                                                                   [PUBLISH]

             IN THE UNITED STATES COURT OF APPEALS

                     FOR THE ELEVENTH CIRCUIT                   FILED
                                                       U.S. COURT OF APPEALS
                         ________________________        ELEVENTH CIRCUIT
                                                              DEC 21, 2000
                                No. 99-6133               THOMAS K. KAHN
                         ________________________              CLERK


                    D. C. Docket No. 97-00474-CV-A-N



CENTRAL ALABAMA FAIR
HOUSING CENTER, INC., et al.,

                                               Plaintiffs-Appellants,

                                   versus

LOWDER REALTY CO., INC., et al.,

                                               Defendants-Appellees.

                         ________________________

                Appeals from the United States District Court
                    for the Middle District of Alabama
                      _________________________
                           (December 21, 2000)

Before TJOFLAT, MARCUS and KRAVITCH, Circuit Judges.

MARCUS, Circuit Judge:
      Plaintiffs Cynthia Foster, Denise Frazier, Barbara Gill-Smith, Brenda Smith,

Ezell Smith, and the Central Alabama Fair Housing Center appeal a final jury verdict

in favor of defendants on their housing discrimination claims. Plaintiffs present two

distinct issues on appeal. First, the individual plaintiffs argue that the district court

erred by finding a prima facie case of racial discrimination in their use of a

peremptory challenge at trial, and subsequently denying their request to strike the

juror in question. Second, the Central Alabama Fair Housing Center argues that the

district court erred in instructing the jury that the Center’s right to recover was

contingent upon a finding that the defendants unlawfully discriminated against the

individual plaintiffs. We conclude that the district court committed reversible error

as to both issues, vacate the jury verdict, and remand for a new trial.

                                           I.

      The individual plaintiffs are six African-Americans who sought to purchase

homes in Montgomery, Alabama.           They allege that the defendant real estate

companies, Lowder Realty Co., Inc., Lowder New Homes, Inc., and Lowder New

Homes Sales, Inc., intentionally steered them away from predominantly white

neighborhoods and toward predominantly African-American neighborhoods.

Plaintiffs allege violations of the Fair Housing Act of 1968, 42 U.S.C. § 3601, et seq.,

and two provisions of the Civil Rights Act of 1866 (42 U.S.C. §§ 1981 and 1982).


                                           2
A.    Facts Relating to Denial of Peremptory Challenge

      On December 7, 1998, the U.S. District Court for the Middle District of

Alabama called a venire panel for service in a term of civil jury court. This action was

the only case to be tried during the term. Three days preceding the calling of the

venire, the Jury Commissioner had distributed to the parties copies of the list of jurors

on the venire and questionnaires completed by the venire members.

      After the venire was sworn by the clerk, the district court conducted voir dire

and allowed attorneys for the parties to ask questions that further explored answers

given by the individual venire members. After voir dire was completed, the district

court excused four jurors who asserted that for personal reasons it would be

impossible or an extreme hardship to serve on the jury. The court then heard the

parties’ challenges for cause. Plaintiffs made challenges for cause against five jurors,

all white, one of which was granted. Defendants challenged two jurors for cause, both

of whom were struck by the court.

      The court then stated that it would empanel eight jurors and permitted each

party three peremptory challenges. Of the prospective jurors -- the first fourteen

remaining on the venire -- eleven were white and three were black. The parties

exercised their peremptory strikes by concurrently writing down all of their requested




                                           3
strikes and returning them to the clerk. Plaintiffs and defendants each utilized two of

their three allotted peremptory strikes.

      Plaintiffs then asserted that the defendants, who used their two strikes to

challenge African-American jurors (# 7 and #8), exercised their strikes on the basis

of race in violation of the Equal Protection Clause. See Batson v. Kentucky, 476 U.S.

79 (1986). The district court found that a prima facie case was established because

“defendants’ only strikes were black jurors and . . . no black jurors remained on the

panel as constituted.” Although defense counsel pointed out that one African-

American juror had not been struck and would serve even if the parties’ peremptory

strikes were upheld, the district court nevertheless required the defendants to give

race-neutral reasons for their strikes. Defense counsel stated that Juror #7 was struck

because (1) she was grimacing, frowning, and staring straight ahead; (2) defendants’

jury consultant observed that she was sleeping; and (3) one of the defense lawyers

always struck people from Lowndes County. Defense counsel said that Juror #8 was

struck on the grounds that (1) she was grimacing and frowning; (2) her arms were

crossed; (3) the jury consultant observed that she was sleeping; (4) she was a “social

worker type”; and (5) one of the defense lawyers always struck people from Bullock

County. The district court found that these explanations could be a cover for race-




                                           4
based reasons, and upheld plaintiffs’ Batson challenge as to both jurors. The jurors

were then placed on the jury empaneled to hear the case.

       Defendants then asserted that plaintiffs had engaged in intentional

discrimination when exercising their two strikes against Jurors #5 and #9. Defendant

counsel objected on the ground that both jurors were white males and neither had

made statements during voir dire that would justify striking them but for their race.

The district court found a prima facie case of racial striking, stating only “[b]oth

challenges having been used against white jurors, I find there is a prima facie case of

racial striking and I will require the plaintiffs to show race neutral reasons.” When

plaintiffs exercised their peremptory challenges, eleven of the fourteen prospective

jurors were white.

