NEW YORK CITY OFFICE OF ADMINISTRATIVE TRIALS AND HEARINGS

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1 Comm n on Human Rights v. Tantillo OATH Index Nos. 105/11, 106/11 & 107/11 (Feb. 24, 2011), modified on penalty, Comm n Dec. & Order (May 23, 2011), appended In default proceeding, petitioner established that respondent refused to accept a Section 8 voucher from a tenant. Civil penalty of $7,500 recommended. Commission imposes civil penalty of $20,000. NEW YORK CITY OFFICE OF ADMINISTRATIVE TRIALS AND HEARINGS In the Matter of COMMISSION ON HUMAN RIGHTS Petitioner -against- DIEGO TANTILLO, VINCENZO LaBARBERA & ROSA LaBARBERA Respondents REPORT AND RECOMMENDATION FAYE LEWIS, Administrative Law Judge This is an action commenced by the petitioner, the New York City Commission on Human Rights ( the Commission ), pursuant to section 8-109(c) of the Administrative Code. The complaint alleges that respondents have engaged in a pattern and practice of discrimination against recipients of Section 8 housing vouchers, in violation of sections 8-107(5)(a)(1) and 8-107(5)(a)(2) of the Administrative Code. More specifically, the complaint alleges that respondents refused to accept a Section 8 voucher from an existing tenant in a building on 46 th Street in Brooklyn, New York. The complaint names Rosa LaBarbera as managing agent, and Vincenzo LaBarbera and Diego Tantillo as owners of the building (Pet. Ex. 1). Upon respondents failure to appear for a hearing scheduled for December 1, 2010, petitioner submitted proof of service of the complaint, notice of probable cause, notice of conference, notice of trial, and notice of two rescheduled trials, including the trial scheduled for December 1 (Pet. Exs. 1, 1a, 2, 2a, 3, 3a, 4, 4a, 5, 5a, 6, and 6a). It appeared from my initial review of the service documents that appropriate service was made and I therefore declared respondents in default and proceeded with the hearing as an inquest (Tr. 5-13). After the inquest, however, further review revealed that service at one of the addresses for respondent Diego

2 - 2 - Tantillo had not been effectuated. Petitioner contended that service had been made to all respondents in a manner reasonably calculated to achieve actual notice but agreed, in the interest of justice, that an adjourned trial date should be set so that notices could be re-served to the respondents at every address that had been identified for them. Accordingly, a new hearing was scheduled for January 7, 2011, at which none of the respondents appeared. Upon review of the proof of service of the notice of trial adjournment (Pet. Exs. 14, 15), I concluded that service had been made to every identifiable address and that the matter therefore was properly submitted as an inquest (Tr. 64). The record then closed. Based upon the evidence submitted, I find that petitioner has established that respondents refused to accept a Section 8 voucher from an existing tenant. Petitioner failed to prove, however, that respondents engaged in a pattern and practice of discrimination. I recommend that a civil penalty of $ 7,500 be imposed. ANALYSIS The Human Rights Law prohibits discrimination on the basis of lawful source of income. Section 8-107(5)(a)(1) makes it an unlawful discriminatory practice for an owner, managing agent, or any agent or an employee of the owner [t]o refuse to... rent, lease, approve the... rental or lease or otherwise deny to or withhold from any person or group of persons such a housing accommodation or an interest therein because of the actual or perceived... lawful source of income of such person or persons.... Section 8-107(5)(a)(2) similarly prohibits discrimination against any person... because of any lawful source of income of such person... in the terms, conditions or privileges of the sale, rental or lease of any such housing accommodation or an interest therein or in the furnishing of facilities or services in connection therewith. Section 8-102(25) defines lawful source of income as income derived from... any form of federal, state, or local public assistance or housing assistance including section 8 vouchers. Thus, the Human Rights Law makes it illegal to refuse to accept a Section 8 voucher as payment for rent. The prohibition against refusing Section 8 vouchers extends to existing as well as prospective tenants. Rakhman v. Alco Realty I., L.P., 2011 N.Y. App. Div. LEXIS 567 (1st Dep t 2011); Comm n on Human Rights ex rel. Shlyakov v Ocean Co., LLC, OATH Index

