- The Washington Times - Wednesday, December 4, 2002

The Supreme Court yesterday heard from a mixed-race couple stymied in efforts to buy a new home by a real estate agent who they say called them a "salt-and-pepper team." The question for the justices: Can the couple sue the agent's boss?
Robert Schwemm, attorney for David and Emma Holley of Twentynine Palms, Calif., says real estate company owners should be held accountable when their employees discriminate.
But Realtors want the court to rule that the 34-year-old Fair Housing Act outlawing racial discrimination in housing should be used only to punish those who discriminate, not their employers.
The court's ruling could determine how easy it is to collect damages for discrimination.
Mrs. Holley is black and her husband is white. They sued agent Grove Crank; his employer, Triad of Twentynine Palms; and company owner Dave Meyer in 1997 after Mr. Crank reportedly used epithets to describe the couple to the builder of a home they wanted to buy in the California desert. Mr. Crank also refused to make their offer on the house.
The Holleys were joined in their suit by the builder, Brooks Bauer, who sold the house for $20,000 less than the couple was ready to pay.
No one accuses Mr. Meyer of taking part in or knowing of the discrimination of which Mr. Crank is accused.
But Mr. Schwemm said he should be held personally liable under the Fair Housing Act because he failed to ensure his agent complied with the law.
Mr. Meyer "wants to take certain parts of the law that are advantageous to him, but he doesn't want to take other parts, the responsibility parts," Mr. Schwemm told the justices.
The Bush administration is siding with the Holleys. Mr. Meyer "exercised pervasive control" over the company's affairs, assistant solicitor general Malcolm Stewart said.
Douglas Benedon, Mr. Meyer's attorney, said though his client was Triad's founder, owner and the holder of its real estate license, he had nothing to do with Mr. Crank's behavior. "Crank was acting on behalf of Triad. He was not acting on behalf of Meyer," Mr. Benedon said.
A U.S. District Court ruled Mr. Meyer could not be sued, but the San Francisco-based 9th U.S. Circuit Court of Appeals sided with the Holleys.
The discrimination claim has not been tried.
The couple and the builder sued Mr. Meyer personally because Mr. Crank and the corporation have no assets, while Mr. Meyer does.
Mr. Meyer should be shielded from the Holleys' lawsuit just as shareholders in corporations typically are not financially liable for corporate actions, Mr. Benedon said.
That argument won a sympathetic reception from Justice Antonin Scalia. If the court ruled otherwise, Mr. Scalia said, "What's the use of having a corporation then?"
The National Association of Realtors and the California Association of Realtors are supporting Mr. Meyer, who attended the oral argument.
"Who in their right mind would take this job if every single dollar you worked for could be swallowed up in a case if they named you individually?" he asked after the arguments.
Mr. Meyer, the Holleys and Mr. Bauer all live in Twentynine Palms. Mr. Meyer said he no longer is in the real estate business.
The Holleys, who were in search of a larger home, still live in the same house they bought 15 years ago through Triad, he said.

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