Circuit court upholds Section 8 precedent

The 7th Circuit Court of Appeals declined today to overturn precedent on the due process rights of someone rejected from
specific Section 8 housing.

In Marshall Fincher v. South Bend Heritage Foundation, No. 09-1964, Marshall Fincher sued after
his Section 8 application for housing in a building owned by South Bend Heritage Foundation was denied due to a previous eviction.
Fincher claimed he was denied due process of law or that SBHF breached a contract with the United States Department of Housing
and Urban Development to which Fincher is a third-party beneficiary.

Fincher wanted the Circuit Court to overturn its precedent in Eidson v. Pierce, 745 F.2d 435 (7th Cir. 1984), but
the judges declined because they found Eidson to be a well-reasoned opinion. That ruling found there is no legitimate claim
to entitlement for people rejected from a specific housing unit.

“Under Section 8, even if a plaintiff proved that the landlord relied on false information in coming to its decision
to deny the plaintiff housing, the plaintiff still would not be entitled to the housing so long as the housing went to another
eligible candidate,” wrote Judge Joel Flaum. “Therefore, the due process hearing would be meaningless.”

Section 8 only provides landlords with a series of guidelines to apply when choosing between two eligible candidates and
leaves the landlord with considerable discretion in making the final decision, he continued.

The Circuit judges rejected Fincher’s arguments to rely on a 9th Circuit case that was decided two years before Eidson
because the 7th Circuit had already rejected the reasoning from that case in Eidson. They also declined to adopt
rulings out of a New Jersey District Court or the Supreme Judicial Court of Massachusetts because those cases tackled different
issues than the one in Eidson. In the New Jersey case, the issue was whether an individual had a right to a due process
hearing when she was denied eligibility for the Section 8 housing program in New Jersey. The Massachusetts case addressed
a situation where the defendants were allegedly in violation of numerous state public housing regulations that set forth mandatory
priority and preference categories.

“Because Eidson was a well-reasoned opinion, and no significant changes in the law have occurred between when
we decided that case and now, we decline the invitation to overturn Eidson and affirm the district court on the due process
challenge,” wrote Judge Flaum.

The 7th Circuit also affirmed the District Court’s rejection of Fincher’s claim that he can bring a suit as a
third-party beneficiary of a contract entered into between SBHF and HUD. Fincher must point to specific regulations or contract
provisions that are being violated in this case to give rise to this cause of action.