3 - 3 - No. 2829/08, mem. dec. (Jan. 12, 2009); Comm n on Human Rights ex rel. Shmushkina v. New Brooklyn Realty, OATH Index Nos. 2541/08, 2542/08 & 2543/08, mem. dec. (Jan. 2, 2009). Petitioner contends that respondents violated the law by refusing to accept a Section 8 voucher from an existing tenant, Ms. Estevez, who resided at th Street, Brooklyn, New York, which is a six-unit building owned by Mr. LaBarbera and Mr. Tantillo. Petitioner s primary witness was Ingrid Baumann Ostermaier, an attorney with the Commission from November 10, 2008 until September 3, Ms. Ostermaier testified that on September 29, 2009, Ms. Estevez came into the Commission s office to complain that Mrs. LaBarbera had refused to accept her Section 8 voucher. Ms. Estevez provided a copy of her one-year renewal lease, dated November 1, 2008, for th Street (Pet. Ex. 9). On the lease, the owner/agent s name is written as Mrs. R. LaBarbera. Rosa LaBarbera signed for the owner as managing agent (Pet. Ex. 9). Ms. Ostermaier testified and also noted in a memorandum written at the time (Pet. Ex. 11) that Ms. Estevez said that she had given the Section 8 voucher package to Mrs. LaBarbera. According to Ms. Estevez, Mrs. LaBarbera had taken the documents with her and left on a vacation. Upon her return, Mrs. LaBarbera told Ms. Estevez that her voucher would not be accepted. Ms. Ostermaier acknowledged that Ms. Estevez spoke limited English, but testified that she was able to make herself understood (Tr. 19, 33). That same day, Ms. Ostermaier testified, she called Mrs. LaBarbera and left a message identifying herself and describing Ms. Estevez s complaint. Mrs. LaBarbera returned the call within five minutes. While she confirmed that Ms. Estevez had given her the voucher paperwork, she said that she was not going to accept the voucher. Mrs. LaBarbera also said that the building is not a Section 8 building so they do not take Section 8 and do not have to take Section 8. Ms. Ostermaier explained that the Human Rights Law had been amended to prohibit discrimination against a tenant who receives a governmental subsidy. Mrs. LaBarbera responded that they did not accept Section 8 but that she needed to speak to her brother and her husband, who owned the building, and would then get back to Ms. Ostermaier. Mrs. LaBarbera also said she could not speak to her brother and husband until later because her sister-in-law was in labor. Ms. Ostermaier replied that Mrs. LaBarbera would have to let her know whether she would accept the voucher by October 2; otherwise, the Commission would file a complaint (Tr ).

4 - 4 - Ms. Ostermaier s memorandum differed from her trial testimony in that it omitted reference to Mrs. LaBarbera repeating, after the law was explained to her, that the building did not accept Section 8. Instead, Ms. Ostermaier wrote that after she explained the law to Ms. LaBarbera, Mrs. LaBarbera responded that she would need to speak to her husband and brother (Pet. Ex. 11). I found Ms. Ostermaier s contemporaneous memorandum to be more reliable than her trial testimony over a year later. In any event, the difference is minor because, in both versions, Mrs. LaBarbera gave a qualified answer, indicating that she needed to speak to her brother and husband, the owners of the building, before providing a definitive answer about Ms. Estevez s voucher. Ms. Ostermaier testified that she telephoned Mrs. LaBarbera on October 2 to follow up. Mrs. LaBarbera told her to put whatever allegation the Commission had against the building in writing. Ms. Ostermaier responded that the Commission would be filing a complaint (Tr. 24). In her memorandum, Ms. Ostermaier wrote that Mrs. LaBarbera asked her to put the allegation in writing because she needed some time to process it (Pet. Ex. 11). The Commission filed its complaint on October 16, By that time Ms. Estevez had decided that she did not want to remain in her current apartment but would prefer to move. Hence, the Commission did not file the complaint on her behalf but instead filed a Commissioninitiated complaint based upon statements that Mrs. LaBarbera had purportedly made to Ms. Ostermaier (Tr. 25; Pet. Ex. 11). Respondents never filed an answer to the complaint (Tr. 25). Ms. Ostermaier tried to telephone Mrs. LaBarbera in April 2010, so that they could mutually select a date for an OATH conference, but was told that neither Rosa LaBarbera nor Vincenzo LaBarbera was available (Pet. Ex. 12). Respondents never appeared for a conference or trial before this tribunal. On December 11, 2009, Ms. Estevez, using a Spanish interpreter, telephoned Mrs. Ostermaier and said that Mrs. LaBarbera had telephoned her and asked that she write a letter to the Commission withdrawing her complaint (Tr ; Pet. Ex. 12). Ms. Ostermaier explained to Ms. Estevez that she was no longer a complainant and asked if Mrs. LaBarbera had threatened her. Ms. Estevez said Mrs. LaBarbera had not threatened her. Ms. Ostermaier then told Ms. Estevez to notify her if Mrs. LaBarbera telephoned her again. Ms. Estevez did not contact Ms. Ostermaier after this date (Tr ; Pet. Ex. 12).

