United States District Court, S.D. Indiana, New Albany Division
ORDER ON CROSS-MOTIONS FOR SUMMARY JUDGMENT
WALTON PRATT, JUDGE
matter is before the Court on cross-motions for summary
judgment. Plaintiff New Horizons Rehabilitation, Inc.
(“New Horizons”) initiated this action alleging
Defendants, the State of Indiana (the “State”)
and the Executive Director of the Indiana Department of
Homeland Security (“DHS”) in his official
capacity (collectively, “Defendants”), issued a
zoning decision that violates the Equal Protection Clause of
the Fourteenth Amendment; the Rehabilitation Act, 29 U.S.C.
§ 794 (the “Rehabilitation Act”); the Fair
Housing Amendments Act, 42 U.S.C. § 3604(f)
(“FHAA”); and the Americans with Disabilities
Act, 42 U.S.C. § 12132 (“ADA”). (Filing
No. 1 at 9.) On October 27, 2017, this Court granted New
Horizons a preliminary injunction and enjoined DHS from
classifying New Horizons' proposed dwelling as a Class 1
structure. (Filing No. 43.) In the fall of 2018, New
Horizons filed a Motion for Summary Judgment (Filing No.
60) and Defendants filed a Cross-Motion for Summary
Judgment (Filing No. 66). For the following reasons,
the Court grants in part and denies in part
each parties' Motion for Summary Judgment. The result of
this ruling grants New Horizons a permanent
most part, the material facts are undisputed. New Horizons is
an Indiana not-for-profit corporation that assists persons
who have intellectual and developmental disabilities in the
southeastern Indiana counties of Ripley, Dearborn, Ohio,
Franklin, Decatur, and Switzerland. (Filing No.
22-1.) It provides a variety of a services for its
clients, including community-based employment services
through job training, placement, and follow-along services,
individualized home and community-based services, day-program
services, respite care, family support, pre-vocational
training and work opportunities in an industrial setting.
Id. at 1-2. New Horizons owns six supported living
homes located in Lawrenceburg, Batesville, Peppertown, and
Oldenburg, Indiana. (Filing No. 60-1 at 11, 42.)
than four adults are allowed to live in a home full time, and
they are assisted by New Horizons staff. (Filing No. 22-1
at 2.) Between five and seven staff are employed at each
home, and a staff person is on-site 24 hours a day, seven
days a week, but staff does not live at the home. (Filing
No. 26-2 at 22; Filing No. 60-1 at 29.) The
homes are recognized by the Bureau of Developmental
Disabilities within Indiana's Division of Disability and
Rehabilitative Services as “supported living service
arrangements.” (Filing No. 22-1 at 2.)
residents of New Horizons' homes have either physical or
mental impairments that substantially limit one or more of
their daily activities so that they cannot live on their own
and require the assistance of staff. Id. at 3;
Filing No. 60-1 at 22-23. New Horizons offers
residential living as an option for clients who wish to live
with the greatest possible degree of independence.
(Filing No. 22-1 at 2.) The staff assures the safety
of the residents of the homes and provides support to assist
them in acquiring and maintaining skills to attain as much
self-sufficiency as possible. Id.
Horizons' homes are single-family dwellings and comply
with all local land-use requirements imposed on single-family
residences. Id. at 3. They are located in
neighborhoods and are physically indistinguishable from the
surrounding single-family homes. Id. They provide
permanent housing for the residents and are not intended for
transient stays. Id. The residents of the homes live
much like a nuclear family would-they eat together, grocery
shop together, engage in activities together, pool their
money, and live together with no locks on their bedroom
doors. Id.; Filing No. 26-2 at 64-65, 68;
Filing No. 60-1 at 18. Residents of these homes live
with each other for years and form attachments and close
relationships similar to a family and genuinely care for each
other. (Filing No. 60-1 at 65-66.) New Horizons
considers the residents to be families and attempts to create
homes in which the residents feel that they are family.
they are disabled, New Horizons' residents receive either
Social Security Disability (“SSD”) or
Supplemental Security Income (“SSI”) payments
(Filing No. 22-1 at 3-4.) They use these payments to
pay for their food, shelter costs, and other personal items
and expenses. Id. New Horizons is the representative
payee for those residents' who are unable to write checks
and personally manage their benefits. (Filing No. 60-1 at
9-10.) A portion of residents' SSD or SSI payments
go to New Horizons pursuant to a lease that it has with each
resident. Id. at 59; Filing No. 22-1 at 10.
