                                PUBLISHED

                   UNITED STATES COURT OF APPEALS
                       FOR THE FOURTH CIRCUIT


                               No. 12-2096


MICHAEL COREY,

                 Petitioner,

           v.

THE SECRETARY, UNITED STATES DEPARTMENT OF HOUSING & URBAN
DEVELOPMENT, on behalf of: Delores Walker, G.W., by and
through Delores Walker, his legal guardian,

                 Respondent.


                               No. 12-2239


UNITED STATES DEPARTMENT OF HOUSING & URBAN DEVELOPMENT,
Office of the Secretary, on behalf of: Delores Walker,
G.W., by and through Delores Walker, his legal guardian,

                 Petitioner,

           v.

MICHAEL COREY,

                 Respondent.


On Petition for Review of an Order of the Department of Housing
and Urban Development. (10-M-207-FH-27)


Argued:   May 15, 2013                       Decided:   July 5, 2013


Before DAVIS, WYNN, and DIAZ, Circuit Judges.
Petition for review denied; Cross-application for enforcement
granted, by published opinion. Judge Diaz wrote the opinion, in
which Judge Davis and Judge Wynn joined.


ARGUED:   Frederick F. Holroyd, II, HOLROYD & YOST, Charleston,
West Virginia, for Petitioner/Cross-Respondent.      Christopher
Chen-Hsin Wang, UNITED STATES DEPARTMENT OF JUSTICE, Washington,
D.C., for Respondent/Cross-Petitioner.    ON BRIEF:    Thomas E.
Perez, Assistant Attorney General, Dennis J. Dimsey, UNITED
STATES   DEPARTMENT    OF    JUSTICE,  Washington,   D.C.,   for
Respondent/Cross-Petitioner.




                               2
DIAZ, Circuit Judge:

        Petitioner/Cross-Respondent Michael Corey appeals a final

agency order of the Secretary of the United States Department of

Housing and Urban Development (the “Department”).                The Secretary

determined that Corey had committed intentional and egregious

violations of the Fair Housing Act (“FHA”) by discriminating on

the basis of disability against Delores and Gregory Walker, and

ordered Corey to pay a civil monetary penalty as well as damages

for Ms. Walker’s emotional distress.             Finding no error, we deny

Corey’s Petition for Review and grant the Department’s Cross-

Application for Enforcement of the Secretary’s order.



                                         I.

                                         A.

        In April 2009, Corey, a landlord with over fifteen years of

rental    management    experience,       advertised     that   a     two-bedroom

house in Charleston, West Virginia, was available for a monthly

rent of $600.        When Delores Walker called to inquire about the

property, she informed Corey that she would be living with her

forty-eight-year-old      brother,       Gregory   Walker,      who    she   said

suffered from autism and mental retardation.                According to Ms.

Walker, Corey responded to this revelation by insisting that she

would    need   to   obtain   a   bond    to   protect   his    property     as   a

condition of her potential tenancy.              Although this requirement

                                         3
disturbed her, Ms. Walker nevertheless made an appointment to

view the house.

      At the viewing, Ms. Walker told Corey that her brother, Mr.

Walker, suffered from what she termed “severe autism.”                J.A. 74.

But   despite   her    assurances    that     Mr.   Walker    had   never   been

violent or aggressive, Corey expressed reservations about him

living in the house and insisted upon meeting Mr. Walker in

person.    Based      on   his   prior   observations    of   “children     with

autism . . . flailing their arms and hollering and screaming in

outrage,” Mr. Walker’s “severe” autism raised what Corey would

later describe as a “red flag.”              J.A. 134.   Believing that Mr.

Walker posed a liability risk, Corey required Ms. Walker, in

order to proceed with the application process, to (1) provide a

note from Mr. Walker’s doctor stating that he would not pose a

liability threat, (2) obtain a renter’s insurance policy with $1

million in liability coverage, and (3) assume responsibility for

any damage Mr. Walker might cause to the property.                  Corey gave

Ms. Walker a handwritten note listing these three conditions.

As she was leaving, Corey asked Ms. Walker whether she earned

the $2,000 minimum monthly income that he regularly imposed as a

prerequisite for renters, and she replied in the affirmative.

Ms. Walker took an application but never submitted it because

she felt Corey would not have rented to her.