5 - 5 - The Department of Housing Preservation and Development ( HPD ) building registration report for th Street (Pet. Ex. 10), printed from the internet on September 29, 2009, shows that it is a six-unit building and lists Mr. Tantillo as the head officer and managing agent, and Mr. LaBarbera as officer. The HPD building registration report for the same address, printed November 30, 2010 (Pet. Ex. 7), lists Mr. LaBarbera as head officer, Mr. Diego as officer, and Mrs. LaBarbera as managing agent. In addition to Ms. Ostermaier, petitioner presented the testimony of Keith Chapman, a current staff attorney with the Commission. Mr. Chapman testified that he searched for, downloaded, and printed Notices of Property Value for properties owned by the respondents (Tr ). His search revealed that Mr. Tantillo owns two other buildings in Brooklyn, which together have nine residential units (Resp. Exs. 13b, 13c). Vincenzo LaBarbera owns one other building, in Staten Island, with two residential units (Resp. Ex. 13e). Thus, including the building at th Street, respondents collectively own four residential properties, with a total of 17 residential units. Petitioner asks that I find not only that respondents refused to accept Ms. Estevez s Section 8 voucher but also that they engaged in a pattern and practice of discrimination against Section 8 voucher recipients. As to the former, Ms. Ostermaier gave unrebutted testimony that Ms. Estevez told her that Mrs. LaBarbera refused to accept her voucher. At first Mrs. LaBarbera took the voucher package with her on vacation, but on her return she told Ms. Estevez that she would not accept it. Ms. Ostermaier s testimony was second-level hearsay, based on a conversation with someone whose English was limited. However, its reliability was enhanced because Ms. Ostermaier testified that she also spoke to Mrs. LaBarbera, who confirmed that she had not accepted Ms. Estevez s voucher and that the building does not accept Section 8. Ms. Ostermaier s testimony was consistent with her contemporaneous memorandum. Although Ms. Ostemaier wrote in her memorandum that Mrs. LaBarbera told her to put the allegation in writing so she could process it, respondents never answered the complaint or in any other way communicated with the Commission after the complaint was filed. Under section 8-107(5) (a), a managing agent, or any person having the right to sell, rent, or lease, or approve the... lease of a housing accommodation... or any agent or employee thereof may be held liable for a discriminatory act. Mrs. LaBarbera signed the renewal lease as managing agent, and thus may be held liable for acts of discrimination in connection with the

6 - 6 - housing accommodation. As the owners of the building, Mr. LaBarbera and Mr. Tantillo are strictly liable for her actions as an agent. Admin. Code 8-107(13)(a); Comm n on Human Rights ex rel. Gardner v. I.J.K. Service, Inc., OATH Index No. 1921/08 (Oct. 10, 2008), adopted in part, rejected in part, Comm r Dec. & Order (Feb. 19, 2009). Thus, I find that respondents Vincenzo LaBarbera, Diego Tantillo, and Rosa LaBarbera violated sections 8-107(5)(a) (1) and 8-107(5)(a)(2) of the Human Rights Law by refusing to accept Ms. Estevez s Section 8 voucher as payment for her rent. Petitioner did not establish, however, that respondents engaged in a pattern and practice of discrimination against Section 8 voucher recipients based on their lawful source of income. I credited Ms. Ostermaier s testimony, corroborated by her statement, that Mrs. LaBarbera told her that the building was not a Section 8 building and does not accept Section 8. While this raises the possibility that the building may have previously refused to accept tenants with Section 8 vouchers, it does not establish on what occasions, if any, the building actually turned away someone with a Section 8 voucher. This is critical because it was not always illegal to refuse to rent to someone with a Section 8 voucher. The law was amended in March 2008 to prohibit discrimination based upon lawful source of income. See Admin. Code Historical Note: Subd. 25 added L.L. 10/2008 3, eff. Mar. 26, 2008 (Lexis 2009). Thus, even if the building had refused to accept a Section 8 voucher prior to March 2008, that would not constitute illegal discrimination. Similarly, petitioner s assertion in its closing statement that Mrs. LaBarbera told the Commission that they never... will accept Section 8 vouchers (closing statement at 3, ALJ Ex. 1) was unsupported by the evidence. The best evidence of what Mrs. LaBarbera told Ms. Ostermaier is contained in Ms. Ostermaier s memorandum (Pet. Ex. 11). As set forth above, this memorandum references a telephone call on September 29, 2009, in which Mrs. LaBarbera said that the building was not a Section 8 building, does not accept Section 8, and does not have to accept Section 8. However, after Ms. Ostermaier explained the recent addition to the Human Rights Law and asked Mrs. LaBarbera if she would take the voucher, Mrs. LaBarbera responded that she needed to discuss this with her husband and her brother, who owned the building. When Ms. Ostermaier telephoned her again on October 2, 2009, only four days later, to ask if she would take Ms. Estevez s voucher, Mrs. LaBarbera again demurred, and asked Ms. Ostermaier to put the allegation in writing so she could process it. Respondents failure to

