In the case of Texas Department of Housing and Community Affairs v. Inclusive Communities Project Inc., the issue at hand was whether you could pursue a lawsuit under the FHA by claiming that a policy has a “disparate impact”: in other words, that it has a discriminatory effect even if it wasn’t intended as such.
The Supremes ruled [PDF] that disparate impact claims are cognizable under the Fair Housing Act, with Justice Anthony Kennedy writing the opinion for the majority. He was joined by Justices Ruth Bader Ginsberg, Stephen Breyer, Sonia Sotomayor and Elena Kagan, with Justices Clarence Thomas, Samuel Alito, Antonin Scalia and Chief Justice John Roberts dissenting.
“Recognition of disparate impact liability under the FHA also plays a role in uncovering discriminatory intent: It permits plaintiffs to counteract unconscious prejudices and disguised animus that escape easy classification as disparate treatment,” Kennedy wrote.
The court held that illegal disparate impact arises only if the policy is “arbitrary, artificial, and unnecessary.”
The case started in Texas, where the Department of Housing and Community Affairs distributes the federal government’s low-income housing tax credits to developers by designated state agencies. The Inclusive Communities Project, Inc., a Texas-based nonprofit corporation that assists low-income families in obtaining affordable housing, brought a disparate-impact lawsuit under FHA, alleging that the Department and its officers had caused segregated housing patterns to continue in Texas, by allocating too many tax credits to housing in predominantly black, inner-city areas and not enough in predominantly white suburban neighborhoods.
ICP sued on the grounds that the outcome of this policy was racially discriminatory, even if the Texas housing agency didn’t intend it to be.
Supporters of disparate impact lawsuits say they’re necessary because it’s not like a landlord or housing group is going to come right out and say, “Hey, we’re doing this for racial discrimination reasons.” That would make it hard for someone to prove that they were intentionally instituting policies that would be discriminatory.
But those opposed to it had argued that disparate impact suits would hit the private sector hard with costly lawsuits where defendants are given a significant burden of proof.
The press secretary for the White House issued a statement on behalf of the administration, commending SCOTUS on the decision.
“The Court’s decision affirms that the Fair Housing Act enables Americans to challenge not only laws, policies, and practices that are intentionally discriminatory, but also those that have an unjustified discriminatory effect,” the statement reads.
“Too many Americans are victims of more subtle forms of discrimination, such as predatory lending, exclusionary zoning, and development policies that limit affordable housing. This decision reflects the reality that discrimination often operates not just out in the open, but in more hidden forms. And, it preserves a longstanding and important method for challenging and eliminating those practices and continuing the work to end discrimination in housing.”
by Mary Beth Quirk via Consumerist
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