New Horizons does not rent to the public at large; it only
assists persons with an intellectual or developmental
disability. (Filing No. 60-1 at 38-39.) It screens
potential residents to make sure they are compatible with one
another. Id. at 54-55. Residents may stay in a New
Horizon home for their entire life and would never see an
increase in rent, even if their SSD or SSI payments increase.
(Filing No. 26-2 at 64, 70.) New Horizons is a
certified “Medicaid home provider, ” meaning it
receives some of its funding from Medicaid and its residents
are eligible for Medicaid benefits. (Filing No. 60-1 at
a resident moves into a New Horizon home, a contractor hired
by the Bureau of Developmental Disabilities will complete an
inspection check list to make sure the overall environmental
conditions are satisfactory. Id. at 49-51, 96-97.
Among other things, the inspections ensure there is a working
fire extinguisher in each home. Id. at 96. All New
Horizons' residences have fire extinguishers, smoke
detectors, and CO2 detectors. Prior to the opening of any
home, New Horizons invites the local fire department to come
to the home and do a walk through to familiarize themselves
with the layout and to do a visual check for any risks.
(Filing No. 60-3.) Once the home is opened,
residents will engage in five safety drills on a staggered
schedule-drills for fire, bomb, medical, tornado, and
intruder. (Filing No. 60-2 at 20-21.) During the
fire drill, which may occur in the evening hours after the
residents' bedtime, staff members will assist the
resident to get to a designated area across the street.
Id. at 16-17. It takes about five minutes to get to
the designated area, but only about half that time for the
residents to get out of the house. Id. at 20.
2013, New Horizons was donated an unimproved piece of real
estate in Lawrenceburg, Indiana, on the condition that it
would build a supported living home for adults with
intellectual and developmental disabilities on the property.
(Filing No. 22-1 at 4.) The donors are parents of an
adult who will reside in the home once it opens. Id.
at 4-5. As with all New Horizons homes, the residents will be
persons with intellectual or developmental disabilities and
are limited in one or more of their major life activities.
Id. at 5. The property is located within what
Lawrenceburg's zoning ordinance characterized as an
“R-1” district, which is zoned for single, two,
and multi-family homes. Id. The house will be
indistinguishable from the homes surrounding it, and it will
conform to all the requirements Lawrenceburg imposes on
single-family homes. Id.
Horizons initially struggled with the city of Lawrenceburg to
zone the home in the same manner as all other single-family
residences. After litigation with the city, New Horizons
persuaded Lawrenceburg to zone its proposed home as a
single-family residence. Id. at 5-6; New
Horizons Rehabilitation, Inc. v. City of Lawrenceburg,
No. 4:16-cv-00169-RLY-DML (S.D. Ind.).
New Horizons was attempting to negotiate with Lawrenceburg,
its Executive Director, Marie Dausch (“Dausch”),
was informed that the planned home had to be approved by DHS
because it was deemed to be a commercial building.
(Filing No. 22-1 at 5-6.) She was also informed that
plans for the home had to be drawn up by an architect, as
opposed to the builder who had drawn up the then-existing
2015, New Horizons paid an architect $2, 200.00 to make
changes to the original plans to conform to what DHS required
and the plans were submitted to the Plan Review Section of
the Division of Fire and Building Safety within DHS.
Id. at 6; Filing No. 26-2 at 58-59. That
department issued the architect a construction design release
specifying that plans for a fire suppression system had to be
submitted before the release could be issued. (Filing No.
22-1 at 6.) New Horizons had never previously been
required to put such a system in any of the other homes it
operated, including an existing home in Lawrenceburg.
(Filing No. 22-1 at 6.) Dausch attempted to submit a
variance request so that the home could be built without the
costly commercial fire suppression system. Id. But
she did not understand the process of filing the request and
therefore abandoned it. Id.
January 26, 2017, New Horizons settled its lawsuit with the
city of Lawrenceburg, which agreed to treat the proposed New
Horizons home the same way it would treat any single-family
dwelling for zoning purposes. Id. at 5. But in
February 2017, DHS informed Lawrenceburg officials that the
planned home was a Class 1 structure that had to be submitted
to DHS for review and release. (Filing No. 22-2 at
56.) Of primary concern to New Horizons was the Class 1
requirement that New Horizons must install a commercial fire
suppression system in the home. (Filing No. 26 at 5;
Filing No. 22-2 at 38-39.)