7 - 7 - answer or respond to further communications from the Commission was troubling. However, petitioner did not establish that, after being informed of the change in the law, Mrs. LaBarbera refused to ever accept Section 8 vouchers as payment for rent. FINDINGS AND CONCLUSIONS 1. Petitioners properly served respondents with the complaint and notices of hearing. 2. Respondents Vincenzo LaBarbera, Rosa LaBarbera, and Diego Tantillo violated sections 8-107(5)(a)(1) and 8-107(5)(a)(2) of the Human Rights Law by refusing to accept a tenant s Section 8 voucher as payment for her rent. 3. Petitioners did not establish by a preponderance of the credible evidence that respondents engaged in a pattern and practice of discrimination against Section 8 voucher recipients. RECOMMENDATION The Commission has asked that I recommend that a $35,000 civil penalty be imposed against respondents. I find this request to be excessive and instead recommend that a penalty of $7,500 be imposed. Under section 8-126(a) of the Administrative Code, the Commission may impose a civil penalty of up to $125,000 to vindicate the public interest, in the case of a willful, wanton, or malicious act of discrimination. The purpose of this provision is to punish the violator and to strengthen and expand the enforcement mechanisms of the law so the Commission could prevent discrimination from playing any role in actions related to employment, public accommodations, housing and other real estate East 97 th St. Corp. v. Comm n on Human Rights, 220 A.D.2d 79, 88 (1 st Dep t 1996). This appears to be the first adjudicated case in which the Commission has sought a civil penalty for failure to accept a Section 8 voucher. Thus, there is no precedent which is precisely on point. There are, however, factors to be considered in determining an appropriate civil penalty in any discrimination case. These factors include the egregiousness of the discrimination and whether it was committed over a period of time, whether there are any previous findings of discrimination against the respondent, and the potential impact of respondent s discrimination on

8 - 8 - the public East 97 th St. Corp., 220 A.D.2d at 88; Comm n on Human Rights ex rel. Russell v. Chae Choe, OATH Index No. 2617/09 (Sept. 25, 2009); Comm n on Human Rights ex rel. Alvarez v. Gerardo s Transportation, OATH Index No. 2045/09 (May 22, 2009), adopted, Comm n Dec. & Order (Aug. 12, 2009); Comm n on Human Rights ex rel. Martin v. Hudson Overlook, LLC, OATH Index No. 137/06 (Aug. 30, 2006), adopted, Comm n Dec. & Order (Dec. 5, 2006); Comm n on Human Rights ex rel. Thomas v. Space Hunters, Inc., OATH Index No. 997/04 (May 31, 2005), adopted, Comm n Dec. & Order (July 26, 2005). Further, because it is in the public interest to have individuals respond and participate in a process designed to cure discriminatory practices, the failure of a respondent to file an answer, respond to the Commission, or appear at trial may be considered an aggravating factor. Gerardo s Transportation, OATH 2045/09 at 9; Chae Choe, OATH 2617/09 at 9 (Sept. 25, 2009); Hudson Overlook, OATH 137/06 at In any analysis, a principle of proportionality is to be applied; that is, because the Commission is precluded from assessing more than $125,000 in any given case, the civil penalty must be narrowly tailored to the particular facts and circumstances of that case, as opposed to other cases with different aggravating or mitigating circumstances East 97 th St. Holding Corp., 220 A.D.2d at 88; see also Silver Dragon Restaurant v. City of New York Commission on Human Rights, NYLJ, Mar. 31, 2004 (Sup. Ct. Kings Co.) (applying proportionality analysis to reduce civil penalty from $10,000 to $5,000 where restaurant had discriminated against African-American customer by requiring that she pay for her take-out food in advance). Considering the applicable factors under the proportionality analysis leads to the conclusion that an award of $35,000 is excessive. Egregiousness of Discrimination Here, the proven discrimination was that the respondents did not accept a Section 8 voucher from one tenant. The tenant chose soon thereafter to move to a different building and thus the Commission brought the case in its own name, not on behalf of the tenant. There are no compensatory damages sought, nor has the Commission alleged or proven that the tenant suffered mental or physical anguish. This case is entirely different from cases cited in the Commission s closing statement in which a large civil penalty was imposed for egregious

