Supreme Court Upholds Concept of ‘Disparate Impact’ in Fair Housing Claims

June 25, 2015

The U.S. Supreme Court today acknowledged the validity of "disparate impact" claims, which look not at intent to discriminate but at outcome.

In the case, Inclusive Communities Project Inc. had filed a fair housing claim against housing officials in Texas. Inclusive Communities alleged that the Texas Department of Housing and Community affairs had violated the federal Fair Housing Act by allocating too many tax credits to housing developments in predominantly black inner-city areas and too few in predominantly white suburban neighborhoods. The outcome, Inclusive Communities charged, was the continuation of segregated housing patterns.

The Texas Department of Housing argued that, because there was no intent to discriminate, it had not violated the law. But the justices confirmed, in a 5-4 ruling that, even without proof of intentional discrimination, plaintiffs may bring a fair housing claim by demonstrating an adverse impact on a protected class, including through the use of statistical evidence. The ruling is a victory for fair housing advocates who have long held that the Fair Housing Act covers not just outright bias but also racially neutral policies that negatively impact minorities.

"In upholding the tactic [of claiming disparate impact], the Supreme Court preserved a legal strategy that has been used for more than 40 years to attack discrimination in zoning laws, occupancy rules, mortgage lending practices, and insurance underwriting," The Associated Press reported. "Every federal appeals court to consider it has upheld the practice, though the Supreme Court had never previously taken it up."

Opponents have long argued that the Fair Housing Act doesn't cover claims based on disparate impact, but the Supreme Court affirmed the validity of disparate impact claims. All nine U.S. circuit courts had previously addressed this issue and also answered that question in affirmative. 

"This ruling recognizes the stark reality that housing discrimination, regardless of intent, persists for many Americans," Dennis Parker, director of the American Civil Liberties Union's Racial Justice Program, said in a statement reacting to the decision, "This decision retains the essential protections of the Fair Housing Act, meaning the law will continue to serve as an important tool in rooting out pernicious forms of racial segregation and discrimination."

Source: Associated Press, and "Supreme Court upholds the Fair Housing Act," The Week (June 25, 2015)