injuries: non-economic and economic. For its non-economic injuries, the City alleges that Wells Fargo’s conduct negatively impacts the ability of minority residents to own homes in Philadelphia, which injures the City’s “longstanding and active interest in promoting fair housing and securing the benefits of an integrated community.”  The City alleges that it expends resources combating housing discrimination and that Wells Fargo’s actions have interfered with those efforts. For its economic injuries, the City alleges that the discriminatory loans issued by Wells Fargo cause increases in foreclosures that diminish the City’s tax revenues and increase its spending on municipal services.

To remedy its injuries, the City seeks injunctive relief and damages.  On July 21, 2017, Wells Fargo filed a motion to dismiss and a motion to strike.  On November 3, 2017, Wells Fargo filed a motion to stay and/or limit discovery.

I will deny all motions. The motion to dismiss and motion to stay and/or limit discovery are discussed below, and the motion to strike will be addressed in a separate order

Saturday, January 06, 2018

False Claims Act - whistleblower protection - but-for causation required

DiFiore v. CSL Behring, LLC – 3d Cir. – Jan. 3, 2018

Marie DiFiore asserted claims against her former employer, CSL Behring, for retaliation in violation of the False Claims Act, and for wrongful discharge under a theory of constructive discharge in violation of Pennsylvania state law.

Held: An employee’s protected activity must be the “but-for” cause of adverse actions to support a claim of retaliation under the FCA.

child abuse - using drugs during pregnancy

In the Interest of L.B. – Pa. Super. – 12-27-17

Held: A pregnant woman may commit child abuse under the Child Protective Services Law, 23 Pa.C.S. §§ 6301 et seq., based on use of illegal drugs while pregnant,  if CYS establishes that, by using the illegal drugs, the mother intentionally, knowingly, or recklessly caused, or created a reasonable likelihood of bodily injury to a child after birth.

Wednesday, December 20, 2017

tax sale - notice - "reasonable efforts" to find/notify property owner

Klemmer v. Fayette Co. Tax Claim Bureau – Cmwlth. Court – December 14, 2017

Upset tax sale set aside because tax claim bureau (TCB) failed to make any effort to locate the property owner, much less “reasonable efforts” required by 72 P.S. 5860.607a(a), where the certified mail notice was returned unsigned to the TCB, because the property owner was incarcerated during all relevant periods.

From the opinion:

Notice, due process
The Tax Sale Law requires a tax claim bureau to give notice to the delinquent taxpayer before his property can be sold in satisfaction of overdue taxes.  . . .The United States Supreme Court has held that due process is implicated when property is taken for the collection of taxes, stating: [p]eople must pay their taxes, and the government may hold citizens accountable for tax delinquency by taking their property.   But before forcing a citizen to satisfy his debt by forfeiting his property, due process requires the government to provide adequate notice of the impending taking. . . .To satisfy due process, a tax claim bureau must provide “notice reasonably calculated, under all the circumstances, to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections.” . . . .The notice provisions of the Tax Sale Law “assure that no one is deprived of property without due process of law.” . . . .Accordingly, a tax claim bureau must strictly comply with each and every statutory notice provision, or the tax sale will be set aside.

Focus on the actions of the TCB, not the property owner
In reviewing the validity of a tax sale, the court must focus “not on the alleged neglect of the owner, which is often present in some degree, but on whether the activities of the [tax claim bureau] comply with the requirements of the [statute].” Consolidated Reports, 132 A.3d at 644 (quoting Smith, 834 A.2d at 1251). It is the conduct of the tax claim bureau that is determinative of compliance with the statutory notice provisions.

Reasonable efforts requirement

Where a notice to the property owner is either returned without the required signed return receipt, or there are other circumstances which raise a “significant doubt” as to actual receipt of the notice, then before a tax sale can take place, the TCB “must exercise reasonable efforts to discover the whereabouts of [the property owner]and notify him.  72 P.S./ 5860.607a(a).      The statutory list of possible “reasonable efforts” details the “mandatory minimum search required,” but what constitutes a reasonable effort is fact-specific.  . . . .It matters not that the reasonable effort may not have borne fruit. An effort must still be undertaken. . . . Futility is not a defense to a tax claim bureau’s failure to exercise reasonable efforts.  Further, the tax claim bureau must do a reasonable search even where the address to which the tax claim bureau sent the notices is correct. . . .. Here, the Tax Claim Bureau did not offer evidence that it undertook any effort to locate Taxpayer. 

Wednesday, December 13, 2017

UC - financial eligibility - proof of earnings - testimony, written records

Kearsley v. UCBR – Cmwlth. Court – 11-28-17 – unreported* memorandum opinion

Held:  UCBR erred in rejecting claimant’s testimony about her wages and her 1009 form, without making any credibility findings, and in holding that written pay stubs were the only competent evidence of her wages.
*An unreported Commonwealth Court case may not be cited binding precedent but can be cited for its persuasive value.  See 210 Pa. Code § 69.414(b) and Pa. R.A.P.  3716

If the case is old, the link may have become stale and may not work, but you can use the case name, court, and date to find the opinion in another source (e.g., Westlaw, Lexis, Google Scholar)

Friday, December 08, 2017

Paternity - acknowledgment - 23 Pa. C.S. 5103.