       Plaintiffs then provided race neutral reasons for striking the two jurors. As to

Juror #5, they stated that they struck him because he belonged to the NRA. The

district court found this reason to be race neutral, and denied defendants’ challenge

to plaintiffs’ strike of Juror #5.

       Plaintiffs then presented five separate reasons for striking Juror #9: (1) he held

a bank account with Colonial Bank, a company within the same corporate family as

several of the defendant corporations; (2) he owned commercial rental property; (3)

his immediate family members belonged to various clubs and organizations about


                                           5
which the district court had questioned the venire; (4) his status as an alcoholic, as

revealed on the court’s juror questionnaire form, rendered him more susceptible to any

stress associated with jury service in a two-week civil rights trial; and (5) the stress

of serving on a jury could have been further exacerbated by the fact that he lived 80

or 90 miles from the courthouse. Each of the reasons offered by the plaintiffs was

based on information contained in the record, including the jury questionnaires

completed by the venire members.

      After plaintiffs finished explaining why they struck Juror #9, the district court

failed to state whether it considered plaintiffs’ reasons to be race-neutral but instead

immediately presented defendants with the opportunity to challenge the sufficiency

of those reasons. In response, defense counsel stated that they believed Juror #9 had

not had a drink since 1991, that he rented commercial and not residential property, and

that they did not believe in striking a juror because he was an alcoholic. The district

court then concluded that ownership of a warehouse had nothing to do with the case

and that being a recovering alcoholic and living 90 miles from the courthouse were

not legitimate reasons for striking a juror and could be a cover for race-based reasons.

With no further discussion of these three reasons proffered by plaintiffs and no

discussion whatsoever of plaintiffs’ other two proffered reasons, the district court

sustained defendants’ challenge to plaintiffs’ attempted peremptory strike. The


                                           6
district court placed Juror #9 on the jury of eight that was empaneled to hear the case

and the remaining venire members were excused. Juror #9 ultimately served on the

jury that rendered a verdict and became the jury foreperson.

B.    Facts Relating to Center’s Right to Recover Damages

      The Central Alabama Fair Housing Center is a nonprofit corporation whose

mission is eliminating racial discrimination in housing. It receives and investigates

complaints of discrimination in the Montgomery area, provides counseling to persons

who believe they have been discriminated against, and educates realtors and the public

about federal fair housing law. In connection with its investigatory role, the Center

goes to court seeking redress for violations of housing laws.

      At trial, the Center presented the following evidence in support of its claim. In

response to complaints of racial steering it had received, the Center conducted a series

of tests, sending two teams of white and black employees to two different Lowder

realtors, Juliette Stuckey and Debra Whitehouse. White tester Jennifer Woods

recounted her testing experience for the jury. Woods testified that when the team of

white testers contacted Stuckey, they asked to see four houses in racially mixed or

black neighborhoods. Rather than initially showing them the older houses they had

asked to see, however, Stuckey showed them a new house in a predominantly white

area. When she did show them the first of the houses they asked to view, she made


                                           7
a number of comments about the neighborhood, offering her opinion that it was “not

a good area” and that the white testers would not want to live there because there were

“too many of the other kind.”

      Woods further testified that after the couple had viewed the first house they had

requested to see, Stuckey reiterated, “I would hate to see you buy here, I’ll be honest

with you. It’s just not a good area. This used to be the nicest area 40 years ago.”

Then, pointing to an apartment complex nearby, Stuckey said, “That’s nothing but

blacks over there in all those apartments.” As they returned to the Lowder office,

driving through predominantly white neighborhoods, Stuckey remarked how nice the

areas were.

      The Center also presented testimony from black testers Ethica Gilbert and Gary

Lewis, who described a different experience with Stuckey. Stuckey, they said, first

tried to discourage them from spending as much money as they wanted to spend on

a house, although they, like the white testers, claimed to be prequalified in the house’s

price range. Gilbert testified that Stuckey did not take them to view any new houses,

instead showing them older houses in mixed or predominantly black neighborhoods.

She offered them no cautions about the poor quality of these neighborhoods. She did

not drive them through the predominantly white east Montgomery neighborhoods or

comment on the “niceness” of those areas.


                                           8
      The Center also put on testimony from paired testers who had consulted with

Lowder realtor Debra Whitehouse. Drew Colfax, who is white, and Reginald Bowie,

who is black, each told Whitehouse that he wanted to spent about $75,000, and that

he was interested in a particular house on Banyan Street, in a predominantly black

neighborhood.

      Colfax testified that when Whitehouse showed the Banyan Street house to him,

she rushed him through, remarking that the house’s storm windows added “an extra

layer of security.” She suggested that he find a house in Prattville, a white bedroom

community, or off Vaughn Road, a white area. During her second meeting with the

white tester Colfax, Whitehouse showed him houses of her choosing in white

neighborhoods which she described in favorable terms such as “easy to resell,” “a

good place to raise a family,” “a very nice area,” or “my parents live near here.”

      By contrast, according to black tester Bowie, when Whitehouse showed the

same Banyan Street house to him, she pointed out the good features of the

neighborhood, commenting that it had a lot of space for the price. She did not

mention the storm windows or any other security feature. She then showed him other

houses in predominantly black neighborhoods, commenting on their good features and

what he could do to fix them up. When she finally showed him a house in a white

neighborhood, it was above his stated price range.


