High court widens opening for housing discrimination suits
WASHINGTON – A closely divided Supreme Court on Thursday allowed housing bias lawsuits based on unintentional actions that happen to have a discriminatory effect on racial minorities.
In a defeat for the Texas Department of Housing and Community Affairs, and for conservatives more generally, the court by a 5-4 vote concluded that so-called “disparate impact” discrimination lawsuits are authorized under the federal Fair Housing Act.
“Recognition of disparate-impact claims is consistent with the FHA’s central purpose,” Justice Anthony Kennedy wrote, adding that the FHA “provides a clear national policy against discrimination in housing.”
A “disparate impact” arises when a practice produces different effects across racial groups, even if the practice wasn’t racially motivated. For instance, if a mortgage lender establishes borrowing standards based on income and net worth, and some racial groups are less likely than others to qualify for loans under those standards, this could result in a disparate impact.
Underscoring the case’s significance, cities including Miami; Chapel Hill, North Carolina; and Columbia, South Carolina, had filed a brief supporting the disparate-impact lawsuits. Seventeen states including California and Washington also supported the lawsuits.
From the opposing side, groups including the Texas Apartment Association and the National Association of Home Builders had urged the court to limit legal exposure. They had hoped to win over Kennedy, who is often a key swing vote.
But joined by the court’s four liberal justices, Kennedy reasoned that allowing disparate-impact lawsuits can help in “uncovering discriminatory intent” as well as help “counteract unconscious prejudices and disguised animus.”
Kennedy also wrote that the decision Thursday “acknowledges the Fair Housing Act’s continuing role in moving the nation toward a more integrated society.”
The four conservative dissenters warned Thursday that the ruling “will have unfortunate consequences for local government, private enterprise, and those living in poverty.”