The city of Hayward, California agreed to pay $94,200 in damages to S.G. Borello and Sons, Inc., the owners of Eden Roc Mobile Home Park after more than four years in court. The suit, brought on behalf of Borello and Sons, was filed by the Department of Justice in 1991 after it determined that Hayward violated the Fair Housing Act by discriminating against families with children. Eden Roc was formerly an adults-only mobile home community. The owners of the park, along with the tenants, intended fo r Eden Roc to be children-free. However, the 1988 amendment to the Fair Housing Act made it illegal for housing providers to discriminate against families with children under the age of 18 or women who were pregnant. In compliance with the new law, Eden Roc began to allow children to move into the park. According to the Department of Justice, it was at this point that the City of Hayward began discriminating against Eden Roc by illegally interpreting and enforcing its local rent control ordinance.

According to Assistant Attorney General for Civil Rights Deval L. Patrick, once children were allowed into the mobile home park, the city government ordered S.G. Borello and Sons to lower the rent at Eden Roc. According to Hayward officials, the admi ttance of children into the mobile home community constituted a "service reduction" under its rent control ordinance. In late 1991, the Justice Department found Hayward's interpretation of its rent control ordinance to be in direct violation of the Fair Housing Act and filed suit in the U.S. District Court in San Francisco.

In 1992, the U.S. District Court in San Francisco agreed with the Justice Department's claim that the city should not have forced the owners of the park to lower its rent after admitting families with children. The city appealed to the U.S. Court of Appeals for the Ninth Circuit. The Court of Appeals upheld the lower court's ruling and ordered Hayward to pay damages to Borello and Sons.

Hayward attempted to appeal to the U.S. Supreme Court by filing a writ of certiorari. The Supreme Court refused to hear the case. Finally, on February 6, 1996, the city's officials decided to settle.

"This settlement is another step forward in our effort to open housing to families with children," said Patrick. "This case shows it pays for housing providers to comply with the law. We'll stand by those who try to enforce the law and prosecute th ose who stand in their way."