9 - 9 - discrimination which resulted in mental and/or physical suffering to individuals. For example, in Chae Choe, OATH 2617/09, a building owner refused for over a year to grant a 77-year old tenant with multiple serious medical conditions, including pulmonary disease, cardiovascular disease, and arthritis, permission to replace her bathtub with a walk-in shower, even though a not-for-profit organization would have made the replacement at no cost to him. As a result, the complainant continued to suffer physical pain from exiting and entering the bathtub, which was elevated more than two feet off the ground. Also, because she had suffered a near fall getting out of the tub two years ago, the complainant was extremely fearful of ever taking a bath, experiencing heart palpitations whenever she did so, and calling her grown children before and after each bath so they could check on her if necessary. She reduced her bathing from daily to every other day so as to not overly inconvenience her children, and as a result felt unclean and uncomfortable leaving her apartment. In recommending a civil penalty of $50,000, in addition to compensatory damages of $35,000, Judge Rodriguez considered the willful, egregious, and longterm nature of this discrimination, and its serious effect upon the complainant s physical and mental health. The nature of discrimination in this case also differs significantly from that in East 97 th Street Holding Corp., 220 A.D.2d 79, another case relied upon by petitioner. There, the Court upheld a determination that a tenant s landlord had discriminated against him over a period of eighteen months, on the basis of sexual orientation and disability, by repeated written and verbal attacks and other abusive acts. These abusive acts included: burglarizing the tenant s apartment, disabling his door locks, turning off his electricity, refusing to accept rent checks, commencing eviction procedures, and verbally and physically accosting him, including calling him various epithets in public, telling him he had AIDS and they hoped he died, leaving threatening messages on his answering machine, and informing all tenants in his building of his HIV status. Based upon the severe emotional and mental abuse, the Court sustained a $100,000 compensatory damage award. 220 A.D. 2d at 87. The Court noted the egregious nature of the discrimination and the fact that it occurred over a period of time in finding that a civil penalty of $25,000 was appropriate. Similarly, in an older case, the Commission imposed civil penalties of $5,000 and $20,000, respectively, against a landlord and brokerage firm in Comm n on Human Rights ex rel. Smith v. Park West Realty, NYCCHR Compl. No. MH (Mar. 17, 1995). In that case,

10 the landlord had purposely instructed the brokerage firm to use a race-coded restriction on the landlord s apartment listings. Based on the size of the brokerage firm and the duration and extent of race-based coding scheme, the Commission concluded that the discriminatory policy affected a large number of potential renters. This case, by comparison, involves a one-time decision by respondents not to accept a Section 8 voucher from one tenant. There is no claim that the tenant suffered physical or emotional harm. Without in any way minimizing respondents conduct, what happened to Ms. Estevez was not as egregious as what happened to the tenants in Chae Choe or in East 97 th Street. As the Supreme Court held in Silver Dragon, in distinguishing the conduct, and hence the appropriate penalty, from that in East 97 th Street and Park West Realty, a proven discriminatory action, even if intolerable, is simply not comparable to a pattern of severely hostile discriminatory acts... over a period of time or to a documented discriminatory scheme... over an extended period. Silver Dragon, NYLJ Mar. 31, Thus, to the extent that the nature of the discrimination informs a civil penalty award, this case merits a smaller civil penalty award than those cases in which the discrimination is more egregious and/or occurs over an extended period of time. Any prior findings of discrimination Petitioner did not allege or put forth any evidence that there are any prior findings of discrimination against respondents. Potential Impact on the Public Here, the owners of the building, Mr. LaBarbera and Mr. Tantillo, own three other buildings. The total number of residential units in these four buildings is 17. Thus, by no means can respondents be said to be large landlords or building owners. Despite the egregious, long-term discrimination in East 97 th Street, 220 A.D.2d at 88, the First Department reduced the original civil penalty award of $75,000 to $25,000, based on a finding that the landlords owned 50 units, not in the upper range of units owned by large landlords in the city. The Court found that the public interest was not affected to the much greater extent it would have been had petitioners been large landlords whose actions affected hundreds, if not thousands of individuals. 220 A.D.2d at

