The Supreme Court has already essentially gutted the Voting Rights Act. Will it now do the same for the Fair Housing Act, which provides legal protection against housing discrimination? They’ve just granted cert in a case and Ian Millhiser reports that a federal judge has just given them the roadmap to do so.
According to nearly every single federal appeals court in the country, the federal Fair Housing Act prohibits two forms of discrimination: “disparate treatment,” which can be proved by showing that a realtor, landlord or lender engaged in intentional discrimination, and “disparate impact,” which can be proved when a business’ policy leads to disproportionately adverse outcomes for racial minorities or for another protected class of people. As Judge Leon’s opinion acknowledges, 11 of the 12 federal appeals courts that have jurisdiction over fair housing claims have held that the law authorizes both disparate treatment and disparate impact lawsuits. The twelfth appeals court, the United States Court of Appeals for the District of Columbia Circuit, has not considered whether disparate impact lawsuits are permitted under federal fair housing law.
Without disparate impact suits, discrimination cases become extraordinarily difficult to win. Fair housing plaintiffs and their lawyers are rarely gifted with the ability to read minds, and few defendants are foolish enough to put in writing the fact that they chose not to rent or sell a house to someone because they are black. So disparate treatment lawsuits often fail for a lack of evidence that a particular defendant had a racist intent (or some other impermissible intent) when they decided not to do business with the plaintiff.
But the fact that racist intent is difficult to prove does not mean that discrimination does not exist. According to a study conducted on behalf of the U.S. Department of Housing and Urban Development, African Americans and Asians who are looking for a new home are shown or informed of 15 to 19 percent fewer listings than white homebuyers with similar credit and housing interests. Similarly, African Americans with good credit were 3.5 times as likely as whites with similar credit to receive higher-interest-rate loans during the subprime lending boom. Latinos were 3.1 more likely than whites to receive the same loans. The Federal Reserve determined in 2009 that African Americans were twice as likely to be denied a loan as similarly situated whites.So housing discrimination is widespread, even if it is difficult to prove without disparate impact litigation. Nevertheless, Judge Leon’s opinion does not simply reject the idea that eleven federal appeals courts were correct when they held that disparate impact lawsuits are authorized by federal fair housing law (to reach this result, he reads a 2005 Supreme Court opinion aggressively to limit disparate impact litigation); Leon also practically sneers at the Obama Administration for promulgating a regulation consistent with eleven appeals courts’ decisions. At one point, he accuses the Department of Housing and Urban Development of “calculatingly” creating this regulation in an attempt to influence a Supreme Court case seeking to undermine disparate impact lawsuits.
That third paragraph is the key to this issue. If the Supreme Court follows Judge Leon and does away with disparate impact suits, it will mean that the only basis for such a suit is to prove actual racist intent on the part of a realtor, landlord or mortgage provider. But a vast number of psychological studies tell us that there need not be any such racist intent in order to have a clearly racist result. The people in those studies likely show very little overt racism and may in fact be consciously committed to not being racist, but we know from study after study that they can still treat people very differently based on their race because our biases are largely subconscious. That’s why disparate impact is so important here. And I have no confidence at all that the current Supreme Court will even attempt to understand that.