                                          9
       The Center offered this evidence to prove that Stuckey and Whitehouse

engaged in racial steering by discouraging blacks from looking in white

neighborhoods and discouraging whites from looking in black neighborhoods. The

tests that were the subject of this live testimony were conducted by the Center as part

of its investigation of the reports of racial steering it had received.

       The Center’s executive director, Faith Cooper, testified that when the Center

learned through its testers that Lowder realtors were engaging in racial steering, the

Center realized that it would have to divert resources to combat Lowder’s activities.

Lowder’s discrimination, she testified, frustrated the mission of the Center to ensure

that Montgomery citizens have access to the housing of their choice.

       Cooper testified that, based upon her records, the Center diverted resources that

it otherwise would have had available for various activities in its 29-county service

area to its racial steering programs in Montgomery. She also testified that the Center’s

activities related to other kinds of discrimination, such as family status, disability, and

discrimination in mortgage lending, were curtailed as the Center attempted to

counteract the effects of the defendants’ racial steering programs. The Center

undertook counseling, testing, litigation, outreach, and education activities in this

regard. Cooper testified that as of June 1997, the Center had spent $17,866.06 on

these activities and that the Center’s expenses continued to rise.


                                            10
      Following the presentation of this evidence, the judge instructed the jury in

these terms:

               If you find that one or more defendants or their agents
               violated the rights of the individual plaintiffs: Cynthia
               Foster, Brenda Smith, Barbara Gill-Smith, Ezell Smith, or
               Denise Frazier, then you may also consider the damages to
               be awarded as compensation to the Central Alabama Fair
               Housing Center. If the [Center] has suffered injury because
               of racial discrimination on the part of the defendants, the
               [Center] is entitled to recover damages for the costs which
               it has incurred solely in connection with this litigation
               against the defendants. You must find that any damage
               claimed by the [Center] was caused by a violation of the
               discrimination statutes at issue in this case by the Lowder
               defendants and that the damages were incurred in response
               to those violations.

The Center objected to the portion of this charge that made a finding for the Center

contingent upon the jury’s having first concluded that one (or all) of the individual

plaintiffs was entitled to a favorable verdict. The Center’s counsel argued that “the

liability of the defendant as against individual plaintiffs is not a necessary prerequisite

to a finding of damages of the [Center]. . . . There is evidence that has been presented

in this trial that could support damages for the [Center] above and beyond that which

would support claims for individual plaintiffs. . . . The fact that [an individual’s]

claim [may] be legally precluded should not preclude damages to the Center.” The

trial court overruled the objection.



                                            11
      In conjunction with the jury charge, the court prepared a verdict form

containing special interrogatories to guide the jury. Questions (1)(a) and (b) of the

court’s verdict form asked the jury whether it found that the defendants intentionally

discriminated against plaintiff Cynthia Foster and whether the defendants had made

a false representation to her. A “yes” answer to (1)(a) or (b) would indicate a finding

of liability in favor of Foster. Likewise, a “yes” answer to parts (4)(a), (b), or (c)

would indicate a finding of liability in favor of plaintiff Gill-Smith, a “yes” answer to

question 8 would indicate a finding that the defendant were liable to Frazier, and a

“yes” answer to question (11)(a) would indicate that the defendants were liable to

Smith. Having made explicit that a “yes” answer to interrogatories (1)(a) or (b), 4(a),

(b) or (c), 8, and/or 11(a) would mean that a particular individual prevailed on his or

her claim, the court then directed the jury, in interrogatory 14:

             You need to answer this question only if you have
             answered “yes” to question (1)(a) or (b), question 4(a)(b) or
             (c), question 8 or question 11(a) above. If you did, do you
             find by a preponderance of the evidence that the Central
             Alabama Fair Housing Center suffered injury as a result of
             intentional discrimination on the part of the Defendants?

                                 yes                           no

             If you answered “no” to question (14), go to “Part Six --
             liability of James K. Lowder.” If you answered “yes”,
             enter the amount of damages that the Plaintiffs have shown



                                           12
                by a preponderance of the evidence if appropriate to
                compensate the [Center.]

      Having earlier objected to the jury instruction that made recovery by an

individual plaintiff a condition precedent to the Center’s recovery, counsel did not

make a renewed objection to the special interrogatories. The jury returned a verdict

omitting the Center’s claims because it did not find for the individual plaintiffs on

their claims.

                                         II.

      The standard of review is clear. We review the district court’s resolution of a

Batson challenge under the clearly erroneous standard. See, e.g., United States v.

Blackman, 66 F.3d 1572, 1575 (11th Cir. 1995). As part of that review, we give

“great deference to the district court’s finding as to the existence of a prima facie

case.” United States v. Stewart, 65 F.3d 918, 923 (11th Cir. 1995). “Once past the

prima facie case step, the district court’s determination concerning the actual

motivation behind each challenged strike amounts to pure fact-finding, and for that

reason we will reverse the district court’s determination only if it is clearly

erroneous.” Id.

      With respect to jury instructions properly challenged below, we review “de

novo to determine whether they misstate the law or mislead the jury to the prejudice



                                         13
of the objecting party.” United States v. Grigsby, 111 F.3d 806, 814 (11th Cir. 1997)

(citing United States v. Chandler, 996 F.2d 1073, 1085 (11th Cir.1993)). Our task is

“to determine whether the instructions objected to below create ‘a substantial and

ineradicable doubt’ that the jury has been misled in its deliberations.” Wood v. Spring

Hill College, 978 F.2d 1214, 1218 (11th Cir. 1992). The phrasing of special jury

interrogatories is reviewed under an abuse of discretion standard; reversal is warranted

where the interrogatories have “the potential for confusing or misleading the jury.”

