California Civil Rights Department vs Arcadia Management Services Co.

Government Code section 12930 sets forth the responsibly of CRD (formerly known as the Department of Fair Employment and Housing) for investigating and prosecuting violations under the California civil rights laws, including claims under FEHA.

Government Code section 12980 provides:

(a) Any person claiming to be aggrieved by an alleged violation of Section 12955, 12955.1, 12955.1, or 12955.7 may file with the department a verified complaint in writing that shall state the name and address of the person alleged to have committed the violation complained of, and that shall set

forth the particulars of the alleged violation and contain any other information required by the department. The filing of a complaint and pursuit of conciliation or remedy under this part shall not prejudice the complainant’s right to pursue effective judicial relief under other applicable laws, but if a civil action has been filed under section 52 of the Civil Code, the department shall terminate proceedings upon notification of the entry of final judgment unless the judgment is a dismissal entered at the complainant’s request.

(b) The Attorney General or the director may, in a like manner, make, sign, and file complaints citing practices that appear to violate the purpose of this part or any specific provisions of this part relating to housing discrimination. No complaint may be filed after the expiration of one year from the date upon which the alleged violation occurred or terminated.

(c) The department may thereupon proceed upon the complaint in the same manner and with the same powers as provided in this part in the case of an unlawful practice, except that where the provisions of this article provide greater rights and remedies to an aggrieved person than the provisions of Article 1 (commencing with section 12960), the provisions of this article shall prevail.

(d) Upon the filing of a complaint, the department shall serve notice upon the complainant of the time limits, rights of the parties, and choice of forums provided for under the law.

(e) The department shall commence proceedings with respect to a complaint within 30 days of filing of the complaint.

(f) An investigation of allegations contained in any complaint filed with the department shall be completed within 100 days after receipt of the complaint, unless it is impracticable to do so. If the investigation is not completed within 100 days, the complainant and respondent shall be notified, in writing, of the department’s reasons for not doing so.

(g) Upon the conclusion of each investigation, the department shall prepare a final investigative report containing all of the following: (1) The names of any witnesses and the dates of any contacts with those witnesses. (2) A summary of the dates of any correspondence or other contacts with the aggrieved persons or the respondent. (3) A summary of witness statements. (4) Answers to interrogatories. (5) A summary description of other pertinent records. A final investigative report may be amended if additional evidence is later discovered.

(h) If a civil action is not brought by the department within 100 days after the filing of a complaint, or if the department earlier determines that no civil action will be brought, the department shall promptly notify the person claiming to be aggrieved. This notice shall, in any event, be issued no more than 30 days after the date of the determination or 30 days after the date of the expiration of the 100-day period, whichever date first occurs. The notice shall indicate that the person claiming to be aggrieved may bring a civil action under this part against the person named in the verified complaint within the time period specified in Section 12989.1.

The notice shall also indicate, unless the department has determined that no civil action will be brought, that the person claiming to be aggrieved has the option of continuing to seek redress for the alleged discrimination through the procedures of the department if the person does not desire to file a civil action. The superior courts of the State of California shall have jurisdiction of these actions, and the aggrieved person may file in these courts. The action may be brought in any county in the state in which the violation is alleged to have been committed, or in the county in which the records relevant to the alleged violation are maintained and administered, but if the defendant is not

found within that county, the action may be brought within the county of the defendant’s residence or principal office. A copy of any complaint filed pursuant to this part shall be served on the principal offices of the department. The remedy for failure to send a copy of a complaint is an order to do so. In a civil action brought under this section, the court, in its discretion, may award to the prevailing party reasonable attorney’s fees.

CRD is vested with subpoena power and authority to propound written interrogoatires and request for production as part of its duty to investigate and determine if there is reason to believe an unlawful practice has occurrent prior to filing a civil action. (Gov. Code, §§ 12981 (a)(1)-(2), 12963.1, 12963.2, and 12963.4).

B. ORDER TO SHOW CAUSE AND COMPEL RESPONSES UNDER GOVERNMENT CODE SECTION 12963.5

If a person or entity fails to comply or fully respond to CRD’s investigative discovery requests, CRD is authorized to petition a trial court to compel full responses. Pursuant to California Government Code section 12963.5:

(a) The superior courts shall have jurisdiction to compel the attendance and testimony of witnesses, the production of books, records, documents, and physical materials, and the answering of interrogatories. If an individual or organization fails to comply with a subpoena, interrogatory, request for production, or examination under oath by refusing to respond fully or objecting thereto, or by obstructing any proceeding before the department, the department may file with a superior court a petition for an order compelling compliance, naming as respondent the individual or organization that has failed to comply. Such an action may be brought in any county in which the department's investigation or inquiry takes place, or in the county of the respondent's residence or principal office.

(b) The petition shall describe the inquiry or investigation before the department, the basis for its jurisdiction therein, and state facts showing that the subpoena, interrogatory, request for production, or examination under oath was issued or carried out in accordance with the requirements of this part, that the information sought was identified with sufficient particularity to permit response and is reasonably relevant to the inquiry or investigation before the department, and that the respondent has failed to comply.

If the petition sets forth good cause for relief, the court shall issue an order to show cause to the respondent; otherwise the court shall enter an order denying the petition. The order to show cause shall be served, along with the department's petition, on the respondent in the same manner as summons must be served in civil actions, and the order shall be returnable not less than 10 days from its issuance nor later than 45 days after the filing of the petition. The respondent shall have the right to serve and file a written answer or other response to the petition and order to show cause.