Horizons applied for a variance from the Fire Prevention and
Building Safety Commission (“Commission”) in
hopes that they would not be required to install a commercial
fire suppression system in the proposed home. (Filing No.
34-3.) Appearing before the Commission, Dausch reported
that she had fielded an estimate of $12, 000.00 for a
fire-suppression system. Id. at 2. The Commission
advised her that estimate was too high-the cost for the
fire-suppression system in the proposed home should be
between $6, 000.00 to $8, 000.00 Id. at 3. One
commissioner explained that a variance would only be granted
for financial hardship and if the cost of the
fire-suppression system was less than 10% of the total cost
of building the home, no variance would be granted in any
case. Id. The Commission tabled New Horizons'
request so that Dausch could obtain a new estimate.
contacted the builder New Horizons was planning to use and
asked for an estimate on the cost of the fire-suppression
system. Id. The builder estimated the cost to be $9,
800.00. Id. Dausch returned to the Commission with
her new estimate, but the Commission denied her request for a
variance. Id. at 4. The commissioners told Dausch
that the builder had quoted her a price for the wrong
sprinkler system, and the correct estimate would not be more
than $9, 800.00. Id. at 3-4. The Commission denied
her request because to obtain a variance because the cost of
the fire-suppression system would have to be over 10% of
total building costs, but here the cost was about 5% of total
building costs. Id. at 4.
Horizons filed its Complaint for Declaratory and Injunctive
Relief and Damages against the Defendants on March 14, 2017.
(Filing No. 1.) The Court granted New Horizons'
motion for preliminary injunction on October 27, 2017.
(Filing No. 43.) The home continued construction
during this litigation and was scheduled to be open and ready
for occupancy in October or November of 2018. (Filing No.
61 at 6; Filing No. 60-3). It will not contain
a fire suppression system, although it will contain fire
extinguishers and smoke and CO2 detectors. (Filing No.
60-3.) And, like other New Horizons homes, the local
fire department will be invited to tour and inspect it.
Id. In late November 2016, shortly before New
Horizons settled its dispute with Lawrenceburg, the estimated
cost of building the home was $207, 900.00. Id. at
2. By December 2017, the estimate had risen to $236, 100.00.
Id. Additionally, because DHS labelled the proposed
home a Class 1 structure, New Horizons had to pay $2, 200.00
in architect expenses that it would not have incurred had the
home been classified as a Class 2 structure. (Filing No.
26-2 at 59.)
fall of 2018, the parties filed these cross-motions for
summary judgment. (Filing No. 60; Filing No.
66.) Because of the preliminary injunction, New Horizons
was able to build the new home in Lawrenceburg without being
subject to the Class 1 structure requirements, particularly
the requirement that a commercial fire suppression system be
installed. (Filing No. 61 at 32.) New Horizons seeks
a permanent injunction to prevent DHS from imposing the Class
1 requirements, even after the home is open. Id. It
is also seeking monetary damages resulting from the delay in
building the home. Defendants on the other hand, deny any
discrimination, challenge New Horizons standing and contend
that awarding damages would in no way benefit the disabled
individuals that the relevant federal statutes intend to
protect. (Filing No. 69 at 29.)
purpose of summary judgment is to “pierce the pleadings
and to assess the proof in order to see whether there is a
genuine need for trial.” Matsushita Elec. Indus.
Co. v. Zenith Radio Corp., 475 U.S. 574, 587
(1986). Summary judgment is only appropriate by the terms of
Rule 56 where there exists “no genuine issue as to any
material facts and … the moving party is entitled to
judgment as a matter of law.” Fed.R.Civ.P. 56. This
notion applies equally where, as here, opposing parties each
move for summary judgment in their favor pursuant to Rule 56.
I.A.E., Inc. v. Shaver, 74 F.3d 768, 774 (7th Cir.
1996). Indeed, the existence of cross-motions for summary
judgment does not necessarily mean that there are no genuine
issues of material fact. R.J. Corman Derailment Serv.,
Inc. v. Int'l Union of Operating Eng'rs, 335
F.3d 643, 6477th Cir. 2003). Rather, the process of taking
the facts in the light most favorable to the non-movant,
first for one side and then for the other, may reveal that
neither side has enough to prevail without a trial.
