Case: U.S. v. Midwest Bankcentre

4:11-cv-01086 | U.S. District Court for the Eastern District of Missouri

Filed Date: June 16, 2011

Closed Date: 2016

Clearinghouse coding complete

Case Summary

On June 16, 2011, the United States Department of Justice (DOJ) filed this lawsuit in the United States District Court for the Eastern District of Missouri, under the Fair Housing Act, 42 U.S.C. §§3601-3619, and the Equal Credit Opportunity Act, 15 U.S.C. §§1691-1691f, against the Midwest Bankcentre. The DOJ alleged that the defendant engaged in lending discrimination on the basis of race in the St. Louis metropolitan area. The case had been referred to the Department of Justice by the Federa…

On June 16, 2011, the United States Department of Justice (DOJ) filed this lawsuit in the United States District Court for the Eastern District of Missouri, under the Fair Housing Act, 42 U.S.C. §§3601-3619, and the Equal Credit Opportunity Act, 15 U.S.C. §§1691-1691f, against the Midwest Bankcentre. The DOJ alleged that the defendant engaged in lending discrimination on the basis of race in the St. Louis metropolitan area. The case had been referred to the Department of Justice by the Federal Reserve Bank, in St. Louis, which had found statistical signs of discrimination.

More specifically, the DOJ alleged that the defendant's choice of locations for branch offices was designed to serve the banking and credit needs of residents of majority-white census tracts, but not those of residents of majority-black census tracts. Similarly, the DOJ alleged that the defendant made loans for residential real estate in predominantly white residential census tracts but avoided serving the similar credit needs of majority-black census tracts. In total, the complaint asserted, the result was illegal redlining: "defendant's policies and practices are intended to deny and discourage, or have the effect of denying or discouraging, an equal opportunity to the residents of the majority-black neighborhoods of the St. Louis MSA, on account of the racial composition of those neighborhoods, to obtain residential real estate-related loans."

In 2000, 76% of the Missouri portion of the St. Louis metro area was non-Hispanic white, and 19% was African-American; the African-American population was mostly concentrated in the northern part of the City of St. Louis and the neighboring northeastern portion of St. Louis County. But the defendant's had drawn an assessment area (as required by the Community Reinvestment Act) that excluded both majority-black areas: the northern part of St. Louis city and the northeast corner of St. Louis County. In fact, the Midwest's CRA assessment area excluded 47 of the 60 majority-black census tracts in the City of St. Louis, and drew a virtual horseshoe around the majority-black census tracts.

Settlement negotiations preceded filing in this case, and on June 28, 2011, Magistrate Judge Frederick R. Buckles approved a detailed consent decree that had been submitted simultaneously with the complaint. The consent decree included both injunctive and monetary relief, described as "designed to expand opportunities to meet the credit needs of residents located in majority-black census tracts in the Missouri portion of the St. Louis MSA [Metropolitan Statistical Area]. Midwest will ensure that its lending products and services are made available and marketed in majority-black census tracts on no less favorable a basis than in majority-white tracts. Midwest commits itself to take all reasonable, practicable actions, consistent with safety and soundness, to increase the level of its residential lending in majority-black census tracts. with the ultimate objective that Midwest offers mortgage lending services on an equal basis as it offers such services in majority-white census tracts."

Among the injunctive measures in the decree were:

  • a general prohibition on discrimination

  • a redrawn CRA assessment area, including all of the city of St. Louis, as well as St. Louis, Jefferson, and St. Charles Counties

  • at least one new full-service branch office in a majority-black census tract, with an on-site residential mortgage officer

  • continued full-time employment of a Director of Community Development, with primary responsibilities to include overseeing the continued development of the Bank's lending in majority-black census tracts

  • continued full-time employment of a Director of Compliance, with responsibilities to include overseeing compliance with the decree itself

  • a credit needs assessment of the Missouri majority-black census tracts, to be shared with the United States

  • fair lending training, African-American outreach and advertising

  • $900,000 for a special credit program directed at the majority black census tracts, to reduce closing costs

  • $300,000 for consumer financial education and other related relief

  • $25,000 for the Metropolitan St. Louis Equal Housing Opportunity Council, whose complaint got the case underway.