                                         4
     About    a   week   after       he    placed   his    advertisement,       Corey

rented the house to Shelley Dearien and her son, neither of whom

is   disabled.      Corey      did        not   require    Dearien     to   purchase

liability insurance, did not ask for a doctor’s note, and did

not require her to meet the monthly minimum income requirement

he quoted to Ms. Walker.

     According     to    Ms.     Walker,        Corey’s    conduct     caused      her

significant emotional distress for several months and caused her

to fear future discrimination against her brother.                          She also

suffered sleeplessness, panic attacks, and difficulty eating and

drinking--symptoms later corroborated by the testimony of her

friends and sister.

                                           B.

     The Department, on behalf of the Walkers, filed a Charge of

Discrimination      against       Corey,         which     was   heard        by    an

Administrative Law Judge (“ALJ”).                 The Department alleged that

Corey had discriminated against the Walkers based on disability

in violation of the FHA by (1) making facially discriminatory

statements,   in   violation      of       42   U.S.C.    § 3604(c);    (2)    making

housing unavailable because of a disability, in violation of 42

U.S.C. § 3604(f)(1); and (3) imposing discriminatory terms and

conditions because of a disability, in violation of 42 U.S.C.

§ 3604(f)(2).      Specifically, the Department alleged that Corey

had violated the FHA by requiring Ms. Walker to provide the note

                                            5
from Mr. Walker’s doctor, to obtain a renter’s insurance policy

with    $1     million      in     liability        coverage,    and     to    assume

responsibility for any damage Mr. Walker might have caused to

the    property.         Corey    filed    an     Answer   denying     the    charges,

arguing      that   he     had    “an    absolute[ly]      legitimate    basis     for

refusing      to    rent    to”    the    Walkers     because    they    failed     to

establish financial eligibility.                 J.A. 9-12.

       The ALJ, viewing Corey’s statements as reasonable requests

for information that would determine whether Mr. Walker was a

threat, issued an initial decision concluding that Corey had not

violated the FHA.            The Department petitioned for Secretarial

Review.      The Secretary reversed the ALJ’s decision, determining

that the Department had offered evidence sufficient to prove

each of the charged violations, and remanded the case for a

hearing on damages and the civil penalty.

       On remand, the ALJ awarded Ms. Walker $5,000 in emotional

distress damages and imposed on Corey an additional $4,000 civil

monetary penalty--short of the $16,000 maximum civil penalty.

The ALJ also ordered injunctive remedies, directing Corey to

provide       the     Department          with     certain      disability-related

information regarding his rental properties and to participate

in a fair housing training.

       Both the Department and Corey petitioned for Secretarial

Review of the ALJ’s remand decision: Corey asked the Secretary

                                            6
to reinstate the ALJ’s initial decision, while the Department

argued that the remand decision minimized both the degree of Ms.

Walker’s emotional distress and the need for a more significant

civil monetary penalty.            The Secretary issued a Final Agency

Order denying Corey’s petition as untimely, granting in part the

Department’s petition, and imposing a steeper damages award and

civil penalty.

      Corey filed with this court a timely Petition for Review of

the   Final   Agency    Order,      and    the   Department   filed       a   Cross-

Application for Enforcement of the order.              We consolidated these

actions.



                                          II.

      Corey   contests       the    Secretary’s      determination        that     he

violated § 3604(c), (f)(1), and (f)(2) of the FHA, arguing that

his conduct was justified under the circumstances.

      Pursuant   to    the   Administrative       Procedures       Act,   “federal

courts can overturn an administrative agency’s decision . . . if

it      is       ‘arbitrary,          capricious,        an         abuse          of

discretion, . . .      otherwise not in accordance with the law,’ or

‘unsupported by substantial evidence.’”               Knox v. U.S. Dep’t of

Labor, 434 F.3d 721, 723 (4th Cir. 2006) (quoting 5 U.S.C. §

706(2)(A),    (E)).      The       substantial     evidence    standard       is    a

“necessarily . . .      limited”      appellate     review    of    the   agency’s

                                           7
factual determinations.              Almy v. Sebelius, 679 F.3d 297, 302

(4th Cir. 2012) (internal quotations omitted).

      As    a    charging      party,      the       Department      may   prove     an    FHA

violation       by   showing    “that       a    defendant     had    a    discriminatory

intent      either      directly,       through          direct      or    circumstantial

evidence, or indirectly, through the inferential burden shifting

method known as the McDonnell Douglas test.”                           Kormoczy v. HUD,

53   F.3d   821,      823-24   (7th     Cir.         1995)   (referring      to    McDonnell

Douglas Corp. v. Green, 411 U.S. 792 (1973)).                         Of course, if the

Department provides sufficient direct evidence of discrimination

to prove a violation, resort to the McDonnell Douglas method of

proof is unnecessary.            Pinchback v. Armistead Homes Corp., 907

F.2d 1447, 1452 (4th Cir. 1990).

