The federal civil rights lawsuit was filed against the towns of Hildale, Utah, and Colorado City, Ariz., where most residents are members of the Fundamentalist Church of Jesus Christ of Latter-day Saints, run by the group's jailed leader, Warren Jeffs.
The lawsuit claims the two towns, the Colorado City/Hildale marshal's office and utility entities have violated and continue to violate the federal Fair Housing Act, depriving non-sect members of their constitutional rights.
The suit says that includes residents who were never FLDS members, those who left on their own and those who have been excommunicated from the sect.
It claims the defendants "have acted in concert with FLDS leadership to deny non-FLDS individuals housing, police protection, and access to public space and services."
"The Marshal's Office has inappropriately used its state-granted law enforcement authority to enforce the edicts of the FLDS, to the detriment of non-FLDS members," according to the lawsuit filed in federal court in Arizona.
"There's nothing to support the allegation that non-FLDS members are treated differently," attorney Blake Hamilton told The Associated Press. He represents Hildale and the marshal's office.
He said Justice Department lawyers threatened a lawsuit in December when they met him and another lawyer. "DOJ asked us to dismantle a community," Hamilton said.