Banks v. Dallas Housing Authority

UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT

_______________________

No. 00-11160
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SUSIE BANKS, etc; et al.,
Plaintiffs,

ARLEE BOOTH; BETTY MORGAN; LATAVIAN BOOTH;
KIMELA BOOTH; VONTREAL BOOTH; FREDDIE MORGAN;
LESLIE RUSSELL; SANDRA HALL;
Plaintiffs-Appellants,

versus

DALLAS HOUSING AUTHORITY; et al.,
Defendants,

CHALLENGE PROPERTIES; ALFRED D. HUGHES CORP.;
ALFRED D. HUGHES,
Defendants-Appellees.

_________________________________________________________________

Appeal from the United States District Court
for the Northern District of Texas, Dallas

_________________________________________________________________

October 24, 2001
Before JONES, SMITH, and DeMOSS, Circuit Judges.

EDITH H. JONES, Circuit Judge:

At issue in this case is whether a class of black tenants

of a Dallas, Texas housing project may sue its HUD-subsidized

private owners for violations of Section 8 of the Housing Act of

1937, 42 U.S.C. § 1437f(e) (since repealed). We agree with the
magistrate judge’s conclusion that there is no implied private

right of action under § 1437f(e) and that violations of § 1437f(e)

are not actionable under 42 U.S.C. § 1983. The judgment denying

relief against the apartment owners on this basis is affirmed.

I. FACTS AND PROCEDURAL HISTORY

The plaintiffs brought this class action on behalf of

“all African-Americans who, within the two year period prior to

October 28, 1988, occupied a unit at Robin Square Apartments for

which Dallas Housing Authority provided Section 8 [42 U.S.C. §

1437f] Moderate Rehabilitation assistance.” During this two year

period, the Robin Square Apartments were owned and operated by

Challenge Properties, the Alfred D. Hughes Corporation, and Alfred

D. Hughes (collectively, the “Robin Square defendants”).

The Section 8 Moderate Rehabilitation Program authorized

the Secretary of the Department of Housing and Urban Development

(“HUD”) to

make assistance payments under this section directly or
through public housing agencies pursuant to contract with
owners or prospective owners who agree to upgrade housing
so as to make and keep such housing decent, safe, and
sanitary through upgrading which involves less than
substantial rehabilitation. . . .

42 U.S.C. § 1437f(e)(West 1990)(emphasis added).1 In this case,

HUD channeled the assistance payments through DHA, which agreed to

1
The Section 8 program was repealed by Pub. L. 101-625,
Title II, § 289(b), 104 Stat. 4079 (November 28, 1990).

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provide tenants and pay rent assistance for each rehabilitated unit

in the Robin Square Apartments.

The Robin Square defendants were required to maintain the

apartments in “decent, safe, and sanitary” condition in order to

receive government subsidies under Section 8. This statutory

requirement was reiterated in the contractual agreements between

the parties. For example, the standard “Annual Contributions

Contract” between HUD and DHA provided that DHA “shall require, as

a condition for the making of housing assistance payments, that the

owner maintain the assisted dwelling units and related facilities

in decent, safe, and sanitary condition.” The record suggests that

HUD and DHA considered a rental unit “decent, safe, and sanitary”

if it substantially complied with a myriad of HUD standards, such

as those requiring that subsidized units have adequate heating and

cooling, that the units be free of vermin and rodents, and that the

project site be accessible to recreational, educational,

commercial, and health facilities and services. 24 C.F.R. §

882.109; 24 C.F.R. § 882.404(b).

In a series of reports issued in 1987 and 1988, both HUD

and DHA concluded that the Robin Square defendants had failed to

meet HUD’s housing quality standards. In October 1988, HUD and DHA

terminated the Section 8 rent assistance contract with the Robin

Square defendants and transferred the tenants to other housing

projects.

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 In July 1987, several Robin Square tenants filed this

suit, alleging that DHA and the Robin Square defendants had

violated various civil rights laws as well as Section 8 of the

Housing Act of 1937, 42 U.S.C. § 1437f(e). After an initial flurry

of activity, the suit languished until June 1998, when the district

court granted the plaintiffs’ motion for class certification

pursuant to Fed. R. Civ. P. 23(b)(3).

In June 1998, the district court entered partial summary

judgment against DHA in light of its admission that it had approved

the Robin Square project for the purpose of housing black tenants

in segregated neighborhoods. The court also determined that DHA

had breached its obligation to ensure that the Robin Square

apartments met HUD’s housing standards.

