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The former owners of The Sand Castle in Far Rockaway agreed to pay more that $1 million in a settlement with The Fortune Society for refusing to rent to people with criminal records.

The Fortune Society in Long Island City announced a precedent-setting settlement of a landmark federal civil rights case allowing advocacy groups to bring lawsuits against private lawsuits against private landlords who impose blanket bans on renting apartments to people with criminal records.

The nonprofit organization that provides multiple services to formerly incarcerated people who are trying to reenter society, reported the successful settlement of their five-year-long federal litigation alleging the bans are a violation of the Fair Housing Act because they disproportionately and overwhelmingly impact African-Americans and Hispanics.

The owners of The Sand Castle, a 917-unit apartment complex in Far Rockaway, agreed to pay a record-setting $1.1875 million payment as part of the pre-trial settlement.

“This settlement fires a warning shot across the bow of any landlord in America who blanketly refuses to rent apartments to people with criminal justice involvement,” The Fortune Society President and CEO JoAnne Page said. “We entered this litigation with the goal of establishing legal precedent under the Fair Housing Act for challenging blanket bans imposed by private landlords on persons with criminal records. The Court’s summary judgment decision recognizes that right, an in doing so establishes important new legal precedent that Fortune and peer organizations can rely on in the future to bring lawsuits against landlords who exclude persons with records.”

In the complaint, filed in Brooklyn Federal Court in 2014, Fortune alleged that the owners of The Sand Castle on Seagirt Avenue refused to rent to the nonprofit’s clients in 2013. Fortune had received a housing assistance grant to provide 25 residential units and determined that The Sand Castle would be an ideal location.

Specifically, the property is located in a relatively safe and racially diverse area, and in a neighborhood where there are already other Fortune clients. The lawsuit stated that when the defendants learned that Fortune serves formerly incarcerated people, they refused to rent apartments to Fortune stating that they enforce a policy prohibiting anyone with a criminal record from renting an apartment or living at The Sand Castle.

The legal action brought by Fortune against Sandcastle Towers Housing Development Fund Corp. and Sarasota Gold LLC was handled by attorney John Relman, Esq., founder of Relman, Dane & Colfax, a civil rights law firm headquartered in Washington, D.C.

“In the litigation, the defendants also challenged Fortune’s ‘standing-’ a legal requirement that a plaintiff like Fortune, must meet by producing evidence that it was injured by the allegedly unlawful actions of the defendants,” Relman said. “The Court upheld Fortune’s standing based on the time and funds it devoted to finding housing for its previously incarcerated clients who it alleged were not permitted to live at the Sand Castle. The decision establishes an important precedent that can be used and relied on in future cases.”

The defendants in the case, who no longer own the apartment complex, could not be reached for comment.Fortune provides temporary and permanent housing for hundreds of clients each year through “scattered-site” programs that place clients in private rental housing throughout the city.

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