U.S. Supreme Court Grants Cert. (again) in FHA Disparate Impact Case

Disparate Impact FHA

On October 2, the U.S. Supreme Court granted certiorari in Texas Department of Housing and Community Affairs, et al. v. The Inclusive Communities Project, Inc., No. 13-1371, a case in which the Fifth Circuit became the first federal Circuit Court of Appeals to apply the Department of Housing and Urban Development’s (HUD) "effects test" rule (see The Inclusive Communities Project, Inc., v. Texas Department of Housing and Community Affairs, et al., Nos. 12-11211, 13-10306 (747 F.3d 275, March 24, 2014)), which authorizes so-called "disparate impact" or "effects test" claims under the Fair Housing Act (FHA). In granting cert., the Supreme Court accepted one of the two questions presented by the petitioners, which was, “Are disparate-impact claims cognizable under the [FHA]?” It did not accept the second question: “If disparate-impact claims are cognizable under the [FHA], what are the standards and burdens of proof that should apply?” The Supreme Court’s partial grant of the petition represents the third recent matter in which the Court has taken up the issue of whether disparate impact claims may be brought under the FHA. The first opportunity ended in February, 2012 when petitioners in Magner, et al. v Gallagher, et al., No. 10-1032, stipulated to dismissal due to concerns that "a victory could substantially undermine important civil rights enforcement throughout the nation." The Court’s second opportunity, Township of Mount Holly, New Jersey, et al., v. Mt. Holly Gardens Citizens in Action, Inc., et al., No. 11-1507, was dismissed in November 2013, just prior to oral argument after a settlement was reached by the parties.