Giles v. Alto Partners

• Court: Court of Appeals for the Tenth Circuit
• Decided: July 14, 2020
• Docket: 19-1381
• Status: Unpublished

Opinion

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 This order and judgment is not binding precedent, except under the doctrines of law of the case, res judicata, and collateral estoppel.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.

2 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

3 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

4 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).

5 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

6 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

7 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. 8 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