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Racial Bias Housing Case Gets Complicated

ATLANTA (CN) - Coldwell Banker Bullard Realty Co. has filed a cross claim against its co-defendant Coldwell Banker Joe T. Lane Realty, in a housing discrimination case in Federal Court. The U.S. Attorney's Office, on behalf of the National Fair Housing Alliance, claims the real estate agencies and real estate agent Rodney Foreman steered white clients away from housing in black neighborhoods.

The Alliance claims in its original complaint, filed in November 2008, that it investigated Lane Realty's sales practices "using 'testers" to compare the treatment afforded by defendants to prospective home purchasers who were of different races or colors."

"Testers are persons who, without the intent to purchase a home, seek information about the availability of housing to determine whether discriminatory practices are occurring," according to the complaint. The Alliance says it conducted the investigation from October 2003 through August 2005.

The Alliance says it sent three white testers and Foreman consistently steered them away from black neighborhoods. Foreman allegedly told the second tester "not to view homes in a neighborhood in the Stonewall Jackson area, which was predominantly African-American, because he was in that area recently and saw people selling drugs at the neighborhood entrance." He allegedly told the third tester that "he made two different sets of listings - one set in case the tester was white and one set in case the tester was black."

The original complaint was filed against Lane Realty and Foreman. Bullard Realty was added as a defendant, as it bought Lane Realty's assets, which included the purchase of Lane Realty's agents, customer lists, pending home listings and other aspects of the business. At the time of the deal, "Bullard Realty publicly referred to the deal as a merger," according to the complaint.

According to its cross-claim, Bullard "purchased Lane Realty's assets, but it did not assume any of Lane Realty's liabilities and obligations. To the extent that any comments were made that characterized this defendant's purchase of Lane Realty's assets as a 'merger,' such comments were casual statements by laypersons untrained in the law and were not issued to set forth a legal opinion concerning the relationship between this defendant and Lane Realty following the purchase of Lane Realty's assets."

According to the complaint, Bullard Realty explored the possibility of buying Lane Realty in 2005 and was aware of a U.S. Department of Housing and Urban Development investigation involving Lane Realty and Foreman. However, Bullard did not buy the agency until 2007 and "its understanding that any HUD investigation was concluded." HUD investigated the alliance's allegation of discrimination before the civil action was filed.

Bullard Realty was "assured by Lane Realty that it was no longer being investigated by [HUD] nor were there any pending claims against it by HUD, or any other entity, relative to violations of the federal Fair Housing Act," according to the complaint.

Daniel Byrne, attorney for Foreman, the real estate agent, said he met with the U.S. attorney's office last week and is waiting to receive investigative reports from the office before determining how he will proceed.

"I've heard [the reports are] a couple thousand pages," Byrne said. He added that he probably will not take any further action for "another 30 days."

He had no other comment.

Calls to attorneys representing the National Fair Housing Alliance, Bullard Realty and Lane Realty were not returned.

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