11 Similarly, in Hudson Overlook, OATH 137/06, another case relied upon by petitioner in its post-trial submission, OATH recommended a $25,000 civil penalty based on multiple factors including the egregiousness of the discrimination (trying to evict a tenant with a pending discrimination action), as well as the number of rental units the respondents controlled -- almost 500 units. Judge Spooner stressed, The large number of apartments controlled by the respondents indicates a significant potential impact on the public interest and further supports a severe penalty. Hudson Overlook, OATH 137/06 at 16. The Commission undertook a comparable analysis in Park West Realty, NYCCHR Compl. NO. MH , considering the large size of the brokerage firm in assessing the impact its discriminatory policy had upon the public, and imposing a $20,000 fine against the broker. In two other cases, in both the public accommodation and the employment context, this tribunal noted the high volume of business handled by the respondents in recommending a $15,000 civil penalty for each. In Comm n on Human Rights v. Space Hunters, OATH Index No. 997/04 (Mar. 31, 2004), adopted, Comm n Dec. & Order (July 26, 2005), an apartment broker refused to accept the complainant as a client because she was a transsexual and cursed and hung up on City representatives who were investigating the complaint. Judge Kramer stressed that the broker had a large volume of apartment listings -- in the hundreds -- which suggested that its behavior could have a large negative impact on the public. Similarly, in Comm n on Human Rights ex rel Cherry v. Stars Model Management, OATH Index No. 1464/05 (Mar. 7, 2006), adopted, Comm n Dec. & Order (Apr. 13, 2006), aff d, Secor v. Comm n on Human Rights, 13 Misc.3d 1220A (Sup. Ct. N.Y.Co. 2006), a modeling and job placement service found to be an employment agency refused to consider an applicant for a position based upon race and used a racial epithet in telling her that she would not be considered. This agency handled bookings for hundreds of modeling opportunities, leading Judge Kramer to conclude that its discriminatory practice has a significant impact on the public. OATH 1464/05 at 15. See also Comm n on Human Rights ex rel. Alvarez v. Gerardo s Transportation, OATH Index No. 2045/09 (May 22, 2009), adopted, Comm n Dec. & Order (Aug. 12, 2009) (civil penalty award of $15,000 imposed for refusal of car service with offices in multiple states to transport individual with a disability).

12 By contrast, in Comm n on Human Rights ex rel. Campbell v. Personal Employment Services, OATH Index No. 1579/07 (Aug. 20, 2007), adopted, Comm n Dec. & Order (Dec. 14, 2007), Judge Casey recommended a $5,000 civil penalty for an employment agency which had refused to consider an applicant for employment because of her age. Although the discrimination was flagrant, Judge Casey distinguished the case from Stars Model Management because there was no evidence that respondent s actions had any significant impact upon the public. Respondent was a small employment agency and there was no indication that it advertised extensively or handled a large amount of business. Personal Employment Services, 1579/07 at 7. Failure to Cooperate with the Commission or Appear at Trial As petitioner notes, respondents failed to contact the Commission about any of the proceedings, and they did not appear at the hearing or pre-trial conferences. However, respondents failure to participate in the legal process was of an entirely different nature than the conduct engaged in by the respondents in Hudson Overlook, where Judge Spooner cited the respondents scofflaw attitude as justifying a substantial penalty. OATH 137/06. In that case, despite having been fined $5,000 by the Commission in a previous proceeding and ordered to install a ramp, the respondents sold the property without building the ramp. Judge Spooner characterized the respondents actions as malicious and as demonstrating sustained and unrepentant defiance. OATH 137/06 at 16. Similarly, in Chae Choe, Judge Rodriguez found that the respondent s failure to file an answer and appear at the hearing was compounded by his telling petitioner s counsel during a telephone conversation that he would not replace the bathtub and that the tenant should move to a nursing home. Respondent then hung up the telephone. OATH 2617/09 at 9. And in Space Hunters, Judge Kramer noted that the respondent cursed and hung up on City representatives. OATH 997/04 at 12. Here, by contrast, Mrs. LaBarbera returned Ms. Ostermaier s initial telephone call promptly. During the second telephone call, she did not explicitly answer when asked if she would accept the voucher and requested that the Commission would put something in writing because she needed some time to process it. Respondents failure to participate in the subsequent legal process was distressing. There is no evidence, however, that respondents

