The active Schell Brothers lawsuit is a fair housing case in Delaware Superior Court brought by the Delaware Human and Civil Rights Commission on behalf of Mohammed Sedghi, joined by his wife Paula Burkhardt-Sedghi. The suit alleges the homebuilder terminated the couple’s November 2020 purchase agreement, kept their $82,925 down payment, and did so after the company’s general counsel made discriminatory remarks about Mr. Sedghi’s religion and national origin. After three rounds of motions to dismiss, the core discrimination, retaliation, breach of contract, and unjust enrichment claims are still alive as of the court’s April 28, 2025 order.1Delaware Courts. Delaware Human and Civil Rights Commission v. Schell Brothers, Order on Motion to Dismiss
What the Sedghis Say Happened
The Sedghis signed a purchase agreement on November 20, 2020, for a new home in Selbyville, Delaware, and paid a 10 percent deposit of $82,925.1Delaware Courts. Delaware Human and Civil Rights Commission v. Schell Brothers, Order on Motion to Dismiss
Months later, on April 19, 2021, Mr. Sedghi phoned Schell Brothers’ general counsel, Jonathan Horner, to ask about an addendum. According to the complaint, Horner instead threatened to cancel the deal, pointing to a clause in the purchase agreement allowing the company to terminate a contract with any buyer who “does not fit within the ‘community, culture, or operations.'” When Mr. Sedghi said he would exercise his fair housing rights, Horner allegedly canceled the agreement during the call, telling him, “I know your kind of people. I know how you people are.”2CaseMine. Delaware Human and Civil Rights Commission v. Schell Brothers A follow-up email from Horner confirmed the termination and noted that Mr. Sedghi’s stated intent to sue was part of the reason.
Schell Brothers then refused to return the $82,925 deposit unless the couple agreed not to sue.1Delaware Courts. Delaware Human and Civil Rights Commission v. Schell Brothers, Order on Motion to Dismiss
How the Case Reached Court
On May 28, 2021, the Sedghis filed complaints with the Delaware Division of Human and Civil Rights and the U.S. Department of Housing and Urban Development. They alleged violations of the Delaware Fair Housing Act and the Federal Fair Housing Act based on religion and national origin, along with retaliation.2CaseMine. Delaware Human and Civil Rights Commission v. Schell Brothers
The Division investigated and issued a formal charge on July 25, 2022. Schell Brothers and Horner elected to have the matter heard in civil court rather than through the administrative process, which Delaware law allows. The Commission filed the Superior Court complaint on April 6, 2023, and the Sedghis intervened as plaintiffs.1Delaware Courts. Delaware Human and Civil Rights Commission v. Schell Brothers, Order on Motion to Dismiss
What the Court Has Decided So Far
Schell Brothers has tried three times to have the case thrown out. Each ruling has trimmed the case without ending it.
October 2023: Standing and Timing
Judge Mark H. Conner ruled that the Commission could not bring the case in Paula Burkhardt-Sedghi’s name because the Division’s formal charge had been issued only on behalf of her husband. She retained the right to intervene under the Delaware Fair Housing Act, and she did. The court also rejected the defense argument that the roughly nine-month gap between the charge and the filing of the complaint required dismissal, finding the delay was caused by the need to retain special counsel after the Attorney General’s office identified a conflict of interest.2CaseMine. Delaware Human and Civil Rights Commission v. Schell Brothers
April 2025: Contract Claims and Horner’s Role
On April 28, 2025, Judge Conner ruled on the defendants’ third motion to dismiss, which focused on the contract claims in the amended complaint. Three points stand out.
The court refused to dismiss the contract claims as untimely. Although the purchase agreement carried a one-year limitations period, that clock was tolled while the administrative complaint sat with the Division and HUD, so the suit was filed in time.1Delaware Courts. Delaware Human and Civil Rights Commission v. Schell Brothers, Order on Motion to Dismiss
Horner was dismissed from all contractual claims. The court found he acted as Schell Brothers’ attorney and corporate agent and was not personally a party to the purchase agreement, and it noted it lacked jurisdiction over what it treated as an attempt to pierce the corporate veil. Horner remains a defendant on the discrimination and retaliation claims.1Delaware Courts. Delaware Human and Civil Rights Commission v. Schell Brothers, Order on Motion to Dismiss
Several counts against Schell Brothers were dismissed as duplicative of the breach of contract claim or as insufficiently pleaded, including conversion, detinue, fraud, and bad faith breach of contract. The breach of contract count and an alternative unjust enrichment count survived.3Midpage. Delaware Human and Civil Rights Commission v. Schell Brothers
Claims Moving Toward Trial
- Breach of contract (Count I) and unjust enrichment (Count VIII, in the alternative) against Schell Brothers, tied to the canceled purchase agreement and the withheld $82,925 deposit.
- Discrimination (Count VI) against Schell Brothers and Jonathan Horner under the Delaware and Federal Fair Housing Acts, based on religion and national origin.
- Retaliation (Count VII) against both defendants, based on the allegation that they punished the Sedghis for asserting fair housing rights.1Delaware Courts. Delaware Human and Civil Rights Commission v. Schell Brothers, Order on Motion to Dismiss
No trial date appears in the public record reviewed.
Death of Mohammed Sedghi
Mohammed Sedghi died shortly after the amended complaint was filed in June 2024. His estate has been substituted as a party, and Paula Burkhardt-Sedghi continues as plaintiff-intervenor. The court cited federal precedent in which a fair housing action survived the death of the person who experienced the alleged discrimination.1Delaware Courts. Delaware Human and Civil Rights Commission v. Schell Brothers, Order on Motion to Dismiss
Other Schell Brothers Cases
The Sedghi case is separate from two other Schell Brothers matters that sometimes come up in searches. In Bloom v. Schell Brothers, decided in Delaware Superior Court in 2014, two homeowners sued the company and Sussex Group Partners after trees behind their “premium lot” were cleared for additional houses they said the developer had already been approved to build but never disclosed.4Dean Campbell Law. Cases In Schell Brothers v. Pickard, decided in the Delaware Court of Chancery, the company sued a former corporate pilot, Shawn Pickard, and his wife Lori after Pickard’s employment ended within three years of receiving a $237,812 employee discount on a home in Milton, Delaware. In October 2023, Magistrate Bonnie W. David recommended summary judgment for Schell Brothers and ordered specific performance requiring the Pickards to sell the home to satisfy the debt.5vLex. Schell Brothers v. Pickard Neither case involves fair housing claims.