Happiest is he . . . for whom there waits Comfort at home.
— Johann Wolfgang von Goethe1
For many in the United States, the home offers neither rest nor repose. Complaints of housing discrimination — and particularly residential harassment — are on the rise, with millions more cases estimated to be unreported.2 Under the Obama Administration, the Department of Housing and Urban Development (HUD) set out to provide much-needed reprieve. The agency promulgated a regulation (“HUD Rule”) that holds landlords liable under the Fair Housing Act3 (FHA) for failing to intervene against racially motivated tenant-on-tenant harassment.4 The ink had not yet dried when a distressed Black tenant sought shelter under this new safeguard. Donahue Francis had suffered months of racial torment perpetrated by a White neighbor. Their shared landlord knew, but did nothing. Indignant, Francis took to the courts to vindicate his fair housing rights. Yet in Francis v. Kings Park Manor, Inc.,5 the en banc Second Circuit rejected Francis’s FHA claims without so much as a mention of the HUD Rule. Moving forward, judicial opinions should contend openly with this regulation and determine its due weight (which likely equates to Chevron deference). By meeting the HUD Rule head-on, future courts can help clarify an area of housing law — muddled in Francis — that is of great consequence to vulnerable tenants.
After years of living in inner-city urban communities, Donahue Francis, a Black man, sought to better his housing situation.6 In 2010, with the help of a Section 8 voucher, he signed a rental lease agreement with King’s Park Manor (KPM) in a predominantly White and wealthy suburban area.7 According to Francis, just months after he had moved into his new home, he became the target of a racially motivated campaign of harassment by his next-door neighbor, Raymond Endres. Endres, a White man, allegedly called Francis a “fucking lazy, god-damn fucking [n-word]” and a “[B]lack bastard.”8 Endres even threatened Francis, saying, “I oughta kill you, you fucking [n-word].”9 Fearing for his safety, Francis notified KPM four times about the abuse, but KPM took no action — even after Endres was arrested and charged with aggravated harassment.10 In fact, KPM specifically advised its building manager not to get involved in the dispute. The torment continued until Endres’s lease expired in early 2013, whereafter he left the complex.11
Francis brought suit against KPM, alleging violations of the FHA.12 He first claimed that Endres’s racially charged abuse created a hostile housing environment — which Francis analogized to a hostile working environment from the Title VII context.13 He then imputed liability for the harassment to KPM because the landlord “knew about it, had the authority to address it, yet failed to take any reasonable actions.”14
The district court granted KPM’s motion to dismiss as to the FHA claims.15 Judge Spatt acknowledged the viability of Francis’s hostile-environment theory but qualified the analogy to Title VII: he concluded that while Title VII allows employees to triumph over negligent employers, the FHA’s plain terms require that a landlord’s inaction be motivated by discriminatory intent, which Francis had not alleged.16
On appeal, Francis newly raised that a rule proposed by HUD, pending since 2000, might soon be promulgated and would support his hostile-environment claim.17 In response, the panel sent a letter to the agency requesting an amicus brief on the matter.18 Three months later, HUD issued a regulation interpreting the FHA to hold landlords “directly liable for . . . [f]ailing to take prompt action to correct and end a discriminatory housing practice by a third-party, where the [landlord] knew or should have known of the discriminatory conduct and had the power to correct it.”19 The Rule’s preamble made clear that it had not created any new or enhanced liabilities for landlords but merely clarified obligations already owed under the FHA.20 The agency’s subsequent amicus brief called on the court to apply Chevron deference.21
The Second Circuit vacated the district court’s dismissal of Francis’s FHA claims and remanded for further proceedings. Writing for the majority, Judge Lohier22 drew on FHA “text, legislative history, and a pattern of expansive readings of the [statute].”23 But he spilled far more ink on — and gave great weight to — the HUD Rule.24 In dissent, then-Judge Livingston criticized the majority’s reliance on the regulation, agreeing with the district court that the FHA requires a tenant to show that racial animus motivated the landlord’s inaction.25
Nine months later, the panel withdrew its original opinion and issued a new one with the same judgment but different reasoning.26 Again writing for the majority, Judge Lohier27 disclaimed reliance on the HUD Rule and assumed without deciding that intentional discrimination is an element of an FHA violation.28 He then held that Francis had plausibly alleged as much in claiming that KPM had failed to take reason-able steps to address Endres’s harassment despite intervening against other tenants for non-race-related violations of their leases or of the law.29 Then-Judge Livingston again dissented, criticizing the majority’s new theory: just because KPM “did something with regard to some incident involving some tenant at some past point” does not mean that its failure to intervene in Francis’s case stemmed from racial animus.30
The Second Circuit granted KPM’s petition for en banc hearing.31 Prior to oral argument, HUD (now under the Trump Administration) published a notice of proposed rulemaking to withdraw the HUD Rule.32 The agency then asked the court not to rely on the estranged regulation in deciding the appeal.33 Writing for the majority, Judge Cabranes34 obliged. He made no mention of the HUD Rule in his opinion, which vacated the panel decision and affirmed the district court’s judgment. Judge Cabranes instead held that Francis’s factual allegations failed to carry his “modest” burden under the evidentiary framework developed by the Supreme Court in the Title VII context — which the majority found applied here.35 While Francis plausibly alleged that he is a member of a protected class and suffered an adverse action, his complaint lacked “even ‘minimal support for the proposition’” that discriminatory intent had motivated KPM.36 Even under a deliberate indifference theory of liability,37 Francis failed to state a claim, as the power to evict does not furnish a landlord with the requisite “substantial control” over the harasser.38 For a similar reason, Francis’s appeal to the employment context fell equally flat: an employer’s manner and degree of control over its agent-employees is “typically far less” than that of a landlord over its tenants, rendering the analogy inapposite.39
Judge Lohier dissented in relevant part,40 likewise without mention of the HUD Rule. He took aim at the majority’s attack on Francis’s pleading, accusing his colleagues of demanding more than the minimal inference of discriminatory motivation required by the court’s precedents.41 Judge Lohier also contested the majority’s deliberate indifference analysis.42 New York law, he argued, envisions a flexible, fact-dependent inquiry for the “substantial control” element.43 Here, the lease between KPM and both Endres and Francis supplied the landlord with an “arsenal of incentives and sanctions” with which to control the harassment.44 KPM thus had the means and duty to intervene.
The en banc panel erred by not addressing the HUD Rule, which merits Chevron consideration — and likely deference. How a rule is classified under the Administrative Procedure Act45 (APA) defines the weight it is owed by courts. Although the HUD Rule is procedurally and substantively unique, it is best understood as “legislative,” thus invoking the Chevron framework. As a doctrinal matter, then, the Second Circuit was obliged to address the regulation head-on and decide its interpretive weight. Policy considerations, too, counseled for this result.
An understanding of the HUD Rule first requires a detour into the APA. The APA divides agency rulemaking into three buckets: legislative rules, interpretive rules, and general statements of policy.46 Relevant here are the first two. Legislative rules change the law, such as by imposing a new duty; interpretive rules clarify, but do not alter, legal requirements under an existing statute.47 Much rides on the classification: legislative rules require notice and comment — and generally receive Chevron deference — whereas interpretive rules do not.48 The HUD Rule presents as an interpretive-legislative hybrid. In promulgating it, the agency conducted notice-and-comment procedures,49 which are the bread and butter of legislative rulemaking.50 And yet the regulation’s preamble repeatedly describes it as merely interpretive, nothing more.51 In effect, the agency tells the court: “Do as I say, not as I do.”
Despite the HUD Rule’s mixed messaging, it should be treated as legislative and given Chevron consideration. Agencies increasingly face cost-related temptations to skirt the APA’s notice-and-comment requirement; as a result, courts carefully inspect interpretive rules to ensure they are truly exempt.52 But when an agency voluntarily uses notice and comment, the resulting regulation (nominally interpretive or not) merits de jure legislative status. This standard comports with Supreme Court precedents, which remain highly attentive to a rule’s procedural provenance in the weighing process.53 It also makes for good policy. Interpretive rules adopted by agency fiat lack the public accountability of legislative rules. The cost of convenience is heightened scrutiny (and a risk of less deference) by the courts. The HUD Rule’s prize for transparency, won through notice and comment, is Chevron consideration.54
Indeed, the HUD Rule likely merits full-fledged Chevron deference.55 To start, Congress has not directly spoken to the precise question at issue — whether the FHA imposes liability on landlords for failing to intervene against racially motivated tenant-on-tenant harassment and, if so, under what notice standard. At least two circuit courts disagree on this point. The Seventh Circuit held a landlord liable for its inaction under an actual notice, rather than a constructive notice, standard; in so doing, the court rejected HUD’s Title VII analogy and applied Title IX’s deliberate indifference test instead.56 The Second Circuit, meanwhile, denied that a landlord can be held liable at all in the absence of discriminatory intent.57 Even though both courts declined (implicitly or explicitly) to defer to the HUD Rule, their differing interpretations of the FHA suggest that the statute is ambiguous.58 Beyond that, several commentators have determined that the statute’s text, legislative history, and purpose are all consonant with HUD’s interpretation.59 These analyses bolster the agency’s own reasoned defense of the regulation,60 which likely qualifies as a permissible construction of the FHA.61
Doctrinally, then, the en banc panel was duty bound to confront the HUD Rule head-on and decide its weight.62 It is no surprise that the judges declined to do so, given how often the agency flip-flopped on its willingness to commit to the regulation.63 Ultimately, however, the Trump Administration withdrew support for the HUD Rule without going through the proper channels of rescission.64 If an agency wishes to modify its stance on a rule promulgated through notice and comment, it must use the same process.65 The en banc court could presumably have taken the same tack as the three-judge panel below and waited for the Trump Administration to complete its proposed rulemaking (which never actually happened). But by choosing to forge ahead, the Second Circuit, much like the agency, tied its own hands: the judges were left with — and indeed compelled to address — the regulation on the books.
Policy considerations, too, called for the court to consider the HUD Rule. It is well established that notice-and-comment rulemaking has grown “increasingly burdensome, expensive, and time consuming.”66 While some see it as a hindrance to effective agency operation — discouraging deviations from the status quo67 — the ponderous process serves an important objective: preventing frequent alterations to the meaning of the law. This is especially relevant here, where outgoing agency officials sought to affect a case’s outcome at the last minute by informally withdrawing support for an on-point, legally binding rule. In so doing, HUD effectively repealed the regulation without suffering the public scrutiny under which it was enacted. This “tail wagging the dog” routine sets a dangerous precedent for political accountability.68
Although the HUD Rule can no longer vindicate Francis, whose fair housing rights died in the Second Circuit, it still holds promise for those similarly imperiled. Given the scourge of housing discrimination in the United States, that ray of hope is well worth pursuing. The HUD Rule weathered public input, commentary, and criticism — even though it was not required to do so — in an effort to protect vulnerable tenants. It thereby purchased for itself the right to Chevron consideration (and likely deference). In Francis, the en banc Second Circuit deprived the HUD Rule of its due. Future courts must quickly correct course and chart a path toward clarifying this vital area of housing law.