13 forced Ms. Estevez out of her unit or that she decided to move because her Section 8 voucher was rejected. Although Mrs. LaBarbera telephoned Ms. Estevez to ask her to drop the complaint, this occurred after Ms. Estevez had already decided to move. Ms. Estevez said that Mrs. LaBarbera had not threatened her. Respondents actions fall short of the open defiance or maliciousness found in other cases. The principle of proportionality The principle of proportionality dictates that a civil penalty award should be commensurate with the particular facts of a given case. Less serious cases should result in a lesser damage award than more egregious cases. Following this principle, the $35,000 penalty sought by the Commission is not justified. The discrimination here, while illegal, was far less extreme than the egregious, long-term discrimination in either Chae Choe ($50,000 penalty), East 97 th Street ($25,000 penalty), or Park West Realty ($20,000 against brokerage firm). Nor was the discrimination here comparable to the malicious retaliation in Hudson Overlook ($25,000 fine). Moreover, there was no evidence that respondents cursed at or were rude to Commission employees or city investigators, as was the case in Chae Choe and Space Hunters. Moreover, respondents own four buildings, with only 17 residential units. This is less than the 50 units in East 97 th Street, and far less than the 500 units in Hudson Overlook. The size of their business (17 renters) distinguishes them as well from the apartment broker and employment agency in Space Hunters or Stars Model Management, respectively, both of which had hundreds of listings ($15,000), the large-scale brokerage firm in Park West Realty, and the car service in Gerardo s Transportation ($15,000). This case is more comparable to Personal Employment Services, which involved a smaller employment service and merited a $5,000 civil penalty. Here, as in Personal Employment Services, there are no prior findings of misconduct against the respondents. However, unlike Personal Employment Services, respondents failed to file an answer, respond to any communications from the Commission, or appear at trial or hearing. Considering the case as a whole, including the nature of the discrimination, the lack of prior disciplinary findings, the relatively small number of units owned by respondents, and the respondents failure to participate in this process, I recommend that a civil penalty of $7,500 be imposed against respondents for their failure to accept a Section 8 voucher from a tenant.

14 Faye Lewis Administrative Law Judge February 24, 2011 SUBMITTED TO: PATRICIA L. GATLING Commissioner APPEARANCES: LAURA D. FLYER, ESQ. CARLOS VELEZ, ESQ. Attorneys for Petitioner No Appearance by or for Respondent

15 Commission Decision & Order, Comp. No (May 23, 2011) DECISION AND ORDER On September 29, 2009, a woman named Ramona Estevez visited the Offices of the New York City Commission on Human Rights (hereafter referred to as the Commission ) and complained that the Respondents refused to accept her Section 8 Voucher as rental payment for her apartment located in th Street, Brooklyn, New York. On September 29, 2009, former Commission Staff Attorney Ingrid Kelly, now known as Ingrid Baumann-Ostermaier, contacted Respondent Rosa LaBarbera, who confirmed that she did refuse to accept Ms. Estevez Section 8 Voucher and stated that the building was not a Section 8 building. When Baumann-Ostermaier explained the Human Rights Law to Ms. LaBarbera, Ms. LaBarbera said that she would have to speak to her husband and brother; the owners of the building. On October 2, 2009, Baumann-Ostermaier spoke with Ms. LaBarbera over the telephone and inquired whether Respondents decided to accept Ms. Estevez Section 8 Voucher. Ms. LaBarbera requested that the Commission provide her with something in writing. At that point, Ms. Estevez decided to move from her apartment and did not wish to pursue a complaint with the Commission. On October 16, 2009, pursuant to Section 8-109(c) of the Administrative Code of the City of New York, the Commission served and filed a Verified Complaint. Respondents failed to answer the Verified Complaint, respond to any of the Commission s attempts to contact them by telephone or to notices sent by the Commission, and/or to appear at any of the proceedings in this matter. A trial before Administrative Law Judge Faye Lewis (hereafter referred to as ALJ Lewis ) was conducted in the Office of Administrative Trials and Hearings (hereafter referred to as OATH ) on December 1, ALJ Lewis determined that the Respondents were properly served and willfully absented themselves. The evidence at trial consisted of the above recited facts. In addition, Baumann-Ostermaier testified that sometime after the Verified Complaint was served and filed, Ms. LaBarbera contacted Ms. Estevez by telephone and asked her to drop the complaint. Ms. Estevez lease indicating that Rosa LaBarbera was the managing agent, as well as City records indicating that Diego Tantillo and Vincenzo LaBarbera were the owners of the building located at th Street at the time in question were admitted into evidence. Lastly, City records indicating that the building in question contained six or more units and that the