(c) Unless otherwise stipulated by the parties, the court shall no later than 30 days after the filing of the petition file its order granting or denying the petition. However, the court may on its own motion for good cause extend such time an additional 30 days. If the order grants the petition in whole or part, the order shall set forth the manner in which the respondent shall comply and the period of time following the effective date of the order within which such compliance is required. A copy of the order shall be served by mail by the clerk upon the parties. If the order grants the petition in whole or in part, the order shall not become effective until 10 days after it is served. If the order denies the petition, it shall become effective on the date it is served.

(d) The order of the superior court is immediately appealable in the court of appeal. A party aggrieved by such order, or any part thereof, may within 15 days after the service of the superior court's order, serve and file a notice of appeal. The appeal shall have precedence in the court to which the appeal is taken and shall be determined as soon as practicable after the notice of appeal is filed.

III. ANALYSIS CRD brings an order to show cause and compelling compliance based on section 12963.5 and must show that: (i) a description of the inquiry or investigation before the Department; (ii) the juridical basis for the Departments investigation; (iii) facts showing the Department’s investigative discovery was property issued and served; (iv) information sought was identified with sufficient particularity and reasonably relevant to the inquiry or investigation; and (v) the respondent failed to fully comply.

Here, CRD asserts it is investigating inquiry and investigation of discrimination. On October 10, 2025, CRD’s Director, Kevin Kish, issued a Director’s Complaint for systemic group or class relief containing allegations that Arcadia and other entities engaged in a pattern of practice of systematic discrimination against a group or class of tenants on the basis of source of income. (Declaration of Nassim Moallem, p. 1). Specifically, Respondent engages in a pattern of discrimination against tenants with housing subsidies, including section 8 voucher holders at rental apartments that Arcadia manages in San Jose in violation of FEHA and Unruh under Government Code sections 12961 and 12980. (Exhibit A, Declaration of Moallem, p. 11).

The Director’s Complaint include allegations that respondent is evicting or threatening eviction by issuing 90-Day Notice of Termination of Tenancy stating that Arcadia is seeking to “opt out” of section 8 program; respondent is subjecting section 8 tenants to different terms and conditions; and offering unequal leasing terms and steering section 8 tenants to certain areas of renal properties. (Id.).

As part of its investigation, on October 10, 2025, CRD issued and served Arcadia’s agent of service with Request for Production of Documents, set one and investigative interrogatories, set one via certified mail. (Id., at p. 12). Per CRD, Respondent received the requests on or before October 20, 2025. (Id.). CRD cites that it seeks information deemed necessary to determine whether to charge a statutory violation or make a decision that no further action is necessary. (Id., citing (Dept. Fair Empl. & Hous. v. Super. Ct. (Keller) (2002) 99 Cal.App.4th 896, 902.) CRD asserts this administrative investigation is construed broadly. (Id., citing (State Water Resources Control Bd. v. Baldwin & Sons, Inc. (2020) 45 Cal.App.5th 40, 57-58 [describing the definition of relevance in such investigations as “expansive” and “broad”].)

CRD seeks investigative discovery relevant to its investigation as to whether or not Arcadia has violated FEHA and Unruh. CRD compels four categories:

(1) Witness and/ or potential group or class members. (Interrogatories Nos. 14-20, 25 and Request for Production of Documents Nos. 12, 15, 19-23). CRD seeks documents and information regarding current and prospective section 8 tenants at Arcadia’s properties. CRD seeks names and contact information. CRD asserts it needs to be able to identify and interview individuals whoa re potential witnesses to the alleged conduct and/o9r group or class members.

(2) Tenant Evictions. (Interrogatories Nos. 16-17 and Request for Production of Documents Nos. 3-5). CRD seeks documents and information regarding all evictions at the property that it states is relevant to section 8 tenants evictions or threats of evictions.

(3) Rent setting and increases. (Interrogatories Nos. 24 & 26 and Request for Production of Documents Nos. 7-9 & 11). CRD seeks information and documents relating to Arcadia’s rent setting and increases to

determine if section 8 tenants were subjected to different terms and conditions. CRD seeks information including rent rolls, rent increase notices, and rent listings for the last three years.

(4) Relevant Communications. (Interrogatories Nos. 17 and Request for Production of Documents Nos. 13, 14 & 18). CRD seeks information reflecting communication related to decisions about section 9 tenants.

(Id., at p. 13-14).

CRD avers that Arcadia as failed to comply with discovery. (Id., at p. 14-15). Arcadia served responses to initial discovery on November 19, 2025. (Id., at p. 15.). CRD notes deficiencies in responses as noted above. After meeting-and-conferring Arcadia provided supplemental production on January 23, 2026. (Id.). CRD met-andconferred with Arcadia, which provided written responses, but declined to discuss further or comply. (Id.). CRD argues that Arcadia’s assertion of privacy and confidentiality interests lack merit given the type of investigation. (Id.).

CRD emphasizes its compelling interest in prohibits discrimination as outweighing any privacy interests of former and current rental applications. (Id.). CRD also notes its investigations are confidential pursuant to Government Code section 11183. (Id.). CRD also asserts Arcadia fails to show that the discovery is overboard or unduly burdensome. (Id.). CRD asserts that the requested information should be maintained as part of Respondent’s course of business. (Id., at p. 16).

CONCLUSION Based on the foregoing, the Court will hear oral arguments. Parties to appear.

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