The decree also included a variety of record retention and reporting provisions, and a sunset period of five years.

On April 11, 2013, the parties jointly moved to amend the decree, specifically with respect to the $900,000 for special credit programs. The parties stated that the defendant would be "unable to offer the specified forms of financial assistance at a volume that would exhaust the requisite subsidy for the special financing program during the five-year term of the Agreed Order." Therefore, they amended the agreement to provide the defendant "with additional instruments for providing financial assistance intended to facilitate its ability to expend the subsidy through the special financing program." The court approved the amendment on April 15.

The sunset period has passed, and the case is now closed.

People

For PACER's information on parties and their attorneys, see: https://www.courtlistener.com/docket/4298967/parties/united-states-v-midwest-bankcentre/


Judge(s)

Buckles, Frederick R. (Missouri)

Attorneys(s) for Plaintiff

Callahan, Richard G. (Missouri)

Holder, Eric H. Jr. (District of Columbia)

Niles, Sara Lewenberg (District of Columbia)

Perez, Thomas E. (District of Columbia)

Attorneys(s) for Defendant

Sandler, Andrew L. (District of Columbia)

Expert/Monitor/Master

Mitchell, Andrea Kay (District of Columbia)

Judge(s)

Buckles, Frederick R. (Missouri)

Attorneys(s) for Plaintiff

Callahan, Richard G. (Missouri)

Holder, Eric H. Jr. (District of Columbia)

Niles, Sara Lewenberg (District of Columbia)

Perez, Thomas E. (District of Columbia)

Attorneys(s) for Defendant

Sandler, Andrew L. (District of Columbia)

Expert/Monitor/Master

Mitchell, Andrea Kay (District of Columbia)

Documents in the Clearinghouse

Document

U.S. v. Midwest Bankcentre (Docket)

June 16, 2011 Docket
1

Complaint

June 16, 2011 Complaint
9

Consent Decree

June 28, 2011 Settlement Agreement

Resources

Title Description External URL

The Origins of Fair Lending Litigation

Andrew Nash

This paper describes the origins of fair lending litigation in the 1970s. It documents two litigation strategies, one aimed at discriminatory lenders in local communities and a second at the federal … Dec. 4, 2008 http://ssrn.com/...

Docket

See docket on RECAP: https://www.courtlistener.com/docket/4298967/united-states-v-midwest-bankcentre/

Last updated May 11, 2022, 8 p.m.

ECF Number Description Date Link
1

COMPLAINT against defendant Midwest BankCentre Non-Jury Demand,, filed by United States. (Attachments: # 1 Exhibit Map- Branch Locations, # 2 Exhibit Map- Applications, # 3 Exhibit Map- Originations, # 4 Civil Cover Sheet, # 5 Original Filing Form, # 6 Waiver of Service)(Niles, Sara) (Entered: 06/16/2011)

1 Exhibit Map- Branch Locations

View on PACER

2 Exhibit Map- Applications

View on PACER

3 Exhibit Map- Originations

View on PACER

4 Civil Cover Sheet

View on PACER

5 Original Filing Form

View on PACER

6 Waiver of Service

View on PACER

June 16, 2011 RECAP
2

MOTION for Settlement Entry of Agreed Order by Plaintiff United States. (Attachments: # 1 Text of Proposed Order Agreed Order)(Niles, Sara) (Entered: 06/16/2011)

1 Text of Proposed Order Agreed Order

View on PACER

June 16, 2011 PACER
3

MOTION for Leave to Appear Pro Hac Vice Andrea Kay Mitchell (Filing fee $100) by Defendant Midwest BankCentre. (Attachments: # 1 Certificate Of Good Standing)(MRC) (Entered: 06/23/2011)

1 Certificate Of Good Standing

View on PACER

June 22, 2011 PACER
4

MOTION for Leave to Appear Pro Hac Vice Andrew L. Sandler (Filing fee $100) by Defendant Midwest BankCentre. (Attachments: # 1 Certificate Of Good Standing)(MRC) (Entered: 06/23/2011)