16 Respondents, individually and collectively, owned other buildings in the City of New York. The evidence established that the Respondents controlled 17 housing units within the City. ALJ Lewis issued a Report and Recommendation on February 24, 2011, wherein she determined that the respondents violated the New York City Human Rights Law in denying Ms. Estevez the ability to use her Section 8 Voucher to subsidize her rent. ALJ Lewis also determined that though the Respondents controlled 17 housing units throughout the City, there was no evidence to suggest that their discriminatory conduct affected anyone but Ms. Estevez. ALJ Lewis expressed concern that the Respondents failed to participate in the proceedings, but highlighted the fact that they were not rude to Commission staff or Ms. Estevez. ALJ Lewis also characterized Respondents as small landlords in recommending that the Commission Order the Respondents to pay a civil penalty of $7,500 for their violation of the New York City Human Rights Law. The Commission provided the parties until April 11, 2011 to submit comments regarding the Report and Recommendation. No comments were submitted. The Commission agrees with ALJ Lewis that the Respondents clearly violated the New York City Human Rights Law in denying Ms. Estevez the ability to use her Section 8 Voucher to subsidize her rent in the Respondents building. Since Ms. Estevez chose not to pursue a claim, we also agree the only appropriate damage is a civil penalty. It is in the amount of the civil penalty where the Commission disagrees with the Report and Recommendation. The evidence at trial established that the Respondents, either individually or with others, controlled 17 housing units in the City. Clearly they are not the largest of housing providers; however, they are not the smallest either. Most governmental regulation, including the lawful source of income protections under the New York City Human Rights Law, considers small landlords to be those with fewer than six units. Respondents control almost three times that many units; therefore, the Commission does not characterize them as small landlords. Respondents have chosen to do business in New York City and are subject to the regulations and the regulatory and law enforcement agencies associated with that business. The fact that the Respondents have completely failed to participate in the proceedings; thereby hampering the Commission s ability to gather evidence regarding the impact of their discriminatory practices, and even attempted to influence Ms. Estevez into dropping a complaint that she never filed, are very serious issues deserving of consideration. Though ALJ Lewis

17 makes reference in the Respondent s failure to appear and indicates that she considered it in her recommendation of damages, the Commission does not believe she gave the issue the consideration it deserved. Instead, ALJ Lewis focused on the lack of evidence of impact without considering the Respondent s role in that lack of evidence; the fact that the Respondents were more civilized than other Respondents have been in the past in ignoring the Commission; and the fact that Respondents did not treat Ms. Estevez poorly, ignoring the fact that Ms. Estevez felt the need to move from her home denying them the opportunity to further harm her. Considering the above factors, it is the position of the Commission that the recommendation of a $7,500 civil penalty is too small and that a $20,000 civil penalty would be more appropriate. IT IS HEREBY ORDERED, that respondents pay the City of New York a fine in the amount of $20,000. Pursuant to Section 8-123(h) of Title 8 of the Administrative Code of the City of New York, anyone aggrieved by this Order has thirty (30) days after service to seek review in the New York State Supreme Court. Dated: New York, New York May 23, 2011 SO ORDERED: New York City Commission on Human Rights Omar T. Mohammedi, Commissioner Derek B. Park, Commissioner Patricia L. Gatling, Commissioner