Petes v. Hayes, 664 F.2d 523, 525 (5th Cir. 1981).

                                          III.

                                          A.

      We turn first to the individual plaintiffs’ argument that the district court erred

by allowing defendants’ Batson challenge to white Juror #9. The Supreme Court has

established a three-part test for resolving Equal Protection challenges, under Batson

and its progeny, to a party’s attempted peremptory strike. First, the party challenging

the peremptory strike must establish a prima facie case of discrimination. Batson, 476

U.S. at 96. Second, if the court finds that a prima facie case of discrimination is

proven, the party making the peremptory strike is afforded the opportunity to

articulate a non-discriminatory explanation for the strike. Id. at 96-98. Third, if a

non-discriminatory reason is offered, the court must determine whether the party


                                          14
challenging the strike has met its burden of proving the existence of purposeful

discrimination. Id.; see also Purkett v. Elem, 514 U.S. 765, 767 (1995).

       As this framework makes clear, the establishment of a prima facie case is an

absolute precondition to further inquiry into the motivation behind the challenged

strike. Indeed, we have stressed that “[n]o party challenging the opposing party’s use

of a peremptory strike -- whether that party be the government, a criminal defendant,

or a civil litigant -- is entitled to an explanation for that strike, much less to have it

disallowed, unless and until a prima facie showing of racial discrimination is made.”

United States v. Stewart, 65 F.3d 918, 925 (11th Cir. 1995). Thus, a district court may

not require an explanation for a peremptory strike unless and until it satisfies itself that

a prima facie case has been established. Similarly on appeal, “unless it concludes that

a prima facie showing was made, an appellate court should neither reverse a trial

court’s action refusing to disallow challenged strikes, nor should it affirm a trial

court’s action disallowing strikes.” Id. Accordingly, the threshold task in considering

a Batson challenge, for a district court as well as this Court, is to determine whether

a prima facie case was established. If the answer is no, then the inquiry ceases, and

the challenge should be denied.

       In order to establish a prima facie case of racially discriminatory use of

peremptory strikes, the party objecting to a peremptory strike bears the burden of


                                            15
establishing facts sufficient to support an inference of racial discrimination. See, e.g.,

Batson, 476 U.S. at 96; Dudley v. Wal-Mart Stores, Inc., 166 F.3d 1317, 1321 (11th

Cir. 1999). The trial court must examine whether the party has shown sufficient

“relevant circumstances” to raise an inference that the opposing party seeks to exclude

the prospective juror on account of race. In Batson, the Supreme Court offered two

examples of circumstances that may support such an inference: (1) engaging in a

“pattern” of strikes against venire members of one race, or (2) questions or statements

during voir dire or in exercising challenges that suggest a discriminatory purpose. See

476 U.S. at 97.

      Drawing on these examples, the defendants in this case pointed to two facts in

support of their claim of discrimination: (1) plaintiffs’ two peremptory strikes were

used to strike white male jurors, thereby establishing a “pattern” of striking members

of one race; and (2) neither of those white jurors had any made statements during voir

dire that would justify striking them but for their race. The trial judge found a prima

facie case of racial striking based only on the fact that plaintiffs had struck two white

males. As a matter of law, this evidence is inadequate to raise an inference of racial

discrimination sufficient to establish a prima facie case.

      To begin with, the mere fact of striking a juror or a set of jurors of a particular

race does not necessarily create an inference of racial discrimination. The number of


                                           16
persons of a particular race struck takes on meaning only when coupled with other

information such as the racial composition of the venire, the race of others struck, or

the voir dire answers of those who were struck compared to the answers of those who

were not struck. This Court has held that “[i]n making out a prima facie case, ‘the

defendant must point to more than the bare fact of the removal of certain venire

persons and the absence of an obvious valid reason for the removal.” United States

v. Allison, 908 F.2d 1531, 1538 (11th Cir. 1990). A party advancing a Batson

argument ordinarily should “come forward with facts, not just numbers alone.”

United States v. Bergodere, 40 F.3d 512, 516 (1st Cir. 1994). Consequently, a

showing that a party used its authorized peremptory strikes against jurors of one race

does not, standing alone, establish a prima facie case of discrimination.

      That said, an inference of discrimination based on the number of jurors of a

particular race may arise where there is a substantial disparity between the percentage

of jurors of one race struck and the percentage of their representation on the jury. See,

e.g., United States v. Alvarado, 923 F.2d 253, 255 (2d Cir. 1991) (“Only a rate of

minority challenges significantly higher than the minority percentage of the venire

would support a statistical inference of discrimination.”); United States v. David, 662

F. Supp. 244, 246 (N.D. Ga. 1987) (finding that “[a]though the percentage of black

jurors struck from a jury panel might establish a prima facie case in some instances,


                                           17
here it does not because . . . the number of black persons on the regular panel was

small.”). Thus, the number of jurors of one race struck by the challenged party may

be sufficient by itself to establish a prima facie case where a party strikes all or nearly

all of the members of one race on a venire. See United States v. Williams, 936 F.2d

1243, 1246 (11th Cir. 1991) (finding a prima facie case where prosecutor struck all

of the African-American members of the venire).