                                                A.

      Section        3604(c)    of    the       FHA    prohibits      oral    or    written

statements       with    respect      to    the       rental    of    a    dwelling       that

indicate a “preference, limitation, or discrimination” based on

certain     protected     statuses,         including        disability.           Thus,    to

establish Corey’s liability under § 3604(c), the Department must

show that (1) Corey made a statement; (2) the statement was made

with respect to the sale or rental of a dwelling; and (3) the

statement indicated a preference, limitation, or discrimination

on the basis of disability.                See White v. HUD, 475 F.3d 898, 904

(7th Cir. 2007).            To determine whether a statement meets the

                                                8
third prong, courts use an “ordinary listener” standard.                              Id. at

905-06; see United States v. Hunter, 459 F.2d 205, 215 (4th Cir.

1972) (using an “ordinary reader” standard to determine whether

advertisements indicated a racial preference in the acceptance

of tenants).           If an ordinary listener would believe that the

statement suggests a preference, limitation, or discrimination

based      on    a     protected       status,          the    statement      is      deemed

discriminatory.          White, 475 F.3d at 905-06.                   Evidence of the

speaker’s motivation for making the discriminatory statement is

unnecessary to establish a violation.                         Jancik v. HUD, 44 F.3d

553, 556 (7th Cir. 1995).

       Based    on     direct   evidence,         the     Secretary    determined       that

Corey had violated § 3604(c).                 As the Secretary observed, Corey

admitted to imposing conditions, both verbally and in writing,

on   the   Walkers’      prospective      tenancy          because    of    Mr.    Walker’s

disability.            Corey    also    acknowledged           that    he     made     these

statements based on his assumption that Mr. Walker could pose a

threat to neighbors or property due to his disability.                                   The

Secretary       thus    concluded      that       Corey    violated    the    statute     by

making statements to Ms. Walker that an ordinary listener would

deem    reflected        a     “preference         or     limitation        against     [the

Walkers’] tenancy because of Mr. Walker’s disability.”                                  J.A.

281.



                                              9
     Corey does not deny telling Ms. Walker that he intended to

impose special conditions on the Walkers’ prospective tenancy,

but disagrees that he violated § 3604(c).                     He argues that he

imposed the conditions only after Ms. Walker’s “voluntary and

unsolicited     statement    that     her       brother    suffers   from   ‘severe

autism and mental retardation.’”                 Pet’r’s Br. 20.       Corey also

notes that he never indicated a flat refusal to rent to the

Walkers, “only that . . . risk insurance maybe [sic] required.”

Id. at 21.

     Corey’s arguments are unavailing.                    For one, the fact that

Ms. Walker disclosed her brother’s disability does not excuse

Corey’s    discriminatory       responsive        statements.        Nor    does   it

matter that Corey did not refuse to rent to the Walkers; the

statute simply prohibits statements to renters that indicate a

limitation based on disability, and Corey admits to making such

statements.       This   ends   the    inquiry,       as    substantial     evidence

supports the Secretary’s determination.

                                         B.

     In addition to its ban on discriminatory statements, the

FHA 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    [disability].”        42    U.S.C.

§ 3604(f)(1); see United States v. Youritan Constr. Co., 370 F.

Supp. 643, 648 (N.D. Cal. 1973) (interpreting “otherwise make

                                         10
unavailable”         language      to   include    “[t]he     imposition          of     more

burdensome application procedures, of delaying tactics, and of

various forms of discouragement by resident managers and rental

agents”).      Relatedly, landlords are forbidden “[t]o discriminate

against any person in the terms, conditions, or privileges of

sale or rental of a dwelling . . . because of a [disability].”

42 U.S.C. § 3604(f)(2).                 However, FHA § 3604(f)(9) contains a

limited exception to these prohibitions, allowing a landlord to

reject “an individual whose tenancy would constitute a direct

threat to the health or safety of other individuals or whose

tenancy      would    result       in   substantial      physical     damage       to    the

property of others.”