In October 1999, the parties agreed to let a magistrate

judge conduct all further proceedings. In May 2000, the claims of

seven class members were tried before a jury. The jury assessed

modest damages against DHA to compensate the plaintiffs for the

diminished rental value of their units. DHA has not appealed the

court’s finding of liability or the jury’s award of damages.

With respect to the Robin Square defendants, the jury

rejected the plaintiffs’ claims under the Fourteenth Amendment; the

Fair Housing Act, 42 U.S.C. § 3604; Title VI of the Civil Rights

Act of 1964, 42 U.S.C. § 2000d; and 42 U.S.C. § 1982. The jury

found that the Robin Square defendants had neither acted with a

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racially discriminatory purpose to segregate blacks in public

housing nor operated the apartments with the purpose of

discriminating against the plaintiffs because of their race. The

plaintiffs do not appeal this portion of the judgment.

The jury also concluded, however, that the Robin Square

defendants had purposefully and consistently operated the

apartments in violation of § 1437f(e). Despite this finding of

liability, the jury awarded the trial plaintiffs no damages arising

from the Housing Act violations.

After the jury returned its verdict, the magistrate judge

granted the Robin Square defendants’ renewed motion for judgment as

a matter of law. The magistrate judge concluded, first, that

violations of 42 U.S.C. § 1437f(e) are not actionable under 42

U.S.C. § 1983; and, second, that there is no implied private right

of action under § 1437f(e). The magistrate judge entered a final

judgment for the Robin Square defendants and ruled that this

judgment was binding as to all class members.

II. DISCUSSION

The sole issue on appeal is whether the plaintiffs have

a cause of action for the Robin Square defendants’ violations of

former § 1437f(e), which provided that public housing authorities

could make assistance payments to only those property owners “who

agree[d] to upgrade housing so as to make and keep such housing

decent, safe, and sanitary.” Two avenues exist for finding a cause

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of action. The statute may create rights enforceable by

individuals against state actors pursuant to 42 U.S.C. § 1983.

Alternatively, the statute may give rise to an implied private

cause of action.

A. Section 1983

A procedural question first arises as to whether the

plaintiffs have abandoned their Housing Act claim under § 1983

because they did not properly submit that theory of recovery to the

jury. We conclude they did not abandon this claim.

Before trial, the plaintiffs asserted that violations of

§ 1437f(e) were actionable under both § 1983 and under an implied

right of action. To prevail on this § 1983 claim, the plaintiffs

were required to prove that the Robin Square defendants had, while

acting under color of state law, deprived them of a right secured

by 42 U.S.C. § 1437f(e). See, e.g., Bass v. Parkwood Hospital, 180

F.3d 234, 241 (5th Cir. 1999). The crux of the Robin Square

defendants’ argument appears to be that the jury instructions on

the Housing Act claim did not contain any reference to § 1983 or

any instruction regarding the element of state action. By

contrast, the instructions on the plaintiffs’ Fourteenth Amendment

claims under § 1983 explicitly referred to the cause of action and

did contain a brief explanation of state action.

We would note, however, that the specific Fourteenth

Amendment questions submitted to the jury pertained only to whether

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the Robin Square defendants had acted with a racially

discriminatory purpose. Thus, even on the Fourteenth Amendment

claim, the jury was not asked to decide any factual issues relevant

to the state action question. This omission is not surprising

because nearly all the relevant facts -- such as DHA’s financial

support and oversight of the apartments -- are undisputed. Once

the facts were established, the magistrate judge was in a position

to resolve the legal issue whether the Robin Square defendants, who

are private entities, may nevertheless be treated as state actors

for purposes of each § 1983 claim. The record does not show that

either party insisted on a ruling on this issue prior to trial.

And, after the jury found that the Robin Square defendants had not

acted with a discriminatory motive, and after the magistrate judge

ruled that the Housing Act did not confer a right enforceable under

§ 1983, the magistrate judge had no reason to decide the state

action question. Under these circumstances, we cannot say that the

plaintiffs abandoned their Housing Act claims under § 1983 in favor

of their alternative theory that § 1437f(e) implicitly created a

private right of action.

Turning to the merits, the plaintiffs contend that the

Robin Square defendants may be sued under 42 U.S.C. § 1983 for

operating a housing project, which was funded and regulated by

government entities, “in a manner that violated plaintiffs’ United

States Housing Act right to decent, safe, and sanitary housing.”