1 Certificate Of Good Standing

View on PACER

June 22, 2011 PACER
5

ORDER IT IS HEREBY ORDERED that Andrea Kay Mitchells Verified Motion For Admission Pro Hac Vice (Docket No. 3) is GRANTED. IT IS FURTHER ORDERED that the Clerk of Court shall enter Andrea Kay Mitchell as attorney of record for defendant Midwest BankCentre in this matter. granting 3 Motion for Leave to Appear Pro Hac Vice Andrea Kay Mitchell Signed by Magistrate Judge Frederick R. Buckles on 6/23/11. (JWJ) (Entered: 06/23/2011)

June 23, 2011 PACER
6

ORDER IT IS HEREBY ORDERED that Andrew L. Sandlers Verified Motion For Admission Pro Hac Vice (Docket No. 4) is GRANTED. IT IS FURTHER ORDERED that the Clerk of Court shall enter Andrew L. Sandler as attorney of record for defendant Midwest BankCentre in this matter. granting 4 Motion for Leave to Appear Pro Hac Vice Andrew L. Sandler Signed by Magistrate Judge Frederick R. Buckles on 6/23/11. (JWJ) (Entered: 06/23/2011)

June 23, 2011 PACER
7

FULL CONSENT has been received by by Defendant Midwest BankCentre, Plaintiff United States of America. (MRC) (Entered: 06/24/2011)

June 24, 2011 PACER
8

ORDER -.....IT IS HEREBY ORDERED that plaintiff United States of America's Unopposed Motion for Entry of Agreed Order (Doc.#2) is GRANTED. The separate Agreed Order, the entry of which has been consented to by all parties in this cause, is entered herewith. IT IS FURTHER ORDER that, upon the entry of the Agreed Order, the Clerk of Court shall administratively close this case for statistical purposes. The Court shall retain jurisdiction over the cause in accordance with and for the purpose of enforcement of the terms of the Agreed Order, after which the case shall be dismissed with prejudice. granting 2 Motion for Settlement Signed by Magistrate Judge Frederick R. Buckles on 6/28/2011. (MRC) (Entered: 06/28/2011)

June 28, 2011 PACER
9

AGREED ORDER - {see order for complete details}. Signed by Magistrate Judge Frederick R. Buckles on 6/28/2011. (MRC) (Entered: 06/28/2011)

June 28, 2011 PACER

State / Territory: Missouri

Case Type(s):

Fair Housing/Lending/Insurance

Key Dates

Filing Date: June 16, 2011

Closing Date: 2016

Case Ongoing: No

Plaintiffs

Plaintiff Description:

United States Department of Justice

Plaintiff Type(s):

U.S. Dept of Justice plaintiff

Attorney Organizations:

U.S. Dept. of Justice Civil Rights Division

Public Interest Lawyer: Yes

Filed Pro Se: No

Class Action Sought: No

Class Action Outcome: Not sought

Defendants

Midwest Bankcentre (St. Louis, St. Louis), Private Entity/Person

Defendant Type(s):

Bank or credit provider

Case Details

Causes of Action:

Fair Housing Act/Fair Housing Amendments Act (FHAA), 42 U.S.C. §§ 3601 et seq.

Equal Credit Opportunity Act (ECOA), 15 U.S.C. § 1691

Availably Documents:

Trial Court Docket

Complaint (any)

Monetary Relief

Injunctive (or Injunctive-like) Relief

Outcome

Prevailing Party: Plaintiff

Nature of Relief:

Injunction / Injunctive-like Settlement

Damages

Source of Relief:

Settlement

Form of Settlement:

Court Approved Settlement or Consent Decree

Amount Defendant Pays: 85,000

Order Duration: 2011 - 2016

Content of Injunction:

Comply with advertising/recruiting requirements

Develop anti-discrimination policy

Discrimination Prohibition

Goals (e.g., for hiring, admissions)

Hire

Monitoring

Provide antidiscrimination training

Recordkeeping

Reporting

Issues

General:

Disparate Treatment

Housing

Pattern or Practice

Discrimination-area:

Lending

Discrimination-basis:

National origin discrimination

Race discrimination

Race:

Black

National Origin/Ethnicity:

Hispanic