       The   Secretary       concluded     that    Corey     had    imposed       “written

discriminatory        conditions        upon”    the    Walkers,     in    violation       of

§ 3604(f)(1)         and    (2).        J.A.     282.       First,        the    Secretary

determined      that        the    Department      had     proven        the     statutory

violations by direct evidence.                  This included Corey’s testimony

that   he    (1)     imposed      the   conditions       because    of     Mr.    Walker’s

disability,        (2)     believed     “persons       diagnosed    with        autism   and

mental retardation pose a greater risk in terms of liability,”

and (3) did not typically impose the challenged conditions on

his tenants.          Id.      Second, the Secretary determined that the

Department     had       proven    both    violations      via     indirect       evidence

under the McDonnell Douglas burden-shifting method.                               Finally,

                                            11
the Secretary ruled that Corey’s conduct could not be excused

pursuant     to    § 3604(f)(9)’s      “direct        threat”    exception,       since

Corey’s reluctance to rent to the Walkers was not sufficiently

supported by objective, individualized evidence that Mr. Walker

might pose a direct threat.

      Corey contests these determinations, but not persuasively.

Focusing on perceived flaws in the Secretary’s McDonnell Douglas

indirect    evidence       analysis,      Corey    overlooks      the    Secretary’s

direct     evidence        findings,      which       alone     may     sustain     the

violations.        Rather than attempt to account for this evidence,

Corey insists that these facts present a “mixed motives” case,

and that he would have been justified in ultimately rejecting

Ms. Walker’s application because her net monthly income--despite

her affirmation to the contrary--was below his $2,000 income

threshold.        Corey also contests the Secretary’s refusal to apply

the   § 3604(f)(9)       “direct   threat”       exception,      arguing    that    his

requests   for      a   doctor’s   note    and    a    meeting    with    Mr.   Walker

constituted       lawful    attempts   to      obtain    objective       evidence    of

whether Mr. Walker posed a direct threat.

      These arguments fall flat, and again, substantial evidence

supports the Secretary’s determinations.                  First, we agree with

the Secretary that direct evidence established both § 3604(f)

violations.        Corey admitted that he imposed what amounted to

discriminatory terms and obligations on his rental negotiations

                                          12
with    Ms.    Walker       based     on    his     fears    about       Mr.     Walker’s

disability.          This admission alone supports the FHA violations:

by imposing more burdensome application procedures and generally

discouraging the Walkers’ application, Corey “otherwise ma[de]

[the    property]         unavailable”      to    the     Walkers       because    of     a

disability,     in     violation      of    § 3604(f)(1),         see   Youritan,       370

F.Supp. at 648, and “discriminate[d] against [the Walkers] in

the terms, conditions, or privileges” of a rental because of a

disability, in violation of § 3604(f)(2).                   And the fact that Ms.

Walker earned less than $2,000 per month does not excuse Corey’s

conduct.      To begin with, Ms. Walker’s ability to pay could not

possibly have motivated Corey’s conduct, as he learned of Ms.

Walker’s      income       only     after   he    imposed     the       discriminatory

conditions.          In     any     case,    this       justification       is    baldly

pretextual, as Corey failed to impose the $2,000 minimum income

requirement on the nondisabled applicant to whom he subsequently

leased the house.

       Second, since the Department established Corey’s violations

with sufficient direct evidence, we need not address Corey’s

argument      that    the    Secretary      erred    in     his    handling       of    the

McDonnell Douglas indirect evidence inquiry.                      See Pinchback, 907

F.2d at 1452.

       Finally,      we    affirm    the    Secretary’s      conclusion        that     the

§ 3604(f)(9) “direct threat” exception does not apply.                              Corey

                                            13
makes no showing that his discriminatory conduct was supported

by any objective evidence that Mr. Walker posed a direct threat

to persons or property, as is required to trigger the exception.

See   H.R.     Rep.   No.   711,   at     30   (1988),    reprinted     in    1988

U.S.C.C.A.N. 2173, 2191.           And even if Corey’s request for a

meeting      with   Mr.   Walker   and     a   doctor’s   note   was,    as    he

maintains, an attempt to obtain such objective evidence, Corey

cannot justify the other discriminatory conditions he sought to

impose, based as they were on unsubstantiated stereotypes about

autistic people in general.



                                        III.

      For these reasons, we deny Corey’s Petition for Review and

grant the Department’s Cross-Application for Enforcement of the

Secretary’s order.

                                           PETITION FOR REVIEW DENIED;
                            CROSS-APPLICATION FOR ENFORCEMENT GRANTED.




                                         14