Id. at 648. “With cross-motions, [the
court's] review of the record requires that [the court]
construe all inferences in favor of the party against whom
the motion under consideration is made.”
O'Regan v. Arbitration Forums, Inc., 246 F.3d
975, 983 (7th Cir. 2001) (quoting Hendricks-Robinson v.
Excel Corp., 154 F.3d 685, 692 (7th Cir. 1998)).
is not permitted to conduct a paper trial on the merits of a
claim and may not use summary judgment as a vehicle for
resolving factual disputes. Ritchie v. Glidden Co., ICI
Paints World-Grp., 242 F.3d 713, 723 (7th Cir. 2001);
Waldridge v. Am. Hoechst Corp., 24 F.3d 918, 920
(7th Cir. 1994). Indeed, a court may not make credibility
determinations, weigh the evidence, or decide which
inferences to draw from the facts. Payne v. Pauley,
337 F.3d 767, 770 (7th Cir. 2003) (“these are jobs for
a factfinder”); Hemsworth v. Quotesmith.com,
Inc.¸476 F.3d 487, 490 (7th Cir. 2007). Instead,
when ruling on a summary judgment motion, a court's
responsibility is to decide, based on the evidence of record,
whether there is any material dispute of fact that requires a
previously stated, for the most part, the material facts are
not in dispute. New Horizons challenges the constitutionality
of the zoning determination regarding its single-family
dwelling unit that it built and operates in Lawrenceburg. It
alleges the State's zoning determination is in violation
of the Equal Protection Clause of the United States
Constitution; the Fair Housing Amendments Act, 42 U.S.C.
§ 3604(f); the Rehabilitation Act, 29 U.S.C. 794; and
the American with Disabilities Act, 42 U.S.C. § 12132.
New Horizons seeks a permanent injunction and damages.
Defendants seek summary judgment arguing that New Horizons
lacks standing, is unable to prove discrimination and dispute
the validity and foundation for the damages that New Horizons
Horizons makes claims under the Rehabilitation Act, 29 U.S.C.
§ 794; the Fair Housing Amendments Act, 42 U.S.C. §
3604(f); and the Americans with Disabilities Act, 42 U.S.C.
§ 12132. (Filing No. 1 at 9.) The Fair Housing
Act, enacted in 1968, prohibits housing discrimination on the
basis of race, color, religion, or national origin. The FHAA,
passed in 1988, extends protections to persons with
disabilities. The current Fair Housing Act makes it unlawful
“[t]o discriminate in the sale or rental, or to
otherwise make unavailable or deny, a dwelling to any buyer
or renter because of a handicap.” 42 U.S.C. §
3604(f)(1). Title II of the ADA provides that “no
qualified individual with a disability shall, by reason of
such disability, be excluded from participation in or be
denied the benefits of services, programs, or activities of a
public entity, or be subjected to discrimination by any such
entity. Id. § 12132. And, under the
Rehabilitation Act, “[n]o otherwise qualified
individual with a disability … shall, solely by
reasons of her or his disability, be excluded from the
participation in, be denied the benefits of, or be subjected
to discrimination under any program or activity receiving
Federal financial assistance.” 29 U.S.C. § 794(a).
Seventh Circuit has said that “all three statutes apply
to municipal zoning decisions, ” and the briefing does
not address whether they apply to zoning decisions made by
the state. Valencia v. City of Springfield, 883 F.3d
959, 967 (7th Cir. 2018). But New Horizons also brings a
claim under the Fourteenth Amendment, and the Supreme Court
has made clear that the ADA is a proper vehicle for
vindicating Fourteenth Amendment rights violated by a state.
See U.S. v. Georgia, 546 U.S. 151, 159 (2006)
(“insofar as Title II [of the ABA] creates a private
cause of action for damages against the States for conduct
that actually violated the Fourteenth Amendment,
Title II validly abrogates state sovereign immunity”).
The Court need not conduct a separate analysis for claims
brought under the FHAA, ADA, and Rehabilitation Act because
“the same analysis generally applies under all three
statutes.” Valencia at 967.
law divides structures into two classes. Ind. Code §
22-12-1-4, -5. Class 1 is the more commercial of the two
classes, and a structure within it is:
building or structure that is intended to be or is occupied
or otherwise used ...