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The plaintiffs’ argument raises two questions: whether § 1437f(e)

creates an enforceable federal right to decent housing; and, if so,

whether the Robin Square defendants acted “under color of state

law” in the course of violating the plaintiffs’ rights.

Section 1983 creates a cause of action against a state

actor who deprives a person “of any rights, privileges, or

immunities secured by the Constitution and laws.” 42 U.S.C. §

1983. Although most § 1983 claims involve constitutional

violations, the provision also applies to rights created by federal

statutes. See Maine v. Thiboutot, 448 U.S. 1, 4, 100 S.Ct. 2502,

2504, 65 L.Ed.2d 555 (1980). However, as the Supreme Court has

emphasized, “[i]n order to seek redress through § 1983, . . . a

plaintiff must assert the violation of a federal right, not merely

a violation of federal law.” Blessing v. Freestone, 520 U.S. 329,

340-41, 117 S.Ct. 1353, 1359, 137 L.Ed.2d 569 (1997).

To determine whether a particular statutory provision

creates a federal right enforceable through § 1983, the Supreme

Court has articulated the following factors:

First, Congress must have intended that the provision in
question benefit the plaintiff. Second, the plaintiff
must demonstrate that the right assertedly protected by
the statute is not so “vague and amorphous” that its
enforcement would strain judicial competence. Third, the
statute must unambiguously impose a binding obligation on
the States [or other state actor].

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Blessing, 520 U.S. at 340-41, 117 S.Ct. at 1359 (citations

omitted).2 In Blessing, the Court unanimously held that recipients

of child support services under Title IV-D of the Social Security

Act could not sue state officials under § 1983 for the state’s

failure to provide adequate services. Id., 520 U.S. at 339-40, 117

S.Ct. at 1359. The Court explained that a statute requiring the

states to operate child support programs “in substantial

compliance” with Title IV-D of the Social Security Act did not

create an individual entitlement to government services. Id., 520

U.S. at 343-44, 117 S.Ct. at 1361. The “substantial compliance”

provision was not primarily intended to benefit families eligible

for Title IV-D assistance; instead, the statute was meant to create

a “yardstick” for the Department of Health and Human Services to

measure a state’s performance under Title IV-D. Id.

Similarly, to the extent § 1437f(e) confers a benefit

upon residents of public housing, the provision operates in an

indirect and attenuated manner. The purpose of § 1437f(e) was to

impose a condition upon the receipt of government monies. That is

to say, public housing authorities could make assistance payments

only to those property owners who kept their housing units “decent,

2
Blessing also held that even if a plaintiff demonstrates
that a federal statute creates an individual right, there is only
a rebuttable presumption that the right is enforceable under §
1983. Id. We do not reach that limitation on Blessing’s three-
factor test.

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safe, and sanitary.” This statutory provision -- especially when

read in conjunction with the corresponding HUD regulations and the

contractual agreements between the parties -- does nothing more

than explain what property owners must do in order to receive

public subsidies. The Supreme Court observed recently that

“[s]tatutes that focus on the person regulated rather than the

individuals protected create ‘no implication of an intention to

confer rights on a particular class of persons’.” Alexander v.

Sandoval, 532 U.S. ____, ____, 121 S.Ct. 1511, 1520, 149 L.Ed.2d

517 (2001) (quoting California v. Sierra Club, 451 U.S. 287, 294,

101 S.Ct. 1775 (1981)). Thus, with respect to the first factor

listed in Blessing, Congress enacted § 1437f(e) for the purpose of

placing conditions upon the property owners’ receipt of assistance

payments, not in order to confer a benefit upon tenants of public

housing.3

3
Our analysis of this first factor follows Edwards v.
District of Columbia, 821 F.2d 651 (D.C. Cir. 1987), which involved
42 U.S.C. §§ 1437p and 1437d(l). Section 1437p provides that HUD
may not approve a public housing authority’s request to demolish a
housing project unless the housing authority satisfies certain
conditions, such as consultation with tenants prior to submitting
the application. Edwards held that § 1437p does not create an
enforceable right against constructive demolition where the public
housing authority has arguably failed to fulfill these conditions.
Edwards, 821 F.2d at 659-60. Section 1437d(l) provides that public
housing authorities “shall utilize leases which . . . obligate the
public housing agency to maintain the project in a decent, safe,
and sanitary condition.” The D.C. Circuit held that this statutory
provision did not create a federal right to properly maintained
housing. That provision created, at most, only the right to a
lease, the terms of which would be enforceable under general

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 The second factor is whether the plaintiffs’ asserted

right to “decent, safe, and sanitary” public housing is too vague

to be judicially enforceable. The plaintiffs rely heavily on

Wright v. City of Roanoke Redevelopment & Housing Auth., 479 U.S.

