A federal suit claims Milwaukee concentrates people in poverty in 'containment zones.' What to know.
A federal lawsuit that caused quite a stir in Milwaukee City Hall last year has been dismissed, according to court records.
The federal complaint unsealed in the summer of 2022 claimed the city created "containment zones" of people living in poverty and with disabilities, while an alderman said it was actually the result of a longstanding feud involving the two Milwaukee property owners who filed the complaint, the city and a local rooming house.
The complaint focused particular attention on how the city has handled a rooming house known as The Clark House near one of the plaintiffs' home on the city's near west side.
Now, U.S. District Judge J.P. Stadtmueller has dismissed the lawsuit.
Here's what to know:
What were the Milwaukee city and county accused of doing?
The complaint was originally filed under seal in February 2022 and was unsealed last summer.
In it, Milwaukee property owners James Dieter and Karen Schwenke argued the city and Milwaukee County violated federal anti-discrimination laws in addition to state and local safe housing laws while claiming to be in compliance in order to receive federal funds.
They accused the city of creating "containment zones" where people of color, people with disabilities and those with low incomes are purposely concentrated in poor living conditions in rooming houses on the near west side and other areas of the city. In those zones, they wrote, the city does not enforce building codes and zoning ordinances, and police contain crime instead of stopping it.
Why did the property owners file the lawsuit instead of the U.S. DOJ?
The other plaintiff listed on the complaint — the United States of America — was the reason for the scramble at City Hall last year.
Before the complaint was unsealed, City Hall chatter about an apparent housing-related federal investigation prompted a proposal to spend $250,000 on outside attorneys to represent the city. But the issue faded as quickly as it surfaced.
What soon came to light was that Dieter and Schwenke had filed the complaint on behalf of the United States government.
Prosecutors in the office of the United States Attorney for the Eastern District of Wisconsin ultimately decided not to intervene in the case, but they asked that their consent be sought to settle, dismiss or otherwise discontinue the litigation.
Who was accused of wrongdoing?
The defendants listed in the original complaint were the City of Milwaukee and its Community Development Grants Administration, the Housing Authority of the City of Milwaukee, and Milwaukee County and its Department of Health and Human Services Housing Division.
Stadtmueller in April dismissed the Housing Division as a defendant, according to court records.
Why was the case dismissed?
Stadtmueller in an Oct. 27 order granted the defendants' motions to dismiss the third complaint the property owners had filed in the case. This time, he dismissed it "with prejudice," meaning the plaintiffs can't again file the same claim in that court.
He called the plaintiffs' grievances "legitimate" and wrote that "it is certainly true that Milwaukee suffers from complex socioeconomic problems."
However, he listed a series of ways in which the property owners' filing had fallen short of the legal standards needed to prove their case.
He wrote in the 26-page order that the plaintiffs had not addressed a lack of specificity in their allegations that he had cited as an issue in an earlier version of the complaint and still had not shown how specific allegations of misconduct were tied to specific mandates the local governments and agencies were required to follow.
"One simply cannot determine whether information is misleading without knowing the metric against which it is weighed," he wrote.
He also wrote the plaintiffs did not "plausibly allege a violation of federal anti-discrimination laws, in other words, how those laws were violated."
Even if he were to construe the plaintiffs' latest complaint as alleging a policy of creating containment zones, Stadtmueller wrote, the document did not contain allegations that showed a relevant and statistically significant disparity between containment zones and other areas.
Alison Dirr can be reached at adirr@jrn.com.
This article originally appeared on Milwaukee Journal Sentinel: Federal suit dismissed, claimed Milwaukee concentrates people in poverty