       In this case, plaintiffs’ rate of challenging white jurors was not significantly

higher than the percentage representation of white jurors on the venire.              The

composition of the venire was 80% white. With their two strikes, plaintiffs’ rate of

challenging white jurors could have only been 0% (if they struck two blacks), 50% (if

they struck one black and one white), or 100% (if they struck two whites).

Consequently, the 100% rate actually utilized by plaintiffs was actually the rate that

most closely approximated the percentage of whites among the prospective jurors.

Moreover, the probability of striking two white jurors was significantly higher than

the probability of striking either a juror of each race or two black jurors. Defendants

do not dispute that, if plaintiffs had exercised their two peremptories in a completely




                                            18
random manner, there was a 60% probability that the strikes would have been

exercised against two white jurors.1

      In addition, not all, nearly all, or even most whites on the panel were struck by

plaintiffs. After resolving the challenges for cause, only the first fourteen jurors could

potentially serve on the panel. Of those fourteen jurors, three were black and eleven

were white. Accordingly, after plaintiff struck two white jurors, nine white venire

persons remained who could potentially serve on the jury.

      Finally, plaintiffs only used two of the three peremptory strikes they were

allotted. This Court has held that the unchallenged presence of jurors of a particular

race on a jury substantially weakens the basis for a prima facie case of discrimination

in the peremptory striking of jurors of that race. See, e.g., United States v. Puentes,

50 F.3d 1567, 1578 (11th Cir. 1995) (“Although the presence of African-American

jurors does not dispose of an allegation of race-based peremptory challenges, it is a

significant factor tending to prove the paucity of the claim.”); United States v.



      1
        Plaintiffs calculate the probability of striking white jurors in the following
manner: the probability of the first strike being against a white juror is equal to the
number of white jurors on the panel divided by the total number of jurors on the panel
-- 11 divided by 14. The probability of the second strike being exercised against a
white juror is equal to the number of white jurors on the panel after the first strike has
been exercised divided by the total number of jurors on the panel after the first strike
has been exercised -- 10 divided by 13. The probability of both strikes being
exercised against whites is the product of the two probabilities.

                                           19
Jiminez, 983 F.2d 1020, 1023 (11th Cir. 1993) (noting that the presence of blacks on

the jury was “significant” in reviewing the district court’s denial of a Batson

challenge); United States v. Allison, 908 F.2d 1531, 1537 (11th Cir. 1990) (finding

that the unchallenged presence of blacks on a jury undercuts the inference of

impermissible discrimination that might arise solely from striking other black

prospective jurors); United States v. Dennis, 804 F.2d 1208, 1211 (11th Cir. 1986)

(“[T]he unchallenged presence of two blacks on the jury undercuts any inference of

impermissible discrimination that might be argued to arise from the fact that the

prosecutor used three of the four peremptory challenges he exercised to strike blacks

from the panel of potential jurors and alternates.”). Thus, viewed in context, the fact

that plaintiffs’ two exercised strikes were against white jurors does not establish a

prima facie case.

      The fact that the two white jurors did not (from the perspective of the

defendants) say anything during voir dire that would justify striking them hardly

establishes a prima facie case.2 The more pertinent question is whether plaintiffs’

counsel said anything during voir dire arguably indicating a discriminatory purpose.

Batson instructs that a trial court judge may consider whether counsel’s questions and

statements during voir dire support a finding of discriminatory purpose. But the mere


      2
       The district court apparently did not give any weight to this argument.

                                          20
fact that plaintiffs’ counsel decided to exercise peremptory challenges against jurors

who had not been extensively questioned during voir dire does not establish a

discriminatory purpose. See United States v. Allison, 908 F.2d 1532, 1538 (11th Cir.

1990) (“[i]n making out a prima facie case, ‘the defendant must point to more than the

bare fact of the removal of certain venire persons and the absence of an obvious valid

reason for the removal.’”) (quoting United States v. Young-Bey, 893 F.2d 178, 179

(8th Cir. 1990)).

       Defendants’ argument misapprehends the distinction between challenges for

cause and peremptory challenges. Peremptory challenges allow parties to remove

jurors who are perceived as having some potential of being partial. Indeed, “[b]y its

very nature, the peremptory challenge is a tool that may be wielded in a highly

subjective and seemingly arbitrary fashion, based upon mere impressions and

hunches.” United States v. Annigoni, 96 F.3d 1132, 1144 (9th Cir. 1996). Especially

given that eleven of the 14 jurors were white, the fact that Plaintiffs attempted to strike

two white jurors whom they had not extensively questioned during voir dire is simply

insufficient to establish a prima facie case. This is particularly true since the venire

members had all filled out questionnaires preceding jury selection, making it likely

that one or both sides would attempt to strike jurors based solely on their answers on

the questionnaire.


                                            21
         We therefore conclude that the district court clearly erred in finding that

defendants had met their burden of establishing a prima facie case of a Batson

violation. Under our decision in Stewart, a prima facie case plainly is a prerequisite

to granting a Batson challenge. Because no prima facie case was established here, the

district court should not have asked the plaintiffs to offer race-neutral reasons

justifying their strikes, and our analysis ceases without consideration of the reasons

eventually proffered by the plaintiffs. Moreover, where as here a district court allows

a Batson challenge in the absence of a prima facie case, the error is not harmless, and

the case must be remanded for a new trial.3 We therefore reverse the district court’s

action disallowing the plaintiffs’ peremptory strike of Juror #9, and remand for a new

trial.

                                          B.


         3
         See Unites States v. McFerron, 163 F.3d 952, 955 (6th Cir. 1998) (noting that
the suggestion that the erroneous denial of a peremptory challenge should be subjected
to a harmless error test has been “resoundingly rejected by every circuit court that has
considered the issue.”); see also Swain v. Alabama, 380 U.S. 202, 219 (1965) (holding
that “[t]he denial or impairment of the right [of peremptory challenge] is reversible
error . . . .”), overruled on other grounds by Batson; United States v. Broussard, 987
F.2d 215, 221 (5th Cir. 1993) (“The denial or impairment of the right to exercise
peremptory challenges is reversible error without a showing of prejudice.”), abrogated
on other grounds by J.E.B. v. Alabama, 511 U.S. 127 (1994); Olympia Hotels Corp.
v. Johnson Wax Dev. Corp., 908 F.2d 1363, 1369 (7th Cir. 1990) (holding that “[i]t
is reversible error to deny a party to a jury trial the peremptory challenges to which
the rules of procedure entitle him . . . .”); United States v. Ruuska, 883 F.2d 262, 268
(3d Cir. 1989) (stating the automatic reversal rule of Swain).

                                          22
      We turn next to the Center’s argument that its ability to recover damages should

not be contingent on the individual plaintiffs’ prevailing on their claims. Defendants

seemingly acknowledge, as they must, that a fair housing organization has standing

to recover certain types of damages on its own to the extent it suffers injury

proximately caused by the defendant’s unlawful conduct. See, e.g., Arkansas Acorn

Fair Housing, Inc. v. Greystone Development, Ltd., Co., 160 F.3d 433, 434 (8th Cir.

1998) (“the deflection of an organization’s monetary and human resources from

counseling or educational programs to legal efforts aimed at combating

discrimination, such as monitoring and investigation, is itself sufficient to constitute

an actual injury [where] traceable to some act of the defendant”); Ragin v. Harry

Macklowe Real Estate Co., 6 F.3d 898, 904-05 (2d Cir. 1993); Hooker v. Weathers,

990 F.2d 913, 915 (6th Cir. 1993). Indeed, the district court rejected defendants’

motion to dismiss and their motion for summary judgment based on lack of standing.

Defendants argue, however, that a fair housing organization cannot recover damages

when the only unlawful conduct proved at trial was suffered by the organization’s

own agents. Thus, defendants assert, the Center cannot seek damages based on

injuries traceable to their unlawful conduct toward the Center’s own testers. We

disagree, and conclude that the district court’s jury instruction -- which indicated that




                                           23
the Center could recover only if one of the individual plaintiffs prevailed -- constitutes

reversible error.

       There can be no debate that under the Supreme Court’s decision in Havens

Realty Corp. v. Coleman, 455 U.S. 363 (1982), a fair housing organization has

standing to sue       when the defendant’s racial steering practices impair the

organization’s ability to provide housing counseling and referral services. In Havens,

three individual plaintiffs and testers, along with an organization called HOME, a

nonprofit corporation whose purpose was to “make equal opportunity in housing a

reality in the Richmond Metropolitan area,” sued for violation of the Fair Housing

Act. Id. at 368. HOME’s activities included investigation and referral of complaints

concerning housing discrimination. Id. HOME alleged broadly that defendant

Havens Realty Corp.’s steering practices had frustrated HOME’s activities as to

housing counseling and referral services, with a consequent drain on resources.

Specifically, HOME attempted to bring suit against Havens on its own behalf because

it “has been frustrated by the defendants’ racial steering practices in its efforts to assist

equal access to housing through counseling and other referral services. Plaintiff

HOME has had to devote significant resources to identify and counteract the

defendant’s racially discriminatory steering practices.” Id. at 379. HOME had




                                             24
employed two “tester plaintiffs” to determine whether Havens engaged in racial

steering.

       Analyzing HOME’s claim in the context of a motion to dismiss, the court first

emphasized that Congress intended for § 812 of the Fair Housing Act, the racial

steering provisions, to extend to the “full limits of Article III.” Id. at 372. Thus, said

the Court, federal courts have no authority to erect “prudential” barriers to standing

in suits brought under Section 812. Id. The sole requirement in bringing suit under

Section 812 is that “the plaintiff allege that as a result of the defendant’s action [it] has

suffered a distinct and palpable injury.” Id.

       The Court then concluded that HOME had established an injury-in-fact

sufficient to confer standing. The Court did not find that HOME’s ability to sue was

in any way contingent upon the standing of any of the individual plaintiffs, but rather

that fair housing organizations “are entitled to sue on their own behalf for injuries they

have sustained . . . in their own right.” Id. at 378-79 (emphasis added). Specifically,

the Court stated:

              If, as broadly alleged, petitioners’ steering practices have
              perceptibly impaired HOME’s ability to provide counseling
              and referral services for low- and moderate-income
              homeseekers, there can be no question that the organization
              has suffered injury in fact. Such concrete and demonstrable
              injury to the organization’s activities with the consequent
              drain on the organization’s resources, constitutes far more


                                             25
             than simply a setback to the organization’s abstract social
             interests.

Id. at 379. Without reference to the validity of the claims of any of the other plaintiffs

in the suit, the Court held that HOME’s allegations were sufficient to prove injury and

remanded for further proceedings.

      Defendants do not now contend that the Center lacks standing to recover at least

some of the kinds of damages that it seeks in this case (allegedly based upon the

diversion of its resources and the frustration of its mission). Rather, defendants

contend that under Havens the Center may only recover such damages to the extent

they are caused by acts of discrimination directed toward persons other than the

Center’s own testers. Accordingly, say the defendants, if none of the plaintiffs can

establish a claim for unlawful discrimination, and the only cause of the alleged

diversion of resources was discrimination toward the testers, it follows that the Center

cannot recover.

      While this Court had never addressed the issue, a majority of circuits to do so

have concluded, based upon Havens, that a fair housing organization may recover in

its own right for the diversion of its resources to combat the defendant’s

discrimination toward its testers. In Village of Bellwood v. Dwivedi, 895 F.2d 1521

(7th Cir. 1990), the Seventh Circuit considered a case brought by 28 testers, a



                                           26
municipality, and a fair housing center against a real estate brokerage firm and two of

its employees alleging discriminatory practices in violation of the Fair Housing Act.

The organization sought damages based solely on the effects of the defendant’s

unlawful acts toward its testers. The jury found for the plaintiffs, and the Seventh

Circuit affirmed. In so doing, it held:

       Havens makes clear . . . that the only injury which must be shown to
       confer standing on a fair housing agency is deflection of the agency’s
       time and money from counseling to legal efforts directed against
       discrimination. These are opportunity costs of discrimination since
       although the counseling is not impaired directly there would be more of
       it were it not for the defendant’s discrimination.

Id. at 1526. The court did not suggest that the organization’s right to recovery was in

any way limited by the fact that the defendant’s unlawful acts related only to the

testers.

       Similarly, in Cabrera v. Jakabovitz, 24 F.3d 372 (2d Cir. 1994), the Second

Circuit allowed a fair housing organization to recover damages based on the

defendants’ unlawful discrimination toward its testers. In Cabrera, a fair housing

center, acting on its own initiative rather than in response to a specific complaint, sent

testers to investigate racial steering claims in the renting of properties in New York

City. Its testers were in fact racially steered and the center successfully recovered




                                           27
damages under the Fair Housing Act and §§ 1981 and 1982 based entirely on the

experiences of its testers. Id. at 379-80.

      The Third Circuit has likewise suggested that a fair housing organization may

recover damages based on the experiences of its testers. In Fair Housing Council of

Suburban Philadelphia v. Montgomery Newspapers, 141 F.3d 71 (3rd Cir. 1998), a

nonprofit fair housing organization brought an action against newspapers, publishers,

and classified advertisement editors, alleging that the publication of allegedly

discriminatory advertisements violated the Fair Housing Act. The organization made

three damage claims: (1) frustration of its mission; (2) diversion of resources to

measures designed to correct the harm allegedly caused by the discriminatory housing;

and (3) diversion of resources to litigation.      Id. at 73.   With respect to the

organization’s allegations of frustration of mission and diversion of resources, a

majority of the court found that the organization failed to meet its burden of proving

a causal link between the alleged wrongdoing and the injury. Id. at 76. However, the

court expressly recognized that these damage claims, if properly proven, could support

an organization’s standing to bring suit. The court specifically emphasized that “[w]e

do not . . . impose a bona fide home-seeker requirement.” Id. at 77 n.3.4


      4
        The Third Circuit did hold, with respect to the organization’s third damages
claim, that “litigation expenses alone do not constitute damage sufficient to support
standing.” Id. at 79. It reasoned that merely devoting funds to support a lawsuit will

                                             28
      Defendants contend that these decisions are incorrect to the extent they concern

what occurs at trial, and that permitting an organization to recover damages based

solely on discrimination toward its testers is tantamount to allowing an organization

to manufacture its own lawsuit simply in order to recover the costs of bringing suit.

Defendants rely heavily on the D.C. Circuit’s decision in Fair Employment Council

of Greater Washington, Inc. v. BMC Marketing Corp., 28 F.3d 1268 (D.C. Cir. 1994).

In BMC Marketing, a fair employment organization alleged that the defendant

(“BMC”) had interfered with its testing, community outreach, public education,

counseling, and research projects and had required the organization to expend

resources to counteract BMC’s alleged discrimination, including employing testers.

The court held that the Fair Employment Council had standing only if the

discriminatory actions taken by BMC “perceptibly impaired” the organization’s

programs, by increasing the number of people in need of counseling or by making it

harder for minorities to find jobs in greater Washington. Id. at 1276. The court

expressly rejected the notion that “the mere expense of testing BMC constitutes


not suffice to establish an Article III injury. The problem there, however, was that the
organization failed to show that it had devoted time and resources to any “legal”
efforts short of pursuing the litigation at hand (such as investigation). Id. at 80 n.7.
Looking at the record here, by contrast, the Center’s potential recovery may well
encompass more than litigation expenses for the suit at hand. Precisely what kinds of
damages may properly be recovered by the Center depends on the nature of proof at
trial and is not an issue before us today.

                                          29
‘injury in fact’ fairly traceable to BMC’s conduct.” Id. The court found that funds the

Council spent on testing BMC “resulted not from any actions taken by BMC, but

rather from the Council’s own budgetary choices.” Id. The court interpreted Havens

as not supporting such a “self-referential injury . . . [where] the time and money that

plaintiffs spend in bringing suit against a defendant would itself constitute a sufficient

‘injury in fact,’ a circular position that would effectively abolish the requirement

altogether.” Id. at 1277. It acknowledged that Havens contemplated standing based

upon a “drain on the organization’s resources,” but it interpreted this statement as

referring to the “drain that apparently sprang from the organization’s need to counter

the defendants’ assertedly illegal practices, . . . simply another manifestation of the

injury that those practices had inflicted upon the organization’s noneconomic interest

in encouraging open housing . . ..” Id. (internal quotation marks omitted). The court

therefore concluded that the organization would have standing based on BMC’s

actions “against bona fide employment candidates, but not from BMC’s actions

against the testers.” Id.

      We are unpersuaded that BMC Marketing should be read to apply to this case,

and conclude instead that the reasoning of the Seventh and Second Circuits provides

a better approach on this record. In particular, we think the underlying logic of

Havens is at odds with the D.C. Circuit’s analysis, at least as applied to these unique


                                           30
facts.5 The Havens court regarded the identification and combating of discrimination

as a “concrete and demonstrable” injury, which could cause a drain on organization

resources and thereby give rise to an organization’s direct standing to sue. Because

testing helps to identify discrimination, the injuries attributable to the discrimination

identified by the testing give an organization standing. In allowing the case to

proceed, the Supreme Court in no way held or even suggested that the organization’s

right to judicial relief would be tied to a successful recovery on the part of one or all

of the individual, bona fide purchaser plaintiffs. Rather, the Court simply stated in a

footnote: “Of course, HOME will have to demonstrate at trial that it has indeed

suffered impairment in its role of facilitating open housing before it will be entitled

to judicial relief.” 455 U.S. at 379 n.21.

      Nothing in Havens suggests that a fair housing organization lacks standing to

recover for damages proximately caused by unlawful conduct toward its testers.

When a fair housing organization expends resources as a proximate result of the

defendant’s discriminatory conduct, and those resources would have been devoted to


      5
        We note as well that one of the key premises of the D.C. Circuit’s opinion --
the notion that the testers did not have individual standing under the Fair Housing Act
and § 1982 -- is at odds with our precedent. See Watts v. Boyd Properties, 758 F.3d
1482, 1485 (11th Cir. 1985) (tester had standing to maintain action for housing
discrimination even though he was motivated solely by a desire to challenge the
legality of the alleged discriminatory practices); compare BMC Marketing, 28 F.3d
at 1271 (attempting to distinguish Watts).

                                             31
other activities consonant with its mission were it not for the offending conduct, it

suffers injury independent of that suffered by individuals in the affected housing

market. That is so regardless of whether the offending conduct is directed toward its

testers as opposed to bona fide homeseekers such as the individual plaintiffs here.

      Moreover, we do not agree with the defendants that allowing the Center to seek

damages, on this record, based on discrimination toward its testers is the equivalent

of permitting the Center to “create its own injury.” There is an obvious difference

between the situation highlighted by defendants -- where an organization

manufacturers the injury necessary to maintain a suit by expending resources on that

very suit -- and the situation where an organization incurs diversion of resources and

frustration of purpose damages as a result of specific documented incidents of

unlawful discrimination toward its testers. In the latter situation, the organization is

clearly not seeking or inflicting its own injury; the injury is inflicted by the

defendants. As a matter of law, the Center is entitled to recover for its own injuries

fairly traceable to the defendants’ illegal conduct.

      In short, even if none of the individual plaintiffs prevail on their claims, the

Center is still entitled to seek damages proximately caused by defendants’ unlawful

discrimination toward the testers. We recognize that, in the event none of the

individual plaintiffs succeed in establishing their discrimination claims, the Center’s


                                          32
permissible recovery may be quite limited, because it may then seek only those

damages that truly flow from the defendants’ unlawful conduct toward its testers.

But as the Center asserts, on this record the existence and extent of any independent

injury should have been left to the jury to decide.

       Accordingly, the trial court erred by instructing the jury that it could only find

for the Center if it first found for one of the individual plaintiffs. It is reversible error

for a district court to instruct the jury incorrectly regarding the applicable law. See,

e.g., Gulf Life Ins. Co. v. Folsom, 907 F.2d 1115, 1121 (11th Cir. 1990) (in order to

withstand the court’s scrutiny, an incorrect jury instruction must have “no tendency

to confuse or mislead the jury with respect to the applicable principles of law”); see

also Busby v. City of Orlando, 931 F.2d 764, 777 (11th Cir. 1991) (“if there is

uncertainty as to whether the jury was actually misled, the [district court’s] erroneous

instruction cannot be ruled harmless”). In this case, not only was the challenged

instruction misleading, the court’s special interrogatory compounded the problem by

reinforcing the erroneous jury instruction. The combination of the erroneous jury

instructions and the erroneous special interrogatories requires a new trial on this

record. The jury verdict is vacated as to both the Central Alabama Fair Housing

Center and the individual plaintiffs, and we remand for a new trial consistent with this

opinion.


                                             33
VACATED AND REMANDED.




                    34