S.N.M. v. M.F. – Superior Court – November 20, 2017

Held:  Trial court erred in ordering putative father’s (PF) 2016 motion for genetic testing, where custody order had been entered between mother and PF, including PF’s formal acknowledgment of paternity.

In R.W.E. v. A.B.R., 961 A.2d 161 (Pa. Super. 2008), the Court stated that a signed, witnessed, voluntary acknowledgment of paternity shall be considered a legal finding of paternity if it is not rescinded by the signatories within sixty days of its signing. 23 Pa.C.S. § 5103(g)(1). After sixty days, the acknowledgment may only be challenged in court on the basis of fraud, duress or material mistake of fact, if established by the challenger through clear and convincing evidence. 23 Pa.C.S.  § 5103(g)(2). Id. at 167. Thus, because PF signed the acknowledgment of paternity and presented nothing to show fraud, duress or material mistake of fact, the paternity of child was established and cannot be challenged at this point.   Accord,  D.M. v. V.B., 87 A.3d 323, 327 (Pa. Super. 2014)

See also Wachter v. Ascero, 550 A.2d 1019, 1021 (Pa. Super. 1988) (stating that “blood test should not have been ordered … even for humanitarian purposes, and should never be ordered unless it is to establish paternity in a proceeding where paternity is a relevant fact and has not already been determined in a prior proceeding”). Here, the custody agreement, made an order of court, is such a proceeding that determined paternity. Accordingly, the trial court abused its discretion in granting the genetic testing.

Wednesday, December 06, 2017

UC - willful misconduct - good cause - religious belief

Kaite v. UCBR – Cmwlth. Court – November 29, 2017

Claimant had good cause to refuse employer direction for her to get a fingerprint background check, where she had a sincerely held religious belief against fingerprinting, in spite of the fact that she did not belong to an particular church or other religious organization. 

From the opinion:

The employer bears the burden of proving the existence of the work rule and its violation, and once the employer establishes that, the burden then shifts to the claimant to prove that the violation was for good cause. Oliver v. UCBR, 5 A.3d 432, 438 (Pa. Cmwlth. 2010). Where the state denies benefits because of conduct mandated by a religious belief, putting substantial pressure on a person to modify behavior and violate that belief, a burden upon religion exists. Cassatt v. UCBR, 642 A.2d 657, 659 (Pa. Cmwlth. 1994). The burden that a denial places on a claimant’s right to free exercise must be sufficiently compelling to override the claimant’s First Amendment rights. Id.
The United States Supreme Court has held that a conditioning of the availability of benefits upon an employee’s willingnessto violate a cardinal principle of her religious faith effectively penalizes the free exercise of her constitutional liberties. Sherbert v. Verner, 374 U.S. 398, 406 (1963).
The Board found that Petitioner’s beliefs were personal and not religious because the Petitioner, at the time of the hearing, indicated she is not a member of any formal, recognized or organized religion. (R.R. 37a.) The Board 8 concluded the beliefs were personal because she kept her religion quiet and only practiced in her home. Id. The United States Supreme Court rejected the notion that to claim the protection of the Free Exercise Clause one must be responding to the commands of a particular religious organization. Frazee v. Illinois Department of Employment Security, 489 U.S. 829, 834 (1989). This Court cautioned in Monroe that the Court must avoid any predisposition toward conventional religions so that unfamiliar faiths are not branded as secular beliefs. Monroe, 535 A.2d at 1225.   See also, U.S. Equal Employment Opportunity Commission [EEOC] v. Consol Energy, Inc., 860 F.3d 131 (4th Cir. 2017


Monday, December 04, 2017

LT - excessive sec. deposit - violation of UTPCPL - treble damages

E.S. Management v. Gao et al. – Superior Court – November 15, 2017

Landlord found liable to four Chinese national students at Carnegie Mellon University

* excessive security deposit (more than two months), in violation of  68 P.S. 250.511a

* UTPCPL violation – students were in China, had limited English proficiency, lease at 15 pages, single-spaced,
   students given only two days to review it – lease never executed - L refused to return deposit

* treble damages award under UTPCPL affirmed – egregious conduct present but not required -
“Discretion to treble damages under the UTPCPL should not be closely constrained by the common-law requirements associated with the award of punitive damages. . . . Nevertheless, the discretion of courts of original jurisdiction is not limitless, as we believe that awards of treble damages may be reviewed by the appellate courts for rationality, akin to appellate review of the discretionary aspect of equitable awards, as previously discussed. Centrally, courts of original jurisdiction should focus on the presence of intentional or reckless, wrongful conduct, as to which an award of treble damages would be consistent with, and in furtherance of, the remedial purposes of the UTPCPL. Schwartz v. Rockey, 932 A.2d 885, 898 (Pa. 2007) (internal citation and footnote omitted).”


If the case is old, the link may have become stale and may not work, but you can use the case name, court, and date to find the opinion in another source (e.g., Westlaw, Lexis, Google Scholar)