418, 107 S.Ct. 766, 93 L.Ed.2d 781 (1987), which held that a

different provision of the Housing Act, 42 U.S.C. § 1437a, created

a federal right enforceable under § 1983. Section 1437a provided

that “tenants could be charged as rent no more and no less than 30

percent of their income.” Wright, 479 U.S. at 430, 107 S.Ct. at

773-74. The Court pointed out that this mandatory provision “could

not be clearer” and that it was “focus[ed] on the individual family

and its income.” Id. The specificity of § 1437a, coupled with its

focus on the tenants, suggested that Congress intended to create a

right enforceable under § 1983. In this case, on the other hand,

the imprecision of the alleged statutory right to “decent, safe,

and sanitary” housing suggests that Congress did not intend to

create a judicially enforceable right.4

principles of contract and property law. Id. at 653 n.2. In each
instance, the statutory provision focused on procedures that public
housing authorities were required to follow, and the public housing
tenants would receive any benefit only indirectly. Here, as in
Edwards, no violations of state contract or property law were
asserted.
4
We recognize, of course, that the HUD housing quality
standards are much more specific than the language of § 1437f(e).
But § 1983 safeguards only those rights secured by the
“Constitution and laws,” so the existence of specific HUD
regulations should not be relevant to the overriding question

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 The third factor is whether the statute unambiguously

imposes a binding obligation on the state actor. To be sure, the

language in § 1437f(e) is not merely precatory. But, as noted

above, the owner’s statutory obligation to maintain decent housing

runs to the public housing authorities, not to the residents of the

housing project. In other words, the obligation is binding only in

the sense that proper maintenance of the rental units is a

condition that Congress placed upon the receipt of Section 8 rent

assistance.

On the basis of the factors articulated in Blessing, the

statutory language of former § 1437f(e) did not create a federal

right enforceable under § 1983.5

B. Implied Private Right of Action

The plaintiffs also contended at trial that a private

right of action to enforce § 1437f(e) may be inferred from the

statute itself. This argument is foreclosed by the Supreme Court’s

recent decision in Alexander v. Sandoval, supra, as well as by our

whether Congress intended to create a federal right enforceable
through § 1983.
5
Because we decide that violations of § 1437f(e) are not
actionable under § 1983, we need not determine whether the Robin
Square defendants were acting under color of state law. Cf.
Brentwood Academy v. Tennessee Secondary School Athletic Ass’n, 531
U.S. ___, ___ 121 S.Ct. 924, 930, 148 L.Ed.2d 807 (2001); Bass v.
Parkwood Hospital, 180 F.3d 234, 241-42 (5th Cir. 1999).

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conclusion that § 1437f(e) does not create an individual right to

“decent, safe, and sanitary” public housing.

“The judicial task is to interpret the statute Congress

has passed to determine whether it displays an intent to create not

just a private right but also a private remedy.” Id., 532 U.S. at

___, 121 S.Ct. at 1519-20. As was true in Alexander, the statutory

provision in this case focuses on the recipients of federal funding

and on the regulating agencies -- not on the class represented by

the plaintiffs. As a general rule, Congress does not intend to

create a private right of action where a statute is “‘phrased as a

directive to federal agencies engaged in the distribution of

federal funds.’” Id., 532 U.S. at ___, 121 S.Ct. at 1521 (quoting

Universities Research Ass’n v. Coutu, 450 U.S. 754, 772, 101 S.Ct.

1451, 67 L.Ed.2d 662 (1981)). We find no evidence in the text or

structure of the statute that would suggest any intent on the part

of Congress to create either a substantive federal right or a

private right of action to enforce that right.

III. CONCLUSION

The magistrate judge did not err in deciding that the

Robin Square defendants are entitled to judgment as a matter of law

or in applying his decision to all class members. The now-repealed

provision of 42 U.S.C. § 1437f(e) requiring that public housing

authorities make assistance payments only to those property owners

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who keep public housing “decent, safe, and sanitary” neither

displays Congressional intent to create a private right of action

nor creates a federal right that is judicially enforceable through

42 U.S.C. § 1983. The judgment is therefore AFFIRMED.

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