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The Nose

Settling for Less

Posted 4/6/2005

When something smells a little funny in this squeaky-clean town, you sniff around. Sometimes that means winding up with a bloody Nose.

In April of last year the nonprofit fair-housing advocate Baltimore Neighborhoods Inc. (BNI) filed a complaint with the state alleging that an 858-unit Ellicott City apartment complex called Charleston Manor was discouraging people with children under 18 and the disabled from applying for rental units there--a violation of both federal and state law.

Last month, BNI announced in a press release that it had reached a settlement with Charleston Manor.

"In agreeing to settle the complaint," reads the March 18 release, "Charleston Manor denied that it discriminated, but offered a $30,000 contribution to BNI in order to assist with furthering its fair housing mission."

A win-win situation, right? A landlord makes an ugly discrimination allegation go away without having to admit any wrongdoing, and a local do-gooder gets a bit of tax-free coin in its coffers. But what about all those disabled people and families who were allegedly denied their civil rights? What exactly did they get out of this, that BNI was so eager to publicize its windfall?

Curiously, the release makes no mention of any actual victims, nor is there any promise by the landlord to amend its leasing practices.

The Nose called Chris Brown, BNI's attorney in this matter, and asked why Charleston Manor had been targeted in the first place.

"I can't tell you anything beyond what's in the press release," the lawyer said, explaining that the settlement included a self-imposed gag order on both parties. Brown suggested nosing around the Maryland Commission on Human relations, where the complaint was filed. "I would think that's a source of public documents."

"I found no information that I can release on this case," said Patricia Wood, assistant general counsel at the commission. "I can't even confirm or deny that there ever was a complaint." Woods explained that because the complaint never "matured" to the level of administrative hearing, it never officially "happened."

Stymied, and yet even more curious, we next called the property itself, which is owned by an investment outfit called Federal Capital Partners and managed by in-house property managers the Donaldson Group. "Donaldson don't know nothing about nothing," the nice lady who answered the phone said. Charleston Manor, it turns out, had been sold to Federal Capital within weeks of the settlement announcement. The previous corporate owner of Charleston Manor--the one who had negotiated the settlement with BNI--also declined to comment. (Its lawyer actually told the Nose, "No comment," just like on television.)

So, on the surface, a widely admired and respected non-profit struck a blow for fair housing by taking an allegedly discriminatory landlord to task and pocketed a tidy sum in the process. And yet, other than the press release, no one will talk about the complaint, the property, BNI's ostensible victory, or the resulting cash windfall, least of all BNI. The organization's executive director, Joe Coffey, was quite voluble about other recent BNI success stories, but he was mum on this one.

"Certainly it's not odd for an organization that has brought an action to get fees as part of the settlement agreement," said Brenda Blom, a professor at the University of Maryland School of Law who teaches housing law.

Most of the housing and legal experts contacted sympathized with the Nose's frustration at the secrecy surrounding the settlement, but said such confidentiality agreements are not only de rigueur, but possibly desirable.

"There is a legitimate issue about transparency, and it's fair to ask whether BNI could further its mission by acting with greater transparency in a matter like this," said Joshua Newberg, a professor of business law and public policy at the University of Maryland business school. "But my guess is they would argue that often confidentiality is a condition of a settlement, and if they want to get a settlement, then they often have to agree to that."

BNI tax returns for the last five years indicate the nonprofit received less than 20 percent of its annual income, on average, from litigation awards. And while we still don't understand the particulars of the settlement between Charleston Manor and BNI, or how regular such settlements are, the Nose did learn a valuable lesson in nuance:

If a public servant agrees to shelve an inquiry into alleged misdeeds in exchange for a campaign contribution, that's bribery, a felony crime. If a public-interest advocate does it, that's